Extremely Common but Very Distasteful Unethical Business Practices

By admin@myofficein | Business, Office, Seat Leasing | 0 Comments

Deception, collusions, and swindling sound like the plot of a best-selling novel. However, these terms are quite common in the office space Philippines where immoral practices can be seen by the dozen.

Whether it is a big or a small business, the stakes of outperforming the competition are always high. This cut-throat struggle for survival and emerging as a winner attracts a lot of unethical tendencies that have unfortunately become a part of the system. Companies have gone greedy in ruling the market, which leads them to turn to the unethical business approach.  The lines between acceptable and unacceptable have blurred over the years while big profits and margins have become the main concern of the companies and have forgotten about their employees, consumers, or the world in general. Even neglected the strict ethics policy, which is known as the cornerstone for any businesses in maintaining a good reputation.

Here are some common unethical business practices that many companies around the world are guilty of adopting for success.

Misleading Product Information

Misleading information is more than just unethical — it’s illegal. The Federal Trade Commission (FTC) regulates “truth in product information,” mandating that businesses must make accurate statements in their product information and, when possible, back their claims with any evidence. However, it has become common now for companies to exaggerate and promote injurious products with misleading information despite knowing that it can be harmful to consumers or the environment, purely for the sake of improving the bottom-line. There is no dearth of examples of this corrupt practice. From breakfast cereals to automobiles, all companies have blatantly tricked the consumers by providing misleading information.

The ethical thing here would be when the company’s claims start to be unprovable; for example, Nutella a sugary hazelnut spread that was pitched as part of nutritious breakfast for children — the company was sued up to $20 to anyone who bought Nutella products for this reason.

For years, businesses have exaggerated on the qualities of their products and downplayed the inferior features to make them more saleable disregarding of what would their customers feel.

Unfair Competition

Defamation of a competitor, libel, misappropriation of their trade secrets, and trademark infringement–all these all under unfair competition which gives a wrong impression to the consumers about the competitor and its products. There’s no harm, or it is never wrong to use a competitor’s name in the marketing material, but the company should not be deplored as well as its products.

For example; in 2009, PepsiCo sued Coca-Cola for promoting its sports drink, Powerade, as being more refreshing than PepsiCo’s Gatorade because it contained more electrolytes. However, PepsiCo argued that there was no scientific evidence behind their claim.

In the digital age, businesses have taken the route of cyber-defamation where they spread wrong information about a brand as an anonymous user on a social networking site or a blog using a fake screen name. There are laws governing this kind of libel and slander, and the offender can be fine to the tune of millions if caught red-handed.

Mistreating Employees

This unethical business behavior has been a familiar scenario in a small as well as big companies who make employees work for long hours and not paying them a fair wage, or employing children under the legal working age and unsafe or unsanitary conditions. Many of these employees are made to do works under stressful conditions and are subjected to mental and even sexual harassment because any practices that are not in compliance with fair labor standards are federal working guidelines fall into this category.

In the wake of finding cheap labor, a lot of companies in developed nations hire sweatshops in third-world countries to get their goods manufactured in bulk. The conditions in these workplaces are worse than one can even imagine.

Manipulating Accounts

Financial reports for companies are the same as what annual report health is to a person. Investors, lenders, and end-consumers go through a company’s financial reports before they associate with them. Employees of a company are incentivized based on how much profits a company makes. Therefore, it is quite natural that companies have a high incentive to manipulate their financial reports since the stakes are so high.

Investors and analysts who give advice to investors on which stocks to pick, and here are some key factors in a financial report:

  • Net debt
  • Proportion of operating cash flow to operating profit
  • Taxes
  • Reserves
  • Line of credit from financial institutions
  • Projections of growth and profits
  • Depreciation
  • Inventory

This is why most companies are involved in the cooking of their books to hoodwink these investors, lenders, and end-consumers tweaking their financial reports to show inflated profits and lowered depreciation. This would make the investors think that the company is faring well, and they end up buying more stocks from the share market.


Inducement to influence a business decision is not uncommon in the corporate world. There has been offering of something value or money in that big world in return of a favorable dealing, and vendors and marketers have witnessed it all already.

In the Philippines, bribery remains the most common economic crime underlining the importance of the government’s anti-corruption drive. One in four companies was asked to pay a bribe in the last 24 months, a study by consultant PwC showed. One in five companies believed that they lost an investment opportunity to a competitor due to bribery.

While economic crimes like insider trading, money laundering and theft were far less common in the Philippines, the incidences of bribery and corruption were higher in the country compared to the Asian and global averages.

But according to MBC Executive Director Peter Perfecto, the perception of bribery is changing and even quoted that “There is a tide of integrity coming because this is a worldwide phenomenon,” he said.

Exploiting Workers

Some businesses choose to increase the profits for the owners at the expense of their workers. This thing is considered as exploitation.

Some of the ways that they do this are arguably unethical, and some are blatantly illegal. They may be paying their workers with low wages, encouraging them to subsidize their income with food stamps and welfare at the taxpayer’s expense. Or they may manufacture their goods overseas in countries that don’t have labor laws that protect their workers, including allowing forced labor for children as young as five years old.

Some companies have been found guilty of violating the wage and labor laws, and by forcing hourly workers to work off the clock or risk losing their jobs, or worst firing workers who complain about violations of the wage laws.

Tax Loopholes

These are known as the gaps in the tax codes that provide room for individuals and businesses to take wrongful advantage without technically the law. Many businesses exploit tax loopholes in order to avoid taxes while raking billions in profits.

Despite knowing that this is a wrong thing to do, but still loopholes are still open and cannot be put to an end. Why? It is because the businesses are making political contributions to politicians to work with them, allowing their businesses and companies to legally dodge the taxes.


Another unethical behavior is deliberately over-billing the customers. Companies bill for more than the agreed price, and even go so far as to charge for products and services that they never provided for their customers. They are also doubling the bill for their services when they do, in a way that the customers would never notice.

There are still some companies who are doing this and is taking advantage of their customers despite the kindness and sincerity that their customers are showing towards their products and business.

Theft at the Workplace

Theft at any office space Philippines comes in a variety of forms, and oftentimes employees do not view it as unethical behavior, believing no one gets hurt by the action. Employees are taking home the office supplies, use business computers for personal tasks, pad expense accounts, and abuse sick time or allotted personal days.

Unethical behavior may also include having another employee punch a time card, or not punching out for lunch hours or other non-approved time off. Though these may seem like minor infractions, they eventually have an impact on the bottom line of the company, which then hurts all employees. Theft also affects employees who have followed and practiced ethical behavior and might disheartened them.

Gifts from Vendors

Businesses that buy and sell products to other businesses are sometimes subject to unethical behavior. The practice of accepting gifts from a vendor in exchange for increased purchasing is not only unethical, but it may also have legal repercussions. The same can be said for offering a customer kickback to increase his or her purchasing habits.

Ethics policies often guidelines for giving or accepting gifts with vendors or other businesses, such as a cap on the value of the gift. Some businesses strictly forbid giving gifts or any other item with monetary value. This is to safeguard and prevent any perception of unethical behavior.

Bottom Line

The pressure of surpassing the competition and wooing consumers’ year-after-year with the same products takes a toll on organizations. As a result, they resort to dishonest and devious activities. Even the biggest names in the industry are not untouched by this phenomenon. From buying email addresses to spam consumers without their consent to ignoring quality and safety guidelines for generating higher revenue, many businesses are indulging in some kind of unethical behavior. This is a big bad world for the consumers, and they should not blindly trust any business. And, for small businesses, don’t let these unethical practices get in at your office space Philippines.

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