Differences Between Business Ethics and Accountability

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In a productive and quality work environment, business ethics and accountability go hand in hand. They drive a thriving workplace culture, a future-oriented approach, and responsible behavior. A company focusing on ethics and accountability experiences various benefits, such as efficiency, customer satisfaction, and more. No wonder they earn more profits than their competitors.

This article will explore the major differences between business ethics and accountability, informing you how they work together to create a robust workplace.

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Business Ethics: An Exploration

Business ethics, in their essence, are rules that define the ‘right’ and ‘wrong’ in an operational sense. It’s a complete but evolving rulebook that guides a company’s actions and ensures that it doesn’t just look for profits.

By bringing a moral outlook to the operations, a company also ensures that it positively impacts its employees, the environment, and society at large. Following are some of the core principles of business ethics:

Honest and transparent communication.
Fairness in the treatment of stakeholders.
Socially responsible practices.
Respect for everyone.

Various Types of Business Ethics

A company’s business ethics can be formed and modified by various factors, depending upon the larger society, the economy, and more. Let’s explore some basic business ethics and accountability that companies and employees generally adhere to.

Corporate Responsibility

Corporate responsibility is an umbrella term that includes legal obligations and other promises a company makes. A company showing corporate responsibility means fulfilling its responsibilities toward clients, employees, customers, and the government.

It should keep its promises, such as providing an equitable working environment and not discriminating based on race, gender, or political views.

Personal Responsibility

Personal responsibility is the hallmark of any trustworthy employee, whether in a junior position or management. It ranges from diligently performing what your job description says and completing the projects that have been assigned to you.

Similarly, openly accept your mistakes, learn from them, and discuss them with others to find a way out.

Fairness & Equity

Consider this startling statistic: According to the World Economic Forum’s Global Gender Pay Gap Report, the world will spend 135 more years before it closes the gender pay gap.

Fairness is a fundamental aspect of business ethics that is all about treating everyone equally regardless of rank, race, religion, and political views. If a lower-level employee is expected to follow the standards of honesty and integrity, the CEO should also be held to the same standards.

Social & Environmental Responsibility

A business doesn’t operate in isolation; it is part of society and connects with it on several levels. Whatever a business does, from manufacturing to delivery, has a tangible impact on society and the environment.

It’s important to recognize this impact and look for ways to mitigate ‘negative externalities,’ such as pollution, waste, and more. One way of doing this is to work directly with various communities, understand their issues, and invest in them to give them opportunities.

Brief Guide to Accountability

Accountability can be defined as an enforcing mechanism, ensuring that companies and their employees adhere to an ethical framework in their conduct. It is about holding businesses and employees responsible for their actions, a system that can be both internal and external.

Internal Accountability

Internal accountability involves performance reviews and analyses that determine a company’s progress toward specific goals. Similarly, it also includes the level of adherence to ethical principles.

To promote a culture of accountability, firms should have a special team to oversee ethical compliance and submit their proposals regularly. Companies should also enact whistle-blower-friendly policies that encourage employees to report ethical violations.

External Accountability

External accountability comes from outside actors like the government, regulatory authorities, and NGOs. The government passes regulations to make companies adhere to ethical standards regarding employee treatment, waste management, taxation, and much more.

Similarly, regulatory authorities and NGOs monitor companies to ensure business ethics and accountability standards are being followed.

Also, customers boycott brands that they think indulge in unethical practices and hurt their market value. It acts as a deterrent for companies to have ethical boundaries.

Examples of Accountability in Action

Following are some examples of how accountability plays out in a corporate context:

A corporation is penalized for harmful waste disposal practices.
A CEO is sacked or suspended because of a bribery scandal.
Customers boycott a brand for its unfair and substandard labor practices.
A company is rewarded for its positive actions for environmental protection.

Difference Between Business Ethics and Accountability: Comparison Table

	Business Ethics	Accountability
Definition	A set of moral codes and principles determining the right and wrong in a company’s conduct.	A system that ensures the ethical framework is being followed.
Focus	Rules that guide decision-making	Consequences of actions
Importance	Builds reputation Minimizes legal and reputational risks Attracts and retains talent Contributes to a sustainable business environment and society	Ensures ethical conduct Encourages and incentivizes responsible decision-making Promotes responsible business practices
Examples	Honest communication Fairness & equity Social and economic responsibility Environmental responsibility	Fines for environmental degradation Firings for unethical conduct Consumer boycotts for unethical practices Acknowledgment of adherence to ethical practices
Mechanisms	Internal: A comprehensive rulebook Training programs Whistleblower policies Regular performance reviews External: Governmental regulations Various industry standards Consumer boycotts Media & NGO scrutiny	Internal: Corporate governance Disciplinary actions Performance reports External: Lawsuits Legal troubles Fines
Challenges	Lack of commitment to ethical principles Navigating gray ethical areas Prioritizing short-term gains	Accurately measuring ethical behavior Potential retaliation against whistleblowers Inherent limitations of internal controls

Conclusion

Business ethics and accountability are two sides of the same coin, both being equally important to a thriving organization. However, it’s a tricky area that sometimes evades our previous knowledge and understanding. Therefore, it’s crucial to have thorough training on the subject, like the one offered by tickthoseboxes.

If you need assistance you can take a look at my accountability coaching packages or book an accountability assessment today.

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About The Author

Darren Finkelstein, The Accountability Guy®, is the founder of TICK THOSE BOXES, a specialised accountability coaching practice. Darren is a formidable international accountability coach, business advisor, mentor, and author/speaker, fostering development and measurable results in entrepreneurship, leadership, and accountability. Darren’s tale is one of perseverance, self-reinvention, and resilience.

With compelling execution, Darren has empowered high-achieving individuals and teams from Australia and New Zealand to Latin America, Europe, Asia, the UK, and the US to embrace accountability; after all, it is your superpower.

Darren’s one-on-one and group coaching programs are based on his bestselling business book, “The Accountability Advantage – Play your best game” and the latest, release “NO’ – Building a life of choice without obligation”.

Darren has an impressive background in business, having held the role of “Manager of Commercial Markets” at Apple Australia during the Steve Jobs revolution.

He enthusiastically “walks the talk,” having also successfully sold and exited his lifestyle businesses, which served as the impetus for establishing his coaching and mentoring business.

Join Darren on this transformative quest to accomplish the remarkable.

Read Darren’s full bio here:
https://tickthoseboxes.com.au/about/