Do the Right Thing!
BUSINESS ETHICS
OBJECTIVES
What is business ethics
History of ethics
What are some of the approaches of dealing with
ethics
Importance of ethics in business
Expert opinions
Conclusion
Ethics
Ethics also known as moral philosophy is a law
philosophy that addresses questions about
morality – that is concepts such as good & evil,
right and wrong, justice, virtue, etc.
The origin of this word is
from ethos which mean character . It can also be
defined as the ability to distinguish between right
and wrong and to act accordingly.
FROM WHERE THE ETHICS COME
Religion
Environment
Parents & teachers
10 commandments of
Ethics
• Be honest
• Have integrity
• Keep your word
• Maintain fidelity
• Always be fair
• Care for others
• Respect others
• Be a responsible citizen
• Rigorously pursue excellence
• Always be accountable
HISTORY OF ETHICS IN
BUSINESS
Business ethics being part of the larger social ethics, always been affected by the
ethics of the epoch. At different epochs of the world, people, especially the elites
of the world, were blind to ethics and morality which were obviously unethical to
the succeeding epoch. History of business, thus, is tainted by and through the
history of slavery history of colonialism and later by the history of cold war.
The need for business ethics in the current epoch had
begun gaining attention since 1970s .
CHARACTERISITICS OF ETHICAL
DECISIONS IN BUSINESS
Ethical decisions differ according to an individual's
perspective. Individual views the individual's perspective.
Individual views the ethical decision in his or her frame of
reference or value system. Hence, ethical decision do not or
value system. Hence, ethical decision do not have a unique
solution, but a multitude of have a unique solution, but a
multitude of alternatives.
Decisions either ethical or unethical, have wide
ramifications, hence affect the other situations.
Ethical or unethical decisions depend on individual
actions.
BUSINESS ETHICS
Business ethics (also known as Corporate ethics) is a form of applied ethics or professional ethics that
examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all
aspects of business conduct and is relevant to the conduct of individuals and business organizations as a whole.
Applied ethics is a field of ethics that deals with ethical questions in many fields such as medical, technical, legal
and business ethics.
Business ethics can be both a normative and a descriptive discipline .
NATURE OF ETHICS IN
BUSINESS
In business two types of ethical problem :–
Overt - bribery, theft, sabotage etc . They are
clear & reprehensible.
covert- complex and not transparent, defy
ethical solutions .It occur in corporate
acquisitions , marketing & personnel policies .
WHY BUSINESS ETHICS
Discussion on ethics in business is necessary because business can become unethical, and there
are plenty of evidences as in today on unethical corporate practices.
One of the conditions that brought business ethics to the forefront is the
demise of small scale, high trust and face-to-face enterprises and emergence of huge
multinational corporate structures capable of drastically affecting everyday lives of the masses .
NEED FOR BUISNESS
ETHICS
Check business malpractices.
Improve consumer confidence.
Protect other social groups.
Safeguard consumer rights and social welfare .
Make businessmen conscious of social
responsibilities.
All businesses exist and operate within society and
therefore they should contribute to welfare of society.
Business either big or small, much operate on ethical
grounds and discharge their social obligations to
survive in the long-run.
FEAUTRES OF BUISNESS
ETHICS
Not against profit making.
Education and guidance required.
Provides basic framework.
Needs willing acceptance and enforcement.
COMMON APPROACHES TO
BUISNESS ETHICS
Utilitarianism – basic premise is that an action
is judged as right or wrong depending on the
consequences of the action.
Universalism – the means justify the ends of an
action, not the consequences.
Rights – based on entitlements and unquestionable claims.
Business Ethics: What Does It Really Mean?
Society’s
Expectatio
ns of
Business
Ethics
Expected and Actual Levels
Ethical
of Business Ethics
Problem
Ethical Problem Actual
Business
Ethics
1950s Early 2000s
BUSINESS ETHICS CYCLE
BUISNESS ETHICS LEVEL
PANEL OF ETHICS
MANAGEMENT IN
A COMPANY
BOARD OF DIRECTORS - is a
body of elected or appointed
members who jointly oversee the
activities of a company or
organization .
AUDIT COMMITEE is an operating
committee of the board of directors
charged with oversight of financial
reporting and disclosure.
GROUP COMPLIANCE OFFICERS
- implementing written policies,
procedures, and standards of
conduct .
ETHICS ADVISORY PANEL – It
advises on issues of legal ethics and
drafting ethics opinions.
BUSINESS ETHICS RESOURCE CENTRE
- is a nonprofit, nonpartisan research
organization, dedicated to independent
research that advances high ethical
standards and practices in public and private
institutions.
The Federal Energy Regulatory
Commission or FERC - is an independent
agency that regulates the interstate
transmission of electricity, natural gas, and
oil. It also oversees environmental matters
related to natural gas and hydroelectricity
projects and other matters;
UNETHICAL BUSINESS
PRACTICES
Against the employees:-
Paying salaries lower than those fixed by the govt. to the employees.
