Zimbabwe: 'Firms Flout Business Ethics'

allafrica

Almost 30 percent of employees have witnessed an unethical business activity within their organisations or firms, a study carried out by Industrial Psychology Consultants (Ltd) has revealed The study, which sought to highlight Zimbabwean companies’ level of adherence to ethical business practices, shows that most organisations treat business ethics as an abstract concept.

 

 

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Said IPC managing consultant Mr Memory Nguwi: “Our findings suggest that in the last six months, three in every 10 employees surveyed have observed an unethical business activity happening in their organisation. This is an alarming result,” he said.

“Business ethics” are generally defined as the application of a moral code of conduct to the strategic and operational management of a business.

The survey also indicates that unethical business practices are particularly prevalent in legal entities and public enterprises.

“The prevalence of unethical business practices seems to vary across sectors, with public enterprises and Government departments having the highest observed incidences.

“The data shows that one in every two public service employee surveyed has witnessed an unethical business practice in the last six months.”

In terms of the figures, 50 percent of employees that were surveyed in law and legal services said they had witnessed an instance of unethical business practice within the past six months. This was also matched by respondents from the public service.

Up to 45 percent of respondents in the retail sector reported witnessing unethical business practices during the period under review, followed by 37,5 percent in the engineering sector, 35 percent in automotive, 32,3 percent in agriculture and agro-processing, 32,1 percent in the education sector, and 28,6 percent in construction.

The tourism and hospitality industry has 26,3 percent of its respondents saying they had witnessed an unethical business practice, while the mining sector had 25 percent similar to non-governmental organisations.

Information and communication technology and telecommunication sector had 23,8 percent, followed by manufacturing with 21,1 percent, financial services with 18,6 percent, marketing and advertising with 13,8 percent and medicine and pharmaceuticals with 8,7 percent.

A total of 718 Zimbabwean employees from various sectors participated in the survey.

Mr Nguwi added that sectors with a high prevalence of unethical business practices were most likely to register lower growth rates.

“Our assessment shows that a correlation of the perceived incidences of corruption to the projected growth forecast for the respective sectors revealed a negative correlation (-0,25) between the two variables.

“In essence, this means that the sectors that are set to grow faster this year have fewer employees who can say they have witnessed corruption taking place in their organisations.”

Experts have observed that companies with fewer incidences of unethical business activity tend to generate significantly more economic value added and market value added that those with higher incidences.

Similarly, it is believed that such firms also experience less price-earning ratio volatility and showed a gradual increase in average return on capital employed than companies with business ethics challenges.

Almost 30 percent of employees have witnessed an unethical business activity within their organisations or firms, a study carried out by Industrial Psychology Consultants (Ltd) has revealed

The study, which sought to highlight Zimbabwean companies’ level of adherence to ethical business practices, shows that most organisations treat business ethics as an abstract concept.

Said IPC managing consultant Mr Memory Nguwi: “Our findings suggest that in the last six months, three in every 10 employees surveyed have observed an unethical business activity happening in their organisation. This is an alarming result,” he said.

“Business ethics” are generally defined as the application of a moral code of conduct to the strategic and operational management of a business.

The survey also indicates that unethical business practices are particularly prevalent in legal entities and public enterprises.

“The prevalence of unethical business practices seems to vary across sectors, with public enterprises and Government departments having the highest observed incidences.

“The data shows that one in every two public service employee surveyed has witnessed an unethical business practice in the last six months.”

In terms of the figures, 50 percent of employees that were surveyed in law and legal services said they had witnessed an instance of unethical business practice within the past six months. This was also matched by respondents from the public service.

Up to 45 percent of respondents in the retail sector reported witnessing unethical business practices during the period under review, followed by 37,5 percent in the engineering sector, 35 percent in automotive, 32,3 percent in agriculture and agro-processing, 32,1 percent in the education sector, and 28,6 percent in construction.

The tourism and hospitality industry has 26,3 percent of its respondents saying they had witnessed an unethical business practice, while the mining sector had 25 percent similar to non-governmental organisations.

Information and communication technology and telecommunication sector had 23,8 percent, followed by manufacturing with 21,1 percent, financial services with 18,6 percent, marketing and advertising with 13,8 percent and medicine and pharmaceuticals with 8,7 percent.

A total of 718 Zimbabwean employees from various sectors participated in the survey.

Mr Nguwi added that sectors with a high prevalence of unethical business practices were most likely to register lower growth rates.

“Our assessment shows that a correlation of the perceived incidences of corruption to the projected growth forecast for the respective sectors revealed a negative correlation (-0,25) between the two variables.

“In essence, this means that the sectors that are set to grow faster this year have fewer employees who can say they have witnessed corruption taking place in their organisations.”

Experts have observed that companies with fewer incidences of unethical business activity tend to generate significantly more economic value added and market value added that those with higher incidences.

Similarly, it is believed that such firms also experience less price-earning ratio volatility and showed a gradual increase in average return on capital employed than companies with business ethics challenges.

This article originally appeared on allafrica

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