How much are ethics worth? This was the topic of a recent study conducted at the University of Ontario’s Ivey School of Business. The study looked at customer attitudes toward companies that were described as highly ethical, neutral and poorly ethical. Generally, what they found is that there is a segment of our society that will pay a premium for ethically produced products. They also found that a larger segment of our society will only pay deeply discounted prices for unethically produced products.
The article concludes with this admonition for businesses: “The lessons are clear. Companies should segment their market and make a particular effort to reach out to buyers with higher ethical standards, because those are the customers who can deliver the biggest potential profits on ethically produced products.”
The lessons are clear: In this article, the authors advocate for ethics only if it leads to increased profits. Moreover, they assume that profits are the only measure of success for a company. While I agree that profits are necessary, focusing solely on profits leads to an imbalance in how the God’s purposes for business are implemented.
Presumably, if unethical behavior lead to an increase in profits, I would have a hard time seeing these authors argue against the unethical behavior. The harsh reality is that anytime you find sin in business, you’re likely to find additional money to support it. Think about it. Look at the businesses that engage in sin – prostitution….drugs….abortion…..gambling….as examples, and you will *always* find an excess of cash in those businesses. Generally, the more sin and lack of ethics, the more profits you will find.
Conducting business in an ethical manner will reduce your profits. It will cost you more to do the right thing. If you run a publically held company, you may have additional explaining to do in order to follow God’s ethics consistently.
As consumers, when reasonably possible, we should avoid supporting products that are produced in unethical manners. For example, if you know that certain clothes are produced using forced child labor in sweat shops in third world countries, your purchase of that clothing supports potential child abuse. Even though you might save money by purchasing this article of clothing, you should ask yourself about the ethics of supporting sweat shops with forced child labor. Integrating ethics into your purchasing decisions honors God and when exercised for moral reasons, furthers His kingdom on this earth.
Bill English, CEO