ETHICS & CSR ETHICS & CSR. Reference books Business Ethics: An Indian Perspective by Prof. P.S. Bajaj / Dr. Raj Agrawal Business Ethics: Text & cases.

ETHICS & CSR ETHICS & CSR

Reference booksReference books

Business Ethics: An Indian Perspective by Prof. P.S. Business Ethics: An Indian Perspective by Prof. P.S. Bajaj / Dr. Raj Agrawal Bajaj / Dr. Raj Agrawal

Business Ethics: Text & cases by C.S.V. MurthyBusiness Ethics: Text & cases by C.S.V. Murthy

A Study in Business Ethics by Rituparna RajA Study in Business Ethics by Rituparna Raj

Business Ethics concepts and cases by Manuel G. Business Ethics concepts and cases by Manuel G. Velasquez Velasquez

Ethics: What Does It Really Mean???Ethics: What Does It Really Mean???

Derived from Greek word ‘Ethicos’ meaning Derived from Greek word ‘Ethicos’ meaning Character or MannersCharacter or Manners

Science of character of a person expressed as Science of character of a person expressed as right or wrong conduct or action.right or wrong conduct or action.

Set of moral principles prescribing code, explains Set of moral principles prescribing code, explains what is good and right, or bad and wrong.what is good and right, or bad and wrong.

Meaning of EthicsMeaning of Ethics

Character of a man

Conductof a person

Series ofActions

Good or Bad,

Right orwrong,

Moral orImmoral

Moral Standards

Decided by Leads toTakentogether

Considered As

Known asMoral

Judgement

Requires

By which we can Judge again

Ethics can be termed as the Ethics can be termed as the science of character of a science of character of a

person expressed as right or person expressed as right or wrong conduct or actionwrong conduct or action

Objective of EthicsObjective of Ethics

Studies human behavior and makes evaluative assessment about Studies human behavior and makes evaluative assessment about them as moral or immoralthem as moral or immoral

Establishes moral standards and norms of behaviorEstablishes moral standards and norms of behavior

Makes judgment upon human behavior based on these standards Makes judgment upon human behavior based on these standards and normsand norms

Prescribes moral behavior and makes recommendations about how Prescribes moral behavior and makes recommendations about how to or how not to behaveto or how not to behave

Expresses an opinion or attitude about human conduct in generalExpresses an opinion or attitude about human conduct in general

Business Ethics: What Does It Really Business Ethics: What Does It Really Mean???Mean???

comprises principles and standards that guide comprises principles and standards that guide behavior in the world of businessbehavior in the world of business

According to John Donaldson “Business Ethics According to John Donaldson “Business Ethics can be described as the systematic study of can be described as the systematic study of moral (ethical) matters pertaining to business, moral (ethical) matters pertaining to business, industry or related activities, institutions, or industry or related activities, institutions, or practices and beliefs. It is the systematic practices and beliefs. It is the systematic handling of values in business and industry.”handling of values in business and industry.”

Unitarian View: Business & morality cannot be separated and it Unitarian View: Business & morality cannot be separated and it must play by the rules of ethics of the community.must play by the rules of ethics of the community.

Views on relationship between Business Views on relationship between Business & Ethics& Ethics

Moral Structure

Business

Moral Ethics

Separatist view of EthicsSeparatist view of Ethics

Proposed by Adam Smith and Milton Friedman: Business is Proposed by Adam Smith and Milton Friedman: Business is a distinct entity and does not include ethics and moralitya distinct entity and does not include ethics and morality

Business Ethics

Integration view of ethicsIntegration view of ethics

Proposed by Talcott ParsonsProposed by Talcott Parsons

Law

Society

Government

Market Systems

BusinessMorality

& Ethics

BusinessEthics

Business EthicsBusiness Ethics

When business people speak about “business ethics” they usually When business people speak about “business ethics” they usually mean one of three things:mean one of three things: 1.1. Avoid breaking the criminal law in one’s work related Avoid breaking the criminal law in one’s work related activityactivity

2.2. Avoid action that may result in civil law suits against Avoid action that may result in civil law suits against the the companycompany

3.3. Avoid actions that are bad for the company imageAvoid actions that are bad for the company image

Businesses are especially concerned with these three things since Businesses are especially concerned with these three things since they involve loss of money and company reputation. they involve loss of money and company reputation.

