Business Ethics, Corporate Governance, Economic Systems

8/4/2019 Business Ethics, Corporate Governance, Economic Systems

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BUSINESS ORGANISATIONCODE-(151102)

Gaurav Jain01211415109

BBA(MOM) 1st Year (2nd Semester)Submitted to G.T.V.L.N Charyullu

ai Parmanand Institute Of Business Studies ([email protected](www.bbaex erts.com)



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BUSINESS

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Business ethics (also known as Corporate ethics) is aform of applied ethics or professional ethics that

examines ethical principles and moral or ethicalproblems that arise in a business environment. It appliesto all aspects of business conduct and is relevant to theconduct of individuals and business organizations as awhole. Applied ethics is a field of ethics that deals withethical questions in many fields such as medical,technical, legal and business ethics.In the increasingly conscience-focused marketplaces of the 21st century, the demand for more ethical businessprocesses and actions (known as ethicism) is increasing.Simultaneously, pressure is applied on industry to

improve business ethics through new public initiativesand laws (e.g. higher UK road tax for higher-emissionvehicles). Businesses can often attain short-term gainsby acting in an unethical fashion; however, suchbehaviours tend to undermine the economy over time.

Business ethics can be both a normative and adescri tive disci line. As a cor orate ractice and a

BUSINESS ETHICS

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This part of business ethics overlaps with thephilosophy of business, one of the aims of which isto determine the fundamental purposes of a

company. If a company's main purpose is tomaximize the returns to its shareholders, then itshould be seen as unethical for a company toconsider the interests and rights of anyone else.Corporate social responsibility or CSR: an umbrella

term under which the ethical rights and dutiesexisting between companies and society is debated.Issues regarding the moral rights and dutiesbetween a company and its shareholders: fiduciaryresponsibility, stakeholder concept v. shareholder

concept.Ethical issues concerning relations between

GENERAL BUSINESS

ETHICS




CORPORATE

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Corporate governance is the set of processes,customs, policies, laws, and institutions affecting the

way a corporation (or company) is directed,administered or controlled. Corporate governance alsoincludes the relationships among the manystakeholders involved and the goals for which thecorporation is governed. The principal stakeholders

are the shareholders, management, and the board of directors. Other stakeholders include employees,customers, creditors, suppliers, regulators, and thecommunity at large.Corporate governance is a multi-faceted subject. An

important theme of corporate governance is to ensurethe accountability of certain individuals in anorganization through mechanisms that try to reduce oreliminate the principal-agent problem. A related butseparate thread of discussions focuses on the impact

of a corporate governance system in economicefficienc with a stron em hasis on shareholders'

CORPORATE GOVERNANCE




Structures and mechanisms thatensure internal structure and rules of the board of directors

Disclosure strictures in regard to

information for shareholders andcreditors

Transparency of operations and animpeccable process of decision-

making

ORPORATE GOVERNAN

FOCUSES On




Corpora te Gove rnanceFramework1. Shareholders elect

directors as theirrepresentatives.

2. Directors vote on keyissues and adoptmajority decision.

3. Directors maketransparent decisionsfor whichshareholders andothers can makethem accountable.

4. Companies adoptaccounting standardsthat generate

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A SIMPLE MODEL FORCORPORATE

GOVERNANCE




ECONOMIC SYSTEM




An economic system is the system of production, distribution and consumption of goods and services of an economy.Alternatively, it is the set of principles andtechniques by which problems of economics areaddressed, such as the economic problem of

scarcity through allocation of finite productiveresources. The economic system is composed of people and institutions, including theirrelationships to productive resources, such asthrough the convention of property. Examples of contemporary economic systems include

ECONOMIC SYSTEM




CHARACTERISTICS OF

ECONOMIC SYSTEM




ADVANTAGES OF

ECONOMIC SYSTEM




DISADVANTAGES OF

ECONOMIC SYSTEM




The basic and general economic systems are:1. Market economy (the basis for several "hands

off" systems, such as capitalism).2. Mixed economy (a compromise economic

system that incorporates some aspects of themarket approach as well as some aspects of

the planned approach).3. Planned economy (the basis for several "hands

on" systems, such as socialism, or a commandeconomy).

