Pressures influencing ethical decision making

5. Relationships. Business ethics involves relationships between a firm and its investors,

customers, employees, creditors, and competitors. Each group has specific concerns, and each

exerts some type of pressure on management

Investors want management to make financial decisions that will boost sales, profits, and returns on their investments.

Customers expect a firm's products to be safe, reliable, and reasonably priced.

Employees want to be treated fairly in hiring, promotion, and compensation.

Creditors require bills to be paid in time and the accounting information furnished by the firm to be accurate.

Competitors expect the firm's marketing activities to portray its products truthfully.

6. Business ethics. Although there are exceptions, it is relatively easy for management to respond in an ethical manner when business is good and profit is high. However, concern for ethics can dwindle under the pressure of low or declining profit In such circumstances, ethical behaviour may be compromised.

Expanding international trade has also led to an ethical dilemma for many firms operating in countries where bribes and payoffs are an accepted part of business. In the U.S. government

agencies have prosecuted several companies for "illegal payoffs", in spite of the fact that there is as yet no international code of business ethics. Until stronger international laws or ethics codes are in place, such cases will be difficult to investigate and effective prosecution is not possible.