It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations. For example, today most major corporations promote their commitment to non-economic values under headings such as ethics codes and social responsibility charters. Adam Smith said, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
Business Ethics and Social Responsibility
Business Ethics andSocial Responsibility Dr. Sanjay Mishra, PhD (BHU)Disclaimer: Views expressed here are of the presenter 1
Business Ethics is• What is appropriate and what is not- in short or long term from the business viewpoint …..• Appropriate in Business is-• Trust of the customer/party• Long term relations• Horizontal rapport• With a feeling of service to the society• After a certain level of satisfaction society pays back to the business 2
Business Ethics/Corporate Ethics• Business Ethics (also known as Corporate Ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment• Business ethics has both normative and descriptive dimensions. As a corporate practice and a career specialization, the field is primarily normative. Academics attempting to understand business behavior employ descriptive methods.• The range and quantity of business ethical issues reflects the interaction of profit-maximizing behavior with non-economic concerns. Interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia. 3
Ethical Issues in Business• Adulteration in edible items• Product Safety/ Unequal Standards• Product storage and logistics irresponsibility• Customers as quantity of consumption• Surrogate Advertising/ Treacherous Campaigns• Finished accountability after selling the product.• Less expenditure on social causes/wellbeing• Environmental issues 4
Genesis• Ethics come from [Middle English ethik, from Old French ethique (from Late Latin ḗthica, from Greek ḗthika, ethics) and from Latin thic (from Greek ḗthik), both from Greek ḗthikos, ethical, from ḗthos, character; see s(w)e- in Indo-European roots.]European meant for character/ manner or• 1: (a) A set of principles of right conduct. (b) A theory or a system of moral values: "An ethic of service is at war with a craving for gain" (Gregg Easterbrook).• 2: Ethics : The study of the general nature of morals and of the specific moral choices to be made by a person; moral philosophy.• 3: Ethics : The rules or standards governing the conduct of a person or the members of a profession: medical ethics. 5
Major branches• Meta-Ethics, about the theoretical meaning and reference of moral propositions and how their truth-values (if any) may be determined;• Normative Ethics, about the practical means of determining a moral course of action.• Applied Ethics, about how moral outcomes can be achieved in specific situations.• Moral Psychology, about how moral capacity or moral agency develops and what its nature is.• Descriptive Ethics, about what moral values people actually abide by. 6
Inventory of ethical Issues in Business• Employee – Employer Relations• Employee –Employee Relations• Company- Customer Relations• Company-Shareholder Relations• Company- Community /Public Relations 7
Why talk about Business Ethics?• For last decade there are evidences that the frequency related to business ethics violation increased• Recently food adulteration in National Capital region and around came into limelight• Corporate, Governance, Service Sector Govt. machinery• Due to professional lapses, incidences frequently take shaping and now a frequent phenomena in India 9
Can we consider?• “We Will Not lie, Steal or Cheat, No Tolerate Among Us Anyone Who Does”• Which do you think is the tougher part• Line 1 or Line 2 ? And Why? 12
Ethics, Economics & Law• Ethical etiquette is personal but larger in implications.• Ethics pays in economic transactions and strengthens the mutual relations than anything in business expansion.• Law is a watchdog, can check when it sniffs and affect the repercussions not the ethics straight. 13
Business, Society & Ethics• It is society that makes the business sustain, business is a tool to increase the frequency of economic activities, not to rule, control or govern the society.• Exchange based society continued for long in the past with minimum conflicts than modern business.• Physical form of business has less likelihood to incur crisis related to business than abstract form of business. 14
Gandhian Approach• He believed a business could and should be conducted with complete honesty.• Indeed, a business that was run honestly would be more successful than one which was not.• In business as well as personal life he subscribed to the view : "Honesty is the best policy." A business person had every right to earn a livelihood from their business, although if vast income was earned from the business, the business person should give what he or she did not need to the community. 16
Trusteeship• In his theory of trusteeship, Gandhi perceived business as a form of service to the community.• Gandhian approach to business ethics relate to today as much as to his lifetime.• Gandhian thought need to go undergo interpretation because of development the business has undergone during last 50 years. 17
Gandhi and business ethics• Business is a way to foster neighborliness, to bring members of a community together and a means by which people can love and serve one another.• Dr. Stephen Kovey one of world’s leading management consultants and author of the best selling book “The Seven habits of Highly Effective People” says in his book: 18
Some case study• For-Profit Colleges in the US: A Morally Bankrupt Sector? case study (Case Code: BECG117)• BPs Continuing Safety Problems: The Gulf of Mexico Crisis(Case Code: BECG116)• Bhopal Gas Tragedy: Revisited after Twenty- five Years(Case Code BECG115)• Intels World Ahead Program - The Baramati Project in India (Case Code:BECG098)• http://www.icmrindia.org/casestudies/Case_Studies.asp?cat=Business%20Ethics 20
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