Business ethics (in Italian also called etica aziendale or etica d’impresa) is the application of ethical values to the behaviour of a company: it concerns both the conduct of individuals and that of the organisation as a whole. It extends to every aspect of running a business, from board strategy to relations with employees and suppliers, from sales and marketing techniques to accounting practices and financial transparency (Institute of Business Ethics).
While declaring values is easy, business ethics takes on concrete meaning when values change a decision. And since ethics concerns above all discretionary choices (those where the law does not say what to do and someone has to decide), we see in it a problem of governance to be addressed: establishing who decides, accountable to whom, and on what criteria.
In this article we will explore it in depth.
Business ethics and the law: where obligation ends
Ethics goes beyond a company’s legal requirements (Institute of Business Ethics). The difference shows in two different questions. The law asks: ‘Can we do it?’. Business ethics asks: ‘Should we do it, and how would we explain it to those who bear the consequences?’. A behaviour can be lawful yet indefensible, and it is in that space that a business shows it has criteria of its own.
This does not make ethics an alternative to compliance. Compliance is the minimum perimeter, verifiable and enforceable; business ethics is what the company decides to do within that perimeter, and sometimes beyond it. Those who reduce one to the other end up with a culture of “as long as we are not penalised” and, at the first grey area, with no criteria.
Business ethics is not the same as professional ethics either. The latter concerns specific professions, such as law, medicine, accountancy or engineering, whose practitioners follow codes of conduct set by professional bodies or trade associations; business ethics concerns companies and organisations (Institute of Business Ethics).
Two different questions
The law requires
“Can we do it?”
What it is
The minimum perimeter: verifiable and enforceable.
Business ethics asks
‘Should we do it, and how would we explain it to those who bear the consequences?’
What it is
What the business decides to do within that perimeter, and sometimes beyond it.
Conduct can be lawful and still indefensible. Those who reduce ethics to compliance end up with a culture of “as long as we are not sanctioned” and, at the first grey area, with no criteria to fall back on.
The domains of business ethics and the decisions they affect
The IBE list gives us the areas. To make them useful, we have translated them into decisions: where choices are actually made, and which criterion can be declared in advance.
The list of areas comes from the IBE; the decisions and criteria in the table are our own examples, to be adapted to context. The value of the method is that the criterion exists before the pressure does: written afterwards, it is a justification.
From values to behaviour: how to build an ethical culture
The Institute of Business Ethics has developed a framework of eight interconnected, non-sequential elements that aims to align values, behaviours, decisions and systems. Here we highlight those that weigh most heavily on decisions.
- Leadership and oversight. An ethical culture starts at the top: leadership behaviour, board oversight, governance structures.
- Values and principles translated into rules. Values and principles become codes and policies that guide everyday behaviour and decisions. This is the stage at which a corporate code of ethics takes shape.
- Strategy, risk and decisions. Ethics is built into decision-making models and risk assessment, including stakeholder engagement.
- People and speaking up. An environment in which anyone who sees a problem feels safe saying so, and where ethics carries weight in hiring, promotions and rewards.
The other elements concern communication and training, measurement and improvement, extending expectations to suppliers and partners, and integration with risk, compliance, sustainability and human resources (Institute of Business Ethics).
The framework distinguishes three levels for action: individual, organisational and systemic, meaning the social and stakeholder context. Reading it this way helps avoid placing all the blame on a single instance of “misconduct”: the question becomes which system made it advantageous or possible.
Reporting wrongdoing: when business ethics becomes an obligation
An environment in which people can report concerns without fear is one of the elements of an ethical culture, and in Italy it is partly a legal obligation too. Legislative Decree 24/2023 on the protection of persons who report breaches has applied since 15 July 2023. Among private-sector entities, it covers those with an average of at least fifty workers, those operating in sectors deemed sensitive and those that have adopted organisation and management models under Decree 231 (ANAC).
The rules provide for an internal channel and an external one, managed by ANAC; retaliation against whistleblowers is prohibited, and administrative fines range from 500 to 50,000 euros (ANAC). For a company, the useful signal is not having the procedure but understanding whether it is used and how reports are handled: if no one ever reports anything, that is usually not a good sign.
