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1. ETHICAL ISSUES AND
CHALLENGES IN THE
WORKPLACE
BUSINESS AND
ENVIRONMENTAL
SUSTAINABILITY

2. LEARNING TARGETS
 Describe the nature of an employer’s responsibility in
ensuring employee health and safety
 Suggest ways to enhance employer-employee relationship
and encourage just and fair business policies and practices
such as recruitment, promotion, retention, marketing and
advertising, intellectual property rights, sources and uses
of funds, and the like.
 Promote policies and practices in environmental
management
 Identify ethical issues in marketing

3. Questions?
 Why is it critical to be aware of ethical
issues and problems in the workplace?
 What is the significance of being ethical in
the workplace?

4.  Business organizations face ethical challenges in the workplace
in managing their employees. Research shows that business
organizations that place employees at the core of the
companies’ strategies produce higher long-term returns to
shareholders.
 One of the most talked about employee-related ethical issues
in the Philippines is the contractualization of employees
(colloquially known as “endo” (end of contract) or “555”).
Employees under this arrangement do not enjoy the social
protection benefits that a regular employee receives such as
SSS, PhilHealth, Pag-IBIG fund, vacation and sick leaves, and
security of tenure, among others. Contractual employees are
given a five-month contract to work in a company.

5. EMPLOYMENT RELATIONSHIP (Employer
Responsibilities and Employee Rights)
 Companies have a responsibility to take care of their employees and
provide for their workplace needs. When an employer hires employee,
an employment relationship is formed. Employment already raises
ethical issues of power, authority, obligation, responsibility, fair
treatment and expectations.
 Due Process and Just Cause – there are times when an employee
commits a mistake and employer will have to take action to give the
employee a sanction commensurate with the mistake committed.
However, before that takes place, the employee will have to undergo
due process, which is defined as the “rule that a legal case must be
done in a way that protects the rights of all the people involved.”

6.  Downsizing - there are times when a company needs to downsize, that
is, to terminate employees to limit costs due to financial difficulties,
closure of offices or branches, automation an use of technology that
replace human resources, and other reasons that the management may
deem fit. Terminating workers is not necessarily unethical decision;
however, companies must act ethically in the process of downsizing.
 When laying-off employees, the management must maintain respect,
dignity, transparency, and consistency.
 The stakeholders that will be affected by the action must be informed
about the decision regarding downsizing.

7.  Health and Safety – employer have a responsibility to protect the
employees’ health and safety while at work. Health and safety are
intangible assets that employees have and are valued both as a means
for attaining other valuable ends and as ends in themselves. They both
have instrumental and intrinsic values.
 Instrumental value is defined as a means to an end. You value things
because of their function. For example, you value your shoes because
they protect your feet when you walk.
 Intrinsic value pertains to the value of something in itself. If your pair
of shoes protects your feet, is that a good thing? If you say yes, you can
conclude that shoes are a good thing because it helps you get to where
you need to go, and help you reach you goals. Having shoes makes you
happy.

8. DISCRIMINATION AND DIVERSITY
 Discrimination is merely being in favor of or against a person based on
group, age, social class, gender orientation, race, religion, or any
category to which that person belongs rather than on individual merit.
 Diversity refers to the presence of differing culture, race, religion,
language, ethnicity, gender, ability, experience, age, social class, and
other categories in the workplace. Workforce diversity is important in
organizations because it helps enhance competitiveness, expand
organizational capabilities, encourage sharing of expertise and skills
from past experiences, and enhance access to markets (Shermerhorn,
Osborn, Hunt, Uhl-Bien 2012).

9. BUSINESS AND ENVIRONMENTAL
SUSTAINABILITY
 Environmental Issues and Sustainability
 There is now a call for international public awareness on
environmental sustainability, and countries in different
parts of the world come up with legislations to protect the
environment. Business organizations and individuals alike
are called to take part in addressing the pressing
environmental issues. One of the environmental issues
that directly concerns business organizations is the
depletion of natural resources.

10.  1. Consumer affluence– the increase in wealth of individual income
has led to increased and indiscriminate spending and consumption,
which produce waste. As democratic country’s function based on the
law of supply and demand, their economy produces what is wanted by
citizens who have the capacity to pay, and not what might be needed
by the impoverished/poor members of the society.
 2. Materialistic cultural values – most people have acquired the
mentality of consumption over conservation, and the "throwaway
culture.” With access to retail stores everywhere, acquiring goods has
been easier. This promotes the practice of overconsumption and
excessive production of disposable or short-lived items.

11.  3. Urbanization – the concentration of people in cities
increases pollution. More people in the cities need more
cars to transport people around and more energy to
sustain daily activities at home and in offices. More
people mean more demand for houses, which pushes the
developers to use lands that once were forests or to
reclaim land from bodies of water.
 4. Population explosion – population growth means more
industrialization, product consumption, waste, and
pollution. This means that more natural resources are
required to meet the growing demands of the population,
and that more people will contribute to environmental
pollution.

