Profit v/s Ethics


Ethics can be identified as the moral principles that govern an individual’s or an organization’s actions. While Profit is a financial benefit that is realized when the amount of revenue gained from a business activity exceeds the business, costs, and taxes.

The words mentioned in this topic fall as some of the important terms to be understood while working on any business strategies. While profit is something that can be measured in monetary terms (quantitative) while, ethics is measured subjectively or by the actions taken. But the relationship of these terms is something which has raised a controversy in the minds of people.

Ultimately, both of these terms end up resulting in one point viz., Reputation. It is considered to be one of the most prominent factors to measure an organization’s corporate success. Many companies end up performing some unethical tasks which show them at good numbers on the ‘success ladder’. But this success is temporary and leads to the creation of controversies.

Profit over ethics:

Profit is one of the missions for any business. Profits are needed to pay back investors as well as give salaries to employees. That should not lead to unethical practices. Profits can be earned along with practicing ethically.

There have been many scenarios where unethical practices have caused the organization to go into serious controversies. Some of the examples are given below:

  • Maggi instant noodles ban in the year 2015: Occurred due to excessive quantities of Mono Sodium Glutamate aka MSG, despite writing “No MSG” on the packet.
  • Volkswagen scenario in 2016: It was noticed that the car company was cheating on the emission tests for more than seven years after it failed a Federal Trade Commission (FTC) test
  • Nirav Modi and Geetanjali jewels: The jewelry giants which had created a huge buzz nationally as well as globally due to unethical practices done by their owners in Punjab National Bank. This scam also gave a bad mark on PNB’s reputation.

So, overall, before these scams came into a scenario, these companies were having a successful path and were earning huge profits. Still unethical practices in marketing prevail to earn more profits in this market.

Ethics over profits:

An investor will look at the financial performance of a company, whereas the customer will look at the reputation of the company before purchasing. Sometimes, customers also look at the social cause of the company. It is necessary to maintain a reputation in the market to grow.

Having ethical practices in our business can offer you good employees, customers who come to you because of the ethical practices as well as good productivity in the long run. Ethical practices can create a holistic environment to work.

Many organizations like Tata, Starbucks, Wipro, Walmart, are known for their ethical practicesall over the world. These companies have good profits but are ethical. They are successful because they have developed a balance between ethics and profits.

Why a balance is required?

An organization without an untargeted profit is the biggest unethical act, due to the following things:

  • No profit means, exhaustion of all the input and resources without any return.
  • The increase in the amount of paying back to the creditors, investors, and stakeholders will create a huge amount of liabilities for the organization.
  • A depiction of inefficiency and not showing responsibility towards the market as well as towards the society.
  • Such companies create an unstable environment for their employees due to a lack of economic security and no targets for motivation.


Just like weight loss where dieting, as well as exercise, are mutually dependent on each other, in business, ethics and profit come as helping hands of one another. Ethics drives the actions which offer profit in the long run and these profits give encouragement to take more ethical actions. If anyone of the parameters is not applied while taking any business actions it can lead to the slow and painful death of your ‘Corporate Ladder’ success.

Author: Shraddha