UNIVERSITY OF MUMBAI

PROJECT ON A STUDY OF CORPORATE ETHICS AND CULTURE WITH A CASE STUDY ON ORACLE, ENRON AND TATA

MASTER OF COMMERCE (MANAGEMENT) SUBJECT: BUSINESS POLICY & STRATEGIC MANAGEMENT SEMESTER II (2012-13)

SUBMITTED BY NISHA PUNJABI ROLL NO. 671

PROJECT GUIDE Dr. Purnima Sharma

Lala Lajpat Rai College of Commerce, 315 New Charni Road, Mumbai- 400004
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MASTER OF COMMERCE (MANAGEMENT)

SUBJECT: BUSINESS POLICY & STRATEGIC MANAGEMENT SEMESTER II (2012-13)

PROJECT ON A STUDY OF CORPORATE ETHICS AND CULTURE WITH A CASE STUDY ON ORACLE, ENRON AND TATA

SUBMITTED BY NISHA PUNJABI ROLL NO. 671

CERTIFICATE

This is to certify that Ms. Nisha Punjabi of M.Com Management Semester II (2012-13) has successfully completed the project on 'A Study Of Corporate Ethics And Culture With A Case Study On Oracle, Enron And Tata' under the guidance of Dr. Purnima Sharma.

Project Guide

__________________________

Course Coordinator

__________________________

Internal Examiner

__________________________

External Examiner

__________________________

Principal

__________________________

Date: ___________ Place: Mumbai

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DECLARATION

I Ms. Nisha Punjabi, student of M.com (Management) 2ND Semester (2012-13), hereby declare that I have completed the Project on 'A Study Of Corporate Ethics And Culture With A Case Study On Oracle, Enron And Tata'

The information submitted is true and original to the best of my knowledge

Nisha Punjabi

(Signature)

ACKNOWLEDGEMENT
This project was a great learning experience and I take this opportunity to acknowledge all those who gave me their invaluable guidance and inspiration provided to me during the course of this project by my guide.

I would also like to thank Dr. Purnima Sharma and the M.COM department of Lala Lajpat Rai College who gave me this opportunity to work on this project which has helped me explore the intricacies of the world of international finance step ahead of just theoretical knowledge provided during the course of this curriculum.

I would also like to extend my gratitude towards the library staff for equipping me with the basics that helped me throughout the making of this project. I am also thankful to all my friends and fellow students who helped me in the cause of my project

Nisha Punjabi Roll no. 671 M.Com (Management)

Table of Contents
INTRODUCTION TO ETHICS ................................................................................................................... 7 NATURE OF BUSINESS ETHICS: ............................................................................................................. 7 DEFINITION & THEORY: ......................................................................................................................... 8 FEATURES OF CORPORATE ETHICS: ...................................................................................................... 9 IMPORTANCE OF CORPORATE ETHICS: .............................................................................................. 10 GOOD ETHICS IS GOOD BUSINESS.................................................................................................. 11 TEN COMMANDMENTS OF BUSINESS ETHICS.................................................................................... 13 ETHICAL CULTURE: ............................................................................................................................... 15 CORPORATE CULTURE AND ETHICAL CLIMATE: ................................................................................ 18 CHANGING THE ETHICAL CULTURE AND CLIMATE ........................................................................... 19 THREE Rs OF ETHICAL CULTURE BY GEORGE.S ................................................................................ 20 ENFORCEMENT OF ETHICAL CULTURE: .............................................................................................. 22 CREATING AN ETHICAL CULTURE .......................................................................................................... 23 REASONS FOR THE PRESENCE OF UNETHICAL BUSINESS PRACTICES IN INDIA ............................ 24 CAN ETHICS AND BUSINESS CO EXIST?........................................................................................... 26 POSITION OF BUSINESS ETHICS IN INDIA .............................................................................................. 26 EXAMPLES OF COMPANIES TRYING TO CREATE AN ETHICAL CULTURE ......................................... 28 CASE STUDY - ENRON & ETHICS ............................................................................................................ 33 ETHICAL PROBLEMS WITH ENRONS CULTURE ..................................................................................... 37 CASE STUDY- ORACLE FINANCIAL SERVICES ...................................................................................... 39 CONCLUSION......................................................................................................................................... 45 BIBLIOGRAPHY ...................................................................................................................................... 46

INTRODUCTION TO ETHICS
Ethics refers to a system of moral principles-a-sense of right and wrong and goodness and badness of actions and their motives and consequences. The term Ethics, refers to a code of conduct while dealing with others. It is a study of individual and collective moral awareness, judgment, character and conduct. It relates to the social rules and cardinal values that motivate people to be honest in dealing with others. Ethics directs human behaviour and differentiates between fair and unfair human behaviour or actions. It creates decency, decorum and discipline in the behaviour of individuals and also in the society. The Ethics is derived from the Greek word ethos which refers to the character. According to Webster dictionary ETHICAL means conforming to professional standard of conduct. The term ethics has wide scope and application. It is applicable to our economic, social, political and religious activities. Businessmen and business enterprises are expected to follow a fair and decent code of conduct while managing their business activities. They are free to make profit but not by exploiting consumers employees and the society at large. They should have fair deal with all social groups. They study of business ethics is essential in these days when the importance of ethical values is fast declining. Ethics is the conspicuous causality in the emerging business scenario. However, businessmen should be told that ethics and ethical business alone will help them to survive and more towards prosperity. They will have social respect, social recognition and consumer support only when they follow ethical principles in their business and that too without any compromise as ethics should never be compromised.

NATURE OF BUSINESS ETHICS:

Business ethics refers to the system of moral principles applied to business activities. It deals with morality in the business. There should be ethics behind all business activities. This means the business activities should be conducted according to certain selfrecognized moral standards. The coverage of Business ethics is very wide as it deals with

norms relating to customers, shareholders, employers, dealers, government and competitors. These are, in fact, the different areas of business ethics. Every professional has its own ethical standards i.e, rules of conduct and individuals conducting that activity are expected to follow such ethical standards honestly. In this sense, medical practitioners, lawyers, engineers, teachers, chartered accountants, etc, have ethical standards and concerned professionals are expected to follow them unscrupulously. The same is the case with businessmen and business enterprises. In fact, everyone needs some framework of values to guide personal behaviour. The dual source of ethical, social and political standards is both natural and necessary. The most important professional ethics is expressed by the Hippocratic Oath of the Greek physician: primum non nocere (Not knowingly do harm). These dictum suggest that a professional should evaluate his decisions and ensure that his decisions/actions will not produce harmful effects on others. A businessman, for example, should not use unfair trade practices as they are always harmful to customers. Business ethics suggests certain golden rules which are fair to all and should be followed by businessmen. Business ethics is a part of social responsibility which the businessmen have to honour in practice. It is the application of ethical values to business. Business ethics from the Legal point of view If it is legal, it is ethical too is their approach. This is inadequate and even dangerous over-simplification of the concept of business ethics. Sometimes line of demarcation between ethical and unethical is very thin.

