SAINT ANTHONY ACADEMY OF GONZAGA SY 2020-2021

SUBJECT: BUSINESS ETHICS AND SOCIAL RESPONSIBILITY ABM 12

LESSONS: THE ROLE OF BUSINESS IN SOCIAL AND ECONOMIC DEVELOPMENT
PREPARD BY: KELVIN JAY S. SAPLA Email: saplakelvinjay@gmail.com

PART I. INTRODUCTION
Hello dear learners! Welcome to this module on Business Ethics and Social Responsibility. This
module makes us realize that there are Filipino businesspersons who practice Social Responsibility in
business through fairness and generosity to employees. Profit-sharing has the positive effect of
minimizing productivity-reducing conflict and generating productivity-enhancing cooperation and
innovation. If only more entrepreneurs and businesspersons were doing this, job satisfaction across the
labor force might be likely, and the results would be immeasurable. The module is self – instructional and
allows you to learn in your own space, at your own pace. So, relax and enjoy learning.
PART II. STANDARDS
CONTENT: The learners demonstrate an understanding of:
1. The nature and forms of business organizations
2. The purposes of establishing business enterprises
3. The core principles underlying fairness, accountability, and transparency in business operation and
stewardship (respect for others’ property)
4. Common practices in business organizations (decorum, protocol, policies, marketing, bookkeeping,
reportorial requirements and documentation, etc.)
LEARNING COMPETENCIES:
The learners:
1.1 differentiate the forms of business organizations
1.2 give examples of the forms of business organizations
1.3 show how these organizations contribute to socioeconomic development
1.4 give examples of how fairness, accountability and transparency is practiced in business and non-profit
organizations
1.5 share observations on business policies and practices
1.6 distinguish between good policies/practices and morally unacceptable policies/practices
LEARNING TARGETS
After going through this module, the learners should be able to:
1. Define and describe business and business organizations
2. Identify and describe the various forms of business organization: sole proprietorship,
partnerships, and corporations
3. Compare and contrast the various forms of business organizations; and
4. Illustrate the role of each form of business organization in the economy
PART III. TRANSFER
PERFORMANCE: The learners are able to:
The learners shall be able to:
1. Identify forms of business organizations and their characteristics
2. Explain the purpose of business organizations and their role in socioeconomic development
3. Explain the core principles of fairness, accountability and transparency in the socioeconomic
development of a country
4. Craft simple “Codes of Ethics” or “Codes of Right Conduct”
Transfer Goal: At the end of this module, you will be able to learn more about business organization and
its social functions in the community to alleviate poverty. The importance of virtuousness on the part of
the individual and institution, and other means that can help for social development
PART VI. DISCUSSION/ SUMMARY

LESSON 1: THE NATURE AND FORMS OF BUSINESS ORGANIZATIONS

As you have taken the subject Fundamentals of Accountancy, Business, and Management 1 you
already learned about this lesson:
Forms of Business Organization:

1.Sole Proprietorship – is owned by one person.

Advantages:
 The owner has all the profit
 The owner makes all the decisions
 It is easy to form and operate
Disadvantages:
 The ownership of the business is not transferrable. Once the owner dies the business
under the owner's name will also be terminated.
 The capital of the business is limited only to the financial capability of the owner
2. Partnership – is owned by two or more persons.
Advantages:
 It is easier to raise capital as there are more than one investors
 “Two heads are better than one”, thus planning towards the development of the business
operation will be efficiently implemented.
 Disadvantages:
 Profits are divided among the partners based on their capital sharing
 A partner can be liable for any mistakes made by other partners
 Any debt or liability of one partner is also a responsibility of other partners

3. Corporation – is created by law (Corporation Code of the Philippines) and it is owned by stockholders
or shareholders.
Advantages:
 Can easily raise additional by selling shares of stock to the public.
 Stockholders or shareholders are not personally liable for the debts or the corporation.
Disadvantages:
 A corporation company is not easy to set up.
 The business operation is restricted by law.

ACTIVITY 1 Direction. List down at least five (5) in each form of business
organization found in your community. Write your answer in your Activity Notebook.
____________________________________________________________
Each form of the business organization plays a vital role in the economic development and
wealth of the country. The businesses make goods and services use by every individual each day.
They provide jobs and through the wages earned people would have a quality of life, buy
property, enjoy leisure activities, and invest money for wealth maximization.
From your answers in your recent activity, you will learn what are the purposes and roles of the
business organization on socio-economic development within your community.
The Social Function of the Business
Social Responsibility
This means that individuals and companies should put their obligations for the best interests of
the environment and society. In business, it applies through Corporate Social Responsibility (CSR)
wherein a certain company will have CSR programs, volunteer efforts, and charitable contributions as the
organizations give back to society.
Responsibilities to the General Public
These responsibilities include avoiding risks and promoting public health, protecting the
environment, and developing the quality of service to the employees. The business organization should
support charities, aid to humanity programs, or any community services through their Corporate Social
Responsibility.
Responsibilities to customers
Industries should give protection to the consumers’ rights to be safe, to be informed, to select, and
to be heard.
Responsibilities to employees
In addition to pay, employees today expect a safe working environment, greater benefits such as
bonuses, incentives, allowances, and as much possible could compensate all the workloads. It is also the
responsibility of businesses to ensure that bullying, age discrimination, and sexual harassment do not
happen in the workplace.
Responsibilities to investors and the financial community
Businesses must be truthful in disclosing their profits and financial standing to avoid deceiving
investors. When companies fail in meeting these responsibilities, thousands of investors, employees, and
customers can suffer. Therefore, government agencies exist to ensure that businesses adhere to proper
accounting practices and to examine alleged fraud and other monetary misdeeds.

