Business ethics references ethical principles, as well as ethical and moral issues that arise within a business setting. An individual's or an organization's ethics outline what they believe to be right or wrong and will influence the way their decisions are made.
Though the law outlines certain standards of conduct, there is a difference between what is legal and what is ethical. It's up to each and every franchisee to not only abide by the regulations that have been set for them by their franchisor but to go out of their way to prioritize ethical decision-making. Why is this? Here are just a few reasons why ethical decision-making matters when you're involved in franchise business opportunities.
It Encourages Ethical Employee Behavior
According to Statista, in 2020, there were approximately 7.49 million people who worked for a franchise. As a business owner taking advantage of franchise opportunities, you have to set an example for your employees. Employees who see their bosses demonstrating ethical reasoning are more inclined to consider it important for themselves. Companies who make their values and ethics known, and then proceed to intentionally act in a way that aligns with those ethics, will inspire employees to complete their duties with integrity.
It Impacts Your Bottom Line
Not only does ethical decision-making help you gain respect as a franchisee, but it's also likely to improve your profitability. More and more, consumers are looking to actively support ethical businesses. They're even looking to give them a shoutout on their socials. A detailed code of ethics or active ethics program could also decrease your losses. If it's discovered that you, as a franchisee, are making unethical choices, then you risk losing partnerships, investors, and customers. You could also risk breaching your franchise agreement.
It Affects the Franchise's Image
When you're involved with business franchising, you not only represent yourself as an entrepreneur, but you're running an operation under a pre-established brand. Somebody else presumably worked hard to make that brand successful and to build its positive reputation. Because of this, they can now offer franchise business opportunities to people like yourself.
Should you decide to engage in unethical business practices, it's not only your name that could potentially wind up tarnished but also the name of the brand that you've invested in. Any losses you incur could have a negative impact on yourself, the brand, and other franchisees who have set up shop using the brand's name.
Applying ethical-decision making to your every day will help you earn the respect of your employees, other franchisees, your franchisor, and the community that you serve. To learn more about hot franchise opportunities that you could invest in, employ the services offered by Franchise Recovery!
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