Do you have an ethical angel?

Last Saturday was Small Business Saturday (SBS), the day of the year where we are encouraged to spend our Christmas pounds in a local business. SBS is one of those events which is designed to appeal to our ethical angel, rather than our consumerist devil, Black Friday I'm looking at you!

There are an increasing number of events, days, badges and schemes designed to appeal to our ethical angels such as SBS and Fair trade and also regular competitions and even whole newspaper sections dedicated to ethical business, these can be a great way for a small ethical business to showcase their work. The hard part comes in deciding how to balance ethics and business, some would argue that ethical business isn't always good business. Maximising profit is key to survival of small businesses, and your business ethics can make this hard.

Business is often portrayed in the media as being a bit of a rogue, and success is often linked with exploitation and poor ethical decisions. Recent cases have included Sir Philip Green former owner of BHS and Mike Ashley at Sports Direct. The truth is that stories like this sell newspapers and advertising, stories about how a company always pays the living wage, has generous employer benefits and ensures its supply chain is audited simply don't. There are an increasing number of customers who do care, infact that's why so many customers of BHS were very upset about its demise. They had bought into a brand which was British and stood for old fashioned British values only to find out that this was a sham. Customers of Sports Direct however should now be under no illusion that the company's aim is to provide products at a very low price, whilst making a good profit. To do this they have to ensure that all costs are minimised and they appear to do this ruthlessly with no real ethical angel for staff, supply chain or the environment. From a purely profit-making viewpoint, this is successful business practice and anyone new to business should be very aware of the power of this model.

This is where a dilemma often occurs as the legitimate aim to reduce prices and increase profit is often seen as incompatible with making ethical decisions. Companies such as the Co-op and LUSH clearly demonstrate that this doesn't have to be the case. These are both successful companies who live by their ethical values. It is possible to create and grow a successful business and maintain ethical values.

This is where understanding why you are going into business and what both your personal and business brand values are is key, this clarity of purpose this will enable you to make these decisions more easily. While some of the entrepreneurs we work with are really clear about their values, others can be quite confused, or confusing. Some will appear to be running an ethical business, yet will ask us to order items from a well-known online retailer who has also been in the press regarding the exploitation of staff, and damage to small business. If as a business owner your aim is just to make profit that is fine, but if you want to do more than that, and if you shout about events such as SBS make sure you live by your ethics, understand that every decision you make should be guided by not only a desire to make a profit, but also in reference to your own ethical angel.


Blog post by Steve Aicheler, Entrepreneurship Officer

December 2016