“Business ethics & ethos”

Introduction.
 Ethics: meaning & definition.
The word “ethics” is derived from the Greek word “ethos”
which refers to character, guiding beliefs, standards or
ideals that pervade a group, community or people. In the
present context, ethics is used in two ways:
1. As a field of study,
2. As a behavioral pattern.
As a field of study, ethics is that branch of philosophy which
is concerned with moral human character & conduct. It
prescribes mass moral principles that define what ought to
be. As a behavioral pattern, ethics relates to behavior
that is ethical.
 Continue..
In simple words ethics is a set of standards, or a code,
or value system, work out from human reason &
experience, by which human actions are determined as
ultimately right or wrong, good or evil. It is the science
of the supreme ideal of human life.
According to Mackenzie, “ethics is the
study of what is right or good in human conduct”.
 “Values”
A value system is viewed as relatively permanent perceptual
framework which influences the nature of an individual’s
behavior. Values are similar to attitudes but are more
permanent & well built in nature.
values are so embedded that they can be
inferred from people’s behavior & perception, personality
& motivation. They are relatively stable & enduring. This is
because of the way in which they are originally learnt. The
values learnt can be divided into two broad categories:
 Terminal values.
 Instrumental values.
 Continue..
Terminal values leads to ends to be achieved.
For instance comfortable life, family security etc,
terminal values reflect what a person is
ultimately striving to achieve whereas
instrumental values relate to means for achieving
desired ends like ambition, courage, honesty etc.
instrumental values reflect how the person gets
there.
 Characteristics of value
 Part of culture: values are elements of culture, culture is
complex of values, ideas, attitudes & other meaningful symbols
to shape human behavior in the society.
 Learned responses: human values represents learned
phenomenon. Unlike other animals, human being have to learn
almost everything about human from experience because they
live in society having certain cultural characteristics.
 Inculcated: values are inculcated & are passed through
generation to generation.
 Social phenomenon: cultural habits are shared by aggregates of
people living in organized society.
 Gratifying responses: values must exist to meet the biological &
other needs of individuals in the society.
 Adaptive process: culture is adaptive, either through a
 Universal lists of values.
 Fearlessness.
 Purity of heart.
 Devotion of knowledge.
 Charity.
 Sacrifice.
 Self-study means one should not only read the books but must
be able to observe, analyze & realize the truth.
 Consistency of purpose.
 Uprightness.
 Harmlessness.
 Truth.
 Continue..
 Even temper.
 Quietude i.e. when the person is conscious of truth, harming
none .
 Unmalicious tongue.
 Tenderness towards beings.
 Non- covetousness i.e. to remain in self- control without
extreme indulgence.
 Gentleness.
 Modesty.
 Not unnecessarily moving the limbs i.e. restlessness of mind &
unsteadiness of character.
 Patience.
 Fortitude: it is the strength of faith, conviction in the goal.
Human values & economic prosperity
Human values lay the foundation for economic prosperity of
particular country. The government & private sector, both are
responsible for economic prosperity of country. Profit
maximization is a good business goal but too often it is treated as
major & human values are ignored.
In the modern day world it is generally
believes that if one has to be successful in material it has to
ignore the human values that should be imbibed in business. The
values & money are considered as two different identities but in
actuality both are two sides of a coin. Values based business
always survives more than an unethical business stream.
 Characteristics of human values
 Humanistic values must be secular, democratic
& pluralistic.
 They must be global.
 They must be based on familial ethic.
 Values should support brotherhood.
 Humanistic values can be taught through
education.
“Gandhi an concept of Sarvodaya”
Sarvodaya means, “ development of all”. The
recent trends of planned change have seen many
developmental programs not only in india, but
also in other developing countries. One of the
reasons for the failure of various models of
modernization is the insensitivity of the policy
makers the implementation of the policies in
local culture.
 Intuition & reason
 Intuition means the ability to know, by one’s feeling
rather than considering the facts or one can say “ an
idea or a strong feeling that is true although one cannot
explain why”.
Whereas Reason is collectively
those facilities of the mind which engage in such
activities as forming judgments, making decisions,
solving problems, explaining, generating general
principles & giving particular examples.
Business Ethics and
Social Responsibility
Chapter 4
Learning Objectives
After completing this chapter, you’ll be
able to:
1. Explain business ethics.

2. Give reasons why ethical behavior is

good for business.

continued
Introduction to Business, Business Ethics and Social Responsibility Slide 2 of 44
Chapter 4
Learning Objectives
After completing this chapter, you’ll be
able to:
3. Define social responsibility.

