Now is a great time to start a business. The growth of the digital economy has also been instrumental in improving accessibility for entrepreneurs. However, for all the resources and knowledge at your disposal, you’ll still have some distinct responsibilities as a business owner.
It’s easy to get caught up in the day-to-day practical aspects of enterprise and overlook the nuances. Some of these are legal requirements, meaning failure to adhere to them could result in penalties. Others are ethical in nature, and your missteps here can lead to damaging your reputation.
We’re going to outline some tips to help you stay on top of these legal and ethical elements as you start on your entrepreneurial path.
1) Commit to Holistic Values
A strong set of values is an essential ethical element of any business. Indeed, consumers are paying close attention to this. A recent study found 88% of consumers want businesses to help them become more ethical in their daily lives. As such, you’re likely to spend time developing your company’s values. However, these can’t be effective if they’re just ideas you posit. You need to work to make sure they’re holistically applied throughout your business.
It can be worth reviewing the practices outlined in your business plan against your values. Consider whether actions meet the highest ethical standards. Create training programs for your staff that both focus on your values and how they’re applied to tasks. Consider whether the activities of your suppliers meet your ethical standards, too. If you’re investing in their services you also have responsibility for their actions.
2) Protect Your Stakeholders
When you have interactions with third parties—consumers, suppliers, the general public, and your staff among them—you have a responsibility to them. You have to make certain you protect your stakeholders from harm at all times. This could be in terms of maintaining high health, safety, and cleanliness standards. It should certainly involve regular risk assessments to identify any current or potential issues that need to be addressed.
However, don’t just focus on the physical elements. We live in a technologically dependent age and you have to protect your stakeholders from threats here, too. Utilizing digital documents for contracts, invoicing, and employee records among others can help to streamline processes. However, you also need to make sure the methods you’re using in these circumstances are secure and minimize the potential for hacking or fraud. This usually involves maintaining strict password protocols and using encrypted storage options.
3) Marketing Honestly
Marketing is an essential component of a successful business. After all, if people don’t know about your business, how can they engage with it? There are some great tools and methods in the contemporary commercial landscape—you can market using social media, blog content, podcasts, and livestreams. Yet, there are legal and ethical guidelines you need to follow when it comes to your marketing. If you fail to advertise honestly, you can both lose the trust of your consumers and find yourself at the receiving end of a hefty Federal Trade Commission (FTC) fine.
Primary among the standards you have to live up to is an accurate representation of your product or service. All businesses want to be seen as better than the competition or to make a difference in consumers’ lives. But there is no excuse for misrepresenting or even slightly exaggerating your products. Be honest in your marketing. Make sure you have access to documentation to support any claims.
4) Handle Data Responsibly
The products and services you sell are not the only valuable elements of your business. Particularly if you’re handling a lot of online transactions, you’ll also be pulling in consumer data. Over the last couple of decades, data has become a vital commodity. On the most basic level, it can be a resource to influence the direction of your marketing and production efforts. You also need to remember this data belongs to the consumers you acquired it from, some of which will be sensitive. It is, therefore, your ethical duty to handle it responsibly.
Behavioral tracking is one of the most common ways in which online businesses in particular gain data. Whenever consumers interact with your website, they leave information behind about their actions, location, and even financial services. To approach behavioral tracking ethically, you need to be transparent with your consumers about how this is collected and stored. You also need to give them options to prevent the collection, storage, and sharing of their data. It’s vital that if your consumers are happy to share their information, you take measures to prevent potential breaches.
5) Support Your Staff
Your staff members are vital contributors to the success of your business. You certainly have legal responsibilities to care for them. But it is a point of ethics to put effort into supporting them in any way you can. This should begin with benefits that maintain their continued health and future financial security. Medical insurance and retirement contributions are the obvious tools here. However, offering perks like paid time off or remote working can also help them achieve a healthy work-life balance.
Don’t just limit your efforts to standard forms of support. Talk to them about their needs. Some of your workers may experience challenges that make their working life more difficult. While the Americans with Disabilities Act (ADA) requires you to make provisions for some employees living with disabilities, this doesn’t cover everything. Show a commitment to collaborate with your workers living with mental health or neurodivergent traits to find elements of support.
Maintaining high ethical and legal standards can influence your company’s success. Make sure your values are present throughout your activities and work to protect your stakeholders at all times. Your marketing must be authentic and you should treat any data you collect with respect. Remember, your staff are vital contributors to your business and deserve the utmost support from you. It can seem like a lot, but keeping these ethical and legal aspects in check are hallmarks of a positive business.