Ethics is an important part of our society. People act and react to situations based on their personal moral standards. Businesses also operate on moral standards, although their ethics may benefit the company rather than society itself.
Normative ethics is the moral philosophy that examines the rightness and wrongness of individual actions. Normative ethics also examines whether certain beliefs should be considered moral obligations.
Applied ethics is concerned with how moral judgment enters into decisions in the private and public parts of society. Finding the best moral answer to difficult situations is the crux of applied ethics.
Business ethics has two parts: internal and external. Internal business ethics consist of how companies handle internal situations with employees and departments, finding the best ethical answer to difficult situations.
External business ethics dictates how companies interact with customers and other businesses. External ethics are important because improper actions can create negative goodwill for a company, damaging their reputation.
Conducting business requires both moral and business ethics. If company management and employees do not have personal moral ethics, it may be difficult to implement a strong business-ethics policy for business operations.