4. Describe the social responsibilities

businesses have to society.

Introduction to Business, Business Ethics and Social Responsibility Slide 3 of 44

Chapter 4
Why It’s Important
Understanding business ethics
and social responsibility makes
you informed of your rights as a
consumer, an employee, and a
citizen.

Introduction to Business, Business Ethics and Social Responsibility Slide 4 of 44

Chapter 4
Key Words
ethics
business ethics
sweatshops
Occupational Safety and Health
Administration (OSHA)
code of ethics
social responsibility continued
Introduction to Business, Business Ethics and Social Responsibility Slide 5 of 44
Chapter 4
Key Words
conflict of interest
Food and Drug Administration (FDA)
Equal Pay Act
Environmental Protection Agency (EPA)

Introduction to Business, Business Ethics and Social Responsibility Slide 6 of 44

Chapter 4
What Is Ethics?
Ethics is the set of moral principles by
which people conduct themselves
personally, socially, or professionally.

Introduction to Business, Business Ethics and Social Responsibility Slide 7 of 44

Chapter 4
What Is Ethics?
Business ethics is a set of laws about
how a business should conduct itself.
In general, for any business to be
successful, it must operate legally and
humanely.

Introduction to Business, Business Ethics and Social Responsibility Slide 8 of 44

Chapter 4
Figure
4.1 ENVIRONMENTALLY FRIENDLY

Ethics is the set of

principles by which
you conduct yourself in
society.

How often do you help

the environment?
What do you do?

Source: The NPD Group

Introduction to Business, Business Ethics and Social Responsibility Slide 9 of 44

Chapter 4
Legal Responsibility
Sweatshops are factories that pay
workers poorly, are unhealthy, and
treat workers badly.

Introduction to Business, Business Ethics and Social Responsibility Slide 10 of 44

Chapter 4
Legal Responsibility
The Occupational Safety and Health
Administration (OSHA) is a division
of the Department of Labor that sets
and enforces work-related health and
safety rules.

Introduction to Business, Business Ethics and Social Responsibility Slide 11 of 44

Chapter 4
Legal Responsibility
Other independent agencies protect
consumers, monitor broadcast
communications, and address
discrimination in the workplace.

Introduction to Business, Business Ethics and Social Responsibility Slide 12 of 44

Chapter 4
Legal Responsibility
Most businesses police themselves by
distributing codes of ethics.
A code of ethics is a set of strict
guidelines for maintaining ethics in the
workplace.

Introduction to Business, Business Ethics and Social Responsibility Slide 13 of 44

Chapter 4
Legal Responsibility
Businesses that regulate themselves
are able to operate more freely.

Introduction to Business, Business Ethics and Social Responsibility Slide 14 of 44

Chapter 4
Ethics as Good Business
Unethical business practices can affect
your business indirectly.
The amount you make in profits from
one unhappy customer can translate
into a lot more lost because of missed
repeat business.
Introduction to Business, Business Ethics and Social Responsibility Slide 15 of 44
Chapter 4
Ethics as Good Business
Treating employees unethically can
also backfire.
Mistreating employees leads to a high
turnover rate. This increases the cost
of hiring and training new employees.

Introduction to Business, Business Ethics and Social Responsibility Slide 16 of 44

Chapter 4
Important Ethical Questions
When considering a questionable
course of action, you have to ask
yourself these important questions:
• Is it against the law? Does it violate
company or professional policies?
continued
Introduction to Business, Business Ethics and Social Responsibility Slide 17 of 44
Chapter 4
Important Ethical Questions
• What if everyone did this? How
would I feel if someone did this to
me?
• Am I sacrificing long-term benefits for
short-term gains?

Introduction to Business, Business Ethics and Social Responsibility Slide 18 of 44

Chapter 4
Making Decisions on
Ethical Issues
Here are some steps if you find
yourself in an ethical dilemma:
1. Identify the ethical dilemma.
2. Discover alternative actions.

continued
Introduction to Business, Business Ethics and Social Responsibility Slide 19 of 44
Chapter 4
Making Decisions on
Ethical Issues
3. Decide who might be affected.
4. List the probable effects of the
alternatives.
5. Select the best alternative.

Introduction to Business, Business Ethics and Social Responsibility Slide 20 of 44

 Graphic Organizer
Chapter
Graphic
Important Organizer
Ethical Questions
4
Does it violate the law or policies? YES UNETHICAL

NO

What if everyone did this, but it’s bad? YES UNETHICAL

NO

Would this sacrifice long-term benefits for MAY BE

short-term gain? YES UNETHICAL

NO

ETHICAL DECISION

Introduction to Business, Business Ethics and Social Responsibility Slide 21 of 44

Chapter 4
Fast Review

1. How do companies benefit by

enforcing their own codes of ethics?