Each company still needs to check whether it falls within scope: the threshold and sectors should be verified against the legislation and with an adviser.
Business ethics and international standards
For those who want an external reference, the United Nations Global Compact sets out ten principles across four areas: human rights, labour, the environment and anti-corruption. The principles derive from international declarations and conventions, including the Universal Declaration of Human Rights, the principles of the International Labour Organization, the Rio Declaration and the United Nations Convention against Corruption (UN Global Compact).
Signing up does not replace an internal system. An external reference provides a common language; it is the company’s own criteria and controls that show whether the language matches the facts. When statements go further than what the company actually does, we enter the territory of ethics proclaimed but not practised, which on the environmental front has a name: greenwashing. Business ethics is also linked to ESG strategy, without being confined to it.
When business ethics is missing
When it stays on paper, the cost comes from reputation before it comes from sanctions. To see how this plays out in practice, a good starting point is our article on the worst corporate scandals of 2025, which compares them.
The Bliss angle: three questions before deciding
We believe business ethics works when it becomes a decision-making habit. That is why the three questions we put to senior leadership, for grey-area choices, are simple.
- Would we do it if it were made public tomorrow?
- Would we accept it if one of our customers, or one of our employees, were on the receiving end?
- Who is accountable for it, by name?
They are not a test that replaces judgement. Their purpose is to bring into the room, at the moment of choice, those who are not there: the customer, the supplier, the colleague least listened to.
If the answer changes the decision, business ethics is working. If it never does, it is probably just communication.
The Bliss Agency perspective
Domande frequenti
What is business ethics?
Business ethics, or corporate ethics, is the application of ethical values to the behaviour of a business, both of individuals and of the organisation as a whole. It covers governance, relationships with employees and suppliers, sales and marketing, accounting and financial transparency, and goes beyond what the law requires (Institute of Business Ethics).
What is the difference between business ethics and compliance?
Compliance is adherence to laws and rules, a minimum perimeter that is verifiable and enforceable. Business ethics concerns the choices that perimeter does not determine: what the business decides to do and how it justifies it. The two complement each other: a compliant company is not ethical by virtue of that alone, and good values are no substitute for controls.
What is the difference between business ethics and professional ethics?
Professional ethics concerns specific professions, such as law, medicine, accountancy or engineering, and rests on codes of conduct set by professional bodies or trade associations. Business ethics, by contrast, concerns companies and organisations as a whole, including decisions on governance, markets and stakeholder relationships (Institute of Business Ethics).
What are the areas of business ethics?
It applies to every aspect of how a business is run. Among these, the Institute of Business Ethics cites board strategy and corporate governance, relationships with employees and suppliers, sales techniques and marketing practices, accounting practices and financial transparency.
How is business ethics applied in a company?
You start from values and purpose, translate them into codes and policies, build them into decision criteria and risk assessment, and support them with communication, training and an environment in which people can raise a concern. Leadership matters too: without consistent behaviour from the top, the other tools remain a formality.
What is a code of ethics for?
The code of ethics translates values and principles into rules of conduct for everyday decisions. It works if it is short, recognisable in real situations and linked to controls and consequences. A code that is posted on the wall but never cited in decisions remains a statement: the test of its usefulness is whether it is invoked when a choice comes at a cost.
What is whistleblowing and when is it mandatory?
It is the reporting of wrongdoing by those who become aware of it. In Italy, Legislative Decree 24/2023 has applied since 15 July 2023 and covers, in the private sector, organisations with an average of at least fifty employees, those operating in sensitive sectors or those that have adopted 231 models, with an internal and an external channel and a ban on retaliation (ANAC).
What are the principles of the Global Compact?
They are the ten principles of the United Nations Global Compact, grouped into four areas: human rights, labour, the environment and anti-corruption. They derive from international instruments such as the Universal Declaration of Human Rights, the standards of the International Labour Organization, the Rio Declaration and the UN Convention against Corruption (UN Global Compact).
How can you tell whether a company is truly ethical?
Look at facts more than statements: whether ethical criteria change concrete decisions, whether senior leadership is held accountable for them, whether reports are acted on and handled properly, whether incentives and promotions are consistent with the values. A good statement without this evidence is not enough, and a single inconsistent act by senior leadership can undermine it.