Easy and informative ppt

1. UNIT-3
BUSINESS ETHICS

2. ETHICS
• The term “Ethics” refers to
value-oriented decisions and
behaviour. This word comes
from the Greek root ‘Ethos’
meaning character, guiding
beliefs, standards, or ideals that
pervade a group, community or
people.
• It is that section of information
or understanding that deals with
a moral code of conduct or
principle governing our
activities.

3. BUSINESS ETHICS
• Ferrel and Hirt have defined business ethics as: “the principles and
standards that determine acceptable conduct in business
organizations. The acceptability of behaviour in business is
determined by customers, competitors, government regulators,
interest groups, and the public, as well as each individual’s personal
moral principles and values.”
• The term ‘Business Ethics’ refers to the system of moral principles
and rules of the conduct applied to business. Business being a social
organ shall not be conducted in a way detrimental to the interests of
the society and the business sector itself. Every profession or group
frames certain do’s and do not’s for its members. The members are
given a standard in which they are supposed to operate.

4. Some other definitions of Business Ethics
• “Business ethics in short can be defined as the systematic
study of ethical matters pertaining to the business, industry or
related activities, institutions and beliefs. Business ethics is the
systematic handling of values in business and industry.” —
John Donaldson
• “Business Ethics is generally coming to know what is right or
wrong in the work place and doing what is right. This is in
regard to effects of products/services and in relationship with
the stake holders.” —Cater Mcnamara

5. Features of Business Ethics
• Voluntary Compliance: While laws and regulations establish
minimum standards, business ethics go beyond legal requirements.
Ethical behavior in business is often voluntary and reflects a
commitment to doing what is right rather than simply what is legally
mandated.
• Universal Applicability: Business ethics apply universally across
different industries, sectors, and geographical locations. While
specific ethical dilemmas may vary, fundamental principles such as
honesty, integrity, and fairness remain relevant in all business
contexts.
• Interconnectedness: Ethical decisions in business can have far-
reaching consequences, impacting not only the organization itself
but also its stakeholders, the environment, and society as a whole.
Recognizing these interconnections is essential for making ethical
choices that consider the broader implications.

6. • Practical Application: Business ethics are not merely theoretical concepts
but practical guidelines that inform decision-making and behavior within
organizations. They provide frameworks for addressing ethical dilemmas and
navigating complex situations in a manner consistent with moral principles.
• Ethical Leadership: Ethical behavior within an organization starts with
ethical leadership. Leaders play a crucial role in setting the tone, establishing
ethical standards, and fostering a culture of integrity and accountability
among employees.
• Balance of Interests: Business ethics involve striking a balance between
various competing interests, including those of shareholders, employees,
customers, suppliers, and the broader community. Ethical decision-making
seeks to consider and reconcile these interests while upholding principles of
fairness and justice.
• Accountability and Responsibility: Ethical conduct requires individuals
and organizations to take responsibility for their actions and decisions.
Accountability mechanisms, such as transparency, oversight, and
consequences for unethical behavior, help ensure adherence to ethical
standards.

7. Business Ethics Vs. Corporate governance
Basis of Difference Business Ethics Corporate Governance
Definition Business ethics refers to the
principles, values, and
standards of conduct that guide
behavior within the business
environment. It addresses
moral principles and ethical
dilemmas that arise in business
decision-making and
interactions with stakeholders.
Corporate governance involves
the structures, processes, and
mechanisms through which a
company is directed and
controlled. It encompasses the
relationships between the board
of directors, management,
shareholders, and other
stakeholders, aiming to ensure
accountability, transparency,
and fairness in corporate
decision-making.