2. Why does it pay to treat customers

ethically?
continued
Introduction to Business, Business Ethics and Social Responsibility Slide 22 of 44
Chapter 4
Fast Review

3. What are some important ethical

questions to ask?

Introduction to Business, Business Ethics and Social Responsibility Slide 23 of 44

Chapter 4
Social Responsibility
Social responsibility is the duty to do
what is best for the good of society.

Introduction to Business, Business Ethics and Social Responsibility Slide 24 of 44

Chapter 4
Social Responsibility
The ethical obligations of a business
are to:
• Provide safe products
• Create jobs
• Protect the environment
• Contribute to the standard of living in
society
Introduction to Business, Business Ethics and Social Responsibility Slide 25 of 44
Chapter 4
Social Responsibility
A conflict of interest is when a
business is tempted to put profits
before social welfare.

Introduction to Business, Business Ethics and Social Responsibility Slide 26 of 44

Chapter 4
Responsibility to Customers
The Food and Drug Administration
(FDA), a government agency, protects
consumers from dangerous or falsely
advertised products.

Introduction to Business, Business Ethics and Social Responsibility Slide 27 of 44

Chapter 4
Figure
4.2 OVER-THE-COUNTER MEDICINE LABEL

The FDA governs

advertising and
labeling of over-
the-counter
medicines.

Analyze why the

FDA officials might
feel that regulation
of advertising and
packaging labels is
necessary.
Introduction to Business, Business Ethics and Social Responsibility Slide 28 of 44
Chapter 4
Responsibility to Customers
Fair competition between businesses
is healthy for the marketplace, but
some companies don’t always play
reasonably.

Introduction to Business, Business Ethics and Social Responsibility Slide 29 of 44

Chapter 4
Responsibility to Customers
Some companies use unethical means
to eliminate competition.
One of the most common means is to
conspire with other companies to
control the market for a product.

Introduction to Business, Business Ethics and Social Responsibility Slide 30 of 44

Chapter 4
Responsibility to Employees
Businesses have a social
responsibility to create jobs.
They are expected to provide
employees with safe working
conditions, equal treatment, and fair
pay.
Introduction to Business, Business Ethics and Social Responsibility Slide 31 of 44
Chapter 4
Responsibility to Employees
The Equal Pay Act (passed in 1964)
requires that men and women be paid
the same wages for doing equal work.

Introduction to Business, Business Ethics and Social Responsibility Slide 32 of 44

Chapter 4
Responsibility to Employees
The Americans with Disabilities Act
bans discrimination against persons
with physical or mental disability.

Introduction to Business, Business Ethics and Social Responsibility Slide 33 of 44

Chapter 4
Responsibility to Employees
It’s in a company’s best interest to
treat its workers fairly otherwise low
morale, poor productivity, and a high
turnover rate are its troubles.

Introduction to Business, Business Ethics and Social Responsibility Slide 34 of 44

Chapter 4
Responsibility to Society
Businesses have responsibilities not
only to customers and to employees
but also to society as a whole.

Introduction to Business, Business Ethics and Social Responsibility Slide 35 of 44

Chapter 4
Responsibility to Society
In 1970, the U.S. government created
the Environmental Protection
Agency (EPA), a federal agency that
enforces rules that protect the
environment and control pollution.

Introduction to Business, Business Ethics and Social Responsibility Slide 36 of 44

Chapter 4
Responsibility to Society
Many businesses plan for their social
responsibilities just like planning for
production and sale of their products.

Introduction to Business, Business Ethics and Social Responsibility Slide 37 of 44

Chapter 4
Fast Review

1. Define social responsibility.

2. What is a conflict of interest?

continued
Introduction to Business, Business Ethics and Social Responsibility Slide 38 of 44
Chapter 4
Fast Review

3. What do companies adopt in the

workplace to treat their workers
fairly?

