As much as business activity betters our lifestyle and contributes to the economy, it also may be involved in unethical or fraudulent activities and legal problems. A business that is involved in unethical activities faces the risk of a damaged reputation and brand image. The business will lose credibility and brand loyalty will also suffer, resulting in a loss of sales, market share and clientele. Most often than not, businesses undertake these types of activities in order to maximize profits and reduce costs, and sometimes these activities may even be considered illegal. Unethical behaviour involves polluting the environment without making any effort to reduce it, testing its products on animals, overcharging customers, underpaying and exploiting workers etc. Businesses can also be fined for these activities, and may face pressure group action, consumer boycotts and in extreme cases, even lawsuits.
Businesses can also be on the receiving end of unethical corporate behaviour. This includes factors such as how workers are poached, for example. Although this cannot be deemed severely unethical or taboo in any way, it still disrupts business processes and all efforts and expenses invested on employee development is wasted. Another serious problem that businesses face is when debtors default on their payments. Although legitimate excuses are sometimes offered, in which case the debts are written off as bad debts or the business will agree to settle for a smaller sum of money, in some instances outside entities default on payments by means of getting what they want and afterwards, avoiding payment. This causes a number of problems within the business, and debt collections in Australia use up a lot of the company’s resources and time. Debtors may avoid communication with the business and may attempt to go into hiding, so to speak, in order to avoid being found.
In such a case, the only route that a business can take is legal action, where a lawsuit is filed against the defaulting debtor. Businesses also take lawsuits against entities who steal original ideas of the business, who are involved in plagiarism, companies that sell faulty and harmful raw materials, workers who have stolen from the business etc. In a case where the perpetrator cannot be found, a method known as skip tracing can be used.
This is where, through means of technology, investigations and thorough, extensive research, the perpetrator is located and brought out of hiding, in order to face a fair trial against the company in order to determine whether he was guilty or innocent. Businesses should therefore incorporate moral codes into the business operations, and should ensure that proper research is done prior to making business deals.