What does the term 'business ethics' encompass?

The term 'business ethics' encompasses the standards for conduct that help distinguish right from wrong in a business context. It refers to the moral principles that guide the behavior of individuals and organizations in the business world. This includes considerations about honesty, integrity, fairness, respect, and transparency; all of which are crucial for building trust with stakeholders, including customers, employees, and the community.

While legal regulations are relevant to business operations, they do not fully capture the essence of ethics, which encompasses broader moral considerations than just compliance with the law. Similarly, strategies aimed at increasing profitability or enhancing employee morale, while important for business success, do not directly define business ethics. Ethics informs decision-making processes and helps organizations navigate complex moral dilemmas they may encounter in their practices.