(FORTUNE Small Business) – When I hear that some New York business owners are tired of Eliot Spitzer's endless snooping around, I have just one reaction: Send the state's crusading attorney general my way. He would find fertile ground in my industry. I compete against one rival who tried to secure a customer's loyalty by giving her expensive jewelry. And what am I supposed to do about the competitor who hands out laptops? Perhaps it is no wonder that we and other honest suppliers have a hard time successfully jockeying for some accounts.

In the packaging industry, as in many others, business ethics are in need of repair. Too often, it seems, executives pay little heed to distinguishing between right and wrong in their hot pursuit of customers. Worse, those who work for some customers often forget that their self-interest may not correspond with the needs of their employers. It would seem obvious that purchasing agents shouldn't take expensive gifts from those whose bids they are supposed to judge. But even after countless scandals in the corporate world, it still happens among smaller businesses. And it makes me sick.

I don't want to limit business ethics to the narrow realm of purchasing, either. How about the rival that buys lots of equipment—buys other companies, in fact—but bounces payroll checks? One company I know, on the eve of filing for bankruptcy protection, ordered tens of thousands of dollars of goods from suppliers knowing it might never pay for them. I have a supplier that has a broker selling to us who also happens to be a major owner of a company that competes with us. Does that sound like a conflict of interest? Our supplier doesn't think so, even though I've repeatedly pointed it out.

The absence of any reaction leads me to ask, Is American business morally tone-deaf? It would seem wide swaths of it are. And I can understand why. As with anything that involves money, the temptation to park your conscience is a constant struggle. Just recently I've tried to avoid thinking about how to repay a $100,000 loan from a supplier that was predicated on our buying product from him. Unfortunately, we ran into quality problems with his material, which forced us to buy elsewhere. I let months slip past until my father, a stickler for doing what is right, asked me what I planned to do. I finally picked up the phone and began crafting a solution.

Forty or 50 years ago shady behavior may have been even more common than it is today. My father, who started our family-owned plastic-bag-manufacturing company in 1963, tells of purchasing managers who openly demanded payoffs in return for business. And his own behavior—he once penalized himself on the final hole of an industry golf tournament for playing the wrong ball, a move that cost him first place and helped earn him the moniker "Honest Jim." If his approach were commonplace, I suspect that no one would have given him the nickname.

Our company is much bigger now, with a dozen managers doing business in our name. So my siblings and I recently decided that if we were going to build on the reputation that was established by our father, it was best that we put in place a code of ethics to make sure everyone knows what is expected. It is a pretty simple program: Treat suppliers and customers fairly, let me or my siblings know if any conflicts of interest exist, and don't take any gifts or meals worth more than $100. My hope is that the spirit of the policy will inform our employees' behavior in their dealings with the outside world.

I also believe that good behavior helps us attract customers in the long run. I know many of them deal with us because they trust that we are not going to bribe anyone or try to cover up problems. Several customers have even told me they don't want to deal with some of our rivals because they worry about dishonesty. And for me there's always the issue of keeping my peace of mind. I know that if attorney general Spitzer does come knocking someday, I will have nothing to hide.