22 Jun 2016

Unethical business practices, although they might be profitable, kill businesses and may result with personal liabilities. 

Speaking at a seminar organised by Botswana Business Ethics Forum in Gaborone on June 21, Professor Gedeon Rossouw, chief executive officer of The Ethics Institute, said the notion that, ‘ke ja sengwe’ could end up costing companies a lot more than they bargained for. 

The sentence ‘ke ja sengwe’ was allegedly used in government enclave where officials ask bidding companies for something in return after they award them tenders. 

Professor Roussouw said many companies had folded while their executives faced criminal charges emanating from unethical business practices.

He said it was better for companies to remain in the red than take short cuts.  

As an example, Volkswagen stocks collapsed after it was revealed the German car manufacturing company had cheated on emissions involving 11 million vehicles around the world, a move set to cost the company billions in revenue. 

Enron, an energy company based in the US, saw its stock plummeting from as high as US$90.75 per share to less than US$1 after it was revealed the company had hid billions of dollars in debt from failed deals and projects. 

Professor Rossouw said a corrupt business resulted with low staff morale adding, the higher up the ladder the corruption takes place, the greater the impact. 

Furthermore, companies with high morale had significantly stronger year-on-year performance. 

“Business ethics refers to the ethical values that determine the interaction between a company and its stakeholders,” he said.

Botswana in 2011 ratified the UN Convention against corruption; a move which Professor Rossouw said was a welcomed development as it also sought to fight corruption in the private sector. 

The UN Convention Against Corruption Article 12:1 highlights the prevention of corruption in the private sector. 

He said government could not fight corruption alone but needed the private sector in order to achieve a zero rate. 

Unethical behaviour in business is characterised by asking for kickbacks, bribery, undue influence in the awarding of tenders, price fixing, provision of substandard services and goods, tax evasion and money laundering. 

Professor Rossouw said as Botswana aims to be a corrupt free country, it should be an ethical one adding it was also important to address ethics within different sectors especially in construction. ENDS