Business Ethics

• Ethics Means : moral principles that govern a persons

behavior or the conducting of an activity.
• The branch of knowledge that deals with moral
principles.
• Business Ethics : Business Ethics ( also known as
corporate ethics) is a form of applied ethics or
professional ethics that examine principles and moral or
ethical problems that arise in a business environment. It
applies to all aspects of business conduct and is relevant
to the conduct of individuals and entire organizations.
 Business Ethics
• Need or importance of business ethics
(1) Stop business malpractices.

(2) Improve consumers confidence.

(3) Survivals of business.

(4) Protecting consumers rights.

(5) Protecting employees, shareholders etc.

(6) Develop good relations between business and society

(7) Creates goods image of business.

(8) Smooth functioning of business.

(9) Consumer movement

(10) Consumer satisfaction.

(11) Importance of labour.

(12) Healthy competition.

 Principles of business Ethics
12 Ethical principles
(1) Honesty

(2) Integrity
(3) Promise – keeping & Trustworthiness.
(4) Loyalty

(5) Fairness
(6) Concern for others
(7) Respect for others

(8) Law abiding

(9) Commitment to Excellence
(10) Leadership
(11) Commitment to Excellence

(12) Leadership
(13) Reputation & Morale.

(14) Accountability.
 Management challenges in the new
Millennia 21st Century
 Impact of Globalization: Leads to a strategic
challenges of mixed cultures and languages in
the business environment.
 Managing Across Borders: The ability of an
organization to survive and succeed in the 21st
century transnational workforce and border
less business environment. Challenges in
managing enterprises – wide production
environments.
 Management challenges in the
new Millennia 21st Century
 Revolution of information Technology:
Supported by a new world infrastructure of data
communications and telecommunications for
example use of internet, wireless , e –
commerce as part of management tools and
easing of technology transfer.
 Security Issues: With wide usage of internet
platform in business transaction.
 Management challenges in the
new Millennia 21st Century
 Increasing demand for knowledge –
worker in the knowledge driven
organizations.
 The Key to Organization Survival &
prospering in the 21st century
 Corporate Strategy: Organization must
have a structure that help to unleash the
power of their professionals and to
capture the opportunity of todays
economy.
 Ethical Issues: Understanding the new
ethical issues emerged from changes in
the social and political landscape and from
the development of new technologies.
 The Key to Organization Survival &
prospering in the 21st century
 Social Responsibility: the issues of privacy
and confidentially, accessibility to
technology, issues, property rights and
ownership issues, freedom of speech etc.
 Global Challenges: Impact of globalization
and cross – border work culture.
 Ecological Issues: Oil exploitation and
land rights, food security, mining in Africa,
climate vulnerability and ecotourism.
 The Key to Organization Survival &
prospering in the 21st century
 Workforce Diversity: Cultural Awareness /
Acceptance (i.e. Ethnic Minorities,
Multingualism, Individual Differences).
 Ethical issues
 Due to increased emphasis on the business ethics over
last three decades, this field is suffering and is troubled
by the lack of proper directions and is struck in the
issues like logic, reasons etc.
 The past conception of the companies about the ethical
issues in business was related to the administration of
rules, regulations in the organization.
 Today people from the top management level and the
business owners have understood that his concept of
ethical issues in business is far superior than handling
the issues and regulations and their effective
implementation.
 Ethical issues
 There are wide ranges of issues related to the business ethics currently
observed by the market analysis today.
 Ethical issues can be varying in nature.

(1) Professional ethics

(2) Employee right issues which can be further divided into different
categories.