DEFINITION & THEORY:

According to Wheeler, Business ethics is an art or science of maintaining harmonious relationship with society, its various groups and institutions as well as reorganizing the moral responsibility for the rightness or wrongness of business conduct There are two theories when we talk about nature of ethics: 1. The theory of moral unity essentially advocates the principles that business actions should be judged by the general ethical standards of society. There exists only one ethical standard which applies to business and to non-business situations.
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2. Second theory is the theory of amorality, which argues that business can be amoral, and the actions of businessmen need not be guided by general ethical standards. Managers may act selfishly because the market mechanism distils their actions into benefits to shareholders and society at large. Adam Smith argued that the invisible hand of the market assures that by pursuing his own interest frequently promotes that of the society more effectively than when he really intends to promote it. In this way, capitalism provides moral justification for the pursuit of profit through behaviour which is not purposefully ethical.

FEATURES OF CORPORATE ETHICS:

1.

Refers to code of conduct. Business ethics is the code of conduct which businessmen should follow while

conducting their normal business activities. 2. Based on moral and social values.

Business ethics is based on well accepted moral and social values. It suggests moral principles/rules of conduct for businessmen. They include self-control, service to society, fair treatment to social groups and not to harm/exploit others. 3. Facilitates protection of social groups.

Business ethics gives protection to consumers and other social groups such as shareholders, employees and the society at large. Business should give priority to social interest or social good. Such ethical approach creates good name and status to business and facilitates its expansion. 4. Provides basic framework.

Business ethics provides the framework within which business is to be conducted. It suggests a legal, social, moral, economic and cultural limit within business is to operate. It suggests what is good and what is bad in business. 5. Needs willing acceptance for enforcement.
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Business ethics cannot be enforced by law or by force. It must be accepted as self-discipline by businessmen. It should come from within. Businessmen should go for ethical trade practices on their own and not by force of law. 6. Education and guidance required for introduction.

Businessmen should be given proper education, guidance and training in order to motivate to follow ethical business practices. Trade associations and chambers of commerce have to play a positive role in this regard. 7. Not against profit making.

Business ethics is not against fair profit making. However, it is against profiteering by cheating and exploiting consumers, employees or investors. It supports expansion of business activities but by fair means and not through illegal activities activities or corrupt practices. 8. Acts as summum bonum of human life.

Ethics, as a science seeks to determine the summum bonum of human life. It passes judgments of value upon human actions with references to the moral values. Judgments of value are judgments of what ought to be. Such judgments may be different from the judgments of facts as they are judgements of what is.

IMPORTANCE OF CORPORATE ETHICS:

Business ethics is important as it has wider social significance. Society will get true benefits of business activities only when business is conducted by respecting ethical values. In addition, it is important as it offers the following advantage to the businessmen, consumers, and employees. Advantages to businessmen/ managements/ business: 1) Orderly functioning:

Business ethics ensures orderly functioning of a business enterprise due to less public criticism.
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2)

Favourable social image:

It creates good social image for business through alertness as regards social responsibilities. 3) Guidance to businessmen:

Business ethics offers guidance to businessmen in decision making for social good and not simply for profit maximization. 4) Support from employees:

Management gets support and cooperation from employees as regards future plans and programmes of the company. 5) Creates social consciousness:

Due to business ethics, businessmen are made conscious as regards honesty and social obligations ion business. It will lead to high level of corporate governance. Respect to ethical values will create socially responsible business obligations. 6) Facilitates business expansion:

Business ethics facilitates the expansion and growth of business activities due to the support and cooperation from different social groups. 7) Encourages fair business:

Business ethics encourages businessmen to use fair business practices for the protection of consumers and the society. It is concerned with morality in business. Ethics is a system of moral values and ethics suggests the extent to which moral values are respected in the conduct of business activities. Businessmen should conduct business activities with selfcontrol. This is necessary for the protection of consumers and the society at large.

GOOD ETHICS IS GOOD BUSINESS

This quotation/slogan/observation suggests the importance of ethics in business. It provides protection, justice, and fair treatment to all social groups. In addition, ethical business gets social support and recognition. It facilitates business expansion and growth.
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Ethical business is equally profitable. Businessmen should therefore support the concept of business ethics. Business ethics is important to business community, consumers and the society at large. The most common belief that good ethics is good business is true. All (including businessmen) should support this common belief of wider social significance. Businessmen have economic power, which they can use for making the life of people happy or miserable. Businessmen should conduct business in a fair and ethical manner and make people happy. This is good business and good ethics. Businessmen may earn quick profits through unethical practices. Along with this, they may also invite consumer displeasure, government control and non-co-operation from the employees. These factors harm the future prospects of business. Business will not get support from the society when justice is not done to different social groups. It is rightly said that honesty is the best policy and also beneficial in the long run. The same rule is applicable to business. Businessmen should not be short-sighted. They should have vision and foresight. They should consider what is good to them and also to the society in the long run. Undue importance need not be given to profit-making in business even when reasonable profit is a must in business. At the same time, businessmen should treat business as a tool for social service. They should be fare to all social groups and offer them benefits and happiness. Businessmen should conduct business with high ethical standard. Ethical values should not be discarded in any human activity and business is not an exception to this rule. Businessmen should not run after profit maximization at any cost. They should support ethical values while managing business activities. Such outlook is beneficial to them and also to the entire society and social system. One can support the slogan of Good business is good ethics with many examples of usual business activities. The slogan Good ethics is good business has special significance/relevance in India. Ethical business is useful to businessmen and also to the society. Businessmen should act as friends and well-wishers of consumers. This is possible when they avoid the exploitation of different social groups but offer protection and support to them. It is rather unfortunate in todays world; moral and ethical scruples fall prey to neglect and finally decay. It is always desirable to strike a balance between economic performance and social performance of a business unit. Business ethics facilitates such balance. Businessmen should decide what is socially good and what is socially undesirable and act accordingly. This will make their business ethical and also beneficial to them and to the society at large. Business also gets public support when it is conducted in a fair manner.
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In this regard, reference may be made to another slogan, which again indicates the importance of ethics in business. This slogan is: No Ethics, No Business. It suggests one eternal truth in regard to business. It is possible to expand business or earn profit far a short period through unethical business activities. In other words, consumers can be exploited or cheated by unfair trade practices for a short period but not permanently. In the long run, the survival, growth and popularity of business depend on the use of ethical business practices. A business enterprise may not be able to conduct over a long period if it fails to honor moral/ethical values. There are some principles of business ethics. Businessmen are expected to honor them honestly and on their own. Their long term survival and growth depend on their support to ethical values. They will be forced to stop their business if they failed to honor business ethics in theory and also in practice. This means that unethical business has no chances of survival over a long period. In this sense, the slogan No Ethics, No Business is true and acts as a guideline to businessmen/business enterprise. It also indicates the importance of ethics in business.

TEN COMMANDMENTS OF BUSINESS ETHICS

Ethics is a leadership issue. Poor ethics can sap business production and long-term results. Here is a concise list of ethical behaviour you can keep to guide you in your future dealings (or make a copy for your boss to do the same). My Ten Commandments of Ethical Business Behaviour have their roots in "Ethics: Easier Said than done," by Michael Josephson. 1) Be honest: To be honest means to be truthful, sincere, forthright, straightforward, frank and candid. You should have zero personal tolerance for lying, stealing, cheating, deceiving or acting deviously. 2) Have integrity: Always be principled, honorable, upright and courageous, acting upon your convictions. Strive not to be unscrupulous or two-faced with a philosophy that the-endjustifiesthe-means.