12.  5. New and uncontrolled technologies – some companies that
prioritize profits, convenience, and consumption over environmental
protection disregard the impacts of the technologies they used and
developed. Although many business organizations that focus on
technological advancements are now more aware of their social
responsibility to the environment, it is still not a mainstream concern
for most companies.
 6. Industrialization – industrial activities deplete natural resources and
the destructive use of the environment for economic reasons causes
environmental decay. Air and water pollution due to manufacturing
activities, improper waste management, use and improper disposal of
toxic chemicals, and other activities are associated with the
manufacturing sector.

13. Principles for Business Sustainability
 The sustainable model provides a general picture of how
business organizations should conduct their businesses in
consideration of their environmental responsibility. This
section will discuss the general principles for a sustainable
business.
 Eco-efficiency is practically "doing more with less," and has
been an environmental guideline for decades. For example,
riding a bike is better than riding a bus; riding a bus or train is
better than flying on a plane, in terms of measuring one's
carbon footprint, or the amount of greenhouse gases
produced to directly or indirectly support human activities.

14.  Biomimicry is the second principle where, ideally, the waste materials
of one company are turned into a resource by another firm. The
ultimate goal of this principle is to eliminate waste instead of just
reducing it. One example or strategy that follows this principle is
closed-loop production, a manufacturing or production that seeks to
integrate what is presently waste back into production.
 A service-based economy interprets consumer demand as a demand
for services—transportation, laundry, and maintenance of cars and
appliances, among others. This principle produces incentives for
product redesigns that create more durable and more recyclable
products. For example, consumers may choose to have their clothes
cleaned by a laundry service company instead of buying their own
washing machines.

15. ETHICS AND MARKETING
 Marketing is defined as a business activity that
aims to build value for the customers and
manage customer relationships in order for the
company to gain value in return. This exchange
of transaction involves convincing the customers
of a product's value through marketing
activities-advertising, events, sponsorships, and
many others.

16.  Product Safety and Liability
 Business organizations have a foremost ethical responsibility to design,
manufacture, and promote their products in ways that do not cause
harm to consumers. The focus of much of the discussion on business'
responsibility for product safety is on assigning liability, or determining
who is at fault, for harms caused by unsafe products.
 In the Philippines, the Bureau of Product Standards (BPS) under the
Department of Trade and Industry (DTI) is responsible for developing,
promulgating, implementing, and promoting standardization activities
as mandated by Republic Act No. 4109 (Charter of BPS) and Republic Act
No. 7394 (Consumer Act of the Philippines). BPS formulates Philippine
National Standards (PNS) or adopts relevant international or foreign
standards to help industries produce quality
products and raise their productivity. These standards do not only
protect consumers but also facilitate trade and compliance with
standards in the global market.

17.  A warranty gives the consumer assurance that the company
will be held liable for product damages or failure (usually a
manufacturiBusiness organizations have the responsibility to
provide the goods at an agreed-upon price. When providing
products to the market, they usually follow the caveat
emptor approach, which assumes that consumers have the
responsibility to look out for their own interests and protect
their own safety when buying a product.
 ng defect) for a certain period of time. This is common for
electronic appliances. A company may repair or replace the
defective product within a defined time period.
The Tort Standards, or the quasi-delict as it is called in
thePhilippines, covers the liabilities of companies.

18. Liability for quasi-delict under the Civil Code of the Philippines
requires the following conditions:
 an unlawful act or omission amounting to a fault or
negligence, imputable to the defendant
 damage or injury to the plaintiff
 such damage or injury being the natural and probable, or
direct and immediate consequence of the defendant's
wrongful act or omission
 there being no preexisting contractual relation between the
plaintiff and the defendant

19. Ethical Issues in Advertising
 Advertising is an important tool in marketing in order to
introduce a product, inform the public about product
updates, and remind and persuade the consumers to buy the
product. Consumers benefit from this tool by receiving
information so they can make informed choices in the
marketplace.
 The tool also gives them the convenience of knowing what
products are available in the market. The most common issue
in advertising is the truth, or how much of the truth is
declared, in advertising materials.

20.  For example, a company may claim that its product can do these things
or produce these benefits where in fact the product can only do so
much. Worse, the product may not even have the benefits it claims to
have in the first place. Most advertising materials, especially magazine
advertisements of beauty products, are portrayed with enhanced or
edited images, which show "perfect” faces and bodies of the models.
 Tobacco advertising on mass media (TV, radio, and print) has been
banned in the Philippines.
Tobacco companies are also directed to use "shock” advertising, which
required them to put on cigarette packaging graphic photos of diseases
that are caused by cigarette smoking, in the hope of discouraging
people from smoking.