8. Nature Business ethics are inherently
normative and deal with
questions of right and wrong,
good and bad. They provide
guidelines for ethical decision-
making and behavior in
business contexts, emphasizing
moral principles and values.
Corporate governance is more
procedural and regulatory in
nature. It involves the
establishment of mechanisms and
frameworks to ensure
accountability, transparency, and
effective management of
corporate affairs, often guided by
legal requirements and best
practices.
Decision-
Making
Context
Business ethics influence decision-
making at all levels of the
organization, from individual
choices made by employees to
strategic decisions made by top
management. Ethical considerations
are integrated into business
processes, policies, and practices.
Corporate governance primarily
shapes decision-making processes
at the highest levels of the
organization, such as the board of
directors and executive
management. It involves
establishing frameworks for
effective oversight, risk
management, and strategic
direction.

9. Business Ethics Vs. Values
• Managerial Values: Managerial values focus on the
individual beliefs and preferences of managers or leaders and
how these values shape their leadership approach,
management style, and decision-making processes. Managerial
values may vary among individuals and influence
organizational culture.
• Business Ethics: Business ethics focus on the ethical
dimensions of decision-making and behavior within the
organization as a whole. It addresses questions of right and
wrong, moral dilemmas, and the application of ethical
principles to business practices, regardless of individual
managerial values.

10. Significance of Business Ethics
• Business ethics will create a positive image of the company. If both
the employees and an employer follow business ethics with
enthusiasm without getting indulged in unscrupulous activities, it
will create a positive image in the society of the organization.
• If business ethics are strictly followed, it will safeguard consumer
rights as well. Not only will they get complete information about
what they are consuming, but their grievances can be redressed
ethically.
• Reducing Legal and Financial Risks: Adhering to ethical standards
helps mitigate legal and financial risks associated with unethical
behavior. Compliance with laws, regulations, and industry standards
reduces the likelihood of lawsuits, fines, and reputational damage,
safeguarding the organization's assets and resources.

11. • Attracting Investors and Partnerships: Investors and partners prefer to
collaborate with organizations that demonstrate strong ethical principles and
values. Ethical behavior signals stability, reliability, and integrity, making the
organization an attractive investment or partnership opportunity.
• Strengthening Corporate Culture: Business ethics play a vital role in shaping
corporate culture by defining shared values, norms, and expectations. A strong
ethical culture guides employee behavior, decision-making, and interactions,
promoting a sense of belonging, pride, and commitment to the organization's
mission and goals.
• Attracting and Retaining Talent: Employees are attracted to organizations
with strong ethical values and a positive corporate culture. Ethical organizations
tend to prioritize employee well-being, provide a supportive work environment,
and offer opportunities for professional growth. As a result, they can attract and
retain top talent, leading to increased productivity and innovation.
• Improving Decision-Making and Problem-Solving: Business ethics provide a
framework for making ethical decisions and resolving ethical dilemmas. Ethical
principles guide employees and managers in evaluating the consequences of
their actions, considering the interests of stakeholders, and making decisions
that align with moral values. Ethical decision-making enhances organizational
effectiveness and contributes to positive outcomes.

12. Examples of Business Ethics being followed and violated
• Starbucks' Ethical Sourcing: Starbucks has prioritized ethical
sourcing of coffee beans by implementing programs such as Coffee
and Farmer Equity (C.A.F.E.) Practices. These practices ensure that
coffee is sourced from farms that meet environmental, social, and
economic standards. Starbucks also supports fair trade and pays
premium prices to coffee farmers, contributing to the sustainability of
coffee-growing communities.
• Nike and Sweatshop Labor: Nike, a global leader in athletic
footwear and apparel, faced intense scrutiny in the 1990s over
allegations of sweatshop labor practices in its overseas
manufacturing plants. Reports revealed poor working conditions, low
wages, and child labor in factories contracted by Nike. This ethical
dilemma forced the company to reassess its supply chain practices,
implement stricter labor standards, and improve transparency in its
manufacturing processes.