Introduction to Business, Business Ethics and Social Responsibility Slide 39 of 44

Chapter 4

Why should a company make a

vested interest in nature over its
products?

continued
Introduction to Business, Business Ethics and Social Responsibility Slide 40 of 44
Chapter 4

How does the consumer pay for a

company’s environmentally
responsible inventions?

continued
Introduction to Business, Business Ethics and Social Responsibility Slide 41 of 44
Chapter 4

What are social issues you’re

interested in pursuing?
How are businesses involved?
continued
Introduction to Business, Business Ethics and Social Responsibility Slide 42 of 44
Chapter 4

What government agency has a

responsibility to protect society
from genetically modified
organisms?
Introduction to Business, Business Ethics and Social Responsibility Slide 43 of 44
End of Chapter 4
Business Ethics and Social Responsibility
 Let’s take a
Values and Ethics look at
what really
matters to
you.
 What do you believe in?
 Who do you care about?
 What motivates you?
 Are you a spiritual person?
 Why are you really in college?
 How do you tell the
difference between right and wrong?
 What are values?
 They are the ideas and beliefs about life
that guide us to do what we do and be
what we are…
 They can be about:
Politics Family
Sex Friends
Religion Dishonesty
Being of service Taking Risks
Education Respect
Money Leisure
Career And so on…
 Different kinds of Values
 Moral Values:
• Values you hold for yourself but
don’t force on others such as right
vs. wrong, honesty vs. dishonesty,
being of service to others
 Aesthetic Values:
• Personal standards of beauty as
seen in nature, art, music, personal
appearance
 Performance Values:
• Benchmarks you set for yourself
such as accuracy, speed, reward for
achievement, self-discipline and
overall accomplishment
Means & Ends Values

 Instrumental Values (the means):

• Objectives used to reach goals such as
being responsible, obedient, loving,
ambitious, independent, honest
 Intrinsic Values (the end):
• Personal happiness, a comfortable life,
personal freedom, true friendship, a
successful career
 Values Checklist
 Having good friends
 Having a positive relationship
 Having self-respect & the
respect of others
 Being financially secure
 Being spiritual
 Making a meaningful
contribution to mankind
 Being a moral person
 Being a great athlete
 Being physically attractive
 Being creative
 Being personally responsible
 Getting along well with people
in general
 Having freedom and
independence
 Being well educated
 Serving others
 Having peace of mind
 Getting recognition (being
famous)
 Being a good citizen
 Being healthy
 Being intelligent
 Having strong family ties
 Being honest & having
integrity
 Being dedicated and
committed
 Values for College Success
 Connecting your personal values to being
successful in college:
• Clarify your values to be sure you really understand
them-
 As strange as it may seem, many people operate on values
without thinking them through.
 Truly understanding your values is key to applying them
successfully in college, in a career, or in life.
• Make a forthright self-evaluation-
 Are your values workable in college?
 Do you need to change or re-figure them?
• If necessary, change your values to make them more
productive and effective…
 Forging Academic Values:
Participate Fully
 College takes much more time and work
than high school.
 You also have much more freedom which
requires much more personal responsibility.
 Avoid being unnecessarily frivolous, make
yourself stay “on-task”!
 And, unless you honestly have no choice,
DON’T SKIP CLASS!
 Forging Academic Values:
Participate Honorably #1
 Let’s be frank: If you cheat or plagiarize, you are
side-stepping the real reason you came to
college: to get an education.
 Academic dishonesty myths:
• The risk of getting caught is small.
 It only takes getting caught once and you could be out.
• There is no other way to be “successful.”
 No? Then dishonesty should be the hallmark of all human
endeavor.
• It doesn’t matter in the long run.
 Not if you don’t have a conscience.
• The penalty for getting caught won’t be severe.
 Is this something you want to find out the hard way?
 Forging Academic Values:
Participate Honorably #2
 If, on the other hand, you honestly give it your
“best shot”:
• Practicing academic integrity builds moral character.
 There’s nothing like having your conscience tell you did it
right!
• Choosing moral actions builds others’ trust in you.
 Having people believe in you is a major plus.
• Making bogus grades masks real feedback about
learning.
 How will you ever know what you are really capable of?
• Improving integrity in the classroom can rebuild national
character.
 The college classroom is an excellent place to begin
stemming the tide of corporate greed and corruption.
The Eleventh Commandment
Thou shalt not
get caught!
 Challenges to your Values
 At college, you are going to meet new people whose values
may be quite different, if not totally opposite, to your own.
• You may be politically liberal and find yourself
befriending a staunch conservative.
 Are you going to pass judgment and walk away?
 Or are you going to be tolerant and try to see the person in
a new way?
 Tolerance is a very positive trait, but even it can be carried
too far.
 If you see your new friend show a really self-destructive
tendency, like excessive drinking, it is probably best not to
aid and abet them in their weakness, but rather to tell them
what you really think.
 Your challenge is to balance your personal welfare, your
tolerance for diversity and your freedom of choice.
 Values in Conflict: Dualisms
 Values of a society are often in conflict:
• Poverty vs. “Rugged Individualism”
• The Death Penalty vs. Deterrence of Major Crimes
• And so on…
 An individual’s values can also be in conflict, often
personal values reflect the two-sided nature of our
culture’s unresolved contradictory values.
 Who is right? Who is wrong? – These are a matter of
individual choice, based on both conscience and
careful critical thinking.
 Think on this duality:
• Earning excellent grades in college is critical to
success in life.
• The most important decision you make in college
is about the kind of person you want to be.
 “Grades?” Or “Who do you want to be?” How do you
resolve this enigma?
 Changing Society, Changing Values
 American values are changing, caused by:
• Demographic changes caused by much immigration from
other countries
• Globalization of the world economy
• Growing environmental concerns
• Political polarization
• Breakup of the family
• Computer technology and the Internet
• The Feminist movement
• Federal intervention in state’s rights
• Terrorism
• And on and on…
 All of these, and many more, will greatly affect the values
of the individual.
Service Learning and Values
 Service Learning is a teaching method that
combines meaningful service to the
community with curriculum-based learning.
• Serving: To be effective, it should serve a genuine
community need, seen by a student-led
assessment and it should serve a real need.
• Linking: The program needs to have a strong link
between the community need and classroom
goals.
• Learning: Reflection is a key element in service
learning. The instructor sets time and methods for
students to reflect on and analyze their service
experience.
• It includes the best of both worlds into one:
community service and internships into one
learning experience.
 Think about your legacy…
 In order to aid you to understand if you are truly
living up to your values, Stephen Covey, author
of the bestseller The 7 Habits of Highly Successful
People, suggests you ask yourself this question:
• Imagine that you are attending your own funeral,
looking down at yourself in the casket.
• After you sit down, four people:
 A family member
 A friend
 A co-worker
 Someone from your church or community organization
give a eulogy for you.
• What would you want them to say about you?
 Value Assessment Web Resources
 College Success Factors Index
• http://www.csfi-wadsworth.com
 Steps to Successful Career Planning
• http://career.asu.edu/S/careerplan/selfdiscovery/ValuesAssessment.htm

