This power point presentation gives you an idea on the basic concepts and terminologies that you might encounter in business ethics and social responsibility. It will further gives you a concrete rationalization on why it is important to study this subject. Lastly this will be helpful for students and instructors in the senior high school level.

1. Business Ethics
and Social
Responsibility

2. “Business”
-is an organization or economic system where goods
and services are exchanged for one another or for
money. 2

3. Basic Forms of Business
Organizations
• Sole Proprietorship
• Partnership
• Corporation
• Cooperative
3

4. Sole Proprietorship
• also known as a sole trader, is
owned by one person and operates
for their benefit
• A sole proprietor has unlimited
liability for all obligations incurred
by costs or judgments against the
business
• These firms are owned by one
person, usually, the individual who
has day-to-day responsibility for
running the business 4

5. Sole Proprietorship
Advantages
• Easiest and least expensive form
of ownership to organize.
• Sole proprietors are in complete
control, and within the
parameters of the law, may
make decisions as they see fit.
• The business is easy to dissolve
if desired.
Disadvantages
• Sole proprietors have unlimited
liability and are legally
responsible for all debts against
the business. Their business and
personal assets are at risks.
• May be at a disadvantage in
raising funds and are often
limited to using funds from
personal savings or consumer
loans.
• May have a hard time attracting
high-caliber employees, or those
that are motivated by the
opportunity to own a part of the
business.

6. Partnership
• is a business owned by two (2) or
more people.
• each partner has unlimited liability for
the debts incurred by the business.
• the partners should have a legal
agreement that sets forth how
decisions will be made, profits will be
shared, disputes will be resolved, how
future partners will be admitted to
the partnership when needed
6

7. Partnership
Advantages
• Partnership are relatively easy
to establish; however, time
should be invested in
developing the partnership
agreement.
• With more than one owner,
the ability to raise funds may
be increased.
• The business usually will
benefit from partners who
have complementary skills.
Disadvantages
• Partners are jointly and
individually liable for the
actions of the other partners.
• Profits must be shared with
others.
• Since decisions are shared,
disagreements can occur.
• The partnership may have a
limited life; it may end upon
the withdrawal or death of a
partner.

8. Corporation
• The owners of a corporation have
limited liability and the business has a
separate legal personality from its
owners.
• Corporations can be either
government-owned or privately
owned.
• They can organize either for profit or
as non-profit organizations.
• A privately owned, for-profit
corporation is owned by its
shareholders, who elect a board of
directors to direct the corporation and
hire its managerial staff. 8

9. Corporation
Advantages
• Shareholders have limited liability
for the corporation’s debts or
judgments against the corporation.
• Generally, shareholders can only be
held accountable for their
investment in the stock of the
company.
• Corporations can raise additional
funds through the sale of stock.
• A corporation may deduct the cost
of benefits it provides to officers
and employees
Disadvantages
• The process of incorporation
requires more time and money
than other forms of
organizations.
• Corporations are monitored by
the government and some local
agencies, and as a result, may
have more paperwork to comply
with regulations.
• Incorporating may result in
higher overall taxes. Dividends
paid to shareholdersare not
deductible from business
income; thus, this income can be
taxed twice

10. Cooperative
• Often referred to as a “co-op”, a
cooperative is a limited liability
business that can organize for-profit
or non-profit.
• A cooperative differs from a
corporation in that it has members,
not shareholders, and they share
decision-making authority.
• A cooperative is a business
organization owned by a grouped of
individuals and is operated for their
mutual benefit. 10

11. Cooperative
Advantages
• Easiest and least expensive form
of ownership to organize.
• Sole proprietors are in complete
control, and within the
parameters of the law, may
make decisions as they see fit.
• The business is easy to dissolve
if desired.
Disadvantages
• Sole proprietors have unlimited
liability and are legally
responsible for all debts against
the business. Their business and
personal assets are at risks.
• May be at a disadvantage in
raising funds and are often
limited to using funds from
personal savings or consumer
loans.
• May have a hard time attracting
high-caliber employees, or those
that are motivated by the
opportunity to own a part of the
business.

12. Why start a BUSINESS?
12

13. Purpose of Establishing a Business Enterprise
1. To make money and have
financial independence
2. To be your own boss
3. To self-actualize / To fulfill own
interest and enjoyment
4. To Make Dreams Come True
5. To use your skills and
knowledge for yourself
6. To have a second career
7. To have variety at work
8. To create opportunities
9. To take up a challenge
10. To employ relatives, friends, and
community members
11. To come up with better ways, to
create, to innovate
12. To be efficient
13. To set and meet own deadlines
14. To offer value
15. To have more life, more freedom
16. To solve problems
17. To move society, to change the
world, to make the world better
18. To build our future

14. Core Principles
in Business
Operations

15. 1. Fairness
refers to the level of
even-handedness in
dispensing justice whereby
claims are recognized in the
order of their legal and
contractual priority.

16. 2. Accountability
is the obligation of an
individual or organization to
account for its activities,
accept responsibility for them,
and to disclose the results in a
transparent manner.

17. 3. Transparency
refers to the lack of
hidden agendas ad conditions,
accompanied by the
availability of full information
required for collaboration,
cooperation, collective
decision making.

18. 4. Stewardship
The job of supervising
or taking care of
something, such as an
organization or property.

19. Activity time!
On a ½ crosswise,
write a short essay
discussing any of the core
principles of business
operations. Choose a
specific business in any
industry that you know
and share how you been
able to see in them the
core principle of business
operation.

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