13. Theories of Business Ethics
• There are two types of Ethical Theories:

14. Consequential theory
• Consequentialist theories assess the morality of an action based on its
outcomes or consequences. These theories prioritize achieving the
best overall outcome or maximizing utility. Here are two prominent
types of this theory:
1. Utilitarianism: Utilitarianism, proposed by philosophers like
Jeremy Bentham and John Stuart Mill, asserts that the morality of
an action is determined by its ability to produce the greatest amount
of happiness or pleasure for the greatest number of people. In a
business context, this means that an action is considered ethical if it
results in the greatest net benefit for the stakeholders involved.
Example: Consider a pharmaceutical company deciding to reduce the
price of a life-saving drug, making it more accessible to low-income
patients. Despite reducing profits, the action increases overall happiness
by improving access to essential healthcare. Utilitarianism would
support this decision as it maximizes the overall good for a greater
number of people.

15. Utilitarian theory example:
Example: A manufacturing company is considering whether
to invest in upgrading its production facilities to reduce
pollution emissions.
While the upgrade would incur significant costs, it would
also result in lower environmental impact, improved air
quality for nearby residents, and reduced health risks for
employees. By applying utilitarian principles, the company
decides to proceed with the upgrade because the benefits of
reduced pollution outweigh the costs, leading to greater
overall happiness and well-being for stakeholders.

16. 2. Egoism: Ethical egoism posits that individuals should act in their own self-interest to
maximize personal happiness or well-being. It argues that individuals have a moral
obligation to prioritize their own interests, as long as it does not harm others. In a business
context, this theory may justify actions that prioritize the interests of the company or its
shareholders.
Example: An executive at Company Y is faced with a decision to lay off a significant
portion of the workforce to cut costs and increase profits, despite knowing that it will
negatively impact employees' livelihoods. Choosing an egoistic approach, the executive
proceeds with the layoffs, prioritizing the financial interests of the company and its
shareholders over the well-being of employees.
Example: Consider a CEO of a multinational corporation who faces a decision to
outsource production to a foreign country where labor costs are significantly lower. From
an egoist perspective, the CEO may justify outsourcing by arguing that it will increase
profitability and shareholder value, which ultimately benefits the company's employees,
investors, and other stakeholders. While outsourcing may result in job losses in the CEO's
home country, the egoist would prioritize the company's interests and the CEO's own
financial well-being.

17. While both utilitarianism and egoism focus on
the consequences of actions, they differ in their
consideration of whose interests should be
prioritized.
Utilitarianism seeks to maximize overall happiness for the greatest
number of people, while egoism prioritizes the self-interest of
individuals or entities.
In practice, businesses may encounter ethical dilemmas where they
must weigh the interests of various stakeholders and determine the
most morally justifiable course of action based on these
consequentialist theories.

18. Non-Consequentialist Theories
• Non-Consequentialist Theories: Non-consequentialist theories, also
known as deontological theories, emphasize moral principles, duties, or
rules irrespective of their outcomes. These theories prioritize moral
obligations and principles over consequences. Types are:
1. Kantian Ethics:
• Kantian ethics, proposed by Immanuel Kant, suggests that the morality of
an action is determined by its adherence to universal moral principles,
rather than its consequences. It emphasizes rationality and the importance
of following moral duties or rules that can be universally applied.
• Example: A company adopts a policy of honesty and transparency in all its
dealings, adhering to the principle that lying or deceiving customers is
inherently wrong, regardless of potential benefits or consequences. Kantian
ethics would support this decision as it upholds the universal moral
principle of honesty.

19. 2. Rights-based Ethics:
• Rights-based ethics emphasizes the importance of respecting
and protecting individual rights and freedoms. It posits that
certain rights, such as the right to life, liberty, and property, are
inherent and should not be violated, regardless of the
consequences.
• Example: A company upholds employees' rights to fair wages,
safe working conditions, and freedom from discrimination,
recognizing these as fundamental rights that must be respected
and protected. Rights-based ethics would support this decision
as it prioritizes the protection of individual rights.

