What are some examples of unethical business practices in recent years?

What you do by and for yourself may not necessarily be pleasant to the public eye. As a business owner, employee or manager, you should keep what you do in private may contradict the expectations and ethical standards of your professional role. Thus, you should be watching out and avoiding unethical practices at all times.

In this article we explain twenty of the most common unethical practices that may affect your behavior and business practice. Although these actions are a replication of what is generally considered as unethical, they are neither exhaustive nor obvious. There are different ethical expectations for different organizations, cultures, and communities. This list is just for you to choose your actions carefully and avoid falling into the temptation to act unethically.

1) Sexual harassment: this is straightforward and needs no explanation. There are many cases of sexual harassment that have ruined the reputations of people and organization. Uber faced significant public backlash in 2017 for allegedly allowing toxic culture of sexual harassment to take place in the organization. This forced the CEO to resign in June. The character of former President of the USA Donald Trump was also put up for public criticism due to allegations of sexual harassment. Be careful with what you believe to be sexual harassment and what is not. In some context, touching the breast or bottoms of a woman may get you in trouble. Just avoid intentional and close contact with members of the opposite sex to be safe in the workplace.

2) Racial Discrimination: there is currently a movement called #BlackLivesMatter, which has been popularized in social media following the killing of a Black man by police. In anything you do in the workplace, take care not to offend a person who is racially different from you. Otherwise you will be accused of unethical practice. It might be categorized as racial discrimination. Even using the word “negro” can put you in trouble. Try to understand the culture of the other person before engaging more deeply with them, so that you may know what is acceptable and what is not acceptable in their culture. Furthermore, assigning resources and duties should be done equally regardless of race or ethnicity.

3) Using social media to chat while at work: Although social media is acceptable in some work environments, it should not be used inappropriately or for personal purposes. Such behavior is unacceptable and unethical.

4) Using company emails to send private messages: you should not mix private and public communications. Using company’s emails to reach out to your friends may lead to either intentional or unintentional disclosure of pertinent information about the company. That will undermine privacy and confidentiality of the organization’s information.

5) Safety and health issues: employers may face public criticisms for putting employees through unhealthy environments such as working in a dangerous mining site without proper protective devices.

6) Pollution: dumping wastes and releasing affluent into rivers, lakes or public land is unethical. Current societies expect businesses and organizations to take good care of the environment to avoid climate change and loss of diversity.

7) Selling defective products: expired and defective products should not be sold knowingly to customers. Every business has the duty of care towards their customers. A business person should not sell any product that will either affect their customers’ health or not serve the purpose it was intended. Doing so would be considered as an unethical business practice.

8) Quoting wrong prices: as a business person, you should stick to the required price of a product. Some employees deceive unsuspecting customers to pay more than the required prices of the item. Such behavior is wrong and unethical; you should always charge fair and reasonable prices for products.

9) Withholding important information. Let’s say a customer comes in and gets served, then he forgets their purpose on the counter. Then comes back and you refuse to tell them where their purse is. As long as you saw it, you have the responsibility to help them find their purse. Don’t hide important information that will help customers or fellow employees to perform their duties.

10) Financial fraud: This is one of the most serious ethical issues. It does not even deserve to be sat #10. Some accountants use their knowledge to manipulate figures and steal from their companies, shareholders or customers. Wrong!

11) Dishonesty: this is so wide. Any action of dishonesty is unethical and unprofessional, although it may not necessarily be an illegal behaviour. For example, if an employee asks you whether the product has side effects and you say “Yes,” yet you know that it has, then you are lying. That is absolutely unethical.

12) Corruption and bribery: giving gifts in some places may not be unethical, and is encouraged. However, in most cases, receiving gifts to extent undue favor or to provide public service while on duty is unethical. For example, a customer can offer you $100 to give them priority when delivering products. That is corruption, and any ethical person should refuse.

13) Breach of data privacy is an unethical behavior. Employees should not disclose their customers’ information to third parties. Facebook faced ethical challenge when it allowed third parties to access personal information of their users. If a person trusts you with their personal information, only use them for the purpose it is intended and don’t share them with anyone.

14) Nepotism: favoring your cousins or any other relative in employment is a classic example of nepotism. Any favor extended to your relative without following due processes is an unethical practice. They should deserve or earn it by merit.