ACTIVITY 2: Suppose you are going to put up your own company, list down at least ten (10) of
your possible contributions to the socio-economic development in your community. Write your
answer in your Activity Notebook.
______________________________________________________________________

LESSON II CORE PRINCIPLES OF FAIRNESS, ACCOUNTABILITY AND TRANSPARENCY

You have learned in the previous lesson about the forms of business organization and its role in
the socio-economic development in the society.

Goods and services provided by the business contributed to the quality of life of the people within the
community. Creating jobs has been vital to socio-economic development. Business establishments have
many social functions; one is the Corporate Social Responsibility (CSR) in which they will have
programs and activities that benefit society. Another is their responsibility to the general public,
customers, employees and investors, and the financial community.

ACTIVITY 3: As a student, how do you apply accountability, fairness, and transparency? Write your
answer in your Activity Notebook.
_________________________________________________________________________________
Discussion
Core Principles of Fairness, Accountability, and Transparency
Accountability is the obligation to demonstrate that work has been conducted in compliance with agreed
rules and standards. To be accountable is to be liable to explain or justify one’s actions and decisions.
Accountability implies responsibility: it is reasonable only to hold people to account for those things for
which they are responsible.
Fairness is the quality of making judgments that are free from discrimination. However, in the context of
business organization, it involves balancing the interests involved in all decision-making including any
hiring, firing (of employees), compensation, and reward system. 
Transparency is the quality of being easily seen. In a business context, transparency is honesty and
openness. Corporate transparency includes the ethical justification for information disclosure and the
management-employee relationship (participative management). The management should be honest and
open to its employees about the operation of the business for them to easily participate in attaining the
organizational goals and suggest great ideas to solve problems. In non-government offices, appropriate
information disclosure is necessary to inform donors about how their money is used by a certain
organization.
Notions of Competence, Professionalism, and Responsibility
The minimum competencies expected of professionals:
1. Technical Skills – encompass the ability to apply specialized knowledge or expertise.
2. Human Skills – are the abilities to understand, communicate with, motivate, and support other
people, both individually and in groups.
3. Conceptual Skills – are the mental abilities that managers must have to understand, analyze, and
diagnose complex situations.
The moral character and technical competence are viewed as being equally important for worker
excellence. The most basic necessary skill for a working professional is a solid competence in the human
sphere, in the sphere of work. He/she must have a human maturity so that he/she works with the highest
professionalism. Work is done in a spirit of service and love for those people around us.

A worker is expected to work with trustworthiness, integrity, benevolence, and competence.

Trustworthiness is very important to managers. Once it is broken, employees will become dissatisfied and
demoralized.
Servant leaders go beyond their self-interest and focus on opportunities to help followers grow and
develop. They do not use their powers to achieve their goals. The characteristic behavior of servant
leaders includes listening, empathizing, persuading, accepting stewardship, actively developing follower’s
potential.
Effect of servant leadership:
1. Resulted in higher levels of commitment to the supervisor
2. Increase team potency (a belief that one’s team has above-average skills and abilities.
3. Higher levels of citizenship are associated with a focus on growth and advancement.

ACTIVITY 4 Direction: In one hundred (100) words answer the question below. Write your answer in
your Activity Notebook.
When I am in a workplace, how do I instill professionalism?
____________________________________________________________________________________

