
There’s something Australia can do to add $45b to the economy. It involves ethics.
NewsBusiness + Finance
BY The Ethics Centre 29 OCT 2020
Australia faces a perfect storm. An economic deficit, a global pandemic, an uncertain future of work, and long-term social and environmental change around the climate crisis and reconciliation with Indigenous Australians to name but a few.
Adding to this magnitude of challenges are the low levels of trust Australians have in our leaders and our neighbours. In fact, research has found that only 54% of Australians generally trust people they interact with, and as a nation we score ‘somewhat ethical’ on the Governance Institute’s Ethics Index.
How do we navigate the road ahead? One thing is abundantly clear: we need better ethics. That’s why we commissioned Deloitte Access Economics to find out the economic benefits of improving ethics in Australia.
The outcome is The Ethical Advantage, a report that uses three new types of economic modelling and a review of extensive data sets and research sources to mount the case for pursuing higher levels of ethical behaviour across society.
For the first time, the report quantifies the benefits of ethics for individuals and for the nation. The ethical advantage is in, and the findings are compelling. They include:
A stronger economy: If Australia was to improve ethical behaviour, leading to an increase in trust, – average annual incomes would increase by approximately $1,800. This in turn would equate to a net increase in total incomes of approximately $45 billion.
More money in Australians pockets: Improved ethics leads to higher wages, consistent with an improvement in labour and business productivity. A 10% increase in ethical behaviour is associated with up to a 6.6% in individual wages.
Better returns for Australian businesses: Unethical behaviour leads to poorer financial outcomes for business. Increasing a firm’s performance based on ethical perceptions, can increase return on assets by approximately 7%.
Increased human flourishing: People would benefit from improved mental and physical health. There is evidence that a 10% improvement in awareness of others’ ethical behaviour is associated with a greater understanding one’s own mental health.
The report’s lead author and Deloitte Access Economics partner, Mr John O’Mahony, said:
“No one would seriously argue that pursuing higher levels of ethical behaviour and focus was a bad thing, but articulating the benefits of stronger ethics is more challenging.”
“Our report examines the case for improving ethics as a way of addressing these broader economic and social challenges – and the nature and extent of the benefits that would accrue to the nation if we got this right.”
The report also identifies five inter–linked areas for improvement for Australia and its approach to ethics, supported by 30 individual initiatives:
- Developing an Ethical Infrastructure Index
- Elevating public discussions about ethics
- Strengthening ethics in education
- Embedding ethics within institutions
- Supporting ethics in government and the regulatory framework
The findings and recommendations demonstrate the value of The Ethics Centre’s continued contribution to Australian life. For thirty years, The Ethics Centre has aimed to elevate ethics within public debate, organisations, education programs and public policy. Executive Director of The Ethics Centre, Dr Simon Longstaff said the findings validate the impact of those activities and reveals the potential that can be unlocked with greater support.
“The compelling moral argument that ethical behaviour binds a society and its institutions in a common good is now, thanks to Deloitte Access Economics’ research and modelling, also a compelling economic argument. Best of all, we need not be perfect – just better.”
A copy of The Ethical Advantage can be found at this link.
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BY The Ethics Centre
The Ethics Centre is a not-for-profit organisation developing innovative programs, services and experiences, designed to bring ethics to the centre of professional and personal life.
4 Comments
p.s. ethics can create a space away from the everyday. A space for shared dialogues that rise above individual an corporate interests to a new perspective on the common good – from which to explore scenarios and solutions to the Tragedy of the Commons – our shared resources and the need to make a living – that our very lives and those of future generations depend upon.
ReplyI truly believe recycling is the only way our planet is going to survive. Recycling water back into agriculture and gardens and allowing the soil to do it’sjob of reticulatation of water quality. Building infrastructure to move water to where it’s needed. Natural fibres that rely on water rather than chemically based microfibres that destroy microbes in soil and water – and will eventually destroy flora and fauna including us. No more new plastics. Ride bikes, solar and wind energy etc. It has to be the future. We just need to work out how to subsidise it to those who cant afford it. What do you reckon? Ethical issues will involve big business, transitioning in ways that people can maintain income, what about transitioning shareholders? Lots of work can be done in all this, and wouldnt it be wonderful work?
ReplyONE OF THE FIRST THINGS WE CAN BE DOING IS TO USE ETHICAL STATIONERY AS ALL WHITE PAPER MADE IN AUSTRALIA IS MADE FROM THE GIPPSLAND FOREST IN THE ONLY MILL OWNED BY ONE OF THE WORLDS WORST NATIVE FOREST WOOD CHIPPERS ; NIPPON DAISHOU ( REFLEX). USE REAL 1005 POST-CONSUMER RECYCLED PAPER PRODUCTS UNBLEACHED LIKE THOSE MADE BY ECOCERN INSTEAD THAT AE MADE ONLY FROM THE FRUIT OF OUR RECYCLING EFFORTS.
ReplyCongratulations on this initiative to Simon and All at the Ethics Centre. I have appreciated the work of the Centre from its earliest days and continue to do so. It certainly influenced the success of my communication consultancy and it clients. Thank you. I look forward to reading the Deloitte study. Warm regards and good wishes
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