15) Compelling juniors to engage in sexual activities in exchange for favors such as promotion is unethical. Everyone deserves the right to be promoted if they qualify.

16) Using company resources for personal use. For example, you should not use the company’s car or fuel to attend your friend’s wedding. Doing so would contravene professional code of ethics, and it is an unethical issue that affects many companies.

17) Misusing the organization’s time. This is another unethical behavior that should be given serious thought. You should spend paid hours doing official duty, except breaks. For example, leaving your job during working hours to attend a personal business or take a girl for a date is unethical.

18) Abusive behavior: any abusive behavior such as hitting a colleague with a hand or object is unethical.

19) Violating company policy/rules. You should follow all rules in your company. If you are not comfortable with any one of them, you should either quit or follow the right procedure to get it abolished by relevant authorities.

20) Drug use or sale: selling or using drugs at work is both illegal and unethical. Add alcohol and it is still unethical, even if it may not be illegal.

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Ethics. Values. These things are extremely important to working professionals in any industry.  In fact, 73% of professionals say they take an organization’s values into account and would not apply to a company unless its values aligned with their own.

Furthermore, 82% of workers say they would prefer to be paid less and work for a company with ethical business practices rather than receive higher pay at a company with questionable ethics.

Business leaders need to work to ensure their organization is one with high morals, principles, conduct, and ethics so that employees feel comfortable and confident there. Employees who believe in your corporate principles and conduct and share your values are a huge asset to the organization. Employees and management alike can work together to create businesses that have high standards.

Unethical businesses also lose favor with consumers. 43% of consumers have stopped buying from brands they find unethical and 71% say they carefully consider corporate values when making a purchase. Trust is vital for consumers to feel comfortable and confident with their purchases. Business ethics is its own set of morals and values that are vital in a workplace or corporation. Business ethics involves the industry, their business practices, how they deal with customers, profits, legal issues, and corporate conduct. Management needs to focus on business ethics as an important pillar of their corporation in order to make sure customers are happy with the appearance of their workplace..

The workplace should focus on their ethics and values so they can attract the right employees and consumers alike. The more willing a workplace is to create a mission that demonstrates their ethical values, the more likely the organization is to thrive and succeed. rates their ethical values, the more likely the organization is to thrive and succeed. In fact, recent reports show businesses that have ethical workplace cultures outperform their competitors—but especially in stock price growth.

Ethical scandals in business can deeply hurt the look of a corporation, which can make employees and consumers get a bad taste in their mouth about the morals of the company. How a company reacts to ethical scandals and dilemmas that happen on a small level will say a lot about their core practices and values. As a student of business, it’s valuable to learn from business scandals to understand what to avoid or watch out for in business ethics of a company, as an employee and as a consumer. Utilize your time as a student to learn from examples that can give you a deeper understanding as you prepare for a business career.

It’s hard to forget the scandal United Airlines faced after security officers forcefully dragged a passenger off an overbooked flight. While it’s perfectly legal for airlines to overbook flights and equally legal for them to request certain passengers get off the flight, many consumers say they were disappointed with how the company handled the situation. This ethical dilemma of how to handle a consumer who wasn't cooperating showed a. lot about corporate practice for United Airlines.

Additionally, the apology and statement from the United Airlines CEO seemed lukewarm to many consumers. The apology seemed to back up employees, but didn’t really express remorse or regret about the situation. This is a business ethics situation where consumers wanted to hear that their corporate practice involved consumers and customers coming first.

This entire ethical scandal lead many customers to cut up their United Airline loyalty cards, cancel flights, or book with another airline. Many consumers still talk about this incident and use it as an example for reasons to avoid United Airlines, stating their business ethics aren't what they should be.

Equifax faced a large ethical scandal when hackers stole data from more than 148 million consumers. After the fact, the research found that the systems Equifax was using were old, and their security systems were out-of-date and could have been updated to prevent the breach. This is an example of business ethics where small businesses and big companies alike have a duty to ensure the are following guidelines for a safe work environment and safe opportunities for consumers.

Beyond the breach itself, Equifax didn’t report the stolen data for two months. This means that for two months, consumers who had their data stolen were walking around, with no idea there could be any issues. This lead the Equifax CEO to step down, and nobody knows where the data is, or who has it. The ethics in this situation focus on honesty and integrity, and the best ethical choice would have been for Equifax to immediately admit that something had gone wrong.

