Ethical Issues vs Business Issues
So what is the difference between an ethical issue and a business issue? In general terms, a business issue is one which affects the performance, profitability or cash flow of the company and which needs to be tackled to improve business efficiency.
In contrast, an ethical issue is one in which the performance of the company, and often profitability, may be in conflict with the well-being of stakeholders (employees, customers, community) and what is considered to be sustainable and “good business”.
Reputational failure is a business issue and the source of reputational failure is the ethical consideration. The source itself should be resolved (i.e. the threat that should be safeguarded) before it becomes a reputational issue.