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Corporate ethics Tpic in Business Ethics

Jul 12, 2015

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Dimple RamnaniBATCH: J1CORPORATE ETHICS

INTRODUCTIONBusiness Ethics as an applied branch of General Ethics must be studied from the perspective of Philosophy. This is because Ethics is a part of moral principles, you will not know Ethics without being philosophical.

Ethics & Company Philosophies

Ethics & PhilosophyPhilosophy, etymologically came from two Greek words philos, which means love and sophia, means wisdom. (Love of Wisdom)Hence, a philosopher is one who loves wisdom.As a science, philosophy is interested with the meaning of reality including our human experiences. It is a science that seeks to explain the ultimate cause of everything by the use of human reason alone.

Division of PhilosophyTheoretical Philosophy studies the truth to be known, e.g. God, immortality of the soul, origin of the universe.Practical Philosophy studies truths to be acted upon, e.g. ethics, axiology(study of vales, goodness etc.), semantics(relation between words, phases, signs & symbols), etc.

Division of Philosophy

THEORETICALPRACTICALCosmologyOrigin of universeOntologyThe theory of beingMetaphysicsMeta (beyond) physikon (nature)PsychologyHuman/animal behaviorTheodicyGod on logical abstractionEpistemologyTheory of knowledgeSemanticsWords and its linguistic formsAxiologyDiscourse of value judgmentAestheticsPrinciples of beauty and artLogicReasoning to establish truthEthicsFrom Greek word ethos means Characteristic way of acting which is proper to as a rational being.7

Ethics & MoralityMoralityMorality refers to the quality of goodness or badness in a human act. Good is described as moral and bad as immoral. It means conformity to the rules of right conduct.

Ethics Ethics refer to the formal study of those standards and conduct. It is also often called moral philosophy.

Ethics As Normative ScienceEthics is considered a Normative Science because it is concerned with the systematic study of the norms of human conduct, as distinguished from formal sciences such as Mathematics, chemistry physics etc..Ethics is a normative science because it involves a systematic search for moral principles and norms that are justify our moral judgments.

Three Categories of General Ethics

Three Categories of General EthicsDescriptive EthicsDescriptive ethics maintains objectivity in studying human behavior but it does not provide a clear standard of morality.

It simply describes how people act and does not prescribe how people should act.

Three Categories of General EthicsNormative EthicsInvolves moral judgment based on ethical norm or theory.

This consists both the basic moral principles and values and the particular moral rules that govern peoples behavior, which is right or moral and wrong or immoral.

Three Categories of General Ethics

MetaethicsIt does not describe moral beliefs of people, does not evaluate the process of moral reasoning, but simply analyzes the usage and meaning of words.

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICS Ethical RelativismEthical relativism claims that when any two cultures or any people hold different moral values of an action, both can be right. An action may be right for one person or society and the same action taken in the same way may be wrong for another reason, and yet, both persons are equally correct.

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICSApproaches to Morel DifferenceThere is no Moral TruthThere is no Universal TruthDeep down, we can find basic Moral TruthThere is one Universal Moral Truth

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICS There is no ultimate right or wrong. Moral views differ from one person to another. This results to a subjective morality, in which case, what is good for one person may be bad for another.

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICS There is No Universal TruthEach Culture has its own set of rules that are valid for that culture, and we have no right to interfere, just as they have no right to interfere with our rules.

This ethical paradigm maintains that there are moral truths that exist but these truths are relative and dependent on cultures and beliefs of people.

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICS Deep down , We can Find Basic Moral TruthDespite differences, people of different cultures can still agree on a certain moral basics.

There are some common ground on basic moral principles.

This is called Soft Universalism

THE PROBLEM OF ETHICAL RELATIVISM & SITUATION ETHICS There is One Universal Moral TruthThis view is also known as hard universalism or moral absolutism. This moral paradigm maintains that there is only one universal moral code that everybody must follow. Because this moral code is universal and objective, moral problems, and moral conflicts can be solved through proper moral reasoning.

