Importance of Professional Ethics in Business

The provided report concludes that following professional ethics is essential for future growth and prosperity in business. It emphasizes the importance of integrity, honesty, and acting within one's professional limits to maintain healthy relationships with clients, colleagues, and suppliers. The report also references various books and journals on professional ethics, highlighting its significance in different professions such as psychology, culinary studies, veterinary medicine, engineering, and more.

Professional Ethics

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1. 1 Fundamental principles of ethical behaviour........................................................................1
1. 2 Relevant legal, regulatory and ethical requirements which affects accounting and finance
sector. ..........................................................................................................................................2
1. 3 Role of professional bodies in relation to accounting and finance sector.............................2
1. 4 Why individuals, organisations or industry sectors are expected to operate within codes of
conducts and practices.................................................................................................................3
1. 5 Risk of improper practice for an organisation and importance of vigilance.........................3
1. 6 Identify opportunities for maintaining an up to date knowledge of changes to codes of
practice.........................................................................................................................................4
TASK 2............................................................................................................................................4
2. 1 How to act ethically when working with clients, suppliers, colleagues and others..............4
2. 2 Importance of objectivity and maintaining a professional distance between professional
duties and personal life at all times..............................................................................................5
2. 3 Importance of adhering organisational and professional values, codes of practice and
regulations....................................................................................................................................5
2. 4 Importance of adhering to organisational policies for handling clients’ monies..................5
2. 5 Circumstances when confidential information should be disclosed and who is entitled to
the information.............................................................................................................................6
2. 6 Importance of working within the limits and confines of one’s own professional
experience, knowledge and expertise .........................................................................................6
3.1 Relevant authorities and internal departments to which unethical behaviour, breaches of
confidentiality..............................................................................................................................6
3. 2 Appropriate action to take in instances when requests for work are beyond the employee’s
competence..................................................................................................................................7
3. 3 Identify inappropriate client behaviour and how to report it................................................7
3. 4 Internal and external reporting procedures which should be followed.................................7
3. 5 Strategies that could be used to prevent ethical conflict ......................................................7

4.1 Importance of an ethical approach to sustainability ............................................................8
4. 2 Responsibilities of finance professionals in upholding the principles of sustainability.......8
CONCLUSION ..........................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Ethics refers to the philosophies which talks about what is right and wrong conduct. The
professional ethics comprises of personal and corporate standards of behaviour expected by
professionals. These codes of professional ethics are set up by professional organisations in order
to help guide members in performing their job functions according to applied and consistent
ethical principles. To better understand this concept, Marks and Spencer, UK is being selected
for this present report. There are different principles of ethical working which discussed in this
report. The ethical behaviour which is required to deal with internal and external customers is
explained in this report. Apart from this appropriate actions which needs to be taken when any
suspected breaches of ethical codes and conducts. Finance professional has the ethical
responsibilities in promoting sustainability which is also discussed in this report.
TASK 1
1. 1 Fundamental principles of ethical behaviour
Fundamental principles of ethical behaviours allows a person to follow these principles in
there regular course of business or life in order to perform their tasks. There are various
principles which are discussed as below:
Integrity:
Integrity is a principle which talks about the honesty, fair and respectful to others. This is
important to be straight forward to all professional and business relationship in order to maintain
a smooth and long term relationship with people (Shani and Soskolne, 2013).
Objectivity:
The objectivity principles states that the biased behaviour should not be allowed and
conflict of interest or undue influence of other to override professional or business judgements
should not be allowed.
Professional and technical competence and due care:
It is important to maintain a professional knowledge and skill at the level required to
ensure that a client or employer gets competitive professional services based on current
developments. Employees should be aware about legislation related to business so that they can
serve better to client of M&S.
Confidentiality:
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The confidentiality is an another principle which states that one should disclose the data
of business to third parties without any proper and specific authority or unless there is a legal or
professional right to disclose.
Professional behaviour:
This principle impose an obligation to people to comply with relevant laws and
regulations and avoid any action that the professional accountant knows or should know may
discredit the profession.
1. 2 Relevant legal, regulatory and ethical requirements which affects accounting and finance
sector.
