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Ethics for Online Businesses: How Do You Decide What's Right?

Recently, I told you what my definition of business ethics is.

Defining business ethics doesn't seem that hard to me but apparently, I'm wrong. What part of ethical business practices do these executives not get?

So I'm revisiting the definition of business ethics with emphasis on business ethics online.

business ethics, co-creation, online business ethicsPeople really do hire teams of interns to up the star-count on reviews and fake testimonials on their websites. It's not surprising that some people are unethical. What is surprising is that they don't "get" that they are.

Most of us have picked a grape or two at the fruit stand not to ensure that grapes were good before we bought them, but because we just wanted them. Likewise many of us have seeded content. But we need to draw the line...

The CEO involved in the fake reviews called it a "frivolous matter." But it is a practice that undermines the credibility of what The McKinsey Quarterly calls "distributed co-creation," which encompasses the customer reviews on iTunes to the suggestions of "the community" at TurboTax.

Co-creation offers marvelous opportunities for new business models ... if we abide by ethical standards. In fact, many of the business innovations based on internet technology are also based on an assumption of integrity: wikis, location-based games (FourSquare), to name two.

The underlying trust of co-creation is also threatened by "Monetizing Motherhood" as The New York Times Magazine termed it this week. That's the use of endorsements by bloggers who are paid to give positive reviews. Remember the payola scandals when radio was king? The FTC has stepped in, with regulations requiring disclosure of payments. 

Many bloggers object, terming the regulations a witch hunt. The one caught in the net: Ann Taylor, which did not disclose giving gift cards to reviewers of its clothing line. 

Online business ethics, like personal ethics, is about decision-making:

  • What are your priorities when faced with choices?
  • How much more weight do you give self-interest over the interest of the group?
  •  Does harm to the group outweigh benefit to yourself?
  •  Are you being honest with yourself and your customers/readers?

Very high-falutin', I know, but here's what it boils down to for a business person: Do you have serious concern for the integrity of your product/service and for the well-being of the user and the environment?

That doesn't mean you ignore profits but it does mean that maximizing profits in the short-term shouldn't be the guiding light of business. For one thing, it's bad business. So you put up rave reviews. If the game isn't worth raving about, users will no longer trust your games or online reviews. A better approach is to read the "real" reviews to find out what customers care about and change your product to satisfy that demand.

From the game-maker online who posts fake reviews to the brick-and-mortar BP exec who chooses a cheaper valve on a pipeline, short-term thinking is a violation of ethics, good sense, and fiduciary responsibility. And payola is payola in any medium.

Online business ethics is not that different from brick-and-mortar business ethics after all. But the anonymity of the internet allows people to be what they aren't really – think Avatars – and do what they wouldn't in person – rant and rage in particularly ugly ways.

Yes, people do undermine their competitors in the real as well as the virtual world. But that doesn't mean we shouldn't set a high standard for the virtual world. The question is: How do we establish ethical standards when people can hide behind a Twitter handle?

It's up to us, the users of the internet, especially users of social media, to set standards and demand integrity.

What online behavior do you consider unethical? Or do you think it's a "user beware" world?

 


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