Business ethics in the 21st century

business of the 21st century

The entrepreneur faces new challenges that are conditioned by the speed of technological innovations and the new business of the 21st century that it entails. We live in an age of change in a globalized world. What was valid yesterday may not be valid today. The entrepreneur is, for many thinkers, the ‘superman’ of our time. He is called to lead the transformations of society. The way to face these responsibilities is crucial to fulfilling as professionals who decide in freedom.

The importance of ethics in business

Hundreds of business schools around the planet each year prepare thousands of future leaders ready to face the present and future challenges. Business of the 21st-century work areas of these schools and the criteria to measure their excellence are very varied: specialization, salaries, international prestige, etc. However, few of these schools have bothered to train leaders capable of adapting in the long term in an increasingly dynamic and global environment under an ethical approach.

At IEBS, we believe that ethics training is key for any business school that wishes to provide more than just technical knowledge to its students. Every day, hundreds of managers are faced with new challenges that are conditioned by the speed of technological innovations and globalization.

These challenges are the kind that cannot be solved with a simple spreadsheet. We live in an age of change in a globalized world. What was valid yesterday may not be valid today or tomorrow. There was no third party harmed by a business decision yesterday; today, there are thousands. There was no media coverage yesterday; today, millions of anonymous citizens with a mobile camera and an internet connection can shake companies and governments.

The reality and innovations run faster than governments: regulations and laws cannot adapt quickly to changes. The company faces dilemmas of action long before governments enact laws to bring order in this or that field.

Such uncertainty in the environment makes ethics more necessary than ever for professionals, executives, and entrepreneurs. Many of the world’s big companies no longer discuss the importance of ethics in their organizations; rather, they look for a way to apply it. Ethics is a management discipline and a key skill for the next generation of leaders.

business of the 21st century

What is Ethics in business?

Years ago, sociologist Raymond Baumhart posed this question to a panel of executives at large companies. Among the responses were the following:

. Ethics is what my feelings tell me about what is right and wrong.

. Ethics has to do with my religious feelings.

. Ethical behavior is doing what the law dictates.

. Ethics consists of behaving as society accepts.

. I don’t know what ethics is.

Many people tend to identify ethical with their inner feeling of right and wrong: but being ethical does not have much to do with following one’s personal feelings. Personal feelings are often unethical.

Nor is it correct to identify ethics with religion. Many religions uphold certain ethical standards. But if ethics only falls within the sphere of religion, its application would only be valid for practitioners of each creed. Yet, ethics applies to both the religious and the atheist.

Being ethical is not obeying the law either. The law often incorporates ethical principles that most of the population subscribes to. But laws, like feelings, can deviate from what is ethical. For example, racial segregation laws;

Finally, ethics is not behaving as society accepts. Suppose this was the case, to be ethical. In that case, we should first find out what society accepts, which would be quite complicated in cases where there is no clear and overwhelming social consensus: Many people accept abortion, and many others do not accept it.

So what is ethics? Regardless of the different theories enunciated throughout history, we can summarize ethics as the principles that govern decision-making in freedom and in a responsible way. Within this definition are all the principles on which our existence in society is based: Rights, obligations, benefits for society, fairness, honesty, loyalty, right to privacy, equality, etc.

What is Business Ethics?

The global financial crisis that began in 2007 was caused, according to many, by the “irresponsible behavior” of the banking and financial sector blinded by their desire to pursue short-term profit. In this light, the banks’ conduct was neither “responsible” nor “ethical” or “sustainable.” Since then, eyes have been on internationally renowned business schools where most of the executives responsible for those banks were educated.

This situation gives business ethics new strength. Most of the most renowned business schools are seriously re-launching their ethics subjects in all their programs.

Companies are only interested in making money and do not look further for many people—capitalism in its purest form. Earning money is not bad in itself. I consider that making money is very good: how money is earned makes a company have an ethical behavior.

Business ethics today

All societies, without exception, have a value structure that defines the norm of conduct for their members. But today, it isn’t easy to find or define what that moral structure is in the society in which we live. If something characterizes our society, it is fragmentation and apparent contradictions.

An extreme massif fiction of all aspects of life coexists with equally radical individualism in our time. The moral values ​​of individuals today are ‘customizable’ as a consumer good: we can choose from a wide range, each individual being sovereign. For this reason, there are in the same place and time infinity of creeds and codes of conduct opposed. The resulting common structure is a minimum morality reduced to the Universal Declaration of Human Rights and moral positivism that is satisfied only in demanding compliance with current legislation.

In such a diffuse world business of the 21st century an entrepreneur, as a leader and as a creator, must be attentive to the questions and important ethical dilemmas that will undoubtedly appear before him, which will appear in the absence of a clear superstructure of values diffuse. Being aware, therefore, of the existence of dilemmas is the necessary step that we want students to take.

Debate: A current case. Self-driving cars

Often, the technique is ahead not only of the legislation but of the Ethics itself. That is why it is inevitable to stop to think and ask yourself certain questions at some point in the process. The ethical values ​​to be applied in each situation show an apparent contradiction between the continuous evolution of the technique that must coexist among humans, whose principles are governed in a perhaps more universal way. If you are interested in the topic, you can watch the 

debate on self-driving or autonomous cars.

When faced with the question, how should Google Car ‘think’? It is not easy to find an answer. No one is surprised by the proposal of the autonomous car, which works without the need for a driver. Several companies lead projects in this context. The Google project, Google Self-Driving Car Project, stands out, perhaps due to its greater media capacity.

In February 2016, the NHTSA (the body that regulates road traffic safety in the USA) had declared that it considers that the system that replaces the driver in Google vehicles is as legal as a person who has obtained their corresponding permit.

Thus, it seems that the time when humans and machines coexist driving through the streets is closer and closer. And inevitably, conflict situations will arise that will have to be resolved from all perspectives.

Suppose, to put ourselves in a borderline case; we face a situation where the autonomous vehicle must decide between causing fatal damage to a group of passers-by and a dangerous maneuver to avoid it, which could endanger the lives of its occupants. How should the vehicle be programmed to respond to these extreme situations? Business of the 21st century should the principle of least damage caused prevail or, on the contrary, should the safety of its occupants prevail?