The Business Behind Ethics: Navigating a Risky Economy

In the current global economy, doing business is filled with difficulties and uncertainty. Economic recessions, political unrest, natural calamities, and international health crises like the COVID-19 pandemic have brought attention to the value of ethics in the business sector. 

While financial consideration is a critical consideration for multinational companies doing business with new clients, partners or vendors, ethics also play a significant role in securing such partnerships.

In most cases, business deals are called off due to ethical concerns or violation of certain principles and while actions like these may be borne out of the best intentions, they often have far-reaching effects on employees of the said companies, which are often undesirable.

As the Wall Street Journal has pointed out, ethical companies are more highly regarded by consumers, and unethical companies are more likely to be punished if they are seen to be exploiting workers or communities.

In risky economies, failure to partner with such organisations could result in businesses crumbling and unsuspecting employees losing jobs, thereby worsening the unemployment issues, which have is a global problem.

A clear example of the adverse effects of blanket sanctions on businesses can be seen in the Democratic Republic of the Congo.

According to a United Nations assessment, approximately 750,000 jobs in the mining industry have been lost as a result of sanctions meant to penalise the Democratic Republic of the Congo for problems with human rights brought on by war criminals mineral extraction. 

The ripple effect of this is felt even by children, as infant mortality has increased by 143% due to the resulting loss of money, to provide their basic needs.

While penalties such as these often have noble intentions, defenceless citizens bear the brunt, this is similar with business operating under unethical standards, or in dishonest nations and sectors.

This raises the question of how best to handle the tricky situation of dealing with corrupt organizations and business partners. 

Addressing the Issue

Taking a public stand against corrupt businesses could make for good publicity.

However, rather than completely blacklist an organization, ethical corporations can influence the establishment of a committee whose sole obligation is to improve the human rights of workers and other regulatory purposes within these organizations.

Also, a clean sweep can be carried out against officials responsible for corrupt practices in organizations such as these.

It is, indeed, a long road in getting the public to of invest in these corporations with the aim of effecting change from the inside rather than blanket sanctions, but the end is most likely to justify the means.