LESSON 3: CODE OF ETHICS

Code of Ethics
This is referred to as an "ethical code," that may involve areas such as business ethics, a code of
professional practice, and an employee code of conduct. It can also be a guiding principle designed to
help professionals conduct business honestly and with integrity. A code of ethics document may outline
the mission and values of the business and how professionals are supposed to approach difficulties. The
ethical philosophies are based on the organization’s core values and the standards to which the
professional is held.
The purpose of a code of ethics is to provide guidance and set common ethical standards to
promote consistency in behavior across all levels of employment. It is concerned with an individual's
moral judgments about right and wrong. Ethical behavior and corporate social responsibility can bring
significant benefits to the business.
Ethical values guide us along a pathway to deal more effectively with ethical dilemmas by
eliminating those behaviors that do not conform to our sense of right and wrong and our best rational
interests without sacrificing others.
Common Practices in Business Organizations
1. Decorum is defined as appropriate, polite behavior in a particular society. Office decorum is
about the Do's and Don'ts to be practiced in the workplace. It considers a simple list of guidelines
that help in making the office environment a better place to work.
2. Protocol means an official set of procedures for what actions to take in a certain situation. It is
the proper procedure of conduct and a standard set of rules that allow employees to communicate
with each other. The business protocol is an important aspect of the formation of relationships
within a company and between companies. It also helps ensure that all employees comprehend
their role in the company, their tasks, and challenges on how to act on it accurately and quickly.
The purpose of the business protocol is to encourage employees to act uniformly.
 3. Policies and Procedures provide employees a clear understanding of what is being expected of
them. They also provide a fair, predictable, and consistent approach in managing a workplace and
its issues. Company policies and procedures are being implemented to protect the rights of the
employees as well as the business interest of the employers. It establishes the rules of conduct
within the organization and outlines the responsibilities of both employees and employers.
4. Marketing refers to the activities of a company that undertakes to promote the buying and selling
of its product and services. It includes promotion, doing research, advertising, selling, and
distribution of the services and its goods.
Seven Elements of Marketing:
1. Product
2. Price
3. Promotion
4. Place
5. Packaging
6. Positioning
7. People
5. Bookkeeping is a system of maintaining records and data of a particular business with a
centralized book of records to balance daily sales and cash receipts as well as to reconcile bank
accounts. It is considered as the organization of financial information in which you are keeping
your records organized and make it easier to locate and provide to appropriate parties. It is
important because it helps with business analysis, a tool used by management to analyze business
performance.
Features of Bookkeeping:
a. Recording financial transactions
b. Posting debits and credits
c. Producing Invoices
d. Maintaining and balancing subsidiaries, general ledger, and historical accounts
e. Completing payroll

6. Reportorial Requirements. Compliance with this practice is stringent for companies that sell
securities to the public, are listed in the stock exchange, or are classified as public companies. It
is stipulated by laws such as the Securities Regulation Code and the Corporation Code of the
Philippines.
7. Documentation refers to all books, records, files, business records and plans, reports,
correspondence, documentation in respect of the agreement, and other financial and customer
data. It helps to tell the narrative for the decision made and how the client responded to different
situations.

ACTIVITY 5 Direction: Select one of the Code of Ethics and elaborate it in your understanding. Explain
how it affects business organizations? Write your answer in your Activity Notebook.

PART IV. NEW IDEAS/ REFLECTION PART

What I learned in this lesson?
I learned that _________________________________________________________________________

PART VII. EVALUATION

Let us check how much you learned from this module’s coverage
Direction. Answer the 10-item Simple Recall Test and write your answers in your Activity Notebook.
______ 1. These are mental abilities that managers must have to better understand analyze, and
diagnose complex situations.
A. Human Skills C. Conceptual Skills
B. Technical skills D. Management
 ______ 2. This refers to all books, records, files, business records and plans, reports,
correspondence, documentation in respect of the agreement, and other financial and
customer data.
A. Code of Ethics C. Documentation
B. Marketing D. Decorum
______ 3. It refers to the activities of a company that undertakes to promote the buying and selling
of its product and services.
A. Code of Ethics C. Documentation
B. Marketing D. Decorum
______ 4. It is a form of business that is owned by one person.
A. Partnership C. Corporation
B. Sole Proprietorship D. Cooperative
______ 5. In the non-government office, it is very important because the appropriate information
disclosure is necessary to inform donors about how their money is used by a certain
organization.
A. Accountability C. Responsibility
B. Transparency D. Fairness
______ 6. It is defined as appropriate, polite behavior in a particular society.
A. Code of Ethics C. Documentation
B. Marketing D. Decorum
______ 7. This is referred to as an "ethical code," that may encompass areas such as business ethics,
a code of professional practice, and an employee code of conduct.
A. Code of Ethics C. Documentation
B. Marketing D. Decorum
______ 1. They go past their self-centeredness and focus on chances to assist followers grow and
develop.
A. Incorporator C. Proprietor
B. Member D. Partner
______ 9. It is a guiding principle designed to help professionals conduct business honestly and with
integrity.
A Decorum C. Marketing
B. Code of Ethics D. Documentation
______ 10. A business form which is owned by two or more individuals.
A. Sole Proprietorship C. Partnership
B. Cooperative D. Corporation

Reference: Aliza Racelis, RBS Business Ethics and Social Responsibility, First Edition 2017
DepEd Fundamentals of Accountancy, Business Management 1, E-Book
https://www.google.com/url?sa=t&source=web&rct=j&url=http://bcs.solano.edu/workarea/cogden/Bus
%25205%2520Spring%25202014/Ch
%25202/SG_Ch02_CE.pdf&ved=2ahUKEwjVw__Qi5PrAhXVa94KHTGpA4IQFjAAegQIARAC&usg=A
OvVaw2kNfU07EiA8lXI_4z_iC2U&cshid=1597146870324
https://smallbusiness.charon.com
https://www.entreprenuer.com
https://www.investopedia.com
https://www.code.com.au
https://bizfluent.com
https://en.m.wikipedia.org>wiki
https://images.app.goo.gl/aNyzzqNVfAXo3hRU7