13 Examples of Ethical Business Decisions
Ethical decision-making is a critical aspect of running a successful business. We asked 13 seasoned business owners, from founders to CEOs, to share their experiences in making ethical decisions. From addressing employee dishonesty to protecting user data privacy, these leaders offer valuable insights into the ethical dilemmas they’ve faced and how they navigated them.
- Addressing Employee Dishonesty
- Choosing Ethical Suppliers
- Balancing Data Sharing and Confidentiality
- Focusing on Quality Service Over Profit
- Refusing to Compromise Construction Quality
- Avoiding Conflict of Interest
- Selecting Ethical Funeral Homes
- Rejecting Harmful Software Features
- Prioritizing Ethical Behavior Over Short-Term Gains
- Offering Fair Interest Rates
- Pricing for Premium Product Value
- Being Upfront About Pricing
- Respecting User Data Privacy
Addressing Employee Dishonesty
One of the most challenging ethical decisions I had to make as a business owner concerned an employee who was dishonest in their remote work. This was particularly difficult as I was aware of the individual’s challenging family situation.
While the employee was generally good at their job, I began noticing inconsistencies in their work reports, suggesting they were not as engaged in work as they claimed to be. Trust is a fundamental part of any business relationship, and honesty is a key value in our company.
Despite the difficulty of the situation, I knew I couldn’t overlook this breach of trust. I had a conversation with the employee, presenting my observations and listening to their side of the story. After careful consideration, and with a heavy heart, I decided to terminate their contract.
Choosing Ethical Suppliers
As a business owner, I faced an ethical decision when a supplier offered me a significant discount in exchange for overlooking their unethical labor practices. However, after careful consideration, I chose to prioritize ethical standards and refused the offer.
I firmly believe that maintaining integrity is vital for long-term success and sustainable growth. I conducted thorough research into alternative suppliers, ensuring they adhered to fair labor practices and met quality standards.
By making this decision, I not only upheld my moral values but also fostered a reputation as a responsible and trustworthy business, leading to stronger customer loyalty and positive brand perception.
Balancing Data Sharing and Confidentiality
I encountered an ethical decision as a business owner. The situation involved balancing the need to share client data for a potential partnership while respecting client confidentiality.
After a thorough evaluation, considering legal and ethical aspects, and transparently communicating with the clients involved, I made a decision that prioritized data security, minimized information sharing, and maintained ongoing compliance monitoring. This ensured ethical practices and upheld client trust while pursuing the business opportunity.
Focusing on Quality Service Over Profit
At Authors On Mission, we were once faced with a tempting but ethically challenging situation: a lucrative contract that demanded us to compromise on the quality time we provide each author. This was against our core values, and so, despite the financial allure, we declined the offer.
The decision, albeit difficult, reiterated our commitment to prioritizing the needs of our clients over quick profits. We chose to preserve the trust of our authors and maintain our hard-earned reputation. This situation underlines our philosophy that principles should never be compromised for profit, a belief that I, as a CEO, consider paramount to business success.
Refusing to Compromise Construction Quality
Everyone is looking to save money all the time. Unfortunately, when homeowners do this, they often sacrifice the quality of their homes. We have no shortage of homeowners who come back with counter offers to our initial estimates.
In the beginning, I tried to accommodate exactly one of them, and I told them what we would have to do to reach the cost they wanted. I informed them of the risks. A couple of months after the project was completed, we got a callback. This was my fault. I should have said no.
We took the loss to keep the customer, but we no longer negotiate on costs because someone will have to pay for the sacrifice of quality later on. And since we want to maintain good relationships with our customers, that someone would be us.
To sum it up, you can’t sacrifice quality in construction. Just pass on the project, otherwise, you will lose money or lose the customer.
Avoiding Conflict of Interest
We were approached by two competing companies in a niche market. Both companies wanted us to run their marketing activity simultaneously. We realized that this could potentially lead to a conflict of interest, and serving both clients at the same time could hinder our ability to act in the best interest of each client independently.
