MS-208

CORPORATE SOCIAL RESPONSIBILITY, HUMAN VALUES AND ETHICS

UNIT 1

BUSINESS ETHICS & BEHAVIOUR

SOURCE: The PowerPoint presentation has been prepared from the following books:

1) Lawerence & Weber, Business and Society.

2) Blowfield & Murray, Corporate Responsibility.
 LEARNING OUTCOMES

S. No Learning Outcome PO Level Knowledge Level

1. Able to understand the concept of ethics and business PO1, PO2, PO3 K1, K2, K3
ethics.

2. Able to understand the sources of ethical business issues PO1, PO2, PO3 K1, K2, K3
and the ethical decision making.
BUSINESS ETHICS & BEHAVIOUR
 ETHICS: INTRODUCTION
• Ethics is a conception of right and wrong conduct.

• It guides human behaviour, of how we think and behave towards

other and how we want them to think and behave towards us.

• Ethical principles are guides to moral behaviour.

• They may vary greatly from one another.

 BUSINESS ETHICS: INTRODUCTION
• Business ethics is the application of general ideas to business
behaviour.

• Business ethics comprises moral beliefs and codes, formulation and

protection of moral codes, and a conceptual study of morality.

• Business ethics centres around moral judgements- specification,

justification, logical reasoning, and moral responsibility.

• To be considered ethical, business must draw its ideas about what is

proper behaviour from the same sources as everyone else in society.
Business Ethics are important..

To meet demands
of business
stakeholders.

To promote To enhance
personal business
morality. performance.

To comply with
To prevent or
legal
minimize harm.
requirements.
 3 R’s of Business Ethics

RESPECT

RESONSIBILITY

RESULTS
Source: https://commonsenseteaching.com/business-ethics/
 Approaches to Business Ethics
1. Descriptive Approach
Describing practices, moral codes and beliefs.

2. Prescriptive Approach
An attempt to formulate and defend basic moral norms.

3. Conceptual Approach
Analysing central ethical terms such as right, good, virtue, etc. to
distinguish between moral and immoral.
 Business Ethics across Organizational
Functions
Accounting Ethics

Financial Ethics

Marketing Ethics

Information Technology Ethics

Other Functional Areas (like supply chain management)

 Sources of Ethical Issues in Business
Reason Nature of Ethical Problem Typical Approach Attitude

Personal Gain and Selfish Selfish Interest versus Egotistical mentality “I want it!”
Interest others’ interests

Competitive pressures on Firm’s interest versus Bottom-line mentality “We have to beat others
profits others’ interests at all costs!”

Conflicts of interest Multiple obligations or Favouritism mentality “Help yourself and others
loyalties closest to you!”

Cross-cultural Company’s interests Ethnocentric mentality “Foreigners have a funny

contradictions versus diverse cultural notion of what’s right and
traditions and values wrong.”
Source: Lawerence and Weber, Chapter-4 (Figure 4.4)
 Ethical Decision Making

• It refers to the process of evaluating the various alternatives related

to a decision and choosing the one consistent with ethical principles.

• It involves analysing various alternatives and eliminating the unethical

options for selecting the best ethical ones.
 Decision Making Skills
• Problem Solving • Emotional Intelligence
• Leadership • Creativity
• Reasoning • Time Management
• Intuition • Organization
• Strategic Thinking • Teamwork

Source: https://www.indeed.com/career-advice/career-development/decision-making-skills
 Ethical Decision Making Process
• STATE THE PROBLEM
• CHECK THE FACTS
• IDENTIFY THE RELEVANT INTERNAL AND EXTERNAL FACTORS
• DEVELOP A LIST OF OPTIONS
• TEST THE OPTIONS
• MAKE A CHOICE
• REVIEW STEPS

Source: https://serc.carleton.edu/geoethics/Decision-Making
ETHICS VS VALUES
 Basis of
Comparison Ethics Values

Meaning Ethics are the guiding principles which help the Values are associated with the thought process, a
individual or group to decide what is good or bad. person’s sense of what is wrong and what is right.

What is it? Response to a specific situation Values are associated with personal aspects of a
person

Root Word Ethics which means character Values which means worth.

Goverened by Individual or legal and Professional Norms One’s own judgement

Dealt with Right and wrong conduct One’s own judgement of right or wrong

Consistency Ethics are generally uniform Values vary from person to person, it need not be
consistent

Source: Biren Mer; https://medium.com/@birenmer

 Conclusion
• Ethics is a conception of right and wrong behaviour.

• Ethical business behaviour is demanded by business stakeholders, enhances

business performance, complies with legal requirements, provide or minimize
harm, and promotes personal morality.

• There are three approaches to business ethics: descriptive, prescriptive, and

conceptual.

• Ethical decision making refers to the process of evaluating the various

alternatives related to a decision and choosing the one consistent with ethical
principles.
 Questions
1. Define the concept of ethics. What are the different approaches to
ethics?

2. Why should business be ethical?

3. Discuss the various sources of ethical issues in a business organization.

4. Explain the process of ethical decision making.

5. Differentiate between ethics and values.