3) Keep your word: Be worthy of others' trust by keeping promises, fulfilling commitments and abiding by the spirit as well as by the letter of an agreement. Shy away from the

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temptation to rationalize non-compliance or create an excuse to break a commitment on the basis of technical or legalistic interpretations of agreements. 4) Maintain fidelity: Be faithful to your employees, family, friends and country, and never disclose information earned in confidence. Scrupulously avoid undue influences and conflicts of interest lest they cloud your ability to make independent and impartial decisions. 5) Always be fair: Be open-minded, willing to admit errors and change positions. Demonstrate a commitment to justice, with equal treatment of all, and a tolerance for diversity. Never take undue advantage of another's mistakes or adversities. 6) Care for others: Be kind, sharing and compassionate; share, give of yourself and serve others. Help those in need and avoid actions that will bring harm to others. 7) Respect others: Demonstrate respect for human dignity, privacy and the right of selfdetermination of all people. Be courteous, prompt and decent. Provide others with information they need to make informed decisions and do not patronize, embarrass or demean. 8) Be a responsible citizen: Obey just laws (and protest unjust ones). Exercise democratic rights and privileges responsibly by participation, social consciousness and public service. When in a position of leadership, openly respect the democratic decision-making process, avoid unnecessary secrecy or concealment of information and ensure others have the information they need to make intelligent decisions and exercise their rights. 9) Rigorously pursue excellence: Pursue excellence in all you do. Be diligent, reliable, industrious and committed in meeting personal and professional responsibilities. Perform all tasks to the best of your ability while developing and maintaining a high degree of competence. Be well informed and well prepared. Never be content with mediocrity, and never strive to win "at any cost." 10) Always be accountable: Being accountable means accepting responsibility for decisions and the foreseeable consequences of actions and inactions, and for setting an example for others. Employers, along with parents, teachers, professionals and public officials have a special obligation to lead by example and to safeguard and advance the integrity and reputation of their companies, families, professions and the government. Avoid even the appearance of impropriety and take whatever actions are necessary to correct or prevent inappropriate conduct by others.

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The consequences of lost ethics are summed up well in an ancient Chinese proverb, "He who sacrifices his conscience to ambition burns a picture to obtain the ashes."

ETHICAL CULTURE:

Ethics have begun to play a very important role in the study of organizational behaviour and in the relations between organizations and the environments in which the organizations work. It has been recognized that behaving efficiently and effectively. It is not always easy to differentiate between ethical and unethical behaviour. The ethical dimensions of an action vary from person to person and situation to situation. What may seem unethical in one scenario may be perfectly acceptable and even desirable in another scenario.

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Definition of Ethical Culture: Ethical culture is usually defined as the documented systems and procedures that articulate a shared perception of the organizations values, of what behaviour is right and what behaviour the organization expects from its members in certain situations. Organizations usually articulate this ethical culture in written form or formal structures, such as: Codes of ethics. Client characters. Organizational rules. Compliance procedure. Policies and systems. Reward and incentive programs.

There are also other formal systems used to reinforce ethical culture such as disciplinary and enforcement mechanisms, ethics training and training in the organizations values, objectives and strategic goals. Informal mechanisms include expectations about obedience to legitimate authority, peer behaviour and other ethical norms.

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Promoting an ethical culture by rewarding ethical activities and by giving signals to employees/advisers that the organization expects certain types of behaviour in certain situations, can be a positive force on individual behaviour and decision-making. Reward and incentive programs can be used in particular for this purpose. The ethical context of an organization can influence its operations, the decisionmaking of its members and their behaviour in many ways. First, the ethical context of an organization plays a major role in addressing specific unethical behaviour particularly in advisers. Second, poor ethical decision-making and unethical behaviour can be a function of a weak organizational system where acceptable ethical behaviour is not clearly defined and an ethical culture is not promoted. It is possible to integrate compliance systems with the ethical context to assist the organization to manage both regulatory and reputation risk. To do this, the organization needs to decide what values it seeks to champion and what decision-making processes it will promote to support these values.

Responsible officers or compliance managers can begin this process by taking a number of steps: 1. Understand what the existing ethical climate is; 2. Identify the firms values, priorities and decision-making processes; 3. Review how the firm articulates its ethical culture and the documents and systems it uses to do so; 4. List the particular ethical risks or issues that the organization faces; 5. Compare this to the organizations existing ethical climate and culture; 6. Will the existing ethical context allow the organization to ensure those risks are minimized or will it exacerbate those risks? 7. Determine whether the organizations ethical context fits with the organizations values and strategic aims

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8. Consider any potential conflicts that might arise between the existing ethical context and the companys goals; 9. Design a strategy for changing or strengthening the ethical climate and ethical culture so as to ensure alignment.

In performing these steps, a number of questions should be asked, including: 1. Does the organization have a values statement/code of conduct? 2. Is it clear and does it really set out the organizations values and what it believes in? 3. Does it align with organizational vision and support goals, strategy and desired behaviours? 4. Does the organizations induction and training programs instruct staff on organizational values and ethical decision-making? 5. What percentage of staff believe management adhere to organizational policies and codes of conduct?

CORPORATE CULTURE AND ETHICAL CLIMATE:

Corporate culture is a blend of ideas, customs, traditional pratices, company values and shared meanings that help define normal behaviour for everyone who works in a company. Every organization has a culture and it exercises considerable influence on employee behaviour. In some companies, one can feel the blowing of ethical winds. People picks up subtle hints and clues that tell them what behaviour is approved and what are forbidden. This unarticulated under-standing among employees is called an ethical climate. There are three ethical yardsticks are egoism (self-centredness), benevolence (concern for others), and principle (respect for ones integrity, for group norms, and societys laws).

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These ethical yardsticks can be applied to dilemmas concerning individuals, ones company or society at large. The Components of Ethical Climate:

Focus of an Ethical Concern

Ethical Criteria
Egoism Benevolence Principle

Individual Person
Self-Interest Friendship Personal Morality

Company
Company Interest Team Interest Company rules & procedures

Society
Economic Efficiency Social Responsibility Laws & Professional Codes

CHANGING THE ETHICAL CULTURE AND CLIMATE

From a practical perspective, an organization can begin to strengthen/change its ethical context immediately by: Implementing training in ethical decision-making; Revising or developing a formal organizational Code of Ethics; Changes in how employees and advisers are monitored and supervised; Altering company policies and procedures, including manuals, performance objectives, recruitment and termination processes, and incentive and reward systems, to ensure they are consistent with organizational values It may be that alignment has been achieved. For example, the organization may have a law and codes climate which predominates and which is clearly articulated in the organizations

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documents, systems and training. This climate may also be appropriate given the extent to which financial service organizations and financial advisers are governed by government regulation and professional standards. However, as markets, regulations and strategic goals change so do the ethical risks to the organization. In turn, the ethical context may need to change, as it may no longer match the new demands on the organization. The existing ethical climate and culture of the firm might also be working against the organizations ability to meet objectives, thus requiring change.

