An ethics crisis and corporate failure in food and beverage companies. Evidence from Zimbabwe

Lack of adherence to ethics and principles appears to have been one of the main causes of corporate financial distress around the world. A lot of unethical practices have contributed to revenue leakages and reluctance by investors to buy a stake in food and beverage industry in Zimbabwe. The prevalence of unethical practices, illegal behavior, and illicit and deceptive practices in food and beverage companies is an unsolved issue. The aim of the research was to find out the effect of ethical problems on a company's financial performance in the food and beverage industry. The high failure rate of brands in food and beverage companies has given researchers an interest in investigating the impact of ethics on the financial performance of a company. Due to the diverse nature of the food and beverage industries, an action research inquiry of 20 interviews and 100 questionnaires was conducted. A mixed-method convergent approach was used to analyze collected data using questionnaires and interviews. Findings from the study suggest that there is a strong positive relationship between the ethical conduct of employees, managers, and business conduct and the financial performance of a food manufacturing company. The study results show that ethical branding significantly enhances the firm's reputation, and a good reputation reinforces the brand in turn. Ethical branding can provide the company with a distinct advantage as a growing number of consumers become more ethically conscious. It is therefore recommended that ethical issues be considered in all company departments and embedded into the total quality management processes of an organization as they affect potential investors and customers.