Managers are sometimes faced with situations which hare ethically ambiguous without any clear-cut ethical guidelines. These ambiguities can be avoided if there is a formal and specific code of ethics. Such a code serves the following groups :
1. Customers : When an organisation follows a code of conduct, its customers are protected against undesirable transactions, e.g., price discrimination, misleading advertisement, etc. They can deal with confidence and their anxiety is eliminated.
2. Employees : Employees know what type of behavior is expected of them. They can easily distinguish between ethical and unethical acts and thereby avoid unethical practices.
3. Company : The company gains from a code because it has to exercise less control over the behavior of its employees. The code also serves as a basis for maintaining public relations.
4. Industry : Codes of conduct lead to healthy competition and fair trade practices in the industry. Therefore, the industry can gain in a socially responsible manner.
5. Society : Society is the ultimate beneficiary of ethical codes. When professionals follow certain specified patterns of behavior the social cause is served better.