20. • 3. Virtue Ethics: Virtue ethics is an ethical theory that emphasizes the
development of virtuous character traits as the foundation for ethical
behavior. Unlike consequentialist theories that focus on the outcomes of
actions or deontological theories that prioritize adherence to moral rules or
duties, virtue ethics places central importance on the moral character of the
individual and the cultivation of virtues.
• In virtue ethics, virtuous traits or characteristics are considered intrinsic
goods that lead to ethical behavior. These virtues include qualities such as
honesty, integrity, compassion, courage, fairness, and empathy. Practicing
virtue ethics involves striving to embody and cultivate these virtues in one's
actions and decisions.
• One of the key proponents of virtue ethics was the ancient Greek philosopher
Aristotle, who emphasized the importance of developing virtuous character
through habituation and moral education.
• For instance, imagine a sales representative of a company who
encounters a situation where a customer mistakenly believes a product
feature that would not benefit them as described. In line with virtue ethics,
the sales representative decides to be transparent and informs the customer of
the misunderstanding, even though it may result in losing the sale. By
prioritizing honesty and integrity over immediate financial gain, the sales
representative exemplifies virtuous behavior and contributes to fostering
trust and credibility in the company's relationships with its customers.

21. Code of ethics in business
• A code of ethics is a set of specific statements indicating actions
considered ethical as well as unethical. Such statements are
developed by realistic application of general ethical standards to
business situation.
• A code of ethics document may outline the mission and values
of the business or organization, how professionals are supposed
to approach problems, the ethical principles based on the
organization's core values, and the standards to which the
professional is held.
• For members of an organization, violating the code of ethics can
result in sanctions including termination.

22. • Components of a Code of Ethics:
1. Ethical Standards: A code of ethics establishes ethical standards
that individuals and organizations are expected to adhere to. These
standards reflect fundamental principles of integrity, honesty,
fairness, respect, responsibility, and accountability.
EXAMPLE
• Scenario: A marketing executive is asked to promote a product using
misleading claims to increase sales.
• Application of Code of Ethics: The code would emphasize honesty and
integrity in all marketing communications. It would prohibit the use of
deceptive practices and require marketing materials to accurately represent the
product's features and benefits.
2. Guidance for Conduct: It provides guidance on acceptable and
unacceptable behavior in different business situations. This may
include guidelines for interactions with customers, employees,
suppliers, competitors, and other stakeholders.

23. 3. Confidentiality and Privacy: A code of ethics typically includes
provisions regarding the protection of confidential information and the
privacy rights of individuals. It outlines protocols for handling sensitive
data and respecting privacy boundaries.
4. Continuous Improvement: A code of ethics may also include
provisions for ongoing review, evaluation, and improvement of ethical
practices within the organization. It acknowledges that ethical challenges
may evolve over time and emphasizes the importance of adapting ethical
standards accordingly.
EXAMPLE
• Scenario: A company realizes that its environmental impact is higher
than desired due to excessive waste generation.
• Application of Code of Ethics: The code promotes continuous
improvement in environmental practices. In response to the issue, the
company implements measures to reduce waste generation, such as
implementing recycling programs, optimizing production processes to
minimize waste, and investing in sustainable practices to mitigate
environmental impact.

24. 5. Conflicts of Interest: It addresses conflicts of interest
that may arise in business relationships and provides
protocols for managing such conflicts in an ethical manner.
This ensures that business decisions are not unduly
influenced by personal interests or biases.
EXAMPLE
• Scenario: A purchasing manager receives gifts from a supplier in
exchange for favoring their company's products in procurement
decisions.
• Application of Code of Ethics: The code of ethics would prohibit
employees from accepting gifts or favors that could compromise
their objectivity or loyalty to the organization. It would require
disclosure of any potential conflicts of interest and abstention from
decisions where personal interests conflict with organizational
interests.

