Business Ethics an Introduction

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Introduction to Business Ethics

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Business Ethics an Introduction

  1. 1. MEANING Greek word ETHIKOS Means CHARACTER Study of Behaviour and values
  2. 2. ETHICS  Ethics is the study of Behaviour  What is Good and What is Wrong  Branch of Philosophy  Science of morals
  3. 3. You need to be more and more selfless
  4. 4. Action as per standards-Ethical Not as per standards –Un Ethical Actions which are law ful may not be ethical Eg.,Drinking alcohol
  5. 5. Differentiate Human Beings from Animals
  6. 6. ORIGIN What is Right and what is wrong Rules by society =Ethics From Olden Days
  7. 7. ORIGIN IN INDIA Bhagawad Gita VEDAS Upanishads Neeti shatra by chanakya Vedanta
  8. 8. ORIGIN IN WEST Socrates(469-399BC) Plato(427-347BC) Aristotle(384-322BC)
  9. 9. ETHICAL OR UNETHICAL ? • Laying of employees after assuyring no layoffs • Operating cancer treatment centre with tobacco company
  10. 10. DIFFERENCES Morals Ethics  Latin word “MOS”  Social in Nature  Based on Customs  Accepted by religious/cultural institutions  General principles(Friends & Family)  Greek word “Ethikos”  Personal in Nature  Based on Personal Aspects  Personally accepted  Personal principles(own)  Wider scope
  11. 11. RELIGION VS ETHICS VS
  12. 12. ETHICS VS LAW
  13. 13. GOLDEN RULE OF ETHICS
  14. 14. FUNDAMENTAL PRINCIPLES OF ETHICS  INTEGRITY  OBJECTIVITY  CONFIDENTIALITY  PROFESSIONAL COMPETENCE AND DUE CARE  PROFESSIONAL BEHAVIOUR
  15. 15. ETHICS UNIVERSAL/CONSTANT? Ethical principles are some thing we follow regularly in our life Some principles are universal. Right Wrong Honesty Lying Reliability Cheating Mutual respect Stealing Nonviolence
  16. 16. EXCEPTIONS a.Thief breaks in to your home Will you tell truth? b.Can a doctor reveal the serious illness to patients
  17. 17.  Many Ethical values have changed basing on changes in society and time Eg:Abortion-Immoral but not now Child marriage,sati,untouchability,caste Ethical values different in many cultures Eg:Polygamy,using ornaments
  18. 18.  Morality based on Personal perception  Which is good for some one may not be good for some one else Eg:Terrorism Western culture
  19. 19. BRANCHES OF ETHICS  Meta Ethics-Studies meaning  Normative Ethics-Gives prescription  Applied Ethics-Use of Ethics Eg:Medical ethics,legal Ethics,A&F Ethics,Environmental Ethics,Business Ethicsetc.,
  20. 20. NATURE OF ETHICS  Standards of Behavior tells us how to behave  Not same as Feelings  Feelings-Personal  Ethics is not religion but it is advocated by religion  Ethics is not law but law contains ethics  Vary from society to society  Ethics is not science
  21. 21. WHY ETHICS DIFFICULT TO UNDERSTAND? Though it is common in daily life Difficulty a.Base for Ethical standards? b.How can we apply these standards? Application based on demand of the situation
  22. 22. SOURCES TO ETHICAL STANDARDS 5 major sources 1.Utilitarian Approach 2.Rights/Deontological Approach 3.Fairness Apprroach 4.Common Good Approach 5.Virtue Approach
  23. 23. UTILITARIAN APPROACH  Do more good do less harm  Produce balance between good and harm  Deals with consequences
  24. 24. RIGHTS APPROACH  Ethical action is which that protects and respects the moral rights who got affected  Based on Human Dignity gives ability to choose freely,what they do with their lives Eg:Ten commandments
  25. 25. FAIRNESS APPROACH Aristotle contributed this idea TREAT ALL HUMAN BEINGS EQUALLY
  26. 26. COMMON GOOD APPROACH  Life is good in itself,and our actions contributed to that life  Relationship based on Ethical reasoning  Calls common conditions for welfare of Every one  System of law,Effective Enforcement,Educational system or even public relational areas
  27. 27. VIRTUE APPROACH  Ancient Approach  Ethical actions consistent with some ideal virtues(Beliefs)  Honesty,Courage,Compassion  Generosity,Tolerance,  Fidelity,Self control “WHAT KIND OF PERSON WILL I BECOME IF I DO THIS
  28. 28. BUSINESS ETHICS  Application of Every day moral or Ethical norms to Business  Being Ethical requires acting with awareness of how • Products and Services • Actions of Employees • Stake holder and society
  29. 29. • Code of conduct for doing Business • Unite in common pursuit of justice –Mahatma Gandhi • Truthfulness in Business,conduct reflection of their country
  30. 30. NEED  Application of Ethics in Business  Authority to use Natural Resources  Engaged in Social Contract  Business man-Trustee
  31. 31.  Major Emphasis on CSR  Responsible for Share holders and Stake holders  Ethics in Companys –MISSION Statement  Profit Maximisation to Wealth Maximisation
  32. 32. ETHICAL INFLUENCE ON BUSINESS Areas of Business Ethical Practice Plant location Environment Impact Product Pollution Purchase & Storage No hoarding of finished goods Transportation Safety Regulations Advertising Realistic Claims Finance Appreciation of Capital Personnel Equitable treatment
  33. 33. BENEFITS OF FOLLOWING BUSINESS ETHICS  Easier change management  Strong team work and productivity  Enhanced Employee growth  Guarantee that personnel policies are legal  Helps to detect violations easily  Helps to manage values associated with quality management, strategic planning
  34. 34. ETHICAL DILEMMAS Dilemma means Confusion Ethical dilemma: Eg; Rama o Obey or Rule kingdom Arises When there are Alternatives
  35. 35. ETHICAL DILEMMAS IN BUSINESS  Only few issues are straight forward  In many cases conflicts with out clear option  Arises to manager to decide between  i)Right and wrong ii)Right & Right  In finding solutions business man face Ethical dilemmas  Most often business interests conflict with moral values  Eg., Bribe Or a means of sales promotion
  36. 36. GUIDELINES TO HANDLE ETHICAL DILEMMA  Define problems clearly  Stood on the other side of the fence  How did the situations arise?  Intention in making that decision  Who will injure by your decision?  What is probable results of the decision?  Can you discuss with affected parties before decision?  Symbolic potential of your action, if understood or misunderstood?  Exceptions to your stand?
  37. 37. WHY ETHICAL PRACTICES? 1. Self Interest 2. Reward Motive 3. Social Pressure 4. Legal Need 5. Consistent with profit Motive 6. Image 7. Payback Principle
  38. 38. GOI EFFORTS TO ENSURE ETHICAL BEHAVIOUR ACB and CBI Vigilance Commission Right to Information Act Public Interest Litigation Transparency Ombudsman
  39. 39. INSTITUTIONALIZING BUSINESS ETHICS Code of Ethics Compliance officer Ethics committee Teaching in MDP’s ombudsman

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