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Chapter 2 discusses the importance of ethics and social responsibility in entrepreneurship, emphasizing the need for businesses to act ethically and contribute positively to society. It outlines key ethical principles such as transparency, fairness, and accountability, and highlights the necessity of establishing ethics programs within organizations. Additionally, it addresses the responsibilities businesses have towards employees, customers, the environment, and the community.

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6 views

Chapter 2.pptx

Chapter 2 discusses the importance of ethics and social responsibility in entrepreneurship, emphasizing the need for businesses to act ethically and contribute positively to society. It outlines key ethical principles such as transparency, fairness, and accountability, and highlights the necessity of establishing ethics programs within organizations. Additionally, it addresses the responsibilities businesses have towards employees, customers, the environment, and the community.

Uploaded by

clhi34logos
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Entrepreneurship

chapter 2
Mr. Ibrahim Mohamed Ali
BBA,MBA (HRM)
Human Resource Director
Hormuud University
Mogadishu-Somalia. 1
chapter 2

Ethics and Social Responsibility:

Doing the Right Thing.


Ethics & Social Responsibility
A Close Relationship
SOCIAL
RESPONSIBILIT
• ETHICS
Y
• Beliefs about The obligation of a
• right and wrong business
to contribute to
society

3
What is Ethics
Ethics has to do with what my feelings tell me is right or
wrong.“
"Ethics has to do with my religious beliefs."

"Being ethical is doing what the law requires."

"Ethics consists of the standards of behavior our society


accepts.
4
Doing the Right Thing
1. Transparency: Being open about decisions and actions builds
trust.
2. Fairness: Ensuring justice and equity in decision-making
processes.
3. Accountability: Taking responsibility for one’s actions and their
consequences.
4. Sustainability: Considering the long-term impacts of actions on
the environment and society.
5. Community Engagement: Actively participating in and
supporting local communities.

5
What is Business ethics
Business ethics: involves the moral values and behavioral
standards that business people attraction on as they make
decisions and solve problems.
Business Ethics – values and standards that determine acceptable
conduct in business.
Ethical behavior—doing what is “right” as Opposite to
what is “wrong”—starts at the top of an organization with
the entrepreneur. Entrepreneurs’ personal values and
beliefs influence the way they lead their companies and are
actual in every decision they make, every policy they write,
and every action they take.
6
Business and society
•Businesses are part of societies (locally,
nationally, globally) therefore have a duty
to act within their expectations and norms.
•By doing so they are able to operate
successfully without harming the societies,
communities and environments in which
they operate.

7
The Need for Company Ethics
Programs
Scandals in company America have reduced trust in
businesses

Understanding the factors that influence ethical


decision-making can help companies encourage
ethical behavior

Employees are not legal experts and need guidance


The Need for Company Ethics
Programs
Organizations should develop an organizational ethics program by
establishing, communicating, and monitoring uniform ethical
values and legal requirements
A strong ethics program includes:
Written code of conduct
Ethics officer to oversee the program
Care in the delegation of authority
Formal ethics training
Auditing, monitoring, enforcement, and revision of program
standards
What is code of conduct
Code of Conduct Formal statement that
defines how the organization expects and
requires employees to resolve ethical
questions.

10
Effective Ethics Program
• Helps to ensure that all employees understand the
organization’s values and fulfill with the policies and
codes of conduct that create its ethical environment
• Cannot assume that
employees will know how
to behave the people when entering
an organization.
Three Levels of Ethical
Standards
❖ The law. As we know, the laws define what we “must
do.” Laws, therefore, set minimum standard. Simply
following the law is insufficient as a guide for ethical
behavior as ethical behavior requires more.
❖ Organizational policies and procedures
The second level is the clearly written and general set of
organizational policies and procedures that help as specific
guidelines for decision making.