 Journal of College and Character

• http://collegevalues.org/center.cfm
 Rutgers Value Assessment
• http://careerservices.rutgers.edu/OCAvaluesassessment.html

 Ohio Learning Network: Values Assessment

• http://www.oln.org/student_services/plan_your_education/assess_values.php
 Values & Ethics
 In the preceding presentation about values, the
words morals and morality came up regularly.
 Is there a connection between morality and
ethics?
 Generally, the words are used interchangeably.
There is, however, a difference:
• Morality is usually more theoretical; it is a philosophical
concept.
• Ethics are the practical application of morality in daily
life.
 The difference is that of theory and practice.
 If a person has a moral character, he or she will
generally deal with other people in an ethical
manner.
 A 28 Day Project
 In order to determine what you believe is the most
important personal value of all, here is a method originally
developed by the ancient Greeks for determining something
really important.
 At the same time every day (for instance, upon rising in the
morning or at bedtime) for 28 days, keep a journal and
write down: “The personal value I consider most important
is ______” Try to keep it to as few items as possible. One
thing is best, but if you have several items, write them
down. Limit yourself to no more than three.
 At about the 25th or 26th day of the procedure, one
particular value should emerge as the predominant one.
 Enjoy, learn and grow!
 IMPLEMENTING
ETHICS IN WORKPLACE
Every Company is Unique
Leadership
History
Culture
Policies
Practices
People
The Challenge is Doing More with Less
1. Have a Plan - preferably a long range
plan
2. Have support at the Top and an “Ethics
Team”
3. Get an Ethics/Compliance Committee
Chartered
4. Put in place a “Code of Conduct”
5. Get a Helpline Set Up
6. Communicate to Managers/Employees
7.Do Some Training
8.Attend Other Meetings or Training
Sessions
9.Give Leaders Ethics Messages to Send
Out
10.Use the Company Website Extensively
11. Follow in the Wake of Critical Events
12.Regularly Report on Issues to Management
 Seven Sentencing Guidelines
1. Having Standards
2. Assigned Responsibility
3. Due Diligence in Hiring
4. Communication and Training
5. Monitoring, Auditing and Reporting
6. Promotion and Enforcement of Ethical
Conduct
7. Reasonable Steps to Prevent Misconduct
Employee Obligation to the Employer
• Moral duty to work towards goals
of the firm

• Avoid any act which might cause

harm to those goals

• Obey organizational superiors

Employer’s Obligation to the Employee

•Fare and freely agreed compensation

•Conducive working environment

•Workplace safety and job security

 Communication

Getting the right message out

 What is being communicated ?
Ethics Materials : Mission
Values
Code of conduct/ethics
Policies
Decision methods
 Work culture

Ethics Program : Who is the Ethics Officer ? How

to make contact ?