The accounting and finance sector is very sensitive department or sector of organisation
which comprises some of internal data of organisation. There is a very high chance that these
data can be leaked by their professional accountant or manipulate by accountant. So accountant
needs to take care that they are following ethical principles in order to maintain accounts. For
example, if accountant of M&S false represent the data of their financial statements than it
comes under criminal law and company and accountant will be penalised according to laws. So it
is crucial for the people to follow proper code of conduct for performing business operations
effectively. As non following of these code of conducts can leads to heavy penalties on
organisation and employees as well (Grace, 2017).
1. 3 Role of professional bodies in relation to accounting and finance sector
Professional bodies are those organisation whose members are individual professionals.
As these professional body set out some rules and regulations in relation to the business. These
professional bodies shows how the profession should be regulated and make sure professionals
are doing their jobs properly. There are various professional bodies for accounts and finance
sectors which have their rules and regulations and these needs to be followed by organisations in
order to smooth operations of business. Primary role of these bodies are to provides support for
continuing professional development through learning opportunities and tools for recording and
planning. These bodies are Consultative Committee of Accountancy Bodies, Chartered Institute
of Management Accountants and Institute of Chartered Accountants in England and Wales all
these are professional accounting body. An another role of these bodies are to constantly seeks
growth and development of business organisations by preparing adequate financial statements.
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1. 4 Why individuals, organisations or industry sectors are expected to operate within codes of
conducts and practices
A code of conduct is set of rules which are outlining the social norms, rules and
responsibilities or proper practices for an individual, organisation or industry. These code of
conducts are different for each and every one and it is very important for individual and
organisations to follow as it ensure benefit of organisation in long run. The importance of code
of conduct is discussed as below:
For individual:
The code of conduct is very helpful for an individual for career growth as if individual
knows the difference between what is right and what is wrong than problems would never arise.
Individual ethics motivates employees regarding not to include in gossips and nasty politics and
invest this time in work which will help them to get growth in their career.
For organisation:
The code of conduct assist organisation to act as fair, integrity and compassion with all of
its stakeholders. This act will create a faith in mind of investors and large number of investors
might get attracted by these code of conduct (Tannenbaum, 2013).
1. 5 Risk of improper practice for an organisation and importance of vigilance
Code of conduct is an important aspect for every organisation which assist them in their
long term success. But if company follows the improper practices than it can directly make effect
on M&S brand equity. Apart from this there are various risks of improper practice to
organisation which are discussed as below:
 The improper practices like money laundering can hamper goodwill of company.
 These improper practices can also decline sales of organisation and therefore company's
profits will be down.
 If company is not comply with due diligence than they would not be able to maintain
proper financial records.
Vigilance is an element which can help authority to protect from different threats. The
importance are discussed as below:
 Vigilance can helps in finding improper practices and take corrective action where
needed.
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 This will help in reducing risk which can arises due to uncertainty (Basart and Serra,
2013).
1. 6 Identify opportunities for maintaining an up to date knowledge of changes to codes of
practice
The code of ethics keeps changing regularly and it is important for organisation to be up
to date with these changes and maintain a smooth functioning in organisation. As these new rules
and regulations states the ways for doing work which needs to be followed by organisations. If
company follow these rules and regulations than they have an opportunity to create faith among
customers. The IFRS has some set of regulations like companies are liable to prepare financial
statements for annual general meetings but not for extra ordinary general meetings. So if these
standards changes by accounting body than M&S have to prepare the financial statements for
EGM also and this will provide help in making important decision in meeting like disruption of
dividends and other strategic decision. Apart from this code of ethics will also provide an
opportunity to attract new investors and get customers faith by complying with latest laws.
TASK 2
2. 1 How to act ethically when working with clients, suppliers, colleagues and others.
Ethics is an important concern which talks about right and wrong at workplace. It is very
important to act ethically whenever working with anyone whether clients, suppliers, colleagues
and other people at workplace. Ethics works as safeguard for various stakeholders of business
and for organisation itself. It restrain company from doing any kind of malpractice while dealing
with its stakeholders. The ethics related with clients are that company needs to disclose all
material fact about its products and service so client can choose accordingly. Beside this for
suppliers it is important to make payments according to agreements so that any kind of
malpractices or manipulation can be avoided. This will help company to build a better brand
image in mind of consumers and sustain for longer period of time. While dealing with colleagues
it is very important to disclose all the information which are true and fair and there should not be
any kind of hidden terms and condition while signing the colleagues (Brecher, 2014).
