Business ethics

There is a misconception that if a business complies with all legal requirements, it also has good business ethics. However, legal compliance does not automatically equate to morally sound business practices. A member of management or an employee’s conduct may not break any laws, but it may breach the standards of business ethics.

What is business ethics?

Business ethics is a framework for acceptable moral behaviour in the workplace by both management and employees.

Benefits of good business ethics

Good business ethics create trust among colleagues as well as between employees and customers.

Companies with good business ethics are better able to attract top talent, maintain and improve their reputation and stay out of legal trouble.

Good business ethics make for happier employees and happier employees are more productive employees.

Examples of bad business ethics

Undercutting, i.e. where an organisation first drops prices to put competitors out of business and then increases prices again, is not only an example of bad business ethics but it is also illegal.

Unacceptable conduct by management and/or employees in the workplace, for example lying, stealing, sexual harassment and discrimination, erodes trust among employees and between employees and management.

Another example of bad business ethics would be using company assets or consumables for private purposes, e.g. taking office supplies home with you and justifying it to yourself with the fact that you put in some overtime earlier in the month.

Examples of good business ethics

Good business ethics practices by an employer include issues such as the overall treatment of colleagues with respect, dignity, non-discrimination, fairness, intolerance of sexual harassment, tolerance of people’s differences and diversity, and understanding and respecting conflicting points of view.

Environmental ethics apply to an organisation’s responsibility towards nature and the community and will address issues such as accountability for and prevention of pollution.

Employee ethics include, amongst others, honesty towards customers and colleagues, humility, trustworthiness, treating others with respect, commitment to the employee’s work and productivity.

The area of customer ethics may include principles such as honouring contracts, disclosure of and owning up to mistakes made by employees of the organisation and the disclosure of any flaws in a product.

Examples of financial ethics would be to uphold honest accounting practices and not inflating reimbursive travel claims.


The identification of business ethics goals and the training of employees on these goals is a requirement in creating a culture of good business ethics and trust in the organisation, as well as between the organisation and clients or suppliers. Providing ethics training teaches employees sensitivity to ethical issues and how to resolve difficult moral situations on their own within the organisation’s ethics guidelines.

Changes in technology and working environments constantly raise new ethics issues. Ethics training should be reviewed from time to time to ensure that the organisation’s ethics policy remains up to date with current circumstances and issues in the working environment.


An effective type of enforcement of business ethics is a whistle-blower system which allows an employee to anonymously inform management of unethical behaviour which comes under the employee’s attention. Employees often fear retaliation when they bring cases of unethical behaviour under attention of management; with this system employees have the option of remaining anonymous.

You will know that you are guilty of bad work ethics when you start making excuses for your behaviour and justifying your behaviour to convince yourself that your actions are not really that unacceptable.

Senior management as well as lower-ranking employees must be equally committed to moral standards in order to create a culture where good business ethics is the norm rather than the exception.

If you would like more information  about business ethics, please contact your financial adviser.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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The obligation to provide access to certain information about your business

The Promotion of Access to Information Act (PAIA), No 2 of 2000, was enacted in an effort to foster a culture of transparency and accountability in the public and private sector. It gives effect to the constitutional right of access to any information held by the State or any other person and  that is required for the exercise or protection of any rights of any person.

This implies that any person whose rights may be affected may request any of the prescribed information as defined in the Act from a public or private body by following the applicable procedures. The public or private body is then legally compelled to provide such information in the prescribed manner.

Section 51 of this Act requires the head of a private body to compile, within six months after the commencement of this section of the Act or within six months after the establishment of the private body, a manual containing certain prescribed information, such as:

  • postal and street address, phone and fax numbers and email address of the private body
  • the latest notice regarding the categories of records of the private body which are available without a person having to request access in terms of the Act
  • a description of available records generated by the private body, indicating which records are automatically available and which records are available on request
  • the request procedure to be followed in terms of the Act, as well as the applicable fees
  • a statement confirming the head of the public body
  • other information as prescribed by the Act

This manual should be updated every time a change in the prescribed information occurs and must be:

  • submitted to the Human Rights Commission
  • submitted to the controlling body of which the private body is a member (if applicable)
  • published on the privatebody’swebsite (if applicable)

A private body is defined as:

(a) a natural person who carries on any trade or business or profession
(b) a  partnership that carries on any trade or business or profession
(c) any former or existing juristic person, but excluding a public body

When a person requests information in terms of this Act, it must be provided if:

a) the information is requested to exercise or protect a right
b) the person follows the correct procedure as prescribed by the Act
c) access to that information cannot be denied on any of the grounds of refusal as stated in the Act

The deadline for the submission and publication of the PAIA Manual for public and private bodies was 31 December 2011. However, for certain private bodies in certain economic sectors, this has been extended until 31 December 2015.  These exceptions are based on:

  • the economic sector in which the private body operates its business
  • the total number of employees being less than 50
  • the turnover of the private body being less than a certain amount per economic sector

This extension does  not otherwise impact on the enforcement of this Act, and the rest of the requirements of the Act are currently enforced.

The penalty for non-compliance is two years imprisonment or the possible option of fines.

This article is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. 

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Ten business etiquette tips

No-one wants to work in an environment which is unpleasant, unproductive and ripe for litigation, which is exactly what you will get where employees are rude, careless and dismissive. Such behaviour will spill over to customers and will eventually lead to legal proceedings and loss of business. Proper business etiquette practices must start from the top, but every employee should contribute towards promoting these values.

1. Everyone Has a Role

Remember that all the employees in your company and their jobs are interconnected, and that what happens to one, affects the other. Don’t treat any employee in such a way that, when you need him tomorrow, he has become disloyal because of your treatment of him.

2. Make Meetings Useful

When you call a meeting, keep other employees’ schedules in mind, and come to the meeting prepared and organised, so as not to waste people’s time. Thank everyone for their contributions and attendance, and be sure to send out minutes of the meeting with action items. If these are not necessary, it means that the meeting was not supposed to be held in the first place.

3. Prompt Communication

If you receive a call or email from a client or employee, tend to the matter as soon as possible. Even if you cannot make work of it right away, let the person know that it might take some time, but that you are looking into the matter.

4. Use of email

The speed of sending emails can lead to careless, sloppy writing and unprofessional appearance. Use correct spelling, grammar and punctuation, as you would with any other written communication. Avoid unclear information or one-word answers, so that you can wrap the exchange up without too many emails being sent.

5. Respect Others’ Time

When you have to interrupt someone, try to do it at a time that suits them. Be polite and quick, so that he can get back to his work. Don’t interrupt meetings unless it is extremely urgent.

6. Dress for Success

It is always safer to be overdressed rather than underdressed. Take care with your appearance – it sends out a message of respect to your employer, co-workers and customers.

7. Keep Your Boss Informed

Don’t inundate your boss with compliments or always agree with him. Treat everyone with respect, but remember that your employer is your superior. Keep him informed of any setbacks, problems or developments you might experience, so that he is aware of your situation at all times.

8. Respect Other Cultures

If your company works across language, cultural and geographical borders, remember to treat others with respect. Try to learn at least the basic how-do-you-do’s in all the languages you do business in to demonstrate your desire for cooperation. Study different customs of greeting, eating and public holidays, for example, so that you display the correct behaviour.

9. Timelines

There are often timelines and deadlines in business which you have to keep. This means that you will sometimes have to forfeit teatime or shorten your lunch hour because you have more pressing matters to attend to.

10. Remember the Basics

The most important rule is to remember your basic manners, such as “please,” “thank you” and “you’re welcome”. Don’t raise your voice and never use offensive language.

This article is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.

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