Laws and moral standards overlap to a certain extentLaws and moral standards overlap to a certain extent

Law represents a minimum set of standards for producing a desired Law represents a minimum set of standards for producing a desired human behaviourhuman behaviour

Ethics often represents a standard that exceeds the legal minimumEthics often represents a standard that exceeds the legal minimum

Ethics Law

Frequent Overlap

Relationship between law and moral Relationship between law and moral standardsstandards

Common Unethical Acts...Common Unethical Acts...

lying and withholding needed informationlying and withholding needed information

abusive or intimidating behaviorabusive or intimidating behavior

misreporting time workedmisreporting time worked

discrimination and sexual harassmentdiscrimination and sexual harassment

stealingstealing

breaking environmental and safety lawsbreaking environmental and safety laws

falsifying recordsfalsifying records

drug or alcohol abusedrug or alcohol abuse

giving or accepting bribesgiving or accepting bribes

Why Misconduct Is Not Reported...Why Misconduct Is Not Reported...

belief that nothing will be donebelief that nothing will be done

fear of retaliationfear of retaliation

fear of being viewed as a troublemakerfear of being viewed as a troublemaker

Why ethical behavior is important???Why ethical behavior is important???

Business is a subsystem of societyBusiness is a subsystem of society

Empowers all stakeholders concernedEmpowers all stakeholders concerned

Reduction in cost of friction with social Reduction in cost of friction with social environmentenvironment

Important for organizations leaders because Important for organizations leaders because they influence the ethical climate for the rest.they influence the ethical climate for the rest.

Why Ethical problems occur?Why Ethical problems occur?

Personal gainPersonal gain

Individual values widely differ with organizational goalsIndividual values widely differ with organizational goals

Managers values and attitudesManagers values and attitudes

Competitive pressuresCompetitive pressures

Cross-Cultural contradictionsCross-Cultural contradictions

Sources of Ethical NormsSources of Ethical Norms

Fellow Workers

Family

Friends

The Law

Regions of Country

Profession

Employer

Society at LargeReligious Beliefs

The Individual

Conscience

Culture

Encouraging Ethical ConductEncouraging Ethical Conduct Ethics TrainingEthics Training

Key features of effective ethics training programsKey features of effective ethics training programs Top management support.Top management support. Open discussion.Open discussion. A clear focus on ethical issues.A clear focus on ethical issues. Integration of ethics into the organization.Integration of ethics into the organization. A mechanism for anonymously reporting ethical A mechanism for anonymously reporting ethical

violations.violations. Reward ethical conduct.Reward ethical conduct.

Encouraging Ethical Conduct Encouraging Ethical Conduct (cont’d(cont’d

Whistle-BlowingWhistle-Blowing The reporting of perceived unethical matters.The reporting of perceived unethical matters. Reducing the fear of retaliation against whistleblowersReducing the fear of retaliation against whistleblowers

Anonymous hotlines and web sitesAnonymous hotlines and web sites Personal, confidential guidancePersonal, confidential guidance

Ethical AdvocateEthical Advocate An ethics specialist who plays a role of critical An ethics specialist who plays a role of critical

questioner in top-management’s decision-making.questioner in top-management’s decision-making. Serves as the Board of directors’ social conscience.Serves as the Board of directors’ social conscience. Helps prevent groupthink and blind conformityHelps prevent groupthink and blind conformity

Encouraging Ethical Conduct Encouraging Ethical Conduct (cont’d)(cont’d)

Code of EthicsCode of Ethics Published statement of moral expectations for Published statement of moral expectations for

employee conductemployee conduct Requirements for an effective ethics codeRequirements for an effective ethics code

Must describe specific practices as unethical Must describe specific practices as unethical (e.g., kickbacks, payoffs, gifts, falsification of records, (e.g., kickbacks, payoffs, gifts, falsification of records, and misleading product claims).and misleading product claims).

Must be firmly supported and fairly enforced by Must be firmly supported and fairly enforced by top management.top management.

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