Senior Management Why organizational ethics

Commitment to Ethics : matters ?
Wrap Up Round
 CORPORATE
GOVERNANCE & ETHICS
WHAT DO THEY CONNOTE ?
Business corporations are increasingly
important for wealth creation, and how
companies are operated will influence society
as a whole

 To serve this wealth creation function,

companies must focus on their objectives
and be accountable for their actions through the
structure of good corporate governance with an
ethical framework.
-CORPORATE GOVERNANCE is a set of
mechanism used to manage the relationships (&
conflicting interests) amongst stakeholders, and
to determine and control strategic direction and
performance of the organizations (aligning
strategic decisions with company values)

-It provides with a structure through which

company objectives are set, achieved and
monitored and recognises the value of business
ethics and corporate awareness of society
interests to reputation and long-term success
-Successful markets and corporate governance
are founded on a commitment to basic
ethical principles aligned as much as possible
to interests of the individuals, corporations
and society

-Ethical standards may be expressed in a

company’s formal conduct requirements, or
contained in generally stated principles that
guide a company’s preferred conduct or
behavior
STAKE-HOLDER IMPACT ANALYSIS
GOVERNANCE MECHANISM
INTERNAL GOVERNANCE MECHANISMS

1.Ownership Concentration represented

by types of shareholders and their
different incentives to monitor
managers

2. Board of Directors

3. Executive Compensation
EXTERNAL GOVERNANCE MECHANISMS

1. Company acquisitions and mergers

-This market is a set of potential owners seeking

to acquire undervalued firms and earn above-
average returns on their investments by replacing
ineffective top-level management teams.
• (2) The acquisition of proxy voting rights

 In general, company law provides that shareholder voting rights can be

exercised by authorising a proxy. This is the fundamental legal basis for the
acquisition of property rights. It means that a minority of shareholders can
 publicly obtain such delegated proxy rights from others. Weston et al. point
out that, even if the acquisition is not successful, this contention for proxy
rights can have a significant effect on the wealth of the target company’s
 shareholders.

10
ESSENTIAL ELEMENTS
OF GOVERNANCE
 Elements of
Corporate
Governance

Transparency Responsibility Accountability

FIVE PRINCIPLES OF ETHICAL
POWER FOR ORGANIZATIONS
• Purpose
• Pride
• Patience
• Persistence
• Perspective
 SIKKIM MANIPAL UNIVERSITY
VI SEMESTER BBA DEGREE EXAMINATION
BUSINESS ETHICS
BA 1632 (BBA-HR-602) [CGPA 12,13,14,15,16] (3 CR)
18th May 2019
ANSWER SCHEMA

UNIT-I
1. (a) “Ethics is Prescriptive” or “Ethics is Descriptive”; which one of [10]
these two extracts is True and why? In what way is „Ethics‟
linked with „Morality‟?
Scheme Part-1: Validation of the extracts - 5 marks
Part-2: Linkage between „Ethics‟ and „Morality‟- 5 marks

(b) Does Ethics Really Pay? Examine a few benefits of inculcated [10]
organizational values.
Scheme Part-1: Comment with justification - 3 marks
Part-2: Examination of benefits of inculcated organizational
values - 7 marks

2. (a) Who is a „Value-Based Leader‟? There happens to be different [10]

sources of „Ethical Norms‟. Which one of these sources
(according to you) may relatively have a stronger influence on
individual conscience and why?
Scheme Part-1: Meaning of „Value-Based Leader‟ - 4 marks
Part-2: Detection of Source of Ethical Norms having stronger
influence on individual conscience - 6 marks

(b) What are the influencers on „Attitude Formation‟? Illustrate with [10]
relevant examples. Highlight the process to clarify and develop
values.
Scheme Part-1: Influencers on „Attitude Formation‟- 5 marks
Part-2: Process to clarify and develop values - 5 marks

3. (a) What is being understood by „Self-Deception‟? You happen to be [10]

a Corporate Manager in a leading business house. What
commonsense preparatory steps would you adopt in order to limit
the intensity of ethical dilemmas in business decision?
Scheme Part-1: Meaning of „Self-Deception‟- 3 marks
Part-2: Preparatory steps in order to limit the intensity of ethical
dilemmas in business - 7 marks