4. Traditional economy (a generic term for the

oldest and traditional economic systems)5. Participatory economics (a recent proposal for

a new economic system)6. Inclusive Democracy (a project for a new

political and economic system)

TYPES OF ECONOMICSYSTEM




A market economy is economy based on the division of labor inwhich the prices of goods and services are determined in a free

price system set by supply and demand.This is often contrasted with a planned economy, in which a centralgovernment determines the price of goods and services using afixed price system. Market economies are also contrasted withmixed economy where the price system is not entirely free but

under some government control or heavily regulated, which issometimes combined with state-led economic planning that is notextensive enough to constitute a planned economy.In the real world, market economies do not exist in pure form, associeties and governments regulate them to varying degrees ratherthan allow self-regulation by market forces. The term free-market

economy is sometimes used synonymously with market economy,but, as Ludwig Erhard once pointed out, this does not preclude aneconomy from having socialist attributes opposed to a laissez-fairesystem. Economist Ludwig von Mises also pointed out that a marketeconomy is still a market economy even if the government

intervenes in pricing.Different perspectives exist as to how strong a role the government

MARKET ECONOMY




MIXED ECONOMY A mixed economy is an economic system thatincludes a variety of public and governmentcontrol, or a mixture of capitalism and socialism.

There is not one single definition for a mixed

economy, but relevant aspects include: a degreeof private economic freedom (including privatelyowned industry) intermingled with centralizedeconomic planning and government regulation(which may include regulation of the market forenvironmental concerns, social welfare orefficiency, or state ownership and management of some of the means of production for national orsocial objectives).

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PLANNED ECONOMY



,economy. In such economies, central economic planningby the state or government controls all major sectors of the economy and formulates all decisions about the use of resources and the distribution of output. Planners decide

what should be produced and direct lower-levelenterprises to produce those goods in accordance withnational and social objectives. Planned economies are incontrast to unplanned economies, such as a marketeconomy, where production, distribution, pricing, andinvestment decisions are made by the private owners of the factors of production based upon their own interestsrather than upon furthering some overarchingmacroeconomic plan. Less extensive forms of plannedeconomies include those that use indicative planning, inwhich the state employs "influence, subsidies, grants, and

taxes, but does not compel." This latter is sometimesreferred to as a "planned market economy".A planned economy may consist of state-ownedenterprises, private enterprises directed by the state, or acombination of both. Though "planned economy" and

"command economy" are often used as synonyms, some

PLANNED ECONOMY




A traditional economy is an economy based oncustom and tradition. The economic system inwhich resources are allocated by inheritance,

has a strong social network and is based onindigenous technology and methods. Althoughthis type of economy has been converted tomixed, command, or market technologies inmany societies that were once traditionallydriven; over 400 million people across the globestill practice this methodology, as researched bythe World Bank. The techniques may beoutdated.

This type of economy ensures that every

TRADITIONAL

ECONOMY




Participatory economics, often abbreviated parecon, is aneconomic system proposed by activist and political theorist

Michael Albert and radical economist Robin Hahnel. It usesparticipatory decision making as an economic mechanism toguide the production, consumption and allocation of resources in a given society. Proposed as an alternative tocontemporary capitalist market economies and also an

alternative to centrally planned socialism or coordinatorism,it is described as "an anarchistic economic vision", and itcould be considered a form of socialism as under parecon,the means of production are owned by the workers.The underlying values that parecon seeks to implement areequity, solidarity, diversity, workers' self-management and

efficiency. (Efficiency here means accomplishing goalswithout wasting valued assets.) It proposes to attain theseends mainly through the following principles andinstitutions:workers‘ and consumers' councils utilizing self-managerial

methods for decision making,balanced job complexes,

RTICIPATORY ECONOM


INCLUSIVE DEMOCRAC



Inclusive Democracy is a political theory andpolitical project that aim for direct democracy,

economic democracy in a stateless, moneylessand marketless economy, self-management(democracy in the social realm) and ecologicaldemocracy. The theoretical project of InclusiveDemocracy (ID; as distinguished from the political

project which is part of the democratic andautonomy traditions) emerged from the work of political philosopher, former academic and activistTakis Fotopoulos in Towards An Inclusive

Democracy and was further developed by him andother writers in the journal Democracy & Nature and its successor The International Journal of Inclusive Democracy , an electronic journal freelyavailable and published by the International

Network for Inclusive Democracy.

INCLUSIVE DEMOCRAC


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Business Ethics, Corporate Governance, Economic Systems

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