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G12

Accountancy, Business and

Management

Business Ethics and Social

Responsibility
QUARTER 3: WEEK 7

Capsulized Self-Learning
Empowerment Toolkit

Schools Division Office of Zamboanga City

Region IX, Zamboanga Peninsula
Zamboanga City

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 1

CapSLET
BUSINESS ETHICS AND SOCIAL
RESPONSIBILITY
Subject & ABM
QUARTER 3 WEEK 7 DAY
Grade Level ESR-12 dd/mm/yyyy
CONTENT Foundations of the Principles of Business Ethics
LEARNING generate ways to improve business practices guided by the
COMPETENCY philosophies, belief system or Filipino values ABM_ESR12-IIIe-h-2.4

IMPORTANT: Do not write on this material. Write your answers on a separate sheet of paper.

KNOW AND UNDERSTAND

CONTENT STANDARD:
The Filipino Value System (Utang na Loob, Filial Piety, Padrino Suki, Bahala na - Mañana, Amor
Propio, Filipino Family Values)
CHECKPOINT: How does Filipino value system improve business practices?

In making a decision or coming up with a course of action, people tend to depend on their ethical
values whether they look for guidance from people, institutions and/or information
hubs/literatures/sources. Faced with a need to assess if they are about to do the right thing for a
certain situation, people will always find answers by taking into account their religious beliefs,
value systems or philosophies. Value systems and belief systems have their limitations to be
applicable to certain cultures or groups of people. Philosophical ethics provides reasoning that is
relevant to all people. Knowing all these will help us in the conduct of our businesses with
consideration to our partners and clients.

Philosophical Ethics – provides justifications that must apply to everyone regardless of religious
belief or values; in contrast, religious beliefs and value systems vary across different cultures so
that what is right to one culture may be wrong with another.

Three Ethical Frameworks

Ethical Framework Source of Moral Activity
A. Utilitarianism  Making decisions based on ethical consequences
 Results-based approach
 The ends justify the means
B. Ethics of Principles  Making decisions based on principles and not just on
and Rights consequences
 The ends DO NOT justify the means
C. Virtue Ethics  Grounded on character traits and emphasizes moral character in
contrast to moral rules or consequences of actions

A. Utilitarianism

As a consequentialist or results-based approach to ethics and social policy, utilitarianism holds that
an action is judged based on its overall consequences. It assumes that each one should act in ways

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 2

that produce better consequences or results, regardless of the means taken in reaching the results.
“Better consequences” are results that promote human well-being such as happiness, dignity,
health, integrity, freedom and respect of all people affected or involved. It also upholds the
following principles:
1. A decision is morally right if it promotes the greatest good for the greatest number of
people.
2. It is morally right if the net benefits over the costs are greatest for all people affected,
compared with the net benefits over costs of all other possible choices.
3. It is morally right if its benefits are greatest for each individual and if these benefits
outweigh the cost and benefit of alternatives.

Utilitarianism can be categorized as 1) rule-based or 2) act-based. Rule-based Utilitarianism uses

general principles (rules) in making a decision on the greatest benefit that can be achieved from
an action. Act-based Utilitarianism bases decision on the likelihood of achieving greatest utility or
good by analysing particular action or behavior. For rule-based example, companies with
confidentiality clause (rules) may terminate or sanction employees who share trade secret or
confidential information to unauthorized persons. In contrast in act-based utilitarianism, an
employee of a mobile phone company whose latest phone model may cause fire if overcharged or
subjected to higher atmospheric pressure may divulge to the public of the possible danger of
people buying the phone. While the employee may violate the company’s confidentiality clause,
he may feel he is doing the right thing to serve the greater good.

Utilitarian concept is widely practiced in government and business environments because it:
1. Considers both the collective interests as well as some particular interests;
2. Analyses and formulates alternative choices based on the greatest good of everyone
involved in the decision; and,
3. Estimates the costs and benefits of alternative choices for the affected groups.
Since consequences to action depend on each situation, utilitarianism tends to move toward
practical thinking. No act is ever absolutely right or wrong in every situation as long as it produces
the greatest good for the greatest number of people. Ultimately, its goal is to achieve the best
consequences for all parties involved in the actions. Therefore, utilitarianism answers the
fundamental question, “What should we do?”

However, the following are challenges in using utilitarianism in making decisions:

1. There really is no exact definition of “good” for all concerned and there is no agreement on
who decides, whose interests are prioritized in decisions, and, for whose good it is that has
to be considered.
2. It will be hard to quantify the costs of non-monetary stakes and long-term effects of an
action.
3. While utilitarianism considers the collective interest, there are times when individual
interest may need to be prioritized.

B. Ethics of Principles and Rights

Ethics of principles and rights considers principles and not just consequences – thus, the ends do
not justify the means. Bearing in mind the greatest good in decision making is definitely an ethical
way at arriving at a decision, but it is also important to consider principles and not just
consequences. This explores the relationship between legislative and judicial branches of
government: legislative role creates laws and regulations based on utilitarian principles (greatest
good) while judicial role interprets these laws to achieve justice and fairness (for individual or
group). The second framework upholds that some decisions are needed to be made based on

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 3

principles rather than consequences. Taking on judging cases, the decision is not based on the
greater good but on what principles (laws) were violated.

For example, paying bribe to customs personnel will promote greater good for the stakeholders
i.e. companies may speedily process imported materials and turn it to products which the
consumers may enjoy immediately while customs personnel will earn additional compensation for
their families. However, the Philippine Constitution and the Anti-Graft and Corrupt Practices Act,
prohibit public officials from receiving any gift in exchange for favor. Thus, paying a bribe is not
ethical based on ethics of principles and rights. Aside from the law, there are also rules, duties and
guidelines set by organizations and institutions which a member should follow. These rules serve
as a social agreement or a contract that helps you function and get through with relationships with
people.

C. Virtue Ethics

Virtues – can be described as the character traits that would constitute a good and meaningful life;
being happy, friendly, joyful and calm; preserving dignity and integrity; having good relationships;
and, possessing modest things are a few of the characteristics of having a meaningful life.

Virtue ethics is grounded on character traits and emphasizes moral character in contrast to moral
values (deontology) or consequences of actions (results/consequences of utilitarianism). It has
roots in ancient Chinese and Greek philosophy and is recognized to have been established by Plato
and Aristotle. It focuses on the type of person you want to be, grounded on good character,
motives and core values, and not on the actions that should be taken.

SAQ1: Define philosophical ethics and discuss its various ethical frameworks?

Human beings have different personalities, different goals, different values and different belief
systems. These different backgrounds, especially religious orientations or belief systems, have
impacts on business ethics.

Buddhism is a flexible system of beliefs that allows it to adapt to country-specific customs and
agrees with the moral teachings of other religions. Centered in Buddhism belief are five precepts
or training rules, which help promote peaceful co-existence and harmony in society. These are the
minimum moral obligations of Buddhists, which they fulfill by refraining from:
1. Harming or taking lives of beings;
2. Taking what is not given;
3. Engaging in sexual misconduct;
4. Lying or engaging in gossip; and,
5. Taking intoxicating substances such as alcohol and illegal drugs.

In Islam, trading or catering to business is favored as long as rules are obeyed and the practice is
guided by honesty. Cheating or deception in economic transactions is condemned by the Qur’an.
Possible gains from the trade or business should not result to materialism, which is considered as
diverting the attention from more important spiritual concerns.

Christianity teaches that Christians are stewards of resources and responsibilities toward other
people and resources such as the environment. Christians who considered that God called them
to a particular occupation or business were naturally concerned that their actions involving their
work or business must be conducted in an ethical manner and for the good of the community.

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 4

Unique Filipino Value System, which covers our culture, beliefs and practices, also affect the
business setting. Some of these Filipino traits are the following:

 Filipino time – synonymous to being late. This trait is being used as an excuse for being
tardy in meetings, events and other social affairs, both formal and informal. It reflects
unprofessionalism and lack of respect for other people’s time.
 Padrino system or patronage – happens when one gains favor, promotion or position
through family affiliation or friendship as opposed to earning it due to one’s skills, abilities
and capabilities.
 Utang na loob or indebtedness in gratitude – concept of “paying back” a person in non-
monetary terms a good deed received. Good deed is paid with a good deed as well.
 Pakikisama – describes how Filipinos take care of their interpersonal relationships by
agreeing to what the majority wants or by getting along with others.
 Bahala na – leaving everything to chance, come what may. Businesses cannot be left on its
own to fate.
 Mañana (mamaya na) habit – delaying to do things instead of doing them now. In business,
an owner cannot tolerate wasting company time.
 Filipino hospitality – this is known worldwide as a trait applicable in life but works best in
the hospitality and tourism industries such as hotels, resorts, airlines, travel agencies and
the like. This trait experienced by foreign visitors makes them enjoy their stay and makes
them want to come back.
SAQ2: How do religious belief and Filipino Value System improve business practices?

BE ABLE TO DO
Let’s Practice!

Activity 1
Directions: Write an essay based on the case presented and the guide questions provided.

Jessica, Timothy and Aldrin are Grade 12 students who have been classmates since grade school.
All three of them have been on the honor roll since grade school. One day, Jessica was approached
by another friend from another section saying she has a copy of the leaked Business Mathematics
Final Examination. Being not confident in her grades in Business Mathematics, Jessica grabbed a
copy of the leaked questionnaire. Being a friend to Timothy and Aldrin, Jessica also shared the
“good news” with them. However, Timothy and Aldrin informed their Business Mathematics
teacher of the leak and showed her the copy that came from Jessica. Jessica was questioned by
the teacher and school authorities and was expelled from school.

1. Do you think what Timothy and Aldrin did was right? Why or why not?
2. What pushed Timothy and Adrin to report the case to their teacher?
3. If you were Timothy and Aldrin, what would you have done?
4. If you were the teacher and school authority, what would you have done?
5. Can you cite ethical philosophies, religious beliefs or Filipino value system from our case?

REMEMBER
Key Points

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 5

 Philosophical Ethics provides justifications that must apply to everyone regardless of religious
belief or values; in contrast, religious beliefs and value systems vary across different cultures so
that what is right to one culture may be wrong with another.
 Utilitarianism as a consequentialist or results-based approach to ethics and social policy, holds
that an action is judged based on its overall consequences. It assumes that each one should act
in ways that produce better consequences or results, regardless of the means taken in reaching
the results and that this “better consequences” are results that promote human well-being such
as happiness, dignity, health, integrity, freedom and respect of all people affected or involved
or at least to the greater majority.
 Utilitarianism can be categorized as 1) Rule-based Utilitarianism, which uses general principles
in making a decision on the greatest benefit that can be achieved from an action, and, 2) Act-
based Utilitarianism, which bases decision on the likelihood of achieving greatest utility or good
by analysing particular action or behavior.
 Ethics of principles and rights considers principles and not just consequences – thus, the ends
do not justify the means.
 Ethics of principles and rights explores the relationship between legislative and judicial branches
of government: legislative role creates laws and regulations based on utilitarian principles
(greatest good) while judicial role interprets these laws to achieve justice and fairness (for
individual or group). In judging cases, the decision is not based on the greater good but on what
principles (laws) were violated.
 Virtue ethics is grounded on character traits and emphasizes moral character in contrast to
moral values (deontology) or consequences of actions (results/consequences of utilitarianism).
It focuses on the type of person you want to be, grounded on good character, motives and core
values, and not on the actions that should be taken.
 Belief systems also have impacts on decision-making related to business.
 Unique Filipino culture, values, beliefs and practices also affect the business setting both in
negative and positive way.

TRY
Let’s see how much you have learned today!

A. TRUE OR FALSE
Directions: Tell whether if the statement is True or False. Write your answer on a separate
sheet.
_________ 1. Utilitarianism holds that an action is judged based on its principles.
_________ 2. Rule-based and act-based are categories of virtue ethics.
_________ 3. Legislative role creates laws and regulations based on utilitarian principles while
judicial role interprets these laws to achieve justice and fairness based on virtue ethics.
_________ 4. Ethics can be described as the character traits that would constitute a good and
meaningful life; being happy, friendly, joyful and calm; preserving dignity and integrity; having good
relationships; and, possessing modest things.

_________ 5. Getting promoted because of family friendship instead of ability and capability is an
example of pakikisama system.

B. MULTIPLE CHOICE
Directions: Read the statements carefully and write the letter your choice on a separate sheet.

_________ 1. Which among the trait is being used as an excuse for being tardy in meetings, events
and other social affairs, both formal and informal.
“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”
Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 6

A. Pakikisama B. Filipino time

C. Utang na loob D. Mañana (mamaya na) habit

_________ 2. These are minimum moral obligations of Buddhists refrained from, except
A. killing B. gossiping
C. stealing D. gambling

_________ 3. Uses general principles in making a decision on the greatest benefit that can be
achieved from an action.
A. Virtue ethics B. Ethics of principles and rights
C. act-based utilitarianism D. rule-based utilitarianism

_________ 4. Grounded on character traits and emphasizes moral character in contrast to moral
rules or consequences of actions
A. Virtue ethics B. Ethics of principles and rights
C. act-based utilitarianism D. rule-based utilitarianism

_________ 5. A flexible system of beliefs that allows it to adapt to country-specific customs and
agrees with the moral teachings of other religions.
A. Islam B. Christianity
C. Buddhism D. Judaism

Jonalyn C Baquillas, Business Ethics and Social Responsibility, Makati City, Diwa Learning
REFERENCES
Systems, Inc., 2017, p55-75
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“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School
 7

“Unido, Junto avanza con el EduKalidad Cree, junto junto puede!”

Prepared by: Shellame R. Mabalo/ Teacher II
DPLMHS Stand-Alone Senior High School