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Business Ethics

Manish Naik
98676 36938
manish.canopy@gmail.com
Broad Syllabus
Evolution of thought of ethics in business
Culture and ethics
Overview of ethics
Social and economic values and
responsibilities
Trusteeship
Normative ethics
Broad Syllabus
Ethics and decision making
CSR
Ethics and corporate excellence
Ethics in corporate settings
Books
Balachandran S, Business Ethics
Velasquez Manuel, Business Ethics
Concept and Cases, Pearson
Shaw William, Business Ethics,
Wadsworth Publishing
Raj Rituparna, A Study in Business Ethics,
Himalaya Publishing
Reference Text
The Ethics of Management by La Rue
Hosmer
Ethics in Management by SK Chakraborty,
OUP
Some Terms of Reference
Business ethics goes hand-in-hand with
ethics, which is a major discipline
Business ethics is applied science like:
Accountancy ethics
Medical ethics
Consumer ethics
Religious ethics
Work (professional) ethics
Personal ethics

Ethics
Ethics
The concept of ethics comes from the
Greek word ethos meaning both an
individuals character and a communitys
culture
Ethics has a distinguishing disposition
Ethics
Ethics is a set of values and rules that define
right and wrong conduct
What is considered ethical may depend on the
perspective from which ethical issues are
considered
Ethics is non-universal ethics are governed by
the environment and the society (religion
included)
What is ethical may not be legal and vice versa
Terminologies and Errors
Ethical and unethical
Ethically right and ethically wrong
Moral, immoral and non-moral
Morally right and morally wrong
Ethical dilemmas
Profiting and profiteering

Forces that Shape Ethical Conduct
Societal norms and culture
Laws and regulations
Organizational practices and culture
Individual perspective
Nature of Ethics
Ethics deals only with humans
Under what conditions can ethics come into
play?
Only out of freewill
There should be a choice
One needs fully-developed rational faculty and
maturity
Ethics belongs to the field of social sciences
Ethics is a Normative Science


Business and Ethics:
Some Questions
Is profit making the only goal of
businesses?
Should an unbridled market mechanism
drive an enterprise?
To what extent corporations should
compensate for the hidden costs that are
incurred by the society at large?
Consensus in Answers
A consensus emerged:
that corporate practices cannot bypass the
fundamental demands of ethical behavior,
that administration and policies have to be
transparent and publicly accountable, and
that businesses have to be sensitive to the
community and the environment within which
they operate.
This led to the ethical trilogy.
Business Ethics: Emergence of
Ethical Trilogy







* Generally all treated in isolation

Corporate
Ethics
Corporate
Governance
Corporate
Social