Equifax has worked to right the wrong by paying out consumers whose data could be compromised. But unfortunately, there is only so much they can do at this point. Consumers expect business ethics from Equifax and other financial institutions that keep sensitive data to be up-to-date on security measures and do their due diligence to make sure data is kept safe. 

Enron faced an ethical accounting scandal in 2001 after using “mark-to-market” accounting to fake their profits and misused special purpose entities, or SPEs. Enron worked to make their losses seem less than they actually were, and “cooked the books” to make their income look much higher than it was. 

Enron stock plummeted after the news got out, and the SEC began an investigation.

That ethics investigation lead to jail time for many Enron executives, and their accounting firm Arthur Anderson lost all of their clients and eventually was dissolved. Enron filed for bankruptcy, and new laws were introduced based on this scandal to prevent similar situations. This is a case where business ethics means that honesty and full transparency is what companies and consumers should expect.

Google may be one of the largest companies in the world, but it’s not immune from ethical dilemmas and business ethics scandals. As of 2019, Google is facing a fine from the EU, with the EU saying that Google abused their dominant position and forced AdSense customers to sign contracts saying they wouldn’t accept advertising from rival search engines. This is an example of business ethics where consumers expect organizations to be fair in their treatment of consumers and of rivals. Especially when a company dominates the market, the ethics involved have to be more strict.

Google has been fined a total of $9.3 billion by the EU for antitrust issues, ranging from mobile market dominance to manipulating search results. They are now facing a probe from the United States Justice Department. Google has released statements saying they’re working to make changes so all companies are represented fairly on their platform. Users have been unhappy when they’ve discovered the problems that Google is responsible for, but as the company works to institute changes, they are also winning back consumers. As Google works to improve their business ethics practices, they will appeal to their consumers again.

An ethical dilemma is a paradox that comes up when there are two or more options, but neither of them are the best ethical or moral option. False accounting, sexual harassment, data privacy, nepotism, discrimination—these are just some of the ethical dilemmas that happen in today’s workplace. Many business owners and managers will deal with ethical issues at some point in their career. For this reason, it’s crucial for every business—no matter the size—to create a code of ethics. Not only will it establish a foundation of trust between employees, customers, investors, etc., but it will help ensure your business is operating within the law.

Big scandals are just the tip of the iceberg when it comes to business ethics. There are small, daily decisions happening with executives, managers, and employees that all make up a company’s ethical behavior. There are issues that the public doesn’t hear about that could be impacting culture and performance negatively inside an organization. 

As a business student, it’s important to understand how to be ethical in a company now. Making decisions on your values and morals will help you be prepared to face ethical dilemmas in the future. There are many ways you can be ethical, including being honest with other employees and the public, whistle blowing on misconduct, paying employees what they deserve, not tolerating theft, being unwilling to participate in questionable accounting, respecting the environment, and refusing gifts from vendors in exchange for better treatment.

To be prepared to handle company ethical dilemmas, you should try the following.

1. Decide what your ethics are before you start a job. Understand what your values, your personal mission statement, and your goals are in order to help you know ahead of time how you'll behave in an ethical dilemma.

2. Communicate with your manager. Management should be made aware of any areas that you feel are ethically questionable. This is usually best done via email, so you have record and proof or your actions. Be sure to let your manager know the entire situation, and how you feel about it. If a manager is behaving unethically, you can send an email explaining your feelings and concerns.

3. Work with HR if necessary. Sometimes management doesn't respond or react when you bring up ethical dilemmas at the office. If this is the case, go directly to your human resource manager and work with them to know how to best handle the situation.

4. Know when to get out. If you believe a company is going to continue unethical behavior, it's up to you to get out of the company. Work to find another job at a company that you feel will uphold your ethical standards. There is nothing wrong with leaving a job because you believe they are being unethical, and it can end up being good for you in the long-run.

If you’re hoping to be successful in business, understand that the best thing you can do for your employees and your consumers is to practice ethical behavior. Business ethics can be a slippery slope, so it's best to ensure you know what your personal ethics are, so when a conflict or challenge arises, you know exactly what you will do. Ethics are a vital element of becoming successful in business, and the more prepared you are, the better your career will be.