 In the current business environment, the issues like fairness, justices and
honesty are the main issues that are posing complex dilemma to the
business.
 Any wrong or biased decision can have a profound impact on the goodwill
o f the company as well as its market position.
 If they choose to use legality and profitability as their measurement in
determining what is right from wrong then business ethics will study
become irrelevant.
 Work Ethics
 Work ethics are a set of standards and rules that are
required by an individual for satisfactory work
performance.
 Work ethics have two types:

1. Personal ( i.e sincerity, respect for the job, regularity,

punctuality, seriousness).
2. Specific to a work situation
• Keeping certain information confidential
• Maintaining cordial relation with clients and agencies.
• Being prepared to take up new tasks.
 Need for Work Ethics
 Work
 Work Place
 Worker
 Characteristics of Work Ethics
 Attendance
 Character
 Team Work
 Appearance
 Attitude
 Productivity
 Organizational skills
 Communication skills
 Cooperation
 Respect
 Value
 A value is a belief
 A Mission
 A Philosophy
 That is meanigful
 Value
 A value are idealized conceptions that are
endorsed by the personality.
 Businesses and other organizations develop
strategic plans in which they list out their
goods and value.
 For example : One company indicated, “Provide
growth opportunities for our employees.
Create economic value for our customers and
shareholders. Return value to the communities
we serve
 Value
 The greatest potentials for the growth of
any company are generated by a
commitment to high corporate value.
 By the values, we mean the qualitative
goals which the company strives to
achieve in all its objectives
 Types of Value
 There are three types of value
 Physical
 Organization
 Psychological
 Behaviour
• Most people use the word behavior to mean conduct.
• Behavior is anything that a person does.
• In psychology behaviour is regarded as any
observable activity by human being.
• Most human behaviour results from a combination of
factors such as culture, attitudes, emotions, values,
ethics, authority, rapport, peruasion, coercion and
genertics.
 Different Types of Behaviour
• All behavior is learned.
• All behaviour occur for a reason.
• No behaviors occur “out of blüe”
• Behaviours continue to occur because they
are effective.
• Behaviour stop occurring when they are
ineffective.
 Attitude and Value
• Attitude is view point, a mind – set or a way of
valuing life.
• Evaluative statements of objects, people or events.
• A collection of feelings
• Multiple experience which lead to beliefs.
• Beliefs cluster together to form values ( that which
you value).
• Values of life shape itself, into a world view called
attitude.
 TYPES of Attitudes
• Theoretical Attitudes:
Solving a problem
Discover of truth and knowledge.

• Utilitarian Attitude:
Return on an investment of time, energy or money
discover utility and what Is useful or practical.
• Aesthetic Attitude
Discover experiences, impressions and expressions
subjective, experience of self and other.
 Functions of Attitudes
• Knowledge : Organize and simply peoples
experience.
• Instrumental : Maximize rewards or
minimize punishment.
• Ego – Defensive : Protect ourselves from
unpleasant realities.
• Value Expressive: Allow the expression of
personals values and self –concepts.
 Values
• Values carry an individual's concept of
right and wrong.
• Principles that guide our lives. They are
designed to lead us to our ideal world.
• Values define what is of worth , what is
beneficial and what is harmful.
• Values are standards to guide our action,
judgment and attitudes.
 Values System for Managers
• To understand the value for managers, we
have to understand why we need value
• (1) To understand Behavior
• (2) To take decisions
• ( 3) To be more respectful
• (4) To have concern for others.
• (5) To face life that is full of challenges .
 Values System for Managers
• A manager with value
(1) Shape the working environment
(2) Align the belief, perception of employees.
(3) Build the right attitude for work / meeting
organizational goals.
 Values System for Managers
Values determine the credibility and Ethics

(1) Establish a presence of fairness.

(2) Establish Trust
(3) Establish Honesty
(4) Establish the expectation of commitment
 Need of value for Managers
(1) Resolve ethical issues and dilemma’s as
they arise.
(2) Helps in setting high standard.
(3) Helps in practicing Managerial conduct and
Decision making.
(4) Effectiveness at work depends on Ethical
and Moral values.
 Core value of Managers
 Leads by example_ models the standards set
and has respect for the team.
 Accessible and visible to team members , walks
around the department / section. Takes time
for personal contact. Takes an interest staff as
individuals and listens to their concerns.
 Takes the flak when mistakes are made. Is fully
accountable for the actions of people who
report directly to them.
 Core value of Managers
 Is prepared to admit when wrong and
change own behavior, is not afraid to say
sorry . Actively seeks out development
opportunities for people who report directly
to them and seeks their inputs.
 Understand different needs and motivations
of indivjiduals and adapats own style to suiy
persona and situation.