By Daniel Hunter

Around half (48%) of British adults say they believe that British business is behaving very or fairly ethically in terms of its behaviour and decisions following good principles, according to the Institute of Business Ethics report.

Of these only 3% said they think business is behaving ‘very’ ethically. This is a substantial decline from the previous year — down ten percentage points from 58% in 2011. The 2012 proportion is similar to the all-time low of 47% in 2003.

Opinion has declined this year among most demographic groups. There is a particularly sharp drop (19 percentage points) among those aged 35-54. Previously the views of this group had been particularly positive (compared to the total sample).

As in previous years, more people think that executive pay is in need of addressing by British business than any other issue — a third (34%) put it in their top three priority issues from a list of 15.

Those surveyed were asked about a new issue this year - corporate tax avoidance. Just over a quarter (27%) said that this most needs addressing, with discrimination coming third (22%) — a similar proportion as in 2011 (21%).

“This year’s results should act as another wake-up call to business that action needs to be taken in order to restore trust with the British public," Philippa Foster Back, Director of the IBE commented.

"Executive pay continues to trouble the British public - while the country tightens its belt, extravagant bonuses and rewards for failure tarnish business’s reputation.

"Scandals such as LIBOR have meant that the ethics of business has yet again become an issue of direct concern to the general public.”

The survey also examined attitudes towards ethics in business over time. There remain mixed views on how ethically business behaves compared with 10 years ago.

A quarter (25%) say business behaves the same as it did ten years ago (a decline of 5 percentage points from the 2011 figure of 30%). Around a quarter (28%) of the public think British business behaves more ethically now than 10 years ago (the same proportion as in 2011). The same proportion (28%) in 2012 think business behaves less ethically now than 10 years ago — similar to the 2011 proportion of 29%.

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