Have you ever thought why big company’s CEO can cash in on millions of dollars in bonuses and still remain untouchable by Federal Government? Have you ever thought why media always talks about ethical issues, and nothing ever happens to those people? Recently, I was watching a documentary on how big companies are moving their IPs (intellectual properties) to Ireland, and paying only 15% taxes there instead of paying 35% tax in United States. Then I asked myself a question….. Is this legal? ……The answer came out to be…. “YES”. They are not doing anything wrong legally. So, government in United States can’t do anything about this. This raised an another question in my mind….. Is it ethical? ….. And surprisingly the answer came out to be as “YES”. And here is why…… Basics of business: Have you ever saw the definition of business? If you have then you know what I am talking about. In defining a business, ethics don’t play in to the picture at all. Sole purpose of a business is to increase the value for its stakeholders. Thus, can you blame those businesses, who are taking advantage of the lower tax policies in Ireland to increase their net income? It might be morally wrong for those businesses to show all of their profit in Ireland, while they get their 50-70% profit from United States, but you can’t do anything about that. As more and more countries loosen their tax policies to attract foreign businesses, there would always be some companies who want to move there to increase their net profit by paying lower taxes there. Definition of ethics: In my opinion, definition of ethics is very subjective. I don’t think that you can have clear defined ethical standards globally. Whenever you try to define ethics, it doesn’t remain ethics anymore. It becomes a law or a rule. For example: If you think that it’s not an ethical practice for people to do insider trading on the basis of the insider information, and if you want to change that then you might want to change the law which punishes those people. Unless you put that law in practice, you will always find immoral people, who will be using their insider knowledge to make huge bucks for themselves. At the end, ethics shrink down to morals and personal belief of that particular individual, who is running that business. Because there is nothing clearly defined in the books, which will prevent this person from taking unethical decisions.

1. Why can’t your business have any ethical standards?
by Bhavin Gandhi
Have you ever thought why big company’s CEO can cash in on millions of dollars in
bonuses and still remain untouchable by Federal Government? Have you ever thought
why media always talks about ethical issues, and nothing ever happens to those people?
Recently, I was watching a documentary on how big companies are moving their IPs
(intellectual properties) to Ireland, and paying only 15% taxes there instead of paying 35%
tax in United States. Then I asked myself a question….. Is this legal? ……The answer
came out to be…. “YES”. They are not doing anything wrong legally. So, government in
United States can’t do anything about this. This raised an another question in my mind…..
Is it ethical? ….. And surprisingly the answer came out to be as “YES”. And here is
why……
Basics of business: Have you ever saw the definition of
business? If you have then you know what I am talking about. In defining a business,
ethics don’t play in to the picture at all. Sole purpose of a business is to increase the value
for its stakeholders. Thus, can you blame those businesses, who are taking advantage of
the lower tax policies in Ireland to increase their net income? It might be morally wrong for
those businesses to show all of their profit in Ireland, while they get their 50-70% profit
from United States, but you can’t do anything about that. As more and more countries
loosen their tax policies to attract foreign businesses, there would always be some
companies who want to move there to increase their net profit by paying lower taxes
there.
Definition of ethics: In my opinion, definition of ethics is very
subjective. I don’t think that you can have clear defined ethical standards globally.
Whenever you try to define ethics, it doesn’t remain ethics anymore. It becomes a law or a
1 Author: Bhavin.Gandhi@live.com | Contact information: http://gandhibhavin.wordpress.com

2. rule. For example: If you think that it’s not an ethical practice for people to do insider
trading on the basis of the insider information, and if you want to change that then you
might want to change the law which punishes those people. Unless you put that law in
practice, you will always find immoral people, who will be using their insider knowledge to
make huge bucks for themselves. At the end, ethics shrink down to morals and personal
belief of that particular individual, who is running that business. Because there is nothing
clearly defined in the books, which will prevent this person from taking unethical decisions.
Subjective nature: As I mentioned earlier, ethics basically
shrinks down to morals and beliefs of the person who is handling that business. Thus,
ethics tend to be very subjective in nature. And there are various other factors that affects
the core definition of ethics. For example: It would be considered unethical for an
employer to hire a kid, who is only 15 years old. But in some countries, some government
encourages companies to hire younger people, so that they can support their family, while
getting the invaluable professional training for their future. Thus, you can’t exactly define
what is ethical and what is not, when your business is global and you yourself can’t define
what is considered ethical.
Though I have my tight morals, beliefs, and ethical standards; I don’t think that a business,
as an entity, can have any kind of ethical standards. Of course, business can have rules
and policies under which it can operate, but there can’t be any ethical standards that it can
abide to. I hope you liked my argument in this blog. Please feel free to discuss your view
points on the same. I am always curious to hear different perspective from different
people. Thanks – Bhavin Gandhi
Bhavin Gandhi | February 27, 2012 at 2:27 PM | Tags: 21st century, Business
Ethics, CEOs,Challenges, Cultural Change, Ethical Issues, Ethical laws, Ethical
Standards, Leaders of Tomorrow,Leadership, Leadership
Failures, Management, Moral Codes, Self awareness, Unethical behavior, Work
culture | Categories: 21st Century, Leadership, Management |
URL: http://wp.me/p103Cm-6O
2 Author: Bhavin.Gandhi@live.com | Contact information: http://gandhibhavin.wordpress.com

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3 Author: Bhavin.Gandhi@live.com | Contact information: http://gandhibhavin.wordpress.com