Two-fifths say businesses are behaving unethically

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Corporate tax avoidance is the main ethical concern, followed by levels of executive pay

Two-fifths (40%) of the UK public believe British businesses are behaving unethically, according to the Institute for Business Ethics (IBE).

The annual survey asked respondents to choose the two or three business issues they felt were of most ethical concern. The number one concern was tax avoidance, chosen by 34%.

The next largest area of concern was levels of executive pay, selected by 25%. However, this has shown a marked fall from previous years (down from 34% in 2014).

In contrast, exploitative labour was cited as an area of concern by 20% of respondents, a marked increase since 2012 when only 12% selected it as a critical issue.

Philippa Foster Back, IBE’s director, warned that public trust in business is “flat-lining".

“Business needs to do more to effect a step change in public opinion,” she said. “While there are some companies doing great work in this field there are still those that the public perceive are not engaging in ethical business practice. A sizeable minority of businesses have not done enough. These organisations are dragging the sector down.”

The report coincides with media criticism of Sports Direct, which is alleged to enforce overly strict workplace rules, breach minimum wage laws, and subject employees to full-body searches on leaving the premises. More than £500 million has been wiped off the stock market value of the chain following the allegations, compounded by lacklustre performance results.

Foster Back told HR magazine that if the allegations are true it suggests a lack of respect and trust towards the workforce. “Where there is trust and respect companies will do the right thing by staff, and they will respond with higher productivity, so everybody benefits,” she said. “Sports Direct will need to investigate these claims thoroughly.”

Unite assistant general secretary Steve Turner compared the working conditions at Sports Direct to a “Gulag”. “The Sports Direct board should be ashamed that its workforce is treated in such an appalling way,” he added.

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