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 (b) Examine the factors influencing ethical decision. [10]
Scheme ● Careful examination of the factors - 8 marks
● Careful examination of the factors with example- (9-10) marks

4. (a) You are a Medical Practitioner (Gynecologist) in a professionally [10]

managed hospital. You receive an instruction from higher
management of the unit to have gender disclosure of a baby just
before its birth and reveal the same to the parents. This practice is
considered to be unethical. Should you obey the said instruction or
should you leave employment on the pretext of a mismatch of
values? Which particular Model of Management Ethics does the
above situation tone with? Be specific to your answer.
Scheme Part-1: Validation of the self conscience - 5 marks
Part-2: Identification of the Model with justification - 5 marks

(b) What does „Organizational Culture‟ indicate? Discuss the [10]

functions of culture.

Scheme Part-1: Concept of „Organizational Culture‟ - 3 marks

Part-2: Elaboration of the functions of culture - 7 marks

UNIT-II

5. (a) Why is it important for business to act in a socially responsible [10]

manner? Do you feel social responsibility is worth the cost?

Scheme Part-1: Reasons for being socially responsible – 6 marks

Part-2: Impact assessment in terms of cost- 4 marks

(b) Furnish with an overview of current business environment. What [10]

do you mean by „Process Excellence‟?

Scheme Part-1: Overview of current business environment – 7 marks

Part-2: Concept of „Process Excellence‟- 3 marks

6. (a) What is „Corporate Governance‟? Elaborate on its essential [10]

elements.

Scheme Part-1: Meaning and concept of „Corporate Governance‟– 3 marks

Part-2: Elaboration of essential elements - 7 marks

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 (b) The main challenge in implementing ethics in work place is [10]
“Doing More with Less”. How would you overcome this
challenge? What is the role of „Communication‟ in this case?

Scheme Part-1: Measures to overcome the challenge– 6 marks

Part-2: Role of „Communication‟ - 4 marks

7. (a) How would you distinguish between „Ethical Climate‟ and [10]
„Ethical Culture‟? “The market is a place set apart where men may
deceive one another”. Assess the significance of this view point.
Scheme Part-1:Demarcation between „Ethical Climate‟ and „Ethical
Culture‟- 5 marks
Part-2: Assessment of significance of the view point - 5 marks

(b) Interpret the concept of „Social Audit‟. Examine the strategic [10]
importance of „Ethics Auditing‟.
Scheme Part-1: Meaning and concept of „Social Audit‟– 3 marks
Part-2: Strategic importance of „Ethics Auditing‟- 7 marks

8. (a) It is noticeable that China is involved in the practice of charging [10]

high prices for products sold in home market and low prices in
foreign markets and the same is considered unethical under
different international laws.
What may be the exact reasons for which China is still leading in
this domain across the globe? What (according to you) would be
the probable solution to this phenomenon?
Scheme Part-1: Reasons for being a dominant player – 6 marks
Part-2: Probable solution to the phenomenon - 4 marks

(b) Examine the linkage between „Ethics‟ and „Integrity‟. “In public, [10]
as in private life, I am persuaded that honesty will forever be found
to be the best policy”. Elucidate this statement.
Scheme Part-1: Linkage between „Ethics‟ and „Integrity‟- 5 marks
Part-2: Comment and elucidation of the extract - 5 marks

3/ 4
4/ 4
BUSINESS ETHICS
WHAT IS ETHICS ?
• “Our Character is what we do
when we think no one is
looking”.

– Jackson Browne
Ethics may be defined as a set of
moral principles that distinguish
what is right from what is wrong

Ethics has twofold objectives : it

evaluates human practices by calling
upon moral standards ; it may give
prescriptive advice on how to act
morally in a given situation
FACTORS AFFECTING ETHICS
ETHICAL BEHAVIOUR INFLUENCERS

• Legal Interpretations
• Individual Factors
• Organizational Factors
• Other Factors

6
 INTRODUCING
BUSINESS ETHICS
There happens to be increasing
interaction amongst the board of
directors, audit committees,
executives, employees and
stakeholders in general regarding
ethical conduct in the workplace