Deontological Vs. Teleological ApproachesTo Ethical Evaluation of Human ConductACTIONMotives/IntentionsEnd of the actorMeans/Action itselfEnd of the ActNon - ConsequentialistConsequences/Result,Probable and actualConsequentialist

Deontological Vs. Teleological Approaches To Ethical Evaluation of the Human Conduct

Deontological EthicsAlso known as non-consequentialist approach is a body of ethical theories that measures and evaluates the nature of a moral act based on the validity of the motive of an act. This means that if the motive or intention of the act is good, then regardless of the consequences, the whole action is good.

Deontological Vs. Teleological Approaches To Ethical Evaluation of the Human ConductTeleological EthicsCame from the Greek word tele which means far or remote. Known also as Consequentialist theory measures the morality of an action based on its consequences and not on the motive or intention of the actor. If the consequence is good, regardless what motive is, the act is always morally good.

Corporate Social Responsibility (CSR) & Ethics

Definitions and RelationshipsCorporate social responsibility (CSR) is the process by which businesses negotiate their role in society In the business world, ethics is the study of morally appropriate behaviors and decisions, examining what "should be doneAlthough the two are linked in most firms, CSR activities are no guarantee of ethical behavior

Recent Evidence of CSR InterestAn Internet search turns up 15,000 plus response to corporate citizenshipJournals increasingly rate businesses (and NGOs) on socially responsive criteria:Best place to workMost admiredBest (and worst) corporate reputation

CSR CONTINUUMMaximize firms profits to the exclusion of all elseBalance profits and social objectivesFight social responsibility initiativesDo more than required; e.g. engage in philanthropic givingIntegrate social objectives and business goalsDo what it takes to make a profit; skirt the law; fly below social radarComply; do what is legally requiredArticulate social value objectivesLead the industry and other businesses with best practices

Do what it takes to make a profit; skirt the law; fly below social radarFight CSR initiativesComply with legal requirementsDo more than legally required, e.g., philanthropyArticulate social (CSR) objectivesIntegrate social objectives and business goalsLead the industry on social objectives

Businesses CSR Activities

Integrate CSR GloballyIncorporate values to make it part of an articulated belief systemAct worldwide on those values Cause-related marketingCause-based cross sector partnershipsEngage with stakeholdersPrimary stakeholdersSecondary stakeholders

Business Ethics Development The cultural context influences organizational ethicsTop managers also influence ethicsThe combined influence of culture and top management influence organizational ethics and ethical behaviors

The Evolving Context for EthicsFrom domestic where ethics are shared To international where ethics are not shared when companies:Make assumptions that ethics are the sameEthical absolutismthey adapt to us Ethical relativismwe adapt to them To global which requires an integrative approach to ethics

Emergence of a Global Business Ethic Growing sense that responsibility for righting social wrongs belongs to all organizations Growing business need for integrative mechanisms such as ethicsEthics reduce operating uncertaintiesVoluntary guidelines avoid government impositionsEthical conduct is needed in an increasingly interdependent worldeveryone in the same gameCompanies wish to avoid problems and/or be good public citizens

Ways Companies Integrate EthicsTop management commitment in word and deedCompany codes of ethicsSupply chain codesDevelop, monitor, enforce ethical behaviorSeek external assistance

External Assistance with EthicsIndustry or professional codesCertification programs, e.g., ISO 9000Adopt/follow global codesCaux Round Table Principles

Reasons for Businesses to Engage in Development of a Global Code of Business EthicsCreate the same opportunity for all businesses if there are common rulesLevel the playing fieldThey are needed in an interconnected worldThey reduce operating uncertaintiesIf businesses dont collaborate, they may not like what others develop

Four Challenges to a Global EthicGlobal rules emerge from negotiations and will reflect values of the strongGlobal rules may be viewed as an end rather than a beginningRules can depress innovation and creativityRules are static but globalization is dynamic

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