25. 6. Compliance and Legal Requirements: A code of ethics often
includes provisions to ensure compliance with legal requirements and
regulations governing business activities. It helps businesses navigate
complex legal landscapes while also upholding ethical standards
beyond mere legal compliance.
EXAMPLE
• Scenario: A financial analyst is asked to manipulate financial data to
meet quarterly targets, which may violate accounting regulations.
• Application of Code of Ethics: The code would mandate
compliance with all applicable laws and regulations, including
accounting standards. It would prohibit the manipulation of financial
data and emphasize the importance of accurate reporting and
transparency.

26. 7. Reporting Mechanisms: Many codes of ethics incorporate
mechanisms for reporting ethical violations or concerns. This
encourages employees and stakeholders to raise ethical issues
without fear of retaliation and promotes a culture of
accountability and transparency.
EXAMPLE
• Scenario: An employee witnesses unethical behavior by a
senior executive but fears retaliation for reporting it.
• Application of Code of Ethics: The code would establish a
confidential reporting mechanism, such as an anonymous
hotline or whistleblower policy. It would assure employees
that reports of ethical violations will be investigated
impartially, and measures will be taken to protect
whistleblowers from retaliation.

27. ETHOS OF VEDANTA IN MANAGEMENT
• Ethos refers to the characteristic spirit, beliefs, and values of a
community, culture, or group. It encompasses the guiding
principles, moral code, and overall culture that shape behavior
and decision-making within that context.
• In the context of management, ethos refers to the fundamental
values, principles, and beliefs that guide the actions, decisions,
and culture within an organization. It encompasses the
organization's mission, vision, and core values, as well as the
norms and behaviors expected of its members.

28. CONT.
• The term Vedanta is a Sanskrit compound word that is formed with a
combination of two basic words: Veda and anta. The Sanskrit term ‘Veda’ is
derived from ‘vid’ which means - to know or to see directly or to have the
knowledge and ‘anta’ means ‘the end of’ or ‘the goal of’ or ‘culmination’.
• So, the compound term Vedanta means ‘the quest for Self-knowledge’ or
‘the knowledge of Truth’ or ‘the knowledge of our divine nature.
• Vedanta primarily focuses on understanding the nature of reality, the self,
and the ultimate truth. It explores concepts such as the existence of
Brahman (the ultimate reality), the nature of Atman (the individual self),
and the relationship between the two.

29. • Now, when we talk about "Vedanta in management," we're
referring to the application of the principles and insights
derived from Vedanta philosophy in the context of
organizational management. This involves integrating the
ethos of Vedanta, which includes values such as self-
awareness, interconnectedness, ethical conduct, and holistic
perspective, into management practices to foster a culture of
integrity, purpose, and well-being within the organization.

30. Features of Indian Ethos
• Each Soul is Potentially Divine: Indian ethos recognizes the inherent
divinity within each individual. This belief underscores the idea that every
person possesses the potential for spiritual growth and enlightenment.
• Emphasis on Values and Ethics: Indian culture places a strong emphasis
on moral values and ethical conduct. Virtues such as honesty, compassion,
humility, and integrity are highly valued and considered essential for
leading a righteous life.
• Emphasis on Duties and Responsibilities: Indian ethos emphasizes
fulfilling one's duties and responsibilities (dharma) in various roles and
relationships, whether as a member of the family, community, or society.
This focus on duty encourages individuals to prioritize their obligations
over personal desires.
• Rarely Speaks of Rights and Privileges: Unlike Western philosophies that
often emphasize individual rights and freedoms, Indian ethos tends to focus
more on fulfilling one's duties and responsibilities rather than asserting
one's rights and privileges.