THREE Rs OF ETHICAL CULTURE BY GEORGE.S

Who's responsible for acting ethically? You are! It isn't the "company." It isn't just the business owner. It isn't only your manager. It is every person. Ultimately, each of us is responsible for our own actions, including being ethical. Considering the "3R's" will point you and your employees in the right ethical direction. The first "R" of business ethics is RESPECT. It is an attitude that must be applied to people, organizational resources and your environment. Respect includes behaviour such as: Treating everyone (customers, co-workers, vendors, etc.) with dignity and courtesy. Using company supplies, equipment, time, and money appropriately, efficiently, and

for business use only. Protecting and improving your work environment, and abiding by laws, rules and

regulations that exist to protect our world and our way of life.

The second "R" of business ethics is RESPONSIBILITY. You have a responsibility to your customers, your co-workers, your organization and yourself. Included are behaviours such as: Providing timely, high-quality goods and services. Working collaboratively and carrying your share of the load.
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Meeting all performance expectations and adding value.

The third "R" of business ethics is RESULTS. Essential in attaining results is an understanding that the way results are attained the "means" are every bit as important if not more important than the ultimate goals the "ends." Using the phrase The ends justify the means is an excuse that is too often used to explain an emotional response, or action that was not well planned or carefully considered. Obviously, you are expected to get results for your organization and for your customers. However, you are also expected to get those results legally and morally, by being ethical.

If you lose sight of the distinction, you jeopardize your job, your business and your career. By considering Respect, Responsibility and Results before taking action you will avoid the following common rationalizations for not doing what's right: "Everyone else does it." "They'll never miss it." Nobody will care." The boss does it." No one will know." "I don't have time to do it right." "That's close enough."

"Some rules were meant to be broken." It's not my job."

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ENFORCEMENT OF ETHICAL CULTURE:

Enforcement of business ethics is a complicated and delicate issue. Ethical values moral principles and code of fair business practices are good concepts but only when discussed in theory. However, the business ethics need to be followed while conducting various business activities. Businessmen do not take the model code of conduct of business practices seriously. The enforcement of business ethics is always difficult and ineffective enforcement defeats the very purpose of business ethics. It also must be taken into account that business ethics cannot be enforced by law or force.

.Here are some suggestions that can be taken in to account for the enforcement of business ethics: 1) Education and guidance of businessmen as regards business ethics and fair trade

practices by associations of business, press, TV and so on. 2) Pressure from consumers, employees and the society at large on businessmen or

business practices to follow fair trade practices and respect the ethical values. 3) Effective execution of consumer protection laws by the government agencies. This

will put pressure on businessmen to follow certain fair practices due to fear of punishment. 4) Effective role of trade associations, chambers of commerce and other professional

associations of businessmen in making business ethics as an integral part of business management itself. Such associations can educate and guide their members through annual meetings, seminars; lectures etc. and encourage businessmen to follow business ethics on their own.

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CREATING AN ETHICAL CULTURE

1. Is it possible for a corporation to recreate its corporate culture? It is possible for a corporation to recreate its corporate culture. To recreate corporate culture the organization must focus more effort on building the right culture than on building a compliance infrastructure. Corporate Culture is not something created by senior leadership. A culture is an objective picture of the organization; It is the sum total of all the collective values and behaviours of all employees, managers, and leaders. It is important to know what motivates employees in the organization to understand cultural vulnerabilities that can lead to ethics issues. It is important for managers must be aware of how the values they demonstrate impact desired behaviours. To recreate corporate culture the organization must examine if managers and employees can demonstrate moral values such as respect. Employees must feel accountable for their actions and have a stake in the success of the organization to recreate the corporate culture. The culture risk assessment model, developed by Richard Barrett & Associates, provides comprehensive framework for measuring cultures by mapping values on a scale of seven elements. The culture risk assessment model is also used to measure the progress towards achieving corporate culture change. Using the seven elements in the culture risk assessment model, an organization must distinguish its values strengths and weaknesses; then it can take steps to correct the problems with the current corporate culture. To successfully recreate corporate culture the criteria of the ethics program must be outcomes based. An organization must identify the key indicators of its culture. The organization must gauge how all levels of employees perceive adherence to values by others within the company. Lastly, organizations need to remember that formal programs are guides to shape the culture, not opposite.

2.

What specific elements do you think are essential in order to call a culture

ethical?

Culture is ethical when an organization understands the full range of values and behaviours needed to meet its ethical standard goal. Culture should demonstrate moral values such as respect to be considered ethical.
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All seven elements in the levels of an ethical organization are important. Most organizations focus on the first three levels; profit and growth level one, customer satisfaction level two, and productivity, efficiency, and quality level three. The most successful organizations focus on the upper levels of consciousness, the common good, accountability, leading to learning and innovation level four, alignment level five, social responsibility level six, and sustainability level seven. I believe that financial stability, level one, pursuit of profit and stability is an important element. There are financial obligations that employees have which is why they pursue a job. Systems and processes, level three, compliance systems and processes is an important element because an organization focuses on quality, productivity, and efficiency. Alignment, level five, shared values guide decision-making is an important element to clarify the intentions of the organization, giving the employees purpose and direction. In my opinion level one, level three, and level five and the best three elements to focus on to achieve an ethical culture. Providing employees with financial stability helps support their obligations and responsibilities. Organizations that have a clear compliance system and process view internal controls as an opportunity to create better, more efficient processes. Focusing on quality, productivity and efficiency sets guidelines and standards for employees and managers to follow. I believe that shared values guide decision-making which provides employees with a purpose and direction, allowing organizations to align decision making around a set of shared values, and building a climate of trust.

REASONS FOR THE PRESENCE OF UNETHICAL BUSINESS PRACTICES IN INDIA

It is a fact that unethical business practices are reduced in western countries as the businessmen conducting their business over there have realized that profit can be made even without the consumers. But then too unethical practices are practiced on a large scale. Our businessmen feel that more than the normal profit can be achieved by exploiting the consumers. This is the main reason of the unethical practices being followed in India. The most important reasons for presence of such unethical practices is as follows:

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1)

Psychology of businessmen is favourable to unethical practices:

The traditional approach to profit making had not changed that is profit can be earned more by exploiting the consumers.

2)

Indian consumers are poor, illiterate and submissive:

The consumers in India are such in a bad condition that even if they are aware of unethical practices they do not take any action against it. This attitude of accepting injustice silently has also lead to unethical business practices.

3)

Absence of well organized consumer movement at the national level:

Absence of well-organized consumer movement at the national level is one more cause adding to the presence of unethical business practices. As the consumers do not have consumer education and guidance, they accept such unethical business practices.

4)

The presence of unethical business practices is also due to ineffective laws for

consumer protection in India. Many laws are made for consumer protection. However, they are not executed properly. Unethical business practices are used even when laws are against such practices.

