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The major corporate climate debate of the moment is whether business should be solely answerable to stockholders or whether much broader stakeholder responsibilities must be brought into play. In this article I discuss “Business Ethics” and how old-fashioned views of stockholders alone are broadening out into a wider conception of value creation.

I have avoided Twitter for some time. My reluctance stemmed from the fear of another social networking site tearing chunks of time out of my day. However, I've surrendered, and despite my first inclination to only follow the likes of Stephen Fry and other celebs I've actually found it rather thought provoking. Of course, there are many mundane tweets which don't put a spark in my day (such as trips to the dentists or school runs) – but there are others which have made me stop and think about some of the bigger business questions of our day.

After registering for the event at the front door, I then was given a tour of the facility with the emphasis on the people within each office and their accomplishments. My ethic's detector antennae(EAD) began to tingle. Then I was introduced to a variety of associates who began asking me personal questions. Now my EAD is in full vibration. From a sales process, these individuals had not established any relationship, but presumed that my relationship with the person who invited me immediately extended to them. There really wasn't any opportunity to meet any potential ideal prospects because each guest was being held in conversation by anywhere from one to three associates nor was there any time to meet with the individual who invited me because he was circling the room meeting all the other guests. Now the words, multi-level marketing and cult began circling in my head.

Given that my time is quite valuable, I asked one of the associates as tactfully as possible if this was informational or a recruitment meeting. Again, I was told it was informational, absolutely not a recruitment meeting and to please keep an open mind because everything would be shortly explained.

Guests were then directed to a small room with stacking chairs (minimum padding) and spent the next almost 2 hours listening to their successful marketing director all the reasons to buy into this multi-level marketing business. Since I was in the back of the room and was not raised to be a rude individual, I stayed. However, I was not a happy camper because I was definitely lied to by the person who invited me because 2 of the 3 points on the last Power Point slide specifically involved recruitment.

What really bothered me was that the majority of people (mostly young people under the age of 30) in the room were actively listening to this sales pitch which was identified numerous times by the marketing director as not a sales pitch. After all, if you joined them part time you could make over $20,000 annually by just working with 4 families in a month. Of course, the marketing director did not say that you need 4 new families each month to sustain that income. As the old adage goes If it sounds too good to be true, it probably is.

So what does this have to do with ethical values in business? Absolutely everything! Ethics first and foremost are about being honest. When I asked the associates what they did, the only response was We help people. Any further questions were slickly evaded by having a new associate enter the conversation.

Second ethics is a referral mechanism or criteria. Since I network a lot, I also believe in referrals. Ethics is about knowing individuals and what type of values that guide them. Since I was intentionally mislead, I can no longer refer this individual or his organization and when asked will honestly share my perception that this is not a reputable firm no matter what some nationally known business guru said.

A successful business is obviously one who seeks and achieves economic growth. Milton Friedman's famous assertion that “A business's only responsibility is to its shareholders” is often quoted as the ethical foundation of capitalism. In seeking to act responsibly to anyone other than the stockholders of the business, owners and managers are actually behaving unethically. But does this argument really hold much water?

If a successful business is one which seeks and achieves (sustainable) economic growth, how does it do this? It is likely to be working with suppliers who understand its needs and works innovatively to provide it with the best product or service. It is likely to provide value-rich products or services for its customers. It will be complying with legislation and working in all ways to act justly. In short, it will be taking into account multiple stakeholders to achieve the best possible return for each.

So you as a small business person who may actually have such a firm in your formal networking group can avoid my unethical networking experience by following these two rules. (I used to have only one rule, but expanded to a second one.)

1. Directly ask if your potential client market will be there?
2. Do a Google, Yahoo, etc. search on the Internet regardless of the response to question #1

You will learn two things. The first is the ethics of the person involved and the ethics of the organization. Possibly the individual has been conditioned hence why the word cult is used as a descriptor not to think of the organization as MLM.

Business cannot be values-free or ethics-free simply because it is not people-free. Customers, suppliers, financiers, employees and communities are all made up of humans with names and faces. The co-creation of value for all of these stakeholders relies heavily on collaboration.

Is “Business Ethics” an oxymoron?. No – in fact the phrase itself is actually more of an irrelevance than an oxymoron. Good ethics in all parts of our lives actually come back to common sense

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