Today’s top executives ranked business ethics second only to business strategy as the most important field of study, according to research released by the University Business School last week. But when asked to rank the top three fields critical to their own company’s success, the majority of CEOs surveyed chose business strategy, human resource management and communications over ethics.
Business ethics Prof. Tim Fort said the discrepancy can be explained by the pervading nature of ethics in the business world.
“Even if executives don’t mention it by name it’s needed. Ethics is implicit and integrated in all of the aspects that are critically important to a company’s success,” he said.
Fort said a basic notion of ethics “is that the people you are dealing with have fundamental importance as human beings,” citing open and honest communication as both a strategy and an ethics issue.
“If you’re Enron and lying to your stockholders … that’s an issue of communications and ethics.”
Business Prof. Lynn Wooten, who teaches corporate strategy, attributed the survey’s results to a number of factors, including respondent bias and the intertwined relationship of ethics with all other business fields.
“First of all, (the CEOs) probably think more highly of their own firms than the entire market,” she said. “Also, ethics is an important topic, but good firms try to ingrain it within their values, mission statement and culture.”
Wooten cited the Tylenol crisis that consumer products mogul Johnson and Johnson experienced in 1982 to explain the connection between ethics and business strategy.
“When Johnson and Johnson found out the Tylenol was tainted they took all of it off the shelves even though it cost them money,” she said. Wooten added that the recall ultimately saved the company’s reputation.
When asked to offer advice to better educate students in the critical skills necessary for success, survey respondents stressed the importance of ethics and real-world application.
But Fort is skeptical that this new-found emphasis on ethics will remain a central consideration to business executives.
“Ethics is gaining a lot of attention now because of corporate scandals, (but) these things ebb and flow,” he said. “There will be more attention to the field of business ethics and the application and that will last a while. Then there may be less attention which will be unfortunate. I anticipate that there may be a reduction in attention until the next wave of corporate scandals. But these issues will keep coming back again and again.”