5)

There are many more causes responsible for the presence of unethical business

practices in India, which include lack of education, training of businessmen, and limited interest of political parties in consumer protection and inadequate support of the government to consumer movement for its rapid growth. Unethical business practices are now reducing in India. This trend is going on in the right direction and also pro-consumer. Growing market competition, economic reforms, globalization, growing consumer awareness are the major causes due to which the intensity of unethical business practices is reducing in India.

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CAN ETHICS AND BUSINESS CO EXIST?

It is a basic issue which businessmen have to address to themselves. Many businessmen feel that business is for profit making and policies which give more profit are fair and ethical. They use all sorts of unethical practices and exploit social groups for profit maximization. This philosophy of separating business from ethics or arguing that business has nothing to do with ethical or moral values is highly objectionable and socially dangerous. It is harmful to business and the society as well .Moreover, society expects businessmen to act ethically. Business and ethics are closely related. They have to stay together and move together. Ethical/moral principles and values are universal and are applicable to all human activities. Business is not an exception to this rule. However all accepted ethical values (truth, fair treatment to others, not to cheat or exploit others or not knowingly do harm others) are equally applicable to business. No one since early historical period has supported the view that business is not concerned with moral or ethical values. On the other hand, it is universally accepted that businessmen should be honest to all social groups. Business should be conducted with certain ethical values. Moreover, businessmen can earn adequate profits even by supporting / following ethical values. Thousands of e.g. can be given to prove that ethical business has wealth, social recognition and happy life to businessmen. It is not correct to say that profit can be earned only by using unethical practices. In short, ethics and business can stay together and move together. Peaceful co-existence of the two is easily possible if businessmen are honest, properly educated and socially conscious as regards their social obligations.

POSITION OF BUSINESS ETHICS IN INDIA

The following points indicate the position of business ethics in India: 1) Limited attention to business ethics: The concept of business ethics is universal and

also applicable to Indian business community. In India, the principles of business ethics were
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incorporated in our ancient culture. However, at present, they are not given much importance and attention by the business community in general. We have a long history of unethical trade practices. Such unfair / unethical practices are followed by businessmen even at present and that too on a massive scale. 2) Unethical practices are used extensively: In India, the business community in

general has failed to understand the importance of customers (i.e., society) in business. Businessmen use various unethical practices for exploiting / cheating consumers, employees, shareholders and others connected with the business directly or indirectly. 3) Businessmen are severely criticized due to their unethical practices: Businessmen

give too much importance to profit making and desire to maximize profit even at the cost of consumers. In India, businessmen have to face severe public criticism and government controls due to their unethical practices. Businessmen have been accused of scandals, bribery, tax evasion, illegal payment to politicians and environmental pollution. Unfortunately, businessmen have limited respect in the society image by honoring business ethics. This situation also suggests the urgent need for the introduction of ethical standards in India business. 4) Socially conscious and progressive businessmen support ethical business: Many

of our businessmen are lured by fast buck culture, i.e., to earn as much money and as fast as possible. However, there are some cultured businessmen who respect and follow business ethics with honesty. Tatas, Godrej, L&T are some companies which give protection to consumers, liberal wages and welfare facilities to employees , attractive dividend to shareholders , positive contribution to pollution control, ecological balance and community service activities. Some may not be able to follow business ethics due to reasons beyond their control. A businessman, for e.g., has to bribe someone in order to get the work done quickly even when he is not favorable to such bribe giving. His business may suffer if the matter is delayed due to non payment of such bribe. 5) Business environment in India is not favourable for business ethics: The

importance of business ethics is now well accepted by the professional management in India. Progressive business enterprises in India do understand the importance of business ethics and try to follow ethical business practices. However, in general, the business environment in India is not favourable for business ethics. The business community also shows limited initiative in the introduction of ethical norms in their regular business activities. Even the role of trade associations and chambers of commerce in guiding businessmen in this regards is rather insignificant.
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EXAMPLES OF COMPANIES TRYING TO CREATE AN ETHICAL CULTURE

Tata Group Of Companies' Code Of Conduct:

For the Company

To supply goods and services of the highest quality standards to ensure total satisfaction of the customer & parties To engage only in activities beneficial to the national interest of the country they operate

For the Employees

Consuct themselves professionally with professionalism, honesty, integrity as well as high moral & ethical standards

To be fair and transparent & be seen so by third parties

To be fully transparent in accounting and financial reporting standards

To fully strive for the establishment and support a competitive open market economy & Abhor and report unfair trade practices To neither give nor take any illegal payment, renumeration, gift, donation or comparable benefit to obtain favours To comply with all regulations regarding the preservation of the environment Not derive any benfit from any information about the company or group which constitutes inside information

Report to the management any actual or possible violation of code or an event could affect the business or reputation of employee or any TATA company

To be a good corporate citizen & actively assist in the improvement of the quality of life of the community with the objective of making it self-reliant
To regard the social activities as an integral part of the business & not as an optional part To co-operate & share physical, human & management resources with other Tata companies so long as it does not affect its business interests & shareholders value
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Permits employees to pursue an active role in civic and political affairs as long as it doesnt affect the business or interests of the company or the group

Glaxo Smithklines Code Of Conduct

For the Company & Employees. GlaxoSmithKline is committed to sales and marketing activities that are ethical, responsible, principled and patient focused. Govern sales and marketing activities through company policy, on Pharmaceutical Marketing and Promotion Activity, and through industry and company marketing codes. GSK believes that it is important to work with governments to contribute to constructive debate on issues surrounding pharmaceuticals and healthcare. GSK have companywide auditing in place to fully investigate suspected breaches of company standards and take appropriate disciplinary action, including dismissal where appropriate. GSKs Code of Conduct and policies on Anti-Competitive Behaviour set out the standards of behaviour they expect from their employees and agents, thus helping to ensure that they operate within the letter and spirit of the law and maintain high standards of ethical business behaviour. GSK has a specific policy on Prevention of Corruption which fully reflects major US and UK legislation on the subject. The policy does not contain any exception permitting facilitating payments, and there is a separate policy relating to political contributions or donations.

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 GSK also recognizes the dangers regarding employees accepting inducements and there is a separate policy on Acceptance of Gifts or Entertainment by GSK employees. Their audit system enables them to identify and deal with breaches of company policy. They also operate confidential phone lines and an offsite PO Box address for employees to report unethical behaviour. Disciplinary action including dismissal is a potential consequence of any policy violation. Management Certification promotes awareness of GSKs ethical standards and the Code of Conduct. It emphasizes the importance of the Code to thousands of other GSK employees who, in the course of their daily activities, must comply with the law and company policies in the conduct of company transactions. GSK can make a valuable contribution to the debate on public policy issues relating to research and development, the use of pharmaceuticals and healthcare. They also comply with relevant industry codes of practice, such as the International Federation of Pharmaceutical Manufacturers Associations (IFPMA) Code of Pharmaceutical Marketing Practices and the PhRMA Code on Interactions with Healthcare Professionals. GSKs risk mapping process is used by business units and functions to document, manage and report on risks and mitigation plans. GlaxoSmithKline aims to produce safe and effective medicines and vaccines that benefit patients by addressing their unmet medical needs.

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Motorolas Code Of Conduct.