Poor working condition.
Lack of safety measures for workers and lack of provision for welfare facilities.
Against the Govt.:-
Evasion of excise duty, sales tax, income tax etc.
Smuggling of Goods.
Offering bribes to govt. officials and politicians for getting favours .
Against the consumer & society:-
Adulteration of Goods.
Sale of duplicate products.
Sale of unauthentic products.
Sale of products injurious to public health.
Pollution of Environment.
A decision is ethical if it is:
Right- morally right and due
Good- brings good for all concerned
Equitable- just & equal
Proper- appropriate & acceptable
Fair- Honest & due
just- justice is done
BUISNESS ETHICS &
PROFITS
“Survival is the name of any business game . If a company wants to
survive it has to think about its profits . Most business operate on the
principle that profit is not linked to ethical consideration . But there
are instances which nullify the above principles”. By - Johnson &
Johnson.
A firm that is not performing well is considered as liability and burden
to the society.
Thus profit today is recognized as a characteristic of the success of a
business and justification for its existence.
ETHICAL LEARNING FROM BHAGWAD
GITA
The work or karmas is driving force
of life & this work has to be ethical.
Managers who resort to unethical
means to grab the immediate results
are successful only for short time like
dhuryoddan .
The lord advises that one is born
into this life to play his part &
whatever role is assigned to him he
has to perform his duties with utmost
devotion , sincerity & humility .
If people feel that the organization
which they are working is unethical ,
they are caught in more dilemma like
karna faced in fight.
ETHICS , ECONOMICS & LAW
POSITION OF BUISNESS
ETHICS IN INDIA
Limited attention to business ethics .
Unethical practices are used extensively .
Businessmen are severely criticized due to their
unethical practices .
Socially conscious and progressive businessmen
support ethical business .
Business environment in India is not favorable for
business ethics .
NEED FOR BUSINESS
ETHICS IN MBA
The credibility of the term ‘Business Ethics’ has come into question, in recent
times as ‘business ethics’ is increasingly being considered an oxymoron. It is
generally believed that business and ethics cannot coexist and organizations
are said to thrive on unethical practices.
For this, the business schools of India need to be complemented by a
systematic educational movement from the primary school level, reviving the
inculcation of the age-old moral and ethical valued inherent in Indian wisdom
side by side with training and modern scientific knowledge and skills. The
climate in the wake of the economic scandals and the explosions rocking the
business environment calls for a fresh beginning .
Teaching business ethics is not solely about helping manager to resolve a
specific moral dilemma, but also to develop competencies or capacities for,
moral judgment in business contexts, the ability to integrate broader social
issues with the managerial role and to implement this concern in a holistic
fashion.
RESEARCH
This research has shown the increasing percentage of people
who are not committed to business ethics . Thus making the
need to teach the business ethics .
BAD BUSINESS ETHICS CASES
BRITISH AIRWAYS VS VIRGIN AIRLINES
British airways framed a baseless story that in night club of
Richard Branson there were HIV infected needles were
found . They also hacked virgin reservation software , called
the customers & told them flights have been cancelled &
switched them to British airways .
Gillette engineer who led the Razor blade was also
supplying the important details to its competitors .
Mumbai based Tata VSNL employee was caught while
leaking information to competitor .
SATYAM CASE .
DIFFERING OPINIONS
REGARDING BUISNESS ETHICS
MILTON FRIEDMAN - Business ethics is a contested
terrain. He claim ethics is irrelevant to the field of
business. He held that corporations are amoral and CEOs
have only one duty: to maximize the profits of a company
VALDEMAR W. SETZER - Ethics is not definable, is not
implementable, because it is not conscious; it involves not
only our thinking, but also our feeling .
GEORGE W .BUSH – At this moment , America’s highest
economic need is higher ethical standards – standards
enforced by strict laws & upheld by responsible business
leaders .
EXPERT OPINION – PROF VARUN
ARYA ( A MEMBER OF IIM(A)
GOVERNING SOCIETY
He said “In India you cannot just grow unless you
compromise”.
There is rampant corruption here & all the
shortcuts & unfair means are correct . Most of the
top corporate have set of designed values but
hardly any of them walk their talk .
Its not only in India but in world also.
CONCLUSION
In order to Win the game , you need to plan. To plan ,
Information is imperative . Get it through legal & ethical means.
It’s fact that to win consistently , you need to play by rules .
In life & business ,
ETHICAL STANDARDS MUST BE SET ,
ETHICAL STANDARDS MUST BE MET.
IN LIFE PLAY HARD & PLAY FAIR !
BIBLIOGRAPHY
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THANKING YOU
BY :-
Ridhima Sharma
Gourav Kumar