12
CON…..
❖ The moral attitude employees take when faced with
decisions not administered by informal rules

The ethical attitude reflects the values of the


entrepreneur Successful.
entrepreneurs know that they must start
during the employee’s orientation to make
complete clear how they expect every
employee to judge right from wrong and good
from bad.
13
Purposes of Law
Main purposes of laws are
to
o Maintain order
o Establish standards
o Resolve conflict
o Protect individual rights
and freedoms.
Maintaining Ethical Standards

Create and clear a company ideology for ethical


Standards.
Develop a code of ethics
Implement the code of ethics fairly and
consistently
Do ethics training
Hire the right people are Knowing ethical well

15
Maintaining Ethical Standards

Perform periodic ethical audits


Establish high standards of ethics
Set an possible ethical example
Create a culture that emphasizes two-way
communication
encourage employees in starting ethical
standards

16
The Benefits of Moral
Management
Earning a profit does not conflict with maintaining high
ethical standards
1. Avoid the damage to a company’s reputation
that results from unethical behavior
2. Dealing with diverse stakeholders is easier
with a solid ethical foundation
3. Attracting and retaining quality workers is
easier
4. A company’s ethical philosophy determines its
ability to provide value for its customers
17
what is difference between stakeholder
and stockholder

A stockholder: or shareholder is the holder or


owner of stock in a corporation. A
stakeholder: is anyone that has an interest or is
affected by a corporation. ... Other
stakeholders in a corporation include the
employees, the employees' families, suppliers,
customers, community, and others.
18
Types of Stakeholder
• I = INTERNAL • E = EXTERNAL

Owners (I) Customers (E)


Shareholders (I) Suppliers (E)
Managers (I) Community (E)
Staff or employees (I) Government (E )

19
Top Five Factors That Drive Business
Ethics…..

1. Corporate scandals
2. Marketplace competition
3. Difficulties by investors
4. Pressure from customers
5. Globalization
20
What is Social responsibility

Social responsibility: is the idea that


businesses should balance profit-making
activities with activities that benefit society;
it involves developing businesses with a
positive relationship to the society in which
they work.

21
Entrepreneurs and Social Responsibility

22
Business has a Social
Responsibility to...
❖ The environment
❖ Employees
❖ Customers
❖ The community
❖ Government
Your Responsibility to the Environment

The Environmental Protection Agency


(EPA) implements environmental laws
and regulations.
environmental protection agency an
independent federal agency established
to organize programs and implement
regulations aimed at reducing pollution
and protecting the environment.
24
Con…
To protect the environment:
❖ Employ environmental activities work with
them.
❖ Eliminate wasteful practices and productions of
pollutants from manufacturing processes.
❖ Improve products to increase efficiency.

25
Environmental Awareness
Key Steps in an Environmental Strategy
1. Eliminate the concept of waste.
2. Know accountability to the environment.
3. Make prices reflect costs.
4. Support diversity.
5. Make saving product and profitable.
6. Hold on accountability of nations

26
Business’s Responsibility to
Employees
❖ Listen to employees and respect their ideas.
❖ Ask for their input; involve them in the
decision-making process.
❖ Provide regular feedback—positive and
negative—to employees.
❖ Tell them the truth—always.
❖ Let them know exactly what is expected of them.
❖ Reward employees for performing their jobs well.
❖ Trust them: create an environment of respect and
teamwork.
27
Your Responsibility to Customers

Guidelines for your responsibility to


customers include:
❖Do not cheat customers.
❖Give complete information regarding proper
use.
❖Label unsafe products.
❖Offer the best quality products at the lowest
prices.

28
Social Responsibility to community

❖To solve problem of unemployment


❖To develop infrastructure of country
❖To help in natural disasters
❖Taking steps to keep start resources & developing
alternatives where ever possible
❖Improving efficiency of business operations
❖Contributing to R &D
❖Development to diffident areas
29
Responsibility to Government

•To pay taxes, duties in time.

•To cooperate with government in their


social policies and programmes.

•To follow all laws and actions.

30
Thank You For Attending

This Session.

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