2. Ethics
• Business ethics is the application of ethical values to
business behavior
• Business Ethics is a code of moral principles that
management and employees follow with respect to
what is right and what is wrong from the standpoint of
the organization’s dealings and interactions with its
stakeholders. Besides generally acceptable values and
norms, the organizational culture and internal policies
of individual organization play a very important role in
determining the ethical policies that are followed in the
company. The guidelines for proper ethical conduct are
embodied in the company’s Code of Ethics.
3. Ethical Dilemmas:
• Child labor
• Environment protection for law or future
generations
• Bribes or official presents
• Downsizing: maintaining ratios or competence
• Testing medicine on less priveleged
• Merck Vioxx
• Apple shares issue
4. Reidenbach & Robin Model
• Amoral: winning at any cost – no set of values other
than greed
• Legalistic: obeying the law – if it is legal then it is OK
• Responsive: what can be gained from ethical
behavior – pretending to be caring
• Emerging ethical: take an active interest in ethical
issues – recognize social contract – want to do the
right thing
• Ethical cos – have a ‘total ethical profile’ – balance
profits/ethics throughout their culture
5. Code of Ethics
Code of Ethics provides a guideline to the moral
principles or values by which an organization
conducts its business with respect to what is
right or wrong.
The Code of Ethics applies both to the
organization as well as its employees in all their
business dealings.
6. Advantages of adopting a Code of Ethics:
• Provides guidance to employees so that they
know what is expected from them in terms of
ethical behavior.
• Enhances the organization’s reputation and
inspires public confidence.
• Creates an awareness of the organization’s
expectations of proper conduct among all the
stakeholders.
• Promotes a culture of excellence by
demonstrating the organization’s commitment to
ethical behavior.
7. Measures to eliminate unethical practices
• Create a written Company Code of Ethics and
circulate it to each member of the staff.
• Issue clear and specific instructions, requiring
adherence to the norms of ethical behavior.
• The consequences of indulging in unethical
behavior should be stated clearly in the code of
ethics.
• Good and ethic behavior should be rewarded.
• Sponsor and organize seminars and workshops
on Ethics to emphasize the importance of ethical
behavior.
8. Steps involved in conducting a disciplinary enquiry
• Obtain complete written record (date, time, names of
people involved in offensive conduct)
• Obtain specific information from complaints as well as
other sources
• Investigate the personal record of the employees
involved in misconduct
• Study E & D rules of the organization
• Ask the employee involved to give a written statement
to the various allegations leveled against him.
• Meet the employee to listen to his point of vie.
• Examine similar cases and incidents reported in the
past.
• After listening to the employee in an objective, fair and
consistent manner draw conclusion.
• Prepare a report.
9. Wilful Misconduct
(a) Wilful Misconduct is a deliberate act of violation of rules of
employment by an employee. Acts of Wilful Misconduct are
considered to be serious offences as they can cause serious
financial loss to the employers and their reputation or pose
grave risks to the health and safety of other employees.
The situations in which an employee may be liable to be guilty
of Wilful Misconduct are:
(i) Theft.
(ii) Fraud.
(iii) Misuse of official properties/assets.
(iv) Damage to employer’s property with malicious intent.
(v) Harassment of other employees.
(vi) Gross misbehaviour with supervisors, peers and junior
staff.
(vii) Conduct or actions which pose threat to the employee’s
own life or the lives of others
10. (c) It may be necessary for an organisation to dismiss an
employee in the following situations:
(i) The abilities of the employee have been impaired and it is
not possible for the individual to continue to perform the
assigned duties satisfactorily.
(ii) The employee has indulged in serious
misbehaviour/indiscipline with the supervisor or peers and
this conduct is not conducive to the good working
environment of the organisation.
(iii) The employee cannot continue to work as it would be in
contravention of the legal requirements/ laws of the country.
(iv) The employee is involved in corruption/misappropriation
of the employer’s properties.
(v) The employee has divulged company’s
confidential/proprietary information to competitors.
(vi) The employee has attempted or made unauthorized
access in