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2. 2 Importance of objectivity and maintaining a professional distance between professional
duties and personal life at all times
It is very important for an individual to keep their personal and professional life separate
in order to enjoy both life happily. The situation of personal life make huge impact on the
professional life of an individual. If any individual is stressed in its personal life than one would
not be able to give their complete efforts at workplace and efficiency can be decreased. Similarly
if an individual is living a happy life than its impact can be seen on their work performance and
they will be more efficient than other employees at workplace. So it is very important to
maintain a calculative distance between personal and professional life (Gillam and et. al., 2014).
2. 3 Importance of adhering organisational and professional values, codes of practice and
regulations.
Importance of adhering to organisational and professional values, codes of practice and
regulations are as follows :
 It helps to develop honesty and integrity among the members.
 Employees can perform their rules and duties as per the desire of company.
 Provide assistance to follow the compliances of law so that work can be done as per
rules.
 M&S can achieve its objectives by adhering professional values, code of practice and
regulations.
2. 4 Importance of adhering to organisational policies for handling clients’ monies
All companies have its own rules that how they can operate its business so that targets
can be achieve as per the requirement. M&S makes its own policies that how funds of clients
will be handle. Organisation has various stores across the nation and it requires cotton as a raw
material so that clothes can be manufactures. Company has policy that it makes payment to
supplier with 3 months after the purchase. If it does not make payment as per specified time
duration than additional amount will be paid to the suppliers as a result profits can be reduce. So
to adhere corporation policies are important so that clients money can be handle properly
(Coleman, 2012).
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2. 5 Circumstances when confidential information should be disclosed and who is entitled to the
information
Confidential information means those non-public information which are not disclose to
the third party or general public. If an employees leak secret data of organisation to the
competitor of it. In that case other party can misuse that data and use it to beat the company so
that it can grab more market share and generates more revenue. Confidential information
involves business data & documents, strategies, plan, etc. To protect the matter of safety and
security of persons confidential information can be disclose but to the appropriate authority such
as court (Behnke, 2012).
2. 6 Importance of working within the limits and confines of one’s own professional experience,
knowledge and expertise
To remain in the limits by using own professional experience, knowledge is important for
an individual so that a person can accomplish its targets and get the success and growth in the
life. For example, if a person is IT expert and manage information technology related work in
M&S. If it starts managing finance related matters than that individual does not perform as per
desired manner because that persons does not expert in finance and accounts. As a result
company can not manage the financial activities and targets can not be achieve. So it is important
for an individual to use own professional experience, knowledge and expertise in those areas in
which it is expert so that chances of growth and success can be maximize.
TASK 3
3.1 Relevant authorities and internal departments to which unethical behaviour, breaches of
confidentiality
Authorities are the governing bodies who make rules and regulations for the business so
that unethical behaviour, breaches of confidentiality can be control. International Ethics
Standards Board of Accountants has issued guidelines which provide help to manage and control
these activities. As per the regulations it is necessary for a person to provide true and appropriate
data and information while preparing the financial reports and does not make any illegal act like
misrepresentation and falsification of data. It is important that person does not disclose any
confidential information before financial reports has been presented by M&S to the general
public. Managing director of corporation should manage and control the internal department as a
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result unethical practices can be reduce which leads to the efficiency and productivity (Parker,
2017).
3. 2 Appropriate action to take in instances when requests for work are beyond the employee’s
competence
For a company it is important to identify the skills, knowledge and ability of its
employees so that they can perform their roles as per the desire of organisation As a result targets
can be fulfilled and goals can be accomplish effectively. If M&S delegates the work to its
workers beyond their normal capacity than it create more pressure for staffs to complete the task
as per stipulated time period. Employees feel burden and which can hamper the efficiency and
productivity as a result targets can not be fulfilled. In this case workers can take action against
the company that it is not following employment act. So it is essential for an organisation to
delegates the work as per the capabilities of employees so that targets can be accomplish
effectively (Harris and Robinson Kurpius, 2014).
3. 3 Identify inappropriate client behaviour and how to report it
Inappropriate behaviour can considered to be unsuitable, concerning or threatening which
includes : bullying, stalking, harassment, aggressive communication etc. All organisation makes
policies and rules which are needed to be follow so that inappropriate behaviour does not take
place in the corporation. For example, if a female worker of M&S is dealing with client and
during talking it is using abusive language than that staff should report to the corporation about
this inappropriate behaviour and organisation should take action against that client.
