The COVID crisis has been a huge test of the strength of stakeholder relationships for all businesses, yet many have achieved massive transformation in a short period of time. Those businesses that have stayed true to their purpose and that are run with a strong ethical foundation have been best placed. By contrast, businesses that have taken advantage of their workforce, short changed their customers and damaged the communities in which they operate are being found out.
Faced with the need for direction in a time of crisis, humanity has been at the heart of the best responses. That’s because doing the right thing for your stakeholders makes business sense. The best businesses have long recognised that a company is only part of a complex stakeholder ecosystem and understood that maintaining a vibrant and healthy ecosystem benefits everyone.
An investment in business ethics makes for a better business but achieving the sustainable benefits from doing business ethically requires committed leadership, an investment in training and communications to shape a shared and consistent culture, and an active programme of monitoring and assurance to make sure that it doesn’t drift. Get this right, and there are direct business benefits from a more engaged and loyal workforce and improved trust in the business. Investing in a strong speak-up culture, whereby colleagues at all levels feel able to raise concerns, confident that they will be listened to and acted on, provides a business with a vital early warning of things going wrong.
Ethical issues arise everywhere but have been front and centre in the COVID crisis, with enormously difficult decisions being made about issues like renegotiating with suppliers and furloughing staff. Principles-based decision making has been to the fore, with staff at all levels more empowered to make difficult, urgent decisions faced with unprecedented uncertainty. Rule books have not helped and ethical values have been a vital enabler. Businesses with strong, ethical values, embedded into decision making frameworks, have seen better, faster decisions being taken.
For many businesses, some of the biggest challenges are yet to come. As a society we face the prospect of even greater inequality. Business responses to things like executive pay, the rebasing of global supply chains, the lagging hangover of built-up mental health issues and the challenges of environmental stewardship will require decisions that are more demonstrably fair and transparent and will be reviewed by a wider range of stakeholders, including a more interventionist state. Communications will need to be consistent and authentic.
Now is the time to prioritise ethics in your business. Cutting back on ethics programmes may seem like an easy expediency, but the new breed of ethics and compliance professionals needs your support and encouragement. These leaders play a vital role in shaping and embedding the shared and consistent culture that will be needed to navigate the difficult waters ahead. As Yogi Berra also said, “if you don’t know where you are going, you’ll end up someplace else”.
To find out more about the Institute of Business Ethics, visit www.ibe.org.uk.