31. • Balance and Equilibrium: The Indian ethos emphasizes the
importance of balance and equilibrium in all aspects of life.
This concept includes the idea of maintaining balance between
worldly responsibilities and spiritual pursuits, balancing
material desires with spiritual aspirations, and seeking
harmony between opposing forces (such as light and dark,
good and evil).
• Respect for Elders and Teachers: Indian culture places a
high value on respect for elders and teachers. The guru-shishya
tradition, where knowledge is imparted from teacher to
student, reflects the reverence for wisdom and learning.
• Hospitality and Generosity: Indian culture places a high
value on hospitality and generosity towards guests and those in
need. Offering food, shelter, and assistance to others is
considered virtuous and is deeply ingrained in social customs.

32. • Respect for Nature: Indian ethos reveres nature and the
environment, viewing it as sacred and worthy of preservation.
Traditional practices such as worshipping rivers, trees, and
animals reflect the reverence and respect for the natural world.
• Seva (Selfless Service): Service to others, known as seva, is
considered a noble act in Indian ethos. Whether through
charitable activities, volunteering, or acts of kindness, seva is
seen as a way to express compassion, humility, and
selflessness.

33. ETHOS OF VEDANTA IN MANAGEMENT
• Dharma (Duty/Righteousness): Dharma is the moral and ethical duty one
must fulfill in their role or position. In management, it means acting in
accordance with the greater good of the organization, stakeholders,
and society as a whole. For example, a CEO making decisions that
prioritize long-term sustainability over short-term profits is following the
principle of Dharma.
• Ahimsa (Non-violence): Ahimsa refers to non-violence, not just physical
but also in speech and thought. In management, it means resolving
conflicts and issues without resorting to aggression or harm. This can
involve fostering a workplace culture of respect and empathy where
constructive criticism is encouraged rather than hostility.
• Satya (Truth): Satya emphasizes truthfulness and honesty. In
management, it means being transparent in communication, whether
it's with employees, stakeholders, or customers. For instance,
communicating accurate information about company’s financial health to
stakeholders.

34. • Aparigraha (Non-possessiveness): Aparigraha encourages non-
attachment to material possessions and desires. In management, it
involves avoiding greed and excessive accumulation of wealth or
resources. Leaders practicing Aparigraha may focus on using
resources efficiently and sharing success with employees and
communities rather than hoarding wealth for personal gain.
• Atman(Inner-self): Atman refers to the inner self or soul. In
management, it emphasizes self-awareness, self-development, and
understanding the needs and aspirations of oneself and others.
Managers who recognize the atman within themselves and their
employees foster a supportive work culture that promotes
personal and professional growth.
• Sattva(Purity): Sattva signifies purity, harmony, and balance. In
management, it involves cultivating a work environment
characterized by clarity, positivity, and equanimity. Managers
promoting sattva inspire creativity and foster collaboration.

35. • Santosh: Santosh means contentment or satisfaction. In
management, it involves recognizing and appreciating the
accomplishments and contributions of employees, fostering
a culture of gratitude and fulfillment. Managers promoting
santosh inspire loyalty, motivation, and long-term commitment
among their team members.
• Samaveshita (Inclusivity): Samaveshita refers to
inclusiveness and integration. In management, it emphasizes
respecting diversity, embracing different perspectives, and
fostering a sense of belonging among employees. Managers
promoting samaveshita create an inclusive work environment
where everyone feels valued and empowered to contribute
their unique talents and ideas.

36. Role of various agencies in ensuring Ethics in Corporations
Public and Media
Auditors
Judiciary
Directors
Institutional investors
Government Agencies
SEBI

37. • Public Opinion and Media:
Public opinion and media act as watchdogs, highlighting
unethical practices in corporations through investigative
journalism, exposing corruption, fraud, or lapses in corporate
governance.
The right to freedom of speech and expression, guaranteed by
Article 19(1)(a) of the Indian Constitution, empowers the media
and public to critique corporate behavior. Additionally, the Right
to Information Act, 2005, facilitates access to information,
enabling public scrutiny of corporate activities.
For example, in 2016, Nestle India faced a massive backlash and
a significant drop in sales following allegations of lead
contamination in its popular noodle brand, Maggi. Subsequently,
Nestle undertook extensive corrective measures to restore public
trust.