3. 4 Internal and external reporting procedures which should be followed
There are many internal and external process for reporting the unethical and illegal
practices in corporation. The internal process for reporting states that one can say just no to the
unethical practice, talk to the co workers, confront the problem in front of manager and after that
individual can consult an attorney also for this matter. External process refers that one report to
higher authority of firm through a normal reporting channels. So it is considered as an effective
process for reporting because action can be taken more promptly.
3. 5 Strategies that could be used to prevent ethical conflict
Conflict states that opposition resulting from actual or perceived differences and it creates
the situation of disputes. By following the ethics conflicts can be resolve or minimizes and
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corporation should make proper plans and policies to control it. M&S can makes ethical policies
which guide the workers that how they have to behave and what regulations are needed to be
followed to prevent conflicts. Corporation and employees both should follow the ethics so that
targets can be fulfilled effectively and it brings honesty and integrity which help to create healthy
working environment and ethical conflicts can be reduce (Kinsella and Pitman, 2012).
TASK 4
4.1 Importance of an ethical approach to sustainability
The business corporation are develop with the motive to sustain for a long period of time
in the market. To analyse the needs of consumers so that products can produce which can fulfil
the desires as a result M&S can sustain for a long period of time in the market. As per the
organisation culture ethics are needed to be followed. Reputation and brand image can be
enhanced by following the ethical trade practices and provide help to accomplish the goals and
objectives. So to take the benefit of competitiveness ethical approach is very useful for
sustaining in the business.
4. 2 Responsibilities of finance professionals in upholding the principles of sustainability
Finance professionals are the individual who are responsible to follow the compliances
which are made by regulatory governing bodies and associations. It provides help to prepare
financial reports according to the accounting principles and regulations and ensure that code of
conducts are following and financial statements are giving accurate information. It is beneficial
for M&S to take important business decisions which help to boost the business and bring
sustainability. So finance professional provide help to corporation to perform according to the
principles of sustainability (Jahanpour and et. al., 2014).
CONCLUSION
As from the above report, it has been concluded that to follow the professional ethics are
essential for the future growth and prosperity of business. It brings the integrity and honesty
which brings the sustainability. There are various professional bodies which frame the frame
rules and regulations for accounting and finance sector. For an organisation it is essential to act
ethically while working with clients, colleagues and suppliers so that health relations can be
maintained. It is important for person to remain in the limits and confines own professional
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experience, expertise and knowledge so that efficiency can be maximize and targets can be
accomplish effectively.
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REFERENCES
Books and Journals
Knapp, S. J., VandeCreek, L. D. and Fingerhut, R., 2017. Practical ethics for psychologists: A
positive approach. American Psychological Association.
Shani, A., Belhassen, Y. and Soskolne, D., 2013. Teaching professional ethics in culinary
studies. International Journal of Contemporary Hospitality Management. 25(3).
pp.447-464.
Grace, P. J. ed., 2017. Nursing ethics and professional responsibility in advanced practice. Jones
& Bartlett Learning.
Tannenbaum, J., 2013. Veterinary ethics. International Encyclopedia of Ethics.
Gillam, L. and et.al., 2014. The role of emotions in health professional ethics teaching. Journal
of medical ethics. 40(5). pp.331-335.
Basart, J. M. and Serra, M., 2013. Engineering ethics beyond engineers’ ethics. Science and
Engineering Ethics. 19(1). pp.179-187.
Brecher, B., 2014. What is professional ethics? Nursing ethics. 21(2). pp.239-244.
Coleman, S., 2012. Military ethics: an introduction with case studies.
Behnke, S. H., 2012. Constitutional claims in the context of mental health training: Religion,
sexual orientation, and tensions between the first amendment and professional ethics.
Training and Education in Professional Psychology. 6(4). p.189.
Parker, D. B., 2017. Rules of ethics in information processing. In Computer Ethics (pp. 17-20).
Routledge.
Harris, S. E. and Robinson Kurpius, S. E., 2014. Social networking and professional ethics:
Client searches, informed consent, and disclosure. Professional Psychology: Research
and Practice. 45(1). p.11.
Kinsella, E. A. and Pitman, A., 2012. Phronesis as professional knowledge. In Phronesis as
professional knowledge (pp. 163-172). SensePublishers, Rotterdam.
Jahanpour, F. and et.al., 2014. Construction and evaluation of nursing ethics questionnaire.
Online
Ethics. 2018. [Online]. Available through:
<https://www.alzheimer-europe.org/Ethics/Definitions-and-approaches/What-is-meant-
by-the-term-ethics>
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