Assignment I

Business Ethics & Indian Ethos

Submitted To: Dr. Sudhanshu Bhushan

Submitted By: Khyati Tiwari
Roll No.: 020
Date: 25TH MARCH 2022
 INTRODUCTION
BAE stands for British Aerospace Electronic Systems plc, with its headquartering in London
within the UK and it's a multinational Defence, Security Corporation with operations
worldwide. the corporate was formed on 30 November 1999 by the £7.7 billion merger of
two British companies: Marconi Electronic System (MES) the defence electronics and naval
shipbuilding subsidiary of the overall power company plc (GEC) and British Aerospace
(BAE), an aircraft, ammunitions and naval systems manufacturer. it is one among the world’s
largest defence contractors and it had been ranked because the second-largest supported
applicable 2012 revenues.
The British Aerospace Electronics Systems had a series of scandals which rocked the defence
Industry and therefore the issue was a few corporation handling governments across the
planet on unethical grounds. Saud Arabia was one among the countries which BAE had some
business Dealings that happened between 2002-2004, where gifts and payments worth quite
sixty pounds were paid to the members of Saud Arabia royalty and seventeen pounds alone
was paid to the key purchasing arms committee headed by Prince Turky bin Naser, for him,
family, and his 35-strong entourage of servants, drivers and bodyguards. during these
unethical transactions provided BAE not but 43 billion of revenue since 1986. Ethical
theories are the principles and principles that determine right and wrong for any given
situation Crane and Matten (2010).

Q1. What type of business - Government are alluded in this case? identify the key
factors in business - Government relations that make the defence industry particularly
vulnerable to ethical misconduct?
Many business and government relations are often addressed as an un-ethical conduct. during
this case if we glance at the demand side of the market when managing defence industries,
we'll notice that these companies are nearly exclusively selling its product to governments
and in most countries the parliament has got to agree the extent of paying and therefore the
sort of equipment that ought to be bought. Also, governments may require these companies to
supply some parts of the equipment’s domestically to secure more jobs and benefit the
economy. On the availability side of the relation and particularly within the UK, the govt has
its special unit for trade and investment to market its defence companies, and also most deals
involve the govt approval and guarantee. during this quite deals, an extended term and a
robust relationship between both parties is required. As mentioned, before we will note that
this type of trade will be needless to say include many ethical misconducts.
Q2. Identify the main stakeholders in this case and describe the key ethical dilemmas
faced by each of the different actors involved?
The identification of, and understanding stakeholders is vital therein it allows you to increase
the credibility of your organization, stakeholders establish the organization’s fair, ethical,
transparent. Mitchell et al. (1997) suggested that there are three key attributes likely to work
out the seemed to be important: Power which is perceived ability of a stakeholder to
influence organizational action, like the govt and professionals other stakes may haven't any
power like employees in an organization; Legitimacy which perceives whether the
stakeholders action would be desirable, proper or appropriate for the organization; Urgency
which is that the degree to which the stakeholders claims are seemed to involve immediate
attention. the most stake holders during this case were the governments of UK and Saud
Arabia albeit government has many arms and corporation management. The governments of
both states were key stakeholders under the governments as a stakeholder of business and
there are numerous representatives of citizen’s interests. within the above case study there
have been numerous departments like defence secretaries, foreign or external affairs
secretaries, home or internal affairs secretaries, and commerce and industries secretaries,
media. Suppliers of BAE system of raw materials for manufacturing the defence equipment
or components were also stakeholders and that they influenced the business deciding to
significant extent.

 Q3. To what extent can BAE be blamed for its part in the alleged bribery, or are the
UK and Saudi Government more responsible for any wrongdoing?
Each side are involved and responsible. From BAE side seeking high gains and global
request expansion in un-ethical approach by avoiding transparent deals and healthy request
competition counting on bribery, secretiveness and deals made through a posh web of frontal
companies. From the govt side, the united area government is trying to vend companies like
BAE to the congress and may be an unethical conduct. Likewise, I suppose that the united
area government had the complete deal set with BAE and was in total control and dealing
within the shadow. While from the Saudi government side, I suppose that the complete power
and control the Napoleon had may be a total mistake especially in deals that bear blessings
and evaluation before processing, especially when it involves the frugality and security. Also,
both governments have not any clear policy in handling similar situations. Both Governments
during this case are professed than BAE because they are those liable for conducting,
enforcing, and covering ethical approaches and precluding the colourful feathers of
corruption.

Q4. Describe and evaluate the efforts by the BAE and the UK government to address
the problem of corruption?
The company started putting the house so as and thus the shareholders as also stakeholders
were getting upset and strengthened the translucency and responsibility within the operation
of the pot by appointed a special panel on business ethics. The company’s fiscal statements
also suggests but within the absence of the translucency it had been delicate to prove
innocence or could also be inadequate information for tracking the business sale. Monitoring
and Evaluation (M&E) had centred on the Performance Assessment Framework (PAF) for
GBS, which contains specificity-corruption pointers. Dialogue and PAF conduct have
concentrated on precluding and executing grand corruption, and on strengthening PFM
systems. There has been little attention paid to petty corruption and there are not any anti-
corruption pointers that specifically take Pots under consideration or are directly associated
with the consequences of corruption and bribery. The dialogue would be simpler at including
civil society on utmost PAF on anti-corruption pointers are process conduct, associated with
perpetration and monitoring of anti-corruption plans and developing government structures
and processes to fight corruption.

Q5. If you were hired by BAE to advise on its ethical challenges, what would your
recommendations be?
What I would recommend setting standards of ethical behaviour and designing the codes of
ethics and make sure that are implemented. Codes of ethics are voluntary statements that
commit organizations, industries, or professions to specific beliefs, values, and actions or that
began appropriate ethical behaviour for corporation. during this area organizational or
corporate codes of ethics would be more ideal to arrest the actions of briberies and donation
which are meant to influence the govt to form unethical decisions as within the case of BAE
to Saud Arabia government. i might also introduce the worldwide codes of ethics which is
additionally increasingly receiving the eye from business. Business ethics management is that
the direct plan to formally attempt or informally manage ethical issues or problems through
specific policies and practices. i might introduce some components to implemented and be
monitored to make sure that they're working smoothly: Reporting and advice channels which
can provide members of corporation with an appropriate channels of reporting or receiving
some advice regarding ethical and unethical issues; Risk analysis and management for
managing and reducing some risks which will erode the corporate because it happened to
BAE, if risk management was in situ such a thing would haven't happened. consistent with
Alejo Jose Siscon(2000) said that the language of risk assessment has enabled business ethics
to point out its bite by spelling out risks that firms travel by ignoring ethics; Ethics managers,
officers and committees to coordinate and take responsibility for managing ethics within the
corporation; Ethics consults to manage the areas of business ethics and ethics education and
training within the subject ethics unethical decision or behaviour; I might also recommend to
strengthen the stakeholders consultations and dialogue among other stakes in corporate
decision – making and avoid making wrong or unethical decisions; Auditing, accounting and
reporting shall be recommended and proper mission statement which can match with above
components code of conduct.
My suggestions for the organization would be that:
1. The corporate shall work on ethical standards and adopt openness and
transparency. and everyone its policies and procedures must be publicly available and
simply accessible.
2. Develop a proper process ensuring business decisions have been taken by following a
transparent consideration of ethical and reputational risks.
3. Monitor the corporate expenses especially on gifts and hospitality.
 CONCLUSION
The corporations should setup some codes of conduct to avoid some business risk which can
occur to discourage corporation reputation like within the above case study. to possess social
accounting would be much helpful to many corporations because it would make the
companies be accountable and transparent. Engaging ethical consultants would be one of
wisest idea to assist the firms to abide in business ethics or governances. Auditing accounting
and reporting should be strengthened and proper mission statement which could match with
above components code of conduct.
The businesses must setup a few codes of behaviour to keep away from a few commercial
enterprise hazards that can arise to deter organization recognition like in the above case
study. to own social accounting could be lots useful to many businesses due to the fact it
might make the organizations be responsible and transparent. Engaging moral experts could
be certainly considered one among wisest concept to help the companies to abide in
commercial enterprise ethics or governances. Auditing accounting and reporting must be
reinforced and right assignment assertion that can in shape with above additives code of
behaviour.