For The Company & Employees :

Motorola is committed to acting on them--through the potential of the technology and the way they conduct their business. Motorola has established the Ethics Line for its employees, business partners and others to report any questions or concerns they may have about compliance with the Motorola Code of Business Conduct, or the laws, regulations or contract provisions that govern Motorola's business. Times will change. Our products will change. Our people will change. Our customers will change. What will not change is our commitment to our key beliefs. This Code is neither a contract nor a comprehensive manual that covers every situation Motorolas throughout the world might encounter. It highlights key issues and identifies policies and resources to help Motorolas reach decisions that will make Motorola proud. Abusive, harassing or offensive conduct is unacceptable, whether verbal, physical or visual. Responsible for immediately reporting accidents, injuries and unsafe equipment, practices or conditions to a supervisor or other designated person.

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 They build long-term relationships with our customers by demonstrating honesty and integrity. Motorolas who deal with government officials and contracts are responsible for knowing and complying with applicable laws and regulations. Require honest and accurate recording and reporting of information. This includes such data as quality, safety and personnel records, as well as all financial records. Motorola and all their employees are required to comply with the antitrust and unfair competition laws of the many countries in which they do business. Motorola is committed to protecting the environment by minimizing the environmental impact of operations and operating businesses in ways that foster sustainable use of the world's natural resources. Motorola will provide fair, accurate, timely and easy to understand information to the public. The Ethics Line offers information, advice and suggestions. The Audit Committee Line has been established to allow access to the Audit and Legal Committee of the Motorola, Inc. Board of Directors for any interested party with a concern about Motorola's accounting, internal controls or audit matters.

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CASE STUDY - ENRON & ETHICS

Question 1: How did the Corporate Culture at Enron contribute to its bankruptcy? The corporate Culture at Enron could have contributed to its bankruptcy in many ways. Its corporate culture supported unethical behaviour without question for as long as the behaviour resulted in monetary gain for the company. It was describe as having a culture of arrogance that led people to believe that they could handle increasingly greater risk without encountering any danger. Its culture did little to promote the values of respect and integrity it instead rewarded innovation and punished employees deemed week. The performance evaluation process for employees that was dubbed rank and yank utilized peer evaluations, and each of the companys divisions was arbitrally forced to fire the lowest ranking employees. This created cut-throat competition not only against Enrons external competitors but also within the organization. It pitched employees against each other. The internal rivalry created in turn contributed to less communication between operations for fears of being fired. The survival for the fittest atmosphere reached the point where illegal activity was deemed necessary to stay on top of the game. Enrons compensation plans also seemed less concerned with generating profits for shareholders than with enriching officer wealth. Its culture encouraged flaunting the rules and even breaking them. Each Enron division and business unit was kept separate from the others and as a result very few people in the organization had the big picture perspective of the companys operations. All these aspects of the corporate culture at Enron contributed separately to its eventual bankruptcy.

Question 2: Did Enrons Bankers, auditors and attorneys contribute to Enrons demise? If so, what was their contribution? Yes the bankers, auditors and attorneys contributed to Enrons demise. This is because they took sides with Enrons management instead of acting impartial and professionally.
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They contributed in Enrons demise in the following ways:Banker Merrill Lynch It facilitated Enron to sell Nigerian Barges therefore making Enron record about $12 million in earnings and thereby meet its earnings goals at the end of 1999. This was a sham. It facilitated Enron in fraudulently manipulating its income statements by entering into a deal whereby Enron would buy Merrill Lynch in 6 months time with a guaranteed 15% rate of return. Merrill Lynch replaced a research analyst after his coverage of Enron which displeased Enrons executives. This coverage would have saved Enron from demise if Merrill Lynch would have prevailed upon Enron to implement it. Merrill Lynch gave in to threats by Enron that it would be excluded from a coming $750 million stock offering and instead, the replacement analyst is reported to have upgraded his report on Enrons stock rating. This was unethical and unprofessional.

Auditors Arthur Andersen LLP They were responsible for ensuring accuracy of Enrons financial statements and internal bookkeeping. Potential investors used Andersens reports to judge Enrons financial soundness and future potential before they decided whether to invest. Current investors used those reports to decide if their funds should remain invested there. As such, the investors expected that Andersens certifications of accuracy and application of proper accounting procedures would be independent and without any conflicts of interest. However, this was not the case and the investors were deceived by relying on the reports of Andersen. On the other hand, Andersen was a major business partner of Enron and some executives of Andersen accepted jobs from Enron. This was a conflict of interest. Additionally, in March 2002, Andersen was found guilty of obstructing justice by destroying Enron related auditing documents. Moreover, Andersen failed to ask Enron to explain its complex partnerships before certifying Enrons financial statements. This was purely unethical and unprofessional. Andersen were playing a very important role of ensuring that the financial statements and book keeping is accurate and

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should they have played their role well as professionals, then Enron should not have collapsed. Attorneys Vinson & Elkins They helped to structure some of Enrons special purpose partnerships. The firm supported the legality of these deals. They were a great facilitator of these deals through transaction opinion letters. As seen from the article, these deals are the ones that contributed to the demise of Enron.

Question 3: What role did the chief financial Officer play in creating the problems that led to Enrons financial problems? In order to prevent the losses from appearing on its financial statements, Enron used questionable accounting practices. To misrepresent its true financial condition, Andrew Fastow, the Enrons CFO, took his role by involving unconsolidated partnerships and special purpose entities - SPEs, which would later become known as the LJM partnership. Taking advantage from the SPEss main purpose, which provided the companies with a mechanism to raise money for various needs without having to report the debt in their balance sheets, Enrons CFO directly ran these partnerships and designed them to purchase the underperforming assets (such as Enron's poorly performing stocks and stakes). Although being recorded as related third parties, these partnerships were never consolidated so that debt could be getting off its balance sheet and the company itself could boost and have not had to show the real numbers to stockholders. Andrew Fastow was using SPEs to conceal some $1 billion in Enron debt. Overall, according to Enron, Fastow made about $30 million from LJM by using these partnerships to get kickbacks which were disguised as gifts from family members who invested in them and enriching himself. His manipulation of the off-balancesheet partnerships to take on debts, hide losses and kick off inflated revenues while banning employees' stock sales was one of the reasons triggered the collapse of the company and its bankruptcy.

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Question 4: The role of corporate and personal ethics in a case scenario like this? Corporate Issues The Corporate culture: Corporate culture refers to the prevailing implicit values, attitudes and ways of doing things in a company. It often reflects the personality, philosophy and the ethnic-cultural background of the founder or the leader. Enron featured multifaceted and conflicting mores, which included: 1. A very competitive working environment: where workers were evaluated based on their performance. Each year, the worst 10% -2 0% would be fired, while the top performances would be rewarded lavishly. 2. A culture of deception: where Enron used unjustifiable calculation methods to entice investor to hold the company shares. In assessing the value of its assets (i.e. contracts), traders were pressured to use an unrealistically low discount rate and an overvalued future cash flows. This enabled the company to record a huge surge in profit creating an illusion to investors, enticing them to buy the companys shares. Among them were the companys workers, who invested their entire retirements and life savings into the shares. 3. Enron used a deceiving mechanism to cash in the share value so as to obtain a source of cheap capital from creditors, therefore the company was highly geared in debt, and two years after its formation (1987), 75% of its stock value was debt. Further expansion of the company required more debt-raising. This would cause deterioration in the credit rating. As the risk of default increases, the creditors (banks) would charge them a higher interest rate. To get around the problem, Enron set up series of Special Purpose Entities (SPEs) which were invisible from Enrons balance sheet. Enron shares were then transferred to these entities and then used as collaterals to obtain cheap capital. The capital obtained was then channeled to the parent company in exchange for its debt, failing investment projects, and realizing the overvalued contracts. 4. A culture of greed and injustice: The set up of the SPEs enabled the company to cash in on the share value. However, a large part of the money obtained was not used to distribute fairly among the shareholders, but went to reward the top managers who engaged in the deceptive and illegal practices gave themselves high rewards.

