The relevance of ethical conduct in creating a competitive advantage for entry-level emerging contractors

Abstract

Small emerging contracting companies could possibly be flooding the construction industry, putting strain on the construction economy to stay afloat, support and sustain these participants. It is important for any organisation that deals with other individuals and organisations to understand the correct ethical codes of conduct in a business environment. To minimise unethical behaviour in the industry, new contractors need to both understand and apply the principles of ethical conduct in their business environments.

This research is aimed at investigating whether ethical conduct among new entry-level emerging contractors can contribute to, and ensure their sustainable competitiveness in the South African construction industry. This research is also aimed at determining whether education and knowledge of entrepreneurship, business, project and construction management, in addition to building contracts, can contribute to new entry-level emerging contractors’ ethical conduct and sustainable competitiveness.

The literature reviewed and the results of quantitative research among professional consultants in South Africa formed the basis of the study. Ethics is a sensitive topic within the construction industry; therefore, it is difficult to gather the data directly from contractors, as they are reluctant to participate for fear of revealing their identities and having this negatively influence their personal and business credentials.

Unbiased respondents, who were not directly linked to emerging contractors and who were not afraid to give their objective opinions, were questioned and included architects, quantity surveyors, consulting engineers, project managers, construction mentors, and construction managers. The study revealed that ethics is an important factor in any business environment and that the correct application thereof can partially contribute to the sustainable competitiveness of new entry-level emerging contractors. This, in turn, should promote the long-term survival of a business. Furthermore, the knowledge of good management practices and building contracts can contribute to a successfully run business.

However, the average new entry-level emerging contractor has insufficient experience and knowledge of the management of construction projects and of building contracts.

The study should be valuable to construction-industry professionals, contractors and clients, as it provides them with research information on a problem area in the industry.

Keywords: Ethics, sustainable competitiveness, construction, project, and business management, building contracts