Business ethics are most simply

defined as a process of promoting
moral principles and standards that
guide business behavior
ETHICAL WORKPLACE
Key factors in promoting ethical workplace

management behavior

direct supervisors
behaviour
positive reinforcement

compensation (bonus
+salary)
behaviour of peers
UN-ETHICAL WORKPLACE
ETHICAL ISSUES
IN BUSINESS
Conflicts of Interest
Quality Control Issues
Discrimination in Hiring & Promotion
Misuse of Proprietary Information
Abuse of Company Expense Accounts
Misuse of Company Assets
Drug and Alcohol Abuse
Environmental Pollution & Destruction
 Other Issues, if any
INCENTIVES CONFLICTS
PROBABLE OUTCOMES
PRINCIPLES OF BUSINESS
ETHICS AND CONDUCT
 Comply with a written code of business conduct
 Provide sufficient training to all personnel within
the organization regarding personal responsibility
under the code
 Encourage internal reporting of violations of the
code with the promise of no retaliation for such
reporting
 Self-govern the activities by implementing
controls to monitor compliance with all applicable
laws and regulations
 Share the best practices through participation in
an annual Best Practices Forum
 Be accountable to all stakeholders
ACCEPTED ETHICAL
CODE IN BUSINESS
Organizations, regardless of their mission
(e.g., profit oriented, non-profit) and size
(large vs small) should establish an
“Organizational Ethical Culture” that
should have –

(1) A Shared Goal

(2) An Honorable Behavior conforming to

Prevailing Norms

(3) A Conducive Culture

WHY ETHICS MATTERS ?
ETHICS – WHO DECIDES ?

Good

Self Other
Business Ethics refers to the ethical
values that determine the interaction
between a company and its stakeholders
SIGNIFICANCE OF ETHICS

1. Reputation
2. Investor’s Confidence
3. Financial Performance
4. Unlocking Human Potential
5. Building Trust
1. REPUTATION AS A COMPETITIVE EDGE

 “Ethical behaviour is good business.

Companies that operate ethically have a
competitive edge over those that do not”
(Moore: Former Chairman of PWC)

 UK Survey of FTSE 350: Reputation is the

driving force behind ethical programmes
 Companies whose reputations were
boosted by ethics :
–Motorola
–Johnson & Johnson

 Companies whose reputations

suffered from lack of ethics :
–Enron
–Andersen
 2. INVESTOR’S CONFIDENCE
 Global Market :
• Mobility of Capital
• Global Investment Opportunities

 Investors are looking for :

• Responsible, Accountable, Fair and
Transparent Management
• Enterprises with a Strong Ethical
Foundation
 3. FINANCIAL PERFORMANCE
Harvard Business School Study
Benefits of inculcated organisational values

1000 901
900 Percentage
800 756
682 growth -
700 organisational
600 values
500
400 282 Percentage
300 growth - lack of
166 organisational
200 74
100 36 1 values
0
Growth in Growth in Growth in Growth in
revenue workforce share value net
incomes
 4. ETHICS UNLOCKS
HUMAN POTENTIALS

“Respect for Individuals ”

The most pervasive theme in
excellent companies
-Peters and Waterman: In Search of
Excellence
 5. BUILDING TRUST

Why Trust ?
 Distrust is Expensive
 Trust facilitates Co-operation
 Trust unlocks Knowledge
 Trust promotes Loyalty
SO, DOES ETHICS REALLY PAY ?
 Possible consequences of detected
unethical business
– Corporate collapses
– Loss of jobs, investments, returns

 Still, in a short term, there is no guarantee

that good ethics will bring in good
(profitable) business
BUT ETHICS MIGHT PAY.......
 SIKKIM MANIPAL INSTITUTE OF TECHNOLOGY
FIRST SESSIONAL EXAMINATION
BBA VI-SEMESTER
BUSINESS ETHICS (BA 1634)
Duration: 90 mins Max Marks: 50

Note: All questions are compulsory.

Any missing or misprinted data may be assumed suitably.

Q.
Questions M BL PI CO PSO PO
No.
1. Describe different influencers on attitude 5 2 1 1 1 1
formation.
2 Should poor performance be blamed on “Bad 5 5 1 1 1 1
Attitude”? Justify.
3 Assess ‘Five-Part Process’ to clarify and develop 10 5 1 1 1 1
values.
4 Describe different areas with example whose 10 2 1 1 1 1
foundation is ‘Value’.
5 What are the Core Values that are fundamental to 10 1,2 1 1 1 1
the success of any individual or organization?
Explain them.
6 Discuss different ethical issues in business. 10 2 1 1 1 1

M – Marks; BL – Bloom’s Taxonomy Levels (1- Remembering, 2- Understanding, 3 – Applying, 4 –

Analysing, 5 – Evaluating, 6 - Creating); PI Code – Performance Indicator Code; CO – Course
Outcomes; PSO – Program Specific Outcome; PO – Program Outcomes;