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Personal Issues 1. Deception and dishonesty: The Company managed to conceal its massive debts through questionable accounting. On knowing the accounting scandals of the company and the possibility of the collapse of the company, the CEO (LAY) publicly re-assured the future prospects of the company, but secretly he off-loaded his possession of the Enron share in the market. In doing so, he took advantage of the privileged information that was no available to the general public, and hence was guilty of insider trading. 2. Hypocritical and Irresponsible: Skilling claimed his (President and Chief Operating Officer. Served as CEO from Feb. Aug.2001), abrupt resignation was motivated by "personal reasons" and not Enron's impending doom. He left without a pay-off, saying he wanted to spend more time with his children and participate in more charity work. But immediately after his departure he sold millions of dollars' worth of company stock. He claimed not to have any knowledge of the complex web of financial arrangements that became Enron's downfall. 3. Integrity and harshness: Fastow (Chief Financial Officer) was allegedly responsible for creating a web of off-balance sheet partnership with external companies that allowed him to hide Enrons very large losses. He was also found by an internal Enron investigation to have secretly made $30m from managing one of the partnerships. He is said to have refused to answer questions at a December meeting with Securities and Exchange Commission officials. He tried to fire Sherron Watkins and to seize her computer when he learned of her attempt to alert superiors of impending trouble.

ETHICAL PROBLEMS WITH ENRONS CULTURE

Virtue Theory: An action is morally right if in carrying out the action the agent exercises, exhibits, or develops a morally virtuous character, and it is morally wrong to the extent that by carrying out the action the agent exercises, exhibits, or develops a morally vicious character.

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There were positive aspects to Enrons corporate culture, in focusing on stock-price performance, net present value (NPV) and financial innovation, managers were able immediately to apply the skills they had honed in graduate school. Enron encouraged and rewarded innovation. However, the overwhelming drive for short-term personal wealth accumulation was the negative ethic. Managers were encouraged to pursue this goal with, if necessary, guile and deceit. Enron claimed to generate profits and revenue from deals with SPES that were actually limited partnerships that Enron controlled. Enron was claiming billions in profit when it was actually losing money. Enron was using these partnerships to sell to itself these contracts back and forth recording revenue each time to hide losses and debt that it suffered by not reporting them on its financial statements. It was shuffling much of its debt obligations into offshore partnerships.

Lessons from the Enron Case 1. You make money by providing real goods and services i.e. real value for money 2. Financial cleverness is no substitute for a good corporate strategy 3. Executives who are paid too much can think they are above the rules and can be tempted to cut ethical corners to preserve their wealth and perquisites 4. Government regulations and rules need to be updated not relaxed and eliminated. 5. Conflict of interest: Enron claimed to generate profits and revenue from deals with SPES that were actually limited partnerships that Enron controlled. 6. Creation of false confidence i.e. Enron covered up the debt under the separate accounting financial statements of the SPEs that showed growth of business: growth of asset value: rise in Enrons share price: rise to shareholders income. So long as the share price does not fall, the growth of business can be tremendous, but such cover-up sows the seed of hidden disaster as the asset value of business depends primarily on the investors. 7. Collusion: the auditing firm was a partner, internal and external auditor failing to provide complete disclosure, and unfair financial reporting. 8. Transparency in reporting is not an objective

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CASE STUDY- ORACLE FINANCIAL SERVICES

Oracle Financial Services Software Limited believe that the concepts of Code, Character and Conversation provide a good framework for thinking about infusing ethics into organization culture. Code of conduct and ethical policies in Oracle Financial Services Software Limited policy is that all decisions on behalf of the Corporation adhere to the highest standard of integrity. In many circumstances, this imposes a greater than is established by law of regulation. The Oracle Financial Services Software Limited code of conduct and ethical policies are the basis for ethical behaviour in their business dealings with customers, regulators and communities in which they operate.

Code of conduct: The Oracle Financial Services Software Limited code of conduct provides a framework of Oracle Financial Services Software Limiteds values and ethical standards. The following principles must be applied in their day to day business. All decisions and actions must conform to all applicable laws, regulations and corporate policies. Business must only be secured for Oracle Financial Services Software Limited on the basis of their belief in competitive market systems and the appropriateness of earning a profit by providing their customers with effective service. Individuals must be trustworthy and honest in all actions and relationship in behalf of Oracle Financial Services Software Limited. Situations where personal interests conflict, or appear to conflict, with the interests of Oracle Financial Services Software Limited, or its customers must be avoided and prudently dealt with.
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 The results of each action or decision must be fair and even handed to all parties to the transaction or event, in both the short term and long term. Each decision or action must be appropriate, in terms of both their sense of integrity and the security of others. It should seem appropriate even if published in a major newspaper. Human dignity and esteem must be respected in all of their dealings with others. Communication must be honest and accurate. Confidentiality must be maintained where appropriate and necessary. Ethical conduct should be acknowledged and valued by all employees and agents of Oracle Financial Services Software Limited.

Ethical Policies: Oracle Financial Services Software Limited follows the ethical policies which amplify the principles set out in the Oracle Financial Services Software Limited code of conduct. These policies apply to anyone acting on the behalf of Oracle Financial Services Software Limited, its subsidiaries, and affiliates over which Oracle Financial Services Software Limited exercises direct or indirect control. Employees and directors of these entities must understand the Code of Conduct and Ethical policies and comply with them in the discharge of their Oracle Financial Services Software Limited related responsibilities. Supervisors and managers have additional responsibility to help their staff understand and apply these values and to maintain an environment that promotes consistent compliance. Oracle Financial Services Software Limited encourages employees to report concerns and suspected violations of a law, regulations or corporate policy. If, as a part of the employees activities on behalf of Oracle Financial Services Software Limited, they have any concerns or issues, there is a mechanism to report these matters or seek assistance. There are two steps. Step one is to define the nature of their concern or issue. After that they should contact any of the people or functions listed step 2.
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STEP 1

STEP 2

Define your concern

Report your concern

What causes your concern?

Supervisor or next level of management

Group Head Who is involved? When did it happen?

Chief Compliance Executive Management Office

Where did it occur?

