Do you believe ethics have an impact on profit? Why? Why not? Provide specific examples.
For me the question whether the impact of ethics on profit is negative or positive as I firmly believe that there is an impact of ethics on profit. I have seen many people who think that if they follow business ethics to the letter and spirit, they would minimize their profit. Having said that, I have also seen companies who do not follow ethical standards to maximize their profit and one day the ethical violations lead to legal violations and huge fines.
Research has indicated a positive correlation between ethical excellence and business integrity (Solomon, 1992). This is a clear indication that ethics add integrity to a business. Business integrity is a function of customer loyalty and trust. In other words it is a form of financial gain which many miss to see.
Business must be able to see the profit they would gain from abiding by the ethical standards. For example for a business that rely on wood as a raw material, it is pertinent to follow an ethical standard of investing in tree plantation. If they don’t invest in it, their business would no more be sustainable after some time when trees are cut in abundance and a large de forestation is done.