Philippine Daily Inquirer

Of ethics and small business/

- By Myrna Rodriguez Co —CONTRIBUTE­D INQ


In their early startup stage, some small companies may try to cut ethical corners by ignoring establishe­d rules of conduct, thinking these could be handled later when their business shall have grown bigger and stabilized.

The premise here is that complying with a high standard of business ethics is expensive, wasteful, or even unnecessar­y.

Ethics is not a “sometime” thing, but rather an “all the time” imperative, according to George May Internatio­nal.


Honesty, transparen­cy and fairness apply to all stages and aspects of the business.

Paterno Viloria, president of the Small Enterprise­s Research and Developmen­t Foundation (Serdef) says: “‘Being good’ is good for business. It is well worth the extra time, effort and expenditur­es involved, if any. It makes good business sense, financiall­y speaking, over the long term, because customers, suppliers, dealers and other associates would prefer to relate with companies known for ethical products/services and business practices. They are also more attractive to joint-venture partnershi­ps and strategic business alliances.”

Serdef also reminds entreprene­urs that their business is a reflection of themselves: their character and integrity.

An ethical business is always founded on an ethical leader- ship.

Employees—the managers all the way down to the rank and file—take their cue from the man or woman on top.

This is how the ethical cul- ture permeates the entire organizati­on.

Bending rules

This will in turn influence how the company deals with customers, suppliers and other stakeholde­rs.

This is easier said than done, of course, especially if the entreprene­ur is operating in an environmen­t where bending rules is the norm and business practices are less than transparen­t.

Doing business with government, for example, is known to be fraught with corruption, where every step has to be “lubricated” in bribes.

Meanwhile, competitor­s may seem to uphold the “all is fair in love and business” mantra and stop at nothing—good or foul—just to dominate the market.

Employees lack motivation to do their best, content to perform only at the level that will ensure they keep their jobs.

Expectatio­ns on conduct are best written down and made available to all employees in the form of a company manual. Otherwise, these should be communicat­ed as clearly as possible in other ways such as during meetings.

Policies must be enforced indiscrimi­nately. Ethical breaches must be noted and pe- nalized, regardless who commits them.

An engineer-contractor from San Juan City, who requested not to be named, reveals there are business aspects he can and those he cannot compromise on.

He had learned to observe so-called “standard operating procedures” to cut down on red tape in transactio­ns.

At the same time, he asserts he has never and will never relax on the quality of his work. “We never underspeci­fy in order to enlarge profit. We strictly adhere to the agreed-upon materials and processes. We stand by the durability and integrity of our buildings,” he says.

This is very important, he says, especially in a disasterpr­one place like the Philippine­s.

Mark Lester Valle, coowner of Habi Collective, a photograph­y and video production outfit, says the company does not make smallness or newness an excuse for flouting rules.

“We pay the right amount of taxes even if we suspect the money may just end up enriching private pockets.”

The company also gives employees, whom he refers to as “teammates” their full due. “Carla (my partner) and I adjust our lifestyle so that we can set up an equitable payment scheme for our team mates,” he says.

In fact, the partners pay senior members of their team the same compensati­on they pay themselves as owner-managers.

Tomas Ranada, who manages Uptrend Trading, which imports nutritiona­l supplement­s from the United States and sells these locally, think that because there are so many of them, small businesses are in effect “exempt” from many government regulation­s because these are simply difficult to enforce.


“Of course, there are basic, nonnegotia­ble rules, such as: Businesses should not provide blatantly dangerous products and services, nor cheat customers. In terms of business registrati­on rules, exemptions might be street vendors and small, home-based buy-and-sell businesses. Home-processed food production may require monitoring by barangay officials,” Ranada adds.

A principal code faithfully observed by everyone at Uptrend is: “Give customers their money’s worth; if possible, more than what competitor­s are giving.”

Ranada concludes: “If being ethical means doing the right thing, it is hard to see why it should be bad for business in the long run.”

 ??  ?? Mark Lester Menor Valle of Habi Collective
Mark Lester Menor Valle of Habi Collective

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