Ethical policy regarding customers of Oracle Financial Services Software Limited company: They carefully select their customers with whom they conduct business. Oracle Financial Services Software Limited does not do business with drug traffickers, money launderers and other criminals. They seek to build sustained, comprehensive relationships with their customers and counterparties and recognize the importance of continuity of the people and priorities, which Oracle Financial Services Software Limited brings to these relationships, and consistent of purpose and presence. At all times the confidentiality of information about customers will be maintained.

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 Oracle Financial Services Software Limited do not offer or make payments, other inducements or provide lavish entertainment to government officials or customers in order to sell the products or services. They do offer promotional gifts to their large classes of customers. (eg., credit card and consumer account opening promotions) Oracle Financial Services Software Limited makes sure that other their legitimate associations permitted by law, their employees should not discuss or enter into arrangements with competitors.

Ethical policies to investors: All assets (including the goodwill of the company) and facilities owned by the company are used solely foe Oracle Financial Services Software Limited business. They must not be used for personal benefit or personal consumption except where permitted or authorized by Oracle Financial Services Software Limited in line with the local market practices and laws. Each of the Oracle Financial Services Software Limited employees is responsible for safeguarding Corporate assets under their control. Assets include physical property, intellectual property (computer programs and models) The data and records should managed accurate and complete all times. If any one of Oracle Financial Services Software Limited employees violates these rules then the respected person is subjected to disciplinary action, termination of employment and/or legal proceedings.

Ethical policies regarding employees: Oracle Financial Services Software Limited seek to recruit, develop and retain the most talented people. Oracle Financial Services Software Limited and its employees must continually take positive action to ensure equal opportunity in employment and a business environment free of discrimination.
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 They reward people based on corporate, relative and individual performance, teamwork and results. There is no place for discrimination to employees. Safety of people in the workplace is a primary concern of Oracle Financial Services Software Limited. Oracle Financial Services Software Limited employs the relative of Oracle Financial Services Software Limited employees as long as it does not create a potential conflict or the appearance of a conflict of interest. Employees of Oracle Financial Services Software Limited should not accept gifts from customers or suppliers. In situations where refusing or returning the gift is truly impractical or would adversely affect the relationship they can accept but put it on public display. Oracle Financial Services Software Limited encourages every employee to take an active interest in governmental processes. However, any participation in a potential process is done as an individual, not as a representative of Oracle Financial Services Software Limited.

Ethical policies regarding suppliers: It is a policy of Oracle Financial Services Software Limited to purchase all equipment, supplies and services on the basis of quality, utility and price offered by the vendor. Oracle Financial Services Software Limited must not leave any vendor with the impression that it is necessary or useful for the vendor to purchase products or services offered by Oracle Financial Services Software Limited or its subsidiaries.

Results of Oracle's Efforts: Oracle Financial Services Software Limited ethical policies are complied not only regarding employees but also customers, suppliers, investors.
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 Oracle Financial Services Software Limited ensures that employees are made to know the ethical policies as soon as they enter the company. Supervisors and managers are responsible to help their staff understand and apply these values in their working environment. Oracle Financial Services Software Limited takes decision on the basis of ethical values so that it should not harm the parties involved in the decision. When there is a conflict between the employee concern and Oracle Financial Services Software Limited ethical policy Oracle Financial Services Software Limited has procedures to solve those conflicts which help the employees as well as the organization. The ethical policy regarding customers gives goodwill to Oracle Financial Services Software Limited from customers. The customers have great belief in their quality of service Oracle Financial Services Software Limited provides them. Investors of Oracle Financial Services Software Limited are ensured that all the assets including tangible as well as intangible are maintained properly which is complied in the ethical policies. All the matters regarding the Oracle Financial Services Software Limited are accurate and confidentially maintained. The employees are happy with ethical policies regarding them because all the policies relating them are in such a way that it protects the concerns of the employees also. They are treated equally and the reward given to them are based on their performance only. Oracle Financial Services Software Limited ensures any activities regarding the employees done outside the organization can be done unless it does not affect the organization. If the employees violate any rules or did any unethical activity they are given immediate termination. The main unethical activity considered is harassment.
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 The other unofficial unethical activities are comes to office after having drunk, smoking in the prohibited areas of the organization. The rules and regulations are very strict and employees fear to do any unethical activities.

CONCLUSION

The ethical context of an organization plays a major role in addressing specific unethical behaviour in employees and advisors. Poor ethical decision-making and unethical behaviour in financial advisers can be exacerbated by a weak organizational system where acceptable ethical behaviour is not clearly defined and an ethical culture is not promoted. An effective ethical context should be contributing to the types of ethical choices and conduct that the organization wants from its employees/ advisers; and the quality and consistency of ethical decision-making. Ethical context of the organization for which employee work can influence in the ability to meet its obligations, to provide services in an efficient, fair and honest manner, its reputation within the marketplace, and the quality of the advice that will be given to clients. In stronger ethical cultures, employees feel engaged and committed to the company and the company is protected from the risks associated with misconduct and lurking ethics issues. Efforts to promote ethics and develop a strong ethical culture are not only the right thing to dothey make business sense because in stronger ethical cultures: Fewer employees feel pressure to compromise company standards; Fewer employees observe misconduct and there are fewer incidences of every kind of misconduct; Employees who observe misconduct are more likely to report it; and Reporters are less likely to experience retaliation.

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BIBLIOGRAPHY

1. The Responsibility and Accountability of CEOs: The Last Interview with Ken Lay Journal of Business Ethics _ Springer 2010 DOI 10.1007/s10551-010-0675-y O. C. Ferrell Linda Ferrell 2. The critical role of ethics: recent history has shown that when individual ethics are compromised, corporate ethics fail and financial disaster is not far behind by Marianne M. Jennings 3. Enron And Arthur Andersen: The Case Of The Crooked E And The Fallen A Gary M. Cunningham and Jean E. Harris Global Perspectives on Accounting Education Volume 3, 2006, 27-48 4. Kostova, T. and Roth, K. (2002) Adoption of an Organizational Practice by Subsidiaries of Multinational Corporations: Institutional and Relational Effects, The Academy of Management Journal, Vol. 45, No. 1, pp. 215-233 5. Khanna,T. and Palepu, G.K. (2004) Globalization and Convergence in Corporate Governance: Evidence from Infosys and the Indian Software Industry, Journal of International Business Studies, Vol. 35, No. 6, pp. 484-507 6. The Importance of Ethical Culture: Increasing Trust and Driving Down Risks by Ethics Resource Centre (ERC) 7. http://www.findarticles.com/p/articles/mi_m4153/is_6_60/ai_111737942.com 8. http://www.adviservoice.com.au/2010/11/how-to-build-organisational-resilience-toethical-risk-using-integrity-based-mechanisms-and-culture/ 9. http://www.gordoworld.com/gblog/2008/10/ethics-incentives-and-enforcement.html 10. http://www.tata.com/aboutus/articles/inside.aspx?artid=NyGNnLHkaAc= 11. http://www.tata.com/aboutus/articles/inside.aspx?artid=CKdRrD5ZDV4= 12. http://www.gsk-india.com/investor-employees.html 13. http://www.oracle.com/us/corporate/investor-relations/cebc-176732.pdf 14. http://www.oracle.com/us/industries/financial-services/annual-report-2011-20121713441.pdf

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