38. • Auditors: An auditor, as per Indian law, refers to a chartered accountant or a
firm of chartered accountants appointed by a company to conduct an
independent examination of its financial statements, books of accounts, and
other relevant records.
• The auditor's objective is to express an opinion on whether the financial
statements present a true and fair view of the company's financial position and
performance in accordance with applicable accounting standards and statutory
requirements.
• Auditors are required to adhere to auditing standards, ethical guidelines, and
reporting requirements prescribed by the Institute of Chartered Accountants of
India (ICAI) and regulatory authorities such as the Securities and Exchange
Board of India (SEBI) and the Reserve Bank of India (RBI). They play a
crucial role in enhancing transparency, reliability, and credibility in financial
reporting, thereby facilitating informed decision-making by stakeholders and
ensuring compliance with corporate governance norms and regulatory
frameworks.
• Example: The Satyam scandal exposed lapses in auditing practices when the
company's auditor, Price Waterhouse, failed to detect fraudulent activities
despite conducting audits. Subsequently, Price Waterhouse faced regulatory
action, and the case prompted reforms in auditing standards and oversight
mechanisms.

39. • Director: directors are responsible for overseeing the management
of a company and ensuring that it operates ethically and in best
interest of stakeholders. Role of independent directors is crucial in
bringing transparency in operations. Section 149(10) mandates that
at least one-third of the total number of directors (excluding
nominee directors and alternate directors) of listed companies
should be independent directors. This provision also applies to
certain prescribed classes of public companies.
• Institutional Investors: Institutional investors, such as mutual
funds, pension funds, and insurance companies, play a crucial role in
promoting ethical behavior in corporations.
Institutional investors have significant financial stakes in companies,
giving them the leverage to demand transparency, accountability, and
responsible corporate behavior. They often advocate for improved
governance practices, environmental sustainability, social
responsibility, and ethical conduct. Through voting rights, shareholder
resolutions, and dialogue with company management, institutional
investors exert pressure on corporations to align their practices with
ethical standards to protect long-term shareholder value.

40. • SEBI (Securities and Exchange Board of India): SEBI, formulated
on 12th April 1988, regulates the securities market in India and plays a
vital role in ensuring ethics in corporations, particularly those listed
on stock exchanges. It formulates policies, regulations, and codes of
conduct for listed companies to promote transparency, fairness, and
investor protection.
SEBI mandates disclosure requirements, corporate governance norms,
and codes of conduct for listed companies to prevent market abuse,
insider trading, and fraudulent practices. SEBI has power to inspect
books of accounts and documents of companies as required.
• Judiciary: The judiciary interprets laws, resolves disputes, and
delivers judgments to uphold ethical standards, enforce legal
accountability, and provide remedies for aggrieved parties. Courts
adjudicate cases of corporate misconduct, shareholder disputes, and
breaches of fiduciary duties. For instance, courts may order
compensation for victims of corporate fraud.

41. • Government agencies: In India, we have :
1. Ministry of Corporate affairs(MCA) which is responsible for
administering the Companies Act, which governs the formation,
functioning, and dissolution of companies in India.
2. Central Bureau of Investigation (CBI) investigates economic
offenses, including corporate fraud and corruption, and takes legal
action against offenders.
3. Institute of Chartered Accountants of India (ICAI): ICAI is the
regulatory body for chartered accountants in India.
4. Reserve Bank of India (RBI): RBI oversees banks and financial
institutions to ensure compliance with regulations and ethical
standards.
5. Telecom Regulatory Authority of India (TRAI): TRAI also
ensures ethical practices among telecom companies.
6. Insurance Regulatory and Development Authority (IRDA):
IRDA regulates the insurance industry in India, overseeing
insurance companies and intermediaries.