Get All Access for $5/mo

The 4 Pillars of Ethical Enterprises Is your business model moral? Start by asking these questions.

By David Hagenbuch Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Most people don't start a business thinking that they're going to do the wrong thing. However, ethical challenges inevitably arise.

Related: American Apparel Tries On Something New: Ethics.

It's even more difficult to do the right thing if your company is not anchored from the onset to a strong moral base. Entrepreneurs can lay a firm ethical foundation for their enterprise by ensuring a "yes" answer to these four crucial questions:

1. Fairness: Is your business model based on win-win outcomes?

One of the practices that led to the 2008 financial crisis was certain banks bundling risky debt, selling it to clients, then betting against those same investments. No business's success should be predicated upon its own customers' failure. A core tenet of any ethical business is that both company and consumer should come out ahead. A need to win at your customers' expense is a fundamental moral lapse.

2. Integrity: Can your business's products/services be promoted with the truth?

If a business needs to dramatically alter pictures of its products to make them look appealing, fabricate positive customer feedback, or obscure contract terms, something is drastically wrong. Any company that has a legitimate value proposition should be able to promote its products or services by presenting them in a straightforward and honest manner. Creativity in communication is a good thing, but a need to change the truth is a clear sign of a morally-flawed foundation.

Related: Improve Accountability in 3 Swift Steps

3. Decency: Can you unashamedly tell others what your business does?

When asked how he decided what ad content his agency would not use, an advertising executive famously said he would not allow the creation of anything that he wouldn't want his wife and children to see. The same standard of decorum should apply to your basic business concept. You should be able to describe with pride your business to your spouse, children, mother, father and everyone else. Embarrassment may mean a morally suspect business model.

4. Sustainability: Does your business make efficient use of resources?

The notion that wastefulness is immoral is nothing new. Consuming more than we need, or gluttony, has long been one of the seven "deadly sins." Organizations should avoid a similar lack of self-control, starting with the design of a sustainable business model. Of course, remaining viable means being profitable. However, here sustainable more specifically means practicing good stewardship of resources to support the long-term well-being of everyone, not just primary stakeholders. A business model based on reckless consumption is not only inefficient, it is also ethically irresponsible.

Fairness, integrity, decency and sustainability -- the four pillars of ethical enterprise. Of course, these four pillars of ethical enterprise won't guarantee morality, but their early adoption does provide the firm foundation upon which a morally-minded business is based.

Related: How Would You Handle These 7 Situations? Would You Pass the 'Diaper Test'?

David Hagenbuch

Professor of Marketing at Messiah College and Founder of MindfulMarketing.org

David Hagenbuch is a professor of marketing at Messiah College in Mechanicsburg, Pa. He is also the founder of MindfulMarketing.org.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Leadership

How to Close the Trust Gap Between You and Your Team — 5 Strategies for Leaders

Trust is tanking in your workplace. Here's how to fix it and become the boss your team needs to succeed.

Health & Wellness

Get a Year of Unlimited Yoga Class Downloads for Only $23 Through June 17

Regular exercise has been proven to increase energy and focus, both of which are valuable to entrepreneurs and well-known benefits of yoga.

Growing a Business

He Immigrated to the U.S. and Got a Job at McDonald's — Then His Aversion to Being 'Too Comfortable' Led to a Fast-Growing Company That's Hard to Miss

Voyo Popovic launched his moving and storage company in 2018 — and he's been innovating in the industry ever since.

Business News

'Passing By Wide Margins': Elon Musk Celebrates His 'Guaranteed Win' of the Highest Pay Package in U.S. Corporate History

Musk's Tesla pay package is almost 140 times higher than the annual pay of other high-performing CEOs.

Starting a Business

I Left the Corporate World to Start a Chicken Coop Business — Here Are 3 Valuable Lessons I Learned Along the Way

Board meetings were traded for barnyards as a thriving new venture hatched.

Business Culture

Why Remote Work Policies Are Good For the Environment

Remote work policies are crucial for ESG guidelines. Embracing remote work can positively impact your business and employees.