Business ethics (business ethics) is a general application of ethics to business conduct. More specifically the meaning of business ethics denotes ethical or unethical behavior by managers and employees of a corporate organization. Business ethics reflects the moral reflection of individual and institutional (organizational) business actors to assess an issue, where this assessment Is the choice of a growing value in a society. Through this choice of values, the individual or organization will judge whether something done is true or false, fair or not and has usability or not.

Business ethics is not an ethics distinct from ethics in general and business ethics is not an ethic that only applies in the business world. For example, if dishonesty is viewed as unethical and immoral behavior, then anyone in a dishonest business (manager or employee) against workers, shareholders, customers or competitors, is considered unethical And immoral.

Furthermore, if the behavior of preventing others from suffering harm is viewed as ethical behavior, then the company that withdraws its products that have defective production and may endanger the safety of consumers, may be viewed as a company that carries out ethical and moral conduct.

Why does a business need business ethics? Is not a business activity only aimed to gain as much profit as possible in any way? Is not the ethical behavior imposed by the company even hindering the company from competing against its competitors? There are at least seven reasons that drive the company to conduct its business ethically:

  • Increased public expectation for the company to run its business ethically. Companies that are not successful in running their business ethically will experience the spotlight, criticism, and even punishment.
  • In order for the company not to take various actions that endanger other stakeholders.
  • Application of business ethics in the company can improve company performance.
  • The application of business ethics such as honesty, keeping promises, and refusing a bribe can improve the quality of business relationships between two parties who do business relationships. This is due to increased confidence among parties involved in business relationships with others. Conversely, if one party is not to be trusted, then this unreliable party will be ignored by its business partner even by the business community in general.
  • In order for the company to avoid abuse by employees and competitors who act unethical.
  • Proper application of company’s business ethics within a company may prevent the occurrence of labor rights violations by the employer.
  • Companies need to apply business ethics in the conduct of their business, to prevent companies (represented by their leaders) from obtaining legal sanctions for running an unethical business.


Functions and Factors The Emergence of Business Ethics Problems

Various ethical issues in the company can come in many forms. Identification of various factors commonly encountered as a cause of ethical problems in the company is an important step to minimize the impact of business ethics issues on company performance.

Factors that generally cause the problem of business ethics in the company, that is Pursuit of Profit and Personal Interest, Competition Pressure Against Corporate Profit, Disagreement between Company Objectives and Individual, Cross Cultural Ethics Disagreement.

Pursuing Advantages and Personal Interests Greedy attitude can lead to ethical issues. Companies sometimes hire employees who have inappropriate personal values. These workers will place their interests to gain wealth beyond any other interest even in accumulating such wealth he harms other workers, corporations, and society.

Pressure of Competition on Corporate Profits. When companies are in a very tight competitive situation, companies often engage in unethical business activities to protect their level of profitability. Various food and beverage companies in Indonesia are suspected of using food and beverage dyes that are not safe for human consumption but are cheap, so they can reduce production costs and get low product prices. Even the food industry dare to use formalin which is a preservative corpse as a food preservative.

Disagreement between Corporate Values ​​and Business Values ​​(Business Goals versus Personal Values). Ethical issues can also arise when companies want to achieve certain goals or use new methods unacceptable to their workers:

Business Ethics on Corporate Functions

Ethical problems that occur in the company vary between the functions of one company and other corporate functions. This happens because the operations of the company are highly specialized in various fields of profession, so that every function of the company tends to have its own ethical problems.
The following will discuss various business ethics issues that occur in several areas of corporate function, namely:

Ethics in Accounting and Finance

Accounting function is a very important component for the company. Thus honesty, integrity, and accuracy in carrying out accounting activities is an absolute requirement that must be applied by the accounting function. One accounting practice that is considered unethical such as the preparation of different financial statements for different parties with the aim of benefiting from the preparation of such financial statements. In reality business activities are often found by companies that prepare different financial statements for different parties. There are internal company financial statements, financial statements for banks, and financial reports for the tax office. By doing this, the accounting department of the company deliberately manipulates the data in order to benefit from the preparation of the false report.

Ethics in Finance

Financial scandals arising from the execution of unethical financial functions have created various losses for investors. Bank Indonesia’s financial interest report will be applied to the bank . Through this practice it is as if the company has healthy financial ratios so it deserves credit. When in fact the financial condition of corporate finance is not as healthy as reported in the financial statements that have been enhanced. Other examples of financial ethical violations for example through inflating the value of corporate collateral, so the company can obtain credit exceeds the real value of collateral credit.

Ethics in Production and Marketing

 The relationship the company makes with its customers can lead to various ethical issues in the field of production and marketing. To protect consumers from unethical treatment that may be done by the company, the Indonesian government has enacted Law No. 8 of 1999 on Consumer Protection. This law is described various acts prohibited by the business actors. Among other things, business actors are prohibited from producing and / or trading goods and / or services that:
A. Does not meet or is not in accordance with the standards that are publicized and the provisions of legislation
B. Not in accordance with net weight, net or net contents, and quantities in the count as stated in the label or label of the goods
C. Not in accordance with size, dosage, scales, and count counts according to actual size
D. Not in accordance with the conditions, warranties, privileges, or efficacy as stated in the label, label or label of such goods and      services

Ethics in the Field of Information Technology (Ethnology) One of the areas that have the largest growth ethical problems in the era of the 1990s to early 2000 is the field of information technology. Matters that may raise ethical issues in this area include: attacks on a person’s privacy area, collection, storage, and access to business information primarily through e-commerce transactions, copyright protection concerning the creation of software, music and intellectual property rights…