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"Each risk manager should act as an economical ethicist, if he or she wants to do the job properly", Mr Naef said at the annual Sirm gathering. "If companies ignore moral values and concentrate too much on maximising profits, the state will react and implement new laws and regulations in order to protect citizens and values", he added. Such laws and regulations often cost companies a lot of money, stressed the ethics expert.
Mr Naef also warned that ignoring environmental issues and focusing on excessive profits increases the risk of damage to corporate reputation. He argued that many companies are taking their customers for granted with questionable practices, adding to the chances of reputational damage.
The ethics expert also noted that many problems are created by a corporate culture that attempts to stamp down excessively on employee error. This will not help to avoid future mistakes, the expert argued. "Having a positive attitude towards mistakes is the most efficient and cost-effective way to manage risks", he said.