Amity School of Business

Business Policy and Strategic Management

STRA 302

Business Ethics

Course Instructor: Prof. Ruchi Khandelwal

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What are Business Ethics

•  Ethics are the study of moral obligation involving
the distinction between right and wrong.
•  Business ethics are moral principles that guide
the way a business behaves.
•  If a company's purpose is to maximize
shareholder returns, then sacrificing profits to
other concerns is a violation of its fiduciary
responsibility.
•  Conventional approach to business ethics
involves a comparison of a decision or practice
to prevailing societal norms
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Ethical Issues…
•  Employee-Employer Relations
•  Employer-Employee Relations
•  Company-Customer Relations
•  Company-Shareholder Relations
•  Company-Community/Public Interest

•  Law often represents an

Frequent Overlap
ethical minimum
•  Ethics often represents a
standard that exceeds the
legal minimum
Ethics Law

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Three Models

1.  Immoral Management—A style devoid of

ethical principles and active opposition to what
is ethical.
2.  Moral Management—Conforms to high
standards of ethical behavior.
3.  Amoral Management
–  Intentional - does not consider ethical factors
–  Unintentional - casual or careless about ethical
considerations in business

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Factors impacting Organizational Ethics

•  Corporate culture
•  Existence and application of a written code of ethics
•  Formal and informal policies and rules
•  Norms for acceptable behaviour
•  Financial reward system
•  System for recognizing accomplishment
•  Company attitude toward employees
•  How employees are selected for promotions
•  Hiring practices
•  Applications of legal behaviour
•  Behaviours and attitudes of the organization’s leaders

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Business Ethics application

Decision Making
Identify your
stakeholders

Consider the available

alternatives

Consider how a decision

affect the stakeholders

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What is considered ethical?

Behavior or act compared with

Prevailing norms
that has been
of acceptability
committed

Value judgments
and perceptions of
the observer

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Who is responsible?
•  A company’s managers play an important role in
establishing its ethical tone. If managers behave
as if the only thing that matters is profit,
employees are likely to act in a like manner.
•  A company's leaders are responsible for setting
standards for what is and is not acceptable
employee behaviour.
•  It’s vital for managers to play an active role in
creating a working environment where
employees are encouraged and rewarded for
acting in an ethical manner.
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Unethical Business Behavior

•  Misrepresentation hours work.

•  Employees lying to supervisors.
•  Management lying to employees,
customers, vendors or public.
•  Misuse of organizational assets.
•  Harassment.
•  Bribery or gifts.

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Principles of Admirable Business Ethics

1. Be Trustful
2. Keep An Open Mind
3. Meet Obligations
4. Have Clear Documents
5. Become Community Involved
6. Maintain Accounting Control
7. Be Respectful

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