Introduction of business ethicsPresentation Transcript
INTRODUCTION OF BUSINESS ETHICS
Introduction Business ethics is a branch of ethics which prescribes standards of how the business is to be carried out. Guidelines to stakeholders The responsibility of the managers and employees The application of ethical judgments to business activities.
WHAT IS ETHICAL BEHAVIOUR? Ethical behavior is that which is morally accepted as "good" and "right" as opposed to "bad" or "wrong" The advantages of ethical behaviour include:
Higher revenues – demand from positive consumer support
Improved brand and business awareness and recognition
Better employee motivation and recruitment
New sources of finance – e.g. from ethical investors
Relationship between business and ethics Businesses that exhibit and promote strong corporate codes of ethics are more prosperous in the long run Enhances a company's reputation The highly competitive environment in today's global economy puts pressures on company leaders to remain profitable
Need for business ethics Introducing Socialism in Business Interest of Industry Buyers Market Better Relations with Society Advantages to Business and Society
Importance of ethics in business Goodwill Profitability Going concern is assured Sustainability Survival of heated competition Safety from legal perspectives.
Types of ethics Normative ethics Applied ethics
Morality Derived from latin word “moralities”. It is a system of conduct which is virtuous. Refers to personal or cultural values. It refers to what is considered right or wrong by people.
Legality Legality means lawfulness by virtue of conformity to al legal statue.
Distinguish ethics and laws
Concept of right Legal right Human right Employee right Moral rights
Concept of duty Rights and duties are correlative Duties are what he/she owes to others.
Ethical organisation Organisation should posses ethical behaviour. Three theories provide a framework fro judging ethical nature in business. 1. theory of corporate excellence. 2. Ethics and shareholders value. 3. ethics and corporate governance.
Code of conduct A state of rules to guide behaviour and decisions.
Why Have a Code of Conduct A code is an open disclosure of the way an organization operates Codes of conduct offer an invaluable opportunity for responsible organizations to create a positive public identity for themselves Tool to encourage discussions of ethics and to improve how employees/members deal with the ethical dilemmas, prejudices and gray areas