Question

As a result of failing to communicate ethical risks, the organization's reputation suffers and customers are less confident in the organization. What direct impact can this have?

1) Customers will find it more difficult to use your products and services.
2) Morale amongst internal personnel will drop, as will productivity.
3) The products or services the organization creates will have less of an impact in the marketplace.
4) The organization will be more likely to draw the attention of legal and regulatory auditors.

Answer 1

A damaged reputation due to not communicating ethical risks leads to reduced customer confidence, impacts employee morale and productivity, and can increase legal scrutiny. Trust and reputation are vital for repeat business, and professional ethical codes, like those from the IEEE-CS, guide quality and safety in products.

Step-by-step explanation:

Failing to communicate ethical risks can lead to a tarnished organization reputation, resulting in several direct impacts. The organization may experience a loss of customer confidence, which can have a chain reaction leading to a reduced market impact for their products or services, deterioration in employee morale and productivity, and increased scrutiny from legal and regulatory auditors. Trust is essential for customer retention, and a reputable organization typically benefits from repeat customers and referrals—a principle that underscores the importance of maintaining ethical practices in business.

Additionally, businesses are often guided by codes of ethics issued by professional organizations to ensure the integrity of their operations and the quality of their products or services. For instance, the IEEE-CS Software Engineering Code of Ethics highlights the commitment of software engineers to produce safe and reliable products, showcasing the significance of ethical obligations.