Title: Explain the importance of business ethics.
Course: Entrepreneurship (12053-I) > Section: Planning an Entrepreneurial Venture

Explanation should include a definition of business ethics and address the importance of ethics in

- the social responsibilities of businesses as a balance between economic growth and the welfare of society
- the environmental responsibilities of businesses as a balance between economic growth and the welfare of the natural environment
- unintended uses of a product
- financial accountability
- the protection of customers
- the protection of employees.

Explanation should also include business ethics as related to all marketing functions:

- Marketing information management—gathering, storing, and analyzing information, including marketing research
- Distribution or channel management—transporting products to customers
- Product/service management—designing and developing products
- Promotion—using a variety of communication methods to educate customers about a business and attract them to buy its product
- Market planning—understanding the concepts and strategies used to develop and target to a select audience
- Selling—exchanging a product for an agreed upon amount of money
- Pricing—setting prices

Process/Skill Questions:

- What constitutes ethical business behavior?
- Is unethical behavior always against the law? Why, or why not?
- What are some examples of real-world unethical business practices? What makes them unethical? What are the potential consequences of each?
- How can an entrepreneur make sure that his/her employees act ethically?
- Why is it important for a new venture to accurately reflect their financial position to investors and to customers?
- How does misrepresentation of business finances affect the employees? The business? Investors? The community?
- How should an entrepreneur respond when encountering an inferior or unsafe product?
- How does product recall affect the ethics of a business?
- Should business ethics be enforced by market expectations or by government regulations? Why?
- How can businesses promote ethical behavior by their employees?
- How does culture affect ethics?
- Why should a new business venture be socially responsible in the community? Environmentally responsible?