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U N IT -1

Introduction tobusiness ethics


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M EA N IN G

Ethics is a set of rules thatde ne right and wrong conduct.

Business ethics can be de ned aswritten and unwritten codes ofprinciples and values that governdecisions and actions within a company.In the business world, the

organization’s culture sets standards fordetermining the di erence betweengood and bad decision ma ing andbehavior.


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Nature of ethics:Ethics include!

Ethics is applied to human beings only as they have freedomof choice and means of free will ."hey can only decide thedegree of ends they wish to pursue and the means to achievethe ends.

"hey was an argument whether ethics is a science or an art.But e#perts were of the opinion that ethics is more a sciencethan an art.Ethics deal with human conduct which is voluntary not forcedby circumstances or humans. It can be said that at groundlevel, ethics deal with moral $udgment regarding set directedhuman conduct.

"he science of ethics is a normative science. It is a search foran ideal litmus test of proper behavior. %ormative scienceinvolves arriving at moral standards that regulate right andwrong conduct.


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Principles of ethics:

&re as follows!Bene cence

'east harm(espect for autonomy

)ustice.


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Benefi cence:

"he research should generatemore good than harm* and

(is s of research should bereasonable in light of thee#pected bene ts to theindividual and to society.


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Least harm :

"his is similar to bene cence, but itdeals with situations in which neitherchoice is bene cial. In this case , aperson should choose to do the leastharm possible and to do harm to thefewest people.


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Respect for autonom y:

"his principle states that an ethical theoryshould allow people to reign over themselvesand to be able to ma e decisions that apply to

their lives. "his means that people should havecontrol over their lives as much as possiblebecause they are the only people whocompletely understand their chosen type oflifestyle.

"wo ways of loo ing at the respect forautonomy!

+aternalistic view point'ibertarian view point.


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Justice/Non-Exploitation:

"he principle that calls for fairness in theconduct of research is the principle of

$ustice non-e#ploitation

(esearch must!Ensure a fair distribution of ris s and bene ts

(esearch should not be done in acommunity that is not li ely to bene t

from the resultonduct e/uitable recruitment of researchparticipants* and+rovide special protection for vulnerablegroups.


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Types of ethics:

%ormative ethics01what should be234escriptive ethics01what is23.


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Values:

"hese are based on behavior.It is derived from 5rench word 1valoir2which means worth, merit, usefulness orimportance of a thing.6alues can be measured in /uality orstandard or traits.6alues are status of feeling or emotions thatunder that content of choice or decision anddetermine the manner of intellect or reasonfor $ustify and implement choice or decision.


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Relationship vie s on ethics

an! "usiness:7nitarian view of ethics! business is a part of moral structure

and moral ethics. If business want toe#ist, survive and 8ourish in the longterm. 9orality and ethics cannot beseparated from the operation of thebusiness. 9oral structure

9oral ethics

business


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#onti$

:eparatist view of ethics! "his was proposed by &dam smith and

9ilton 5riedman. it concentrate on itsgoal- pro t ma#imization. 9oralityand ethics, they argued has no rolein business.

society

business ethics


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cont%%

Integrated view of ethics! "alcott +arsons proposed a view called theintegrated view.

;e argued that business being economic entity,

has the right to ma e pro t, but at the sametime it should discharge the social obligations.

business 9oralityand ethics

govt

9ar et system

law

society


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Business ethics:

Business ethics is the study ofbusiness.

ethics essentially deals withunderstanding what is right andmorally good in business.Business ethics is the set ofprinciples or reasons which shouldgovern and conduct of businesswhether at the individual or

collective level.


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Nature of "usiness ethics:

.interest of society?.business- society relationship


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Pro"lem s in "usiness ethics:

:el shness of a few people.ompetitive pressures on pro ts.

"he clash of personal values andbusiness goals.ross cultural contradictions.


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&m portance of "usiness ethics:

;elps to maintain a moral course inturbulent times.

ultivates strong teamwor andproductivity.:upports employee growth andmeaning.;elps to ensure that policies arelegal.;elps to avoid criminal acts 2oomission2.


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'ources of "usiness ethics:

(eligionultural e#perience

'egal system


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Types of "usiness ethics:

"ypes of business ethics@eneral business5unctional business ethics

International businessethics and ethics ofeconomic systems.


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(actors infl uencin) "usiness

ethics:6alue forming institutions.Arganizational goals.

or and career.:uperiors.+eers and colleagues.

+rofessional codes.


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*pproaches to "usiness ethics:

+ro t motive approach'egal approach

9oral obligations approach:ocial approach.


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Ethics in or+place:

Bribery4eception7nfair discrimination

Blac moneyoercion "heft;onesty

on8ict of interestInside trading

"a# evasion+ollutioncorruption


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, o!els of ana)em ent Ethics

=>

Three Types Of Management Ethi

Moral Amoral Immoral


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, o!els of ana)em ent Ethics

1. Moral Management C onforms to highstandards of ethical behavior.

2. Immoral Management C& style devoid ofethical principles and active opposition to whatis ethical.

3. Amoral Management CIntentional - does not consider ethical factorsUnintentional - casual or careless aboutethical considerations in business

=?


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. evelopin) oral Ju!)m ent

6-23


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a+in) Ethical Ju!)m ents

=D

Behavior or actthat has beencommitted

Prevailing normsof acceptability

Value judgments

and perceptions ofthe observer

compared with


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hat is Ethical Behavior0. In many situations lines between right and wrong are blurred. Such situationscan lead to ethical dilemmas.When faced with ethical dilemmas, it’s important to consider outcomes of thedecision-making process. One way of dealing with ethical dilemmas is byusing the four way test to evaluate decisions. his test involves asking four

!uestions "

Is my decision a truthful one?Is my decision fair to everyone a ected?

ill it build good!ill for the organi"ation?Is the decision bene#cial to all $arties !ho have a

vested interest in the outcome?


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# company’s managers play an important role inestablishing its ethical tone. If managers behave asif the only thing that matters is profit, employeesare likely to act in a like manner. # company’sleaders are responsible for setting standards forwhat is and is not acceptable employee behavior.

It’s vital for managers to play an active role increating a working environment where employeesare encouraged and rewarded for acting in anethical manner .

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O TH ER FA C T O R S IM PA C T IN GO R G A N IZ AT IO N A L E TH IC S

orporate cultureE#istence and application of a written code of ethics5ormal and informal policies and rules%orms for acceptable behavior5inancial reward system:ystem for recognizing accomplishment

ompany attitude toward employees

;ow employees are selected for promotions;iring practices&pplications of legal behavior4egree to which professionalism is emphasized

"he company’s decision ma ing processes

Behaviors and attitudes of the organization’s leaders


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7 Principles of Adm irable BusinessEthics

1. %e &rustful2. 'ee$ An ($en Mind3. Meet (bligations). *ave +lear ,ocuments

. %ecome +ommunity Involved

. Maintain Accounting +ontrol/. %e 0es$ectful


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Overview of issues in business ethics

orporate socialresponsibility

duciary responsibility,sta eholder concept v.

shareholder conceptindustrial espionage.


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ene ra l bus ines s e th ic s

thics of human resourcemanagement

thics of sales and mar eting thics of $roductionthics of intellectual $ro$ertyno!ledge and s ills

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