We decided to uphold our principle of fairness and transparency and shared our concerns with both clients. We gave the first client, who approached us initially, the choice to either proceed with us or allow us to serve both clients.
They appreciated our honesty and decided to move forward with us exclusively. This ethical decision reinforced our commitment to our clients, demonstrating that we prioritize their interests and success above potential additional revenue. It helped foster trust and further solidified our business relationship with the client.
Selecting Ethical Funeral Homes
My agency focuses on marketing for funeral homes. Unlike other industries, funeral homes lack a legal or ethical way of increasing the demand for their services. This puts funeral homes in a bind since their main way to increase revenue is to upsell each family who comes through their doors.
This can come across as trying to take advantage of grieving families. My agency has made the active choice to only work with funeral homes that meet certain ethical standards. We recognize that this choice can hurt our bottom line, but doing the right thing is more important than making a little additional revenue.
Rejecting Harmful Software Features
I take ethical decisions extremely seriously, and one scenario, in particular, jumps out among our video-editing hijinks. We were tempted to add a function that could make fake news videos automatically, but, happily, my moral compass kicked in like a superhero cape.
I gathered my team, put on my thinking cap, and realized the potentially terrible repercussions of such a feature on society. So, with a sigh of relief and a sparkle in my eye, we decided to shelve the notion and instead focus on supporting creativity and honesty.
After all, we’d rather be renowned for making people laugh with authentic content than for causing a viral fakery epidemic.
Prioritizing Ethical Behavior Over Short-Term Gains
As a business owner, I encountered a moral crossroads that felt more tangled than a slinky. Tempted by a legal loophole that promised a quick profit, I found myself caught in a web of ethical considerations. Reflecting on the long-term impact, I realized that prioritizing short-term gains could compromise the trust of my customers, employees, and business reputation.
So, I summoned my inner superhero and opted for the path of transparency and integrity. And guess what? The data speaks for itself: businesses with strong ethical practices outperform their competitors.
A study by EY found that 81% of consumers prefer companies that prioritize ethical behavior. By choosing the high road, we earned the trust of our customers, motivated our employees, and witnessed sustainable growth.
Offering Fair Interest Rates
Despite the temptation to maximize profits, MaxCash decided to prioritize its role in the community. We chose to offer fair interest rates and transparent terms to help people secure funds without hidden costs. One significant way we’ve chosen to give back to our community is by providing financial-literacy education.
We started sharing educational materials that demystify financial concepts and help our customers make informed decisions. Some of our popular resources include “Ultimate Survival Guide to Prepare for the 2023 Recession” and “What Documents Do I Need to Apply for a Title Loan?”. This approach, we believe, makes a positive impact on the community, supporting people in navigating their financial challenges.
Pricing for Premium Product Value
In 2019, when launching Folderly, a premium email deliverability solution, we faced an ethical conundrum related to pricing. The market was accustomed to low-cost, low-effective email warm-up software, typically in the $30-$50 per month range, while Folderly’s pricing started at $200 per month.
We had to question if it was fair to ask for a higher price, even with our superior solution. Our marketing and sales team played a crucial role in this decision. After evaluating the value of our premium functions, we understood that they couldn’t be sustained at a lower price.
Our services went beyond the market norm and delivered unparalleled results. This decision was reinforced by the positive feedback from clients and data from case studies, showing substantial improvements in email deliverability.
Being Upfront About Pricing
While there are good reasons not to lead with your prices, in our business, we put it right there on our website, above the fold. This is in keeping with our policy of always being upfront and honest with our clients. Making that evident from the start is so essential for us.
Respecting User Data Privacy
We faced a crucial ethical decision regarding user data privacy. Our innovative AI technology had the potential to collect vast amounts of personal information, but we recognized the importance of respecting user privacy.
After extensive discussions with our team and consulting external experts, we decided to prioritize privacy by implementing robust data-anonymization techniques. We firmly believe that safeguarding user data aligns with our mission of building trust with our customers and ensures responsible technology use, setting an ethical standard for the industry.
Our commitment to ethical AI drives our company’s success and fosters meaningful relationships with our users.