What Are the Pros & Cons to Having a Written Code of Ethics?

Business ethics is an internal set of principles by which a company chooses to operate. While not required, it can help a company ensure their employees act beyond societal norms and expectations.

Positive Perception

Using a written code of ethics in business can help companies develop a positive perception with consumers. The ability to educate consumers on how the company chooses to operate can go a long way in creating customer goodwill.

Improves Performance

Companies can often improve their employee's performance through a written code of ethics. This allows the company to set a specific set of ethical standards for employees to follow when working in the company.

Increases Costs

A written code of ethics can increase a company's operating costs. Business owners and managers will need to spend time educating employees and promoting the code through educational seminars and other training methods.

Decreases Revenue

Decreases in revenue may occur when a company operates under a written code of ethics. The company will need to avoid business opportunities that violate the company's code of ethics, regardless of the sales potential.

References

• US Legal: Business Ethics Law & Legal Definition
• UBC Reports: Pros and Cons of Ethics Topics for Class Debate