Declining economic activity over the past decade fuelled unethical practices among businesses as they sought to overcome effects of the stagnation. The Zimbabwean economy, currently characterised
by low industrial output and liquidity challenges, is struggling to rebound following the meltdown prior to adoption of multiple currencies in 2009.
Economic growth has been pegged at 4,4 percent, down from an initial projection of 9,4 percent mainly due to poor performance of the major sectors of the economy, particularly agriculture.
Addressing participants at the Business Ethics Symposium held in the capital, Standards Association of Zimbabwe executive director Mrs Eve Gadzikwa said most companies were resorting to unorthodox means to survive the depressed economic environment.
"Companies are struggling to survive out there," she said.
"Retreating capacity utilisation is fuelling unethical business practices as most of these companies do anything just to stay afloat," she said.
Mrs Gadzikwa said some companies were resorting to smuggling raw materials into the country to evade duties charged at border posts while others were failing to remit taxes to the revenue collecting authority.
Speaking at the same occasion, Institute of Directors Zimbabwe president Mr Johannes Mudzengerere concurred with Mrs Gadzikwa saying that the state of the economy had a direct bearing on ethical practices by the business community.
"The economic environment has a bearing on the state of ethics in business and society in general and as Zimbabweans we are struggling to wean ourselves from the norms we had gotten used to during the hyperinflationary era," he said.
Mr Mudzengerere said there was an urgent need to address the situation which tended to scare away investors.
"What is certain though is that corruption is now pervasive and urgent steps need to be taken to redress the situation.
"Corruption, among other factors, has a direct impact on the risk of doing business in a country, and if risk is high then any borrowings whether off-shore or in the country will be at a premium, rendering the economy uncompetitive," said Mudzengerere.
The symposium was held to create a platform for business discussions on pertinent ethics issues and reviewing the relevance of formulating a national code on corporate governance for best practices in businesses.
The CZI organised the symposium, which was running under the theme "Sound business ethics: an imperative for Zimbabwe's economic growth."