INFLUENCE OF ETHICAL PRACTICES ON PERFORMANCE OF INSURANCE FIRMS IN KENYA
DOI:
https://doi.org/10.47941/ejikm.962Keywords:
Ethical Practices, Performance, Insurance FirmsAbstract
Purpose: Following ethical practices is important for many reasons and a major selling point to many of today's consumers. By taking measures to promote ethics in Kenyan insurance companies, managers can create a better culture, improve their brand reputation and simply feel good that they're doing something positive. The purpose of this work is to enhance the reader's understanding on the influence of ethical practices on performance of insurance firms and to make recommendations for Kenya.
Methodology: A desktop literature review was used for this purpose. , a systematic search was carried out using Google Scholar, Semantic Scholar, and Research Gate. The study included relevant peer reviewed journals and book chapters that were published between 2016 and 2021. Studies that examine organizational ethical practices were included while non-English articles, articles whose full text could not be accessed were excluded.
Findings: From the reviewed studies, it is recognized worldwide that ethical business relationship with stakeholders builds customer value and profitability through several competitive advantages such as customer loyalty and retention, product quality, and efficiency in operations. it was also found that ethical practices enhances employee performance ethical and influences performance of companies by avoiding legal problems.
Recommendations: It is recommended that insurance firms should set ethics programs which are set of activities, policies and procedures intended to support employees to understand and comply with the ethical standards and policies set by the organization. This will contribute to improved employee behavior, ethical attitude and corporate image. Additionally, insurance firms should provide regular employee trainings concerning ethical practices to contribute to profitability by reducing the cost of business transactions, building a foundation of trust with stakeholders, contributing to an internal environment of successful teamwork, and maintaining social capital that is part of an organization's market-place image. In an endeavor to operate ethically, insurance practitioners should observe utmost good faith and disclose all material facts in respect of products at the time of negotiation of cover.
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