Business Ethics

 ”Real integrity is doing the right thing,

knowing that nobody's going to know
whether you did it or not.”
--Oprah Winfrey
Terminologies
 Bribery

 An act of persuading a person by means of

a gift or money to act wrongly

 Code of ethics
 A formal statement that serves as a guide
to actions in situations involving ethical
questions
 Ethics that are important in business
 Honesty

◦ It means not telling lies, not cheating and not

stealing.
 Loyalty

◦ It means to be faithful to your employers,

employees and customers.
 Ethics that are important in business

 Punctuality

◦ It means to arrive on time at your workplace and for

meetings and to complete commitments on time, to
keep appointments and to honour deadlines. A lack of
punctuality is a sign of disrespect.
 Ethics that are important in business

 Fairness

◦ It means to treat other people the same way as you

wish or expect them to treat you.
 Ethics that are important in business

 Harassment free / nonsexual environment

◦ Sexual harassment occurs when someone makes
sexual suggestions or constantly says things relating
to sex that make another man or woman feel
uncomfortable. It also occurs when someone touches
another person sexually without being encouraged or
invited to do so.
Read through the following case study
and answer the questions that follow
 Mr Banda decided to open a private school in his
community, since most primary schools in his town are
usually struggling to accommodate all learners in the
area. He informed the parents in the community that his
business was registered and he started to take in
learners for the 2008 academic year. A total number of
110 learners were enrolled and he appointed five
teachers at the school. Ninety percent (90%) of all
parents paid the school fees in advance for the whole
year. Case A
 Soon after the school started, Mr Banda decided to
open a hotel and appointed two institutional workers
as well. A tender was given out to provide meals to the
learners in the hotel and Sara’s Caterers got it.
During February, the teachers started complaining
to Mr Banda about not receiving their salaries. Mr
Banda promised to give them a raise as soon as all
the parents have paid up.
 By April, that promise was still not kept. None of the
teachers, or the workers received any salary. Sara’s
Caterers that delivered food was not paid so the
deliveries of food came to a halt. The teachers left the
school and now the parents are very unhappy since
most of them paid the school fees.
When the parents reported the case to the Ministry of
Education, it was discovered that the school in fact was
never registered. When the ministerial officials visited
the school to address the issue, Mr Banda tried
to bribe them.
Questions

1. List all the wrong things that Mr Banda has

done.
2. In your opinion, if he wants to start another
business, do you think this business will
succeed? Give reasons for your answer.
 Case B
Mr Thomas owns a cement business and deals
mostly with the local contractors for cement, sand
and stones. Mr Thomas has a reputation for high
quality products and good customer service. His
foreman has just run the standard quality control
tests he performs regularly on the products.
 When the test results are ready, he discovers that
the new batch of products is 9 % less durable than
the usual material. It is still well above all industry
standards and meets all building codes and
requirements for the purpose for which it is
intended. Nevertheless, it is, nevertheless, not up
to the usual standards. Throwing it away would cost
the company many thousands of dollars. Mr
Thomas decides to sell the cement anyway.
 Questions

1. As an entrepreneur, comment on the ethical

behaviour of Mr Thomas.

2. If you were Mr Thomas, would you use this

cement for the foundation of your own house? If
not, why not?