BUSINESS ETHICS AND SOCIAL RESPONSIBILITY MODULE Module No. 3: Week 3: Third Quarter Code of Ethics Learning Competency Formulate a “code of ethics” that reflect core principles derived from analysis. Code: ABM_ESRI2-ITla-d-1.6 Objective [After reading this module, the learners will be able to: 1. To Discuss what is “The Code of Ethics”. 2, To know the Purpose of ‘The Code of Ethics” in the business. 3, Discuss the Role of Ethies in the Accountancy profession. 4. To formulate a simple Code of Ethics. Let us Recall Before we proceed to our next lesson, let us evaluate the case study below recalling our lesson ‘on the Core Principles of Fairness, Accountability, Transparency, and Stewardship. 7 Eee { Oo CASE STUDY: USING OFFICE TIME AND SUPPLIES A) “Sandra is working as a part-time secretary in a small company and at the same time studying at a University. Every time her boss goes out of the office, she immediately makes her assignments during office hours and using also the office supplies every time she has projects for her school. Sandra keeps doing this even if she knows that her boss sensed ‘already that she is using office hours for her personal use. Guide question: 1. Inthe above scenario how would you apply the core principles of Fairness, ‘Accountability, Transparency, and Stewardship?Q Let us Understand What is the “Code of Ethics”? a are the ones who have People as we all know are the highest form of an animal and thus, we are th : ‘hat is wrong or right. what ave call conscience- an inner feeling, which guides one of what is wrong oF NE BOTA 5, how do we define the Code of Ethics? The best thing to understand this is for us 10 ely, Taking the meaning from Merriam-Webster dictionary, Code meats © systematic statement of a body of law or a system of principles or rules, and Ethics means the discipline dealing with what is good and bad and with moral duty and obligation, ‘So, therefore, we can say that the code of ethies is a business organization's set of regulations and principled guidelines according (0 the law where the business organization is located define the words sepa Knowing the meaning of the code of ethics, you could say that this is very familiar already with you, probably when you think of the code of ethics the first thing that will come to our mind are your parents or someone close to you, who have taught you the concept of right or wrong or what you call their rules and regulations presumably since birth, We could say that we have been observing the code of ethics our entire life without consciously knowing it. This code of ethics may have not been put into writings by our parents, but we have unconsciously been following this code of ethics. Our constant exposure to the code of ethics has enabled these codes to be engraved in our hearts and our minds which eventually are very helpful because they serve as guide for us to make the right decisions whenever we are put into some unavoidable situations. a) "e: Do you know where is the next place that we have been using the code of ethics? Yes! Your guess is right as mine, our second home which is our beloved school. If we could look back at the time, when we entered primary education, we were already taught to follow the code of ethics that the school has been practicing for decades. We might not be reading our student's handbook during our secondary education but through our homeroom time, this is where our advisers stressed the do’s and don’ts of our school life or simply saying let us follow the school commandments. As we broaden our knowledge like going to our tertiary education, the code of ethics is still the core of our life into this higher education and in the business world. When you are hired by a company the very first thing that you will be oriented with is the company’s code of ethics. The Purpose of the Code of Ethics ©... on history, the formalized codes of ethics believed to begin during 1980s when organizations and government had an increasing occurrence of corruption and wrongdoings. A code of ethics is necessary for every business organization to have in order to make certain that every individual in the business organization has a clear perception of the guiding principles and the mission to achieve the vision of a business organization. The code of ethics lays out the framework of standard rules andOrganization, These standard policies are ti used on the nts its members to stick to. ation war aws and The code of ethics di crete ise Soe alee from one organization to another since this is desi follow. Even hou et; a 0 rganization has different kinds of set-up and different regulatory laws to. ania See Peas of ethics usually directs it to the intemal conduct of the employees of the EG ae emphasizes how the employees are expected to deal or act with customers. aT ie Ge *S are rules that an employee should follow daily in a business organization, it helps Stay more focused on what the right action to do or the right path to take for common situations cl i fons that would happen daily in the workplace and the guide to the uncommon situations that will eventually happen also. ned to fit every To make certain that the goals and principles of the code of ethics are observed, some organizations have their own compliance officer or compliance department. This individual or department are tasked with keeping up to date on the changes of the regulation codes and monitoring employee conduct to encourage conformity, The employees usually undergo formal training to learn the organization’s code of ethics since non-compliance can cause legal issues for the organization, individual workers within a firm might face penalties for not following the guidelines. Hence, a code of ethics is an essential document for any business organization, as breaches of ethics can inflict business organizations in serious trouble with consumers, other business organizations ‘or government authorities. Having a code of ethics makes decision-making easier with all the levels in the organization by reducing vagueness and understanding individual perspectives in the ethical standards, The Role of the Code of Ethics in the Accountancy Profession Accountants constantly transact with confidential financial details of an individual or business. They handle transactions from thousands to trillions of cash, other accountants help with taking care of paying the taxes or assist others in making decisions in safeguarding retirement money or simply helping clients to invest their money. The Code of Ethics is the core principle which accountants follow for them to conduct business fairly, lawfully, honestly, and with integrity. The Code of profession, maintains the client’s trust, and exhibit ri s also enhances the accountant’s This Code of Ethics for Professional Accountants in the Philippines, have been approved by the Board of Directors of the Philippine Institute of Certified Public Accountants (PICPA) to be recommended for adoption by the Board of Accountancy (BOA) and approval of the Professional Regulation Commission (PRC) as part of the rules and regulations of the BOA for the practice of the accountancy profession is based on the International Code of Ethics for Professiona developed by International Federation of Accountants (IFAC). | Accountants Formulate a simple Code of Ethics BI ly identifying value an individual should respond in certain situations. Here are some guid for your small business from resour Developing a code of ethics starts with cle and deciding how you and s to make a simple code of ethics 's, workable.com)The components of code of professional ethics: * Respect for others. Treat people as you want to be treated. . areas and honesty. Feat ecotixcat tty 1y wrongdoing to the best of your ability Justice. Make sure you are objective and fair and do not disadvantage others. Lawfulness. Know and follow the law ~ always. Competence and accountability. Work hard and be responsible for your work. Teamwork. Collaborate and ask for help. Here are 2 examples of an excerpt of The Codes of Ethics in Philippine firms: 1. BANK OF THE PHILIPPIN) ISLANDS BPI CODE OF BUSINESS CONDUCT AND ETHICS 1. Rationale 1. Objective This Code outlines BPI Group's mission and values and enshrines the main rules of conduct t0 be complied with by Banco BPI, S.A. and the companies referred to in the following paragraph, when carrying on their businesses.2. Scope 2.1 This Code applies directly to all Employees (permanent or temporary) and members of the governing bodies (hereinafter referred to as Employees) of Banco BPI, S.A. and of subsidiaries under direct or indirect control of Banco BPI, S.A. (hereinafter collectively referred to as BPI), and to the service providers of any of those companies, where set out in their agreements. 2.2 Where Banco BPI, S.A.’s controlling interest, direct or indirect, is not total, this Code shall only apply, under the terms mentioned above, if approved by the governing body of the subsidiary concerned. I. Mission BPI is a financial group which, within a context of sustainable and consolidated development Of its business and of strict compliance with its legal and contractual obligations, has the mission to deliver excellent customer service by anticipating market needs and responding with independence, effectiveness, transparency and commitment, in order 10 create value for its Customers, Employees, Shareholders and the Community in which it operates. Aware of the role that the economic actors can play in the societies where they operate and of the importance of their contribution to social and cultural development, BPI pursues carefully the social and cultural supporting policies that at any time it may deem fit to ensure that the aforesaid mission is successful, IN, BPI Values and Culture 3. Rigor, diligence, quality and professional competence BPI and its Employees conduct their duties with rigor, diligence, quality, and professional skills. 4. Integrity, honesty and transparency BPI and its Employees are committed to behave with integrity, honesty, and transparency in all relationships with their customers or any other person or entity with whom they relate. 2, SAN MIGUEL PURE FOODS © Ethical Business Practices San Miguel Pure Foods and its Business Partners conduct business with integrity and always inan ethical manner. © Business Integrity Any form of corruption, extortion, and embezzlement shall be prohibited. We shall not offe pay nor accept bribes or participate in other illegal inducements in business or government relationships. We shall work against corruption in all its forms.Fair Competition We shall conduct our business cons with applicable laws. We advertising. istent with fair and vigorous competition and in compliance shall employ fair business practices including accurate and truthful Trade Compliance We shall comply with all applicable import and export controls, transactions, and other trade compliance laws of the Philippines and applicable laws of the country(ies) where transaction(s) occur Product Quality and Food Safety We, and any party involved in the supply, manufacturing, packaging, testing, storage, and distribution of materials/products on behalf of the food Group, shall uphold compliance with the Food Group quality and practices (e.g., Quality and Food Safety Regulations, Good Manufacturing Practices, Good Laboratory Practices, etc.) that are required in the markets where our products are registered and distributed, Animal Welfare {nimals shall be treated humanely. ‘fforts shall be exerted to refine procedures to minimi pain, siress, and distress, which shall be sciemtifically valid and acceptable to regulators. Accuracy of Business Records All our financial books and records shall conform to generally accepted accounting principles, and shall be accurate, legible, transparent, and reflect actual accounts of events, transactions, payments, and other relevant facts about the business. Protecting Information We shall protect confidential and proprietary information, including personal information collected for or from the Food Groups. We shall prevent information loss, misuse, theft, fraud, improper access, wrongful disclosure, or alteration, including unauthorized communication and/or loss of the Food Group confidential or proprietary information is reported immediately to concerned Food Group authorities. We shall make sure that any unauthorized use, disclosure, or lo of the Food Group confidential or proprietary information is reported immediately to concerned Food Group authorities REFERENCES: Business Ethics and Social Responsibility By: Aliza Racelis Business Ethics and Social Responsibility By: Dr. Reynaldo A. Padilla Philippine Business Ethics (Third Edition) By Alejandro R. Gorospe & Jose Ma. Quintos Business Ethics By: William H. Shaw Directions: Based on the components of code of professional ethics write out in your activity notebook a simple Company Code of Ethies for your future company. Company Name Company Vision Principles Core Values MissionLet us Analyze £2, eee rat bev identify the ethical concerns of some businesspeople ee fone e uM y. Do you sce them as ethical issues? If yes, do you deal with ely? If no, do you need to sharpen your awareness? Kindly check Fe ce Se Aare ct may bother you in the future from an ethical standpoint. Write the a losen on the raring scale on your activity notebook that reflects the level of your concern. Five is the highest degree and one is the lowest. HIGH LOW Sede Seez eel 1. Making decisions affecting employees’ lives 2. Administering some company policies ____ 3. Supporting some “unwritten” company policies ____4. Resolving employee grievances . Administering budgets __ 6. Assigning people to hazardous work __ 7. Disrupting the work of others because of animosity or conflict between groups ___ 8, Misrepresenting issues to others ____ 9. Withholding important data to “protect” others 10. Covering up drug/alcohol abuse among employees, peers, and senior managers i Hemsyou rated 3 or higher, deserves careful attention. You may face some serious ethical problems when you are already in the field. Start solving your ethical concerns now. (This activity is taken from the book of Business Ethics and Social Responsibility by Dr. Reynaldo A. Padilla, Copyright 2016 by JES Publishing Services) S Let us Try Instructions: Read each question carefully and be honest enough to answer it and give a good explanation for your answers in 5 sentences. Below are workplace situations about ethical standards. Answer Yes or No on the space provided after the question and write your explanation after the word Why. Write your answer in your activity notebook. Would you: 1. Alter a business report because your boss told you so? Why? 2. Will you take credit for the work done by your officemate? Why? 3. Protect an officemate wh your departmen Why? h is your best friend even thou he/she is causing a problem in