Business Ethics in Australian Bank Industry

Running head: BUSINESS ETHICS
BUSINESS ETHICS
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1BUSINESS ETHICS
The respective paper is an essay which deals with business ethics of Australian Bank
Industry which has come across a number of scandals. The essay deals with the definition of
business ethics, different types of business ethics, their significance and importance, the reasons
due to which business enterprises face ethical issues and proposed solutions for such cases.
Business ethics is a framework of professional or occupational ethics, which keeps a
restriction and check on the moral and ethical problems (or dilemmas) that can arise in a business
environment (Crane and Matten 2016). Business ethics is a way by which an organization or an
entrepreneur examines typical as well as indirect ethical issues that can arise in an enterprise.
Business ethics is applied to all the employees, professionals, stakeholders, shareholders and
owners of a business and all other aspects of a business and entrepreneurship conducts. The
business ethics generally and customarily revolve around the organizational statements (which
include mission and vision), individuals (according to their job position, designation, duties,
responsibilities and accountability) and statutory or legal system on which the business is
standing. The ethics of a business plays a significant role in the functioning and development of
the respective business. It is the framework of ethics that determines the code of conduct of the
individuals and communities working under the organization and is directly as well as indirectly
responsible and accountable to the prestige and reputation of the business in the market.
Business ethics can be viewed as a set of or a structure of present-day organizational standards,
set of values, code of conduct, principles and norms that examines and keeps surveillance over
the behavior, manners and actions of an individual inside as well as outside the organization.
Business ethics can be broadly classified into two spheres, namely, Normative and Descriptive
business ethics (Audi 2012). The Normative ethics in business is widely based on the actions of
an individual in an organization and the judgment of the action in terms of its righteousness or

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sinfulness. To simplify, it can be said that Normative ethics in business judges the actions of an
individual based on whether the action was morally correct or not. Descriptive ethics in business
which is also called comparative ethics is largely based on the empirical (pragmatic) researches
carried out on the individuals or a community. However, it has to be remembered that business
ethics are significantly responsible for maintaining discipline, law and order in the organization.
An organization, no matter how significant or trivial it may be, is expected to act and
behave in an ethical manner. To survive and thrive in the competitive world, an organization
needs to build itself up into an efficient business. In order to build an efficient business, ethics is
important for an organization because ethics are responsible to keep a track on the law and order
of an organization which is directly and indirectly linked with the prestige, reputation and
welfare of an organization. Values and principles not only increase the credibility of an
organization but also help in the process of a better decision making. Ethical behavior and
corporate social responsibility can bring out low labor turnover which would increase the
productivity of the business (Nunziato and Hill 2019). A set of ideal business ethics and
principles can attract investors and shareholders from outside which in turn, would help the
organization to get developed and improve its performance( Demirtas and Akdogan 2015).
The most common and customary reasons for unethical business behavior are excessive
pressure on the employees by the organization, which often leads to erratic code of conduct of
the employees. Excessive work pressure and critical performance evaluation might lead the
employees into anxiety, thereby, resulting in unethical behavior. Often, certain employees make
fallacious choices because they are sometimes, dubious about their opinions or decisions in the
organization. Other basic malice of human character such as self-interest, personal profit, greed
and lust for position might sometimes lead to treachery on behalf of the employees or individuals