Ethics are important to the business organisation as well as the whole community. Ethics should be implemented ideally throughout all aspects and operations within organisation. With successful implementation of ethical management, organisation can enhance the efficiency in the long run.

Unfortunately, many organisations cannot perform ethical management due to human nature and other inappropriate management control systems. Business organisation with successful ethical management can achieve superior performance because they can attract and retain those high quality staff, customers, suppliers as well as investors. However, establishing the ethical organisation needs time and effort.

It cannot be achieved automatically, because the human beings are not morally perfect. Those unethical staff, customers, suppliers, and investors are capable of preventing business organisations from achieving high integrity and superior performance.

Also, without the adequate ethical training, the culture of trust between the staff within the business organisation cannot be established successfully. Without the appropriate communication system within the organisation, those illegal or unethical conducts cannot be reported instantly and then carefully managed.

Without the ethical hiring system, hiring one employee with an unethical value system can corrupt an organisation. On the other hand, discrimination on an individual’s race, colour, religion, gender, national origin, physical or mental disabilities during hiring the staff could be an offence against the discrimination ordinance.

Ethical leadership performed by the management staff can generate high quality performance outcomes. It tends to attract, develop, and promote hard-working, conscientious, caring, and moral employees who generate high quality performance outcomes.

For treating fairly on each staff in the workplace, management should design and implement the code of ethic so as to abstain from any unfair treatment of customers, supplier, competitors, and employees, such as concealment, abuse of privileged information, and misrepresentation of material facts.

With considering the above issues and knowing why managing ethics is essential and the nature and negative ramification of unethical activities within business organisation, ethic management of organisation can be implemented in the appropriate ways.

Literature Review

Ethical Organisation Achieve Superior Performance in long run

Organisations of high integrity achieve superior performance because they can attract and retain high-quality employees, customers, suppliers, and investors according to Denis (2009). Organisations take time and effort to create high integrity. It is because human beings are not morally perfect. Without ethical employees, customers, suppliers, and investors, organisation cannot achieve high integrity and superior performance. Although unethical organisation can make profit in short term, it cannot be a long run

Ethical Organisation Competitive Advantages

Within the culture of trust between management and employee, the ethical organisation performs competitive advantages than others according to Denis (2009). An ethical corporate organisation attracts the high quality employees and leads all management staff and employees to a higher level of satisfaction and a sense of loyalty as Stewart (2006) stated. For the similar salary level, those job candidates will choose those ethical corporate organisations rather than those unethical organisations. Of course, someone will choose those unethical organisation if the salary and benefits are substantially higher according to Bob (1999).

Competitive Advantages of Being Ethical and Trustworthy

Ethical organisations, comparing with Unethical Organisations according to Denis (2009).

Attract and retain higher quality employees

Attract and retain higher quality customers

Attract and retain higher quality suppliers

Attract and retain higher quality investors

Earn goodwill with community members and government officials

Achieve greater efficiency and decision making, based on more reliable information from stakeholders

Achieve higher product quality

Need less employee supervision

Ethics Challenge