Definition:
• The principles of conduct defining what is right
and wrong governing an individual or a group.
• Business ethics is the principles and standards
that determine the acceptable and right conduct
in business dealings and transactions.
• It is also concerned with moral judgments for
decisions taken in business dealings.
Example of misconduct (unethical behaviors)
• Offering/ taking of bribes/ kickbacks
• Short-changing weights when selling products
• Using sub-standard products as genuine originals
Factors affecting ethical behaviours:
• Personal values and social background
• External forces
• Internal environment of the company
Business Ethics Issues:
• Ethics in finance
• Ethics in marketing and sales
• Ethics in dealing with intellectual property rights
• Ethics in employee relations
• Ethics in production
 The code of ethics is normally prepared by human capital.
Ethics Program:
• Form ethics and integrity committees at division levels
• Set up SOPs for reporting and follow up
• Appoint an ethics ombudsman/ officers
• Set up training programmes on ethical behaviour
Islamic Business Ethics:
 Islam as a way of life. Ethics governs all aspects of a
Muslim’s life.
 In the Quran, Allah describes successful people in life as
those who are ‘inviting all that is good (khayr),
enjoining what is right (ma’ruf) and forbidding what is
wrong (munkar)’
Factors for different ethics:
• the individual’s values and moral attitudes
• personality and character of individual
• family and peer influences
• situational factors
• Life experiences
Islamic Ethics –vs- the Conventional System
 Islamic ethics are for guidance throughout life based on
teachings of Al-Quran and sayings and actions of Prophet
Muhammad (pbuh)
 In conventional (secular) system in, interpretations of laws are
based on current judgments and contemporary values and
standards. This can cause biases of personalities involved.
 Government related Companies and Ministries and
Corporate Social Responsiveness: NGOs:.
Definition:
• PETRONAS, AMBANK, Bank Islam, AXIATA,
• Investors looking for socially responsible Universiti Kuala Lumpur, Nestle and General
• Open and transparent business practice that is
companies Electric.
based on ethical values and respect for the
• Investors look for sustainable
community, stakeholders, including the Areas of CSR by
development
government.
• Muslim investors looking for Syariah-
compliant companies • Education and skills building for children from poor
• Integrating ethical practices into a company’s backgrounds
• Millennials like to work in companies
strategies and operations • Flood relief and rehabilitation
that take their CSR seriously.
• Environmental, e.g. Mangrove habitat, Wetlands
• Human capital development for young people

Ethical practices in Malaysia

• In Malaysia, the public is more concerned with

corruption Conclusion:

• The Government has set up the Anti-Corruption • It is imperative that companies pay special attention to
Agency (now renamed Malaysian Anti-Corruption ethical behaviours of their stakeholders, particularly
Commission). top management.

• The private sector established the Corporate • By becoming good citizens with their CSR activities,
Integrity Pledge (CIP) to stamp out corruption in they can also improve their profits and performance.
business dealings.

• There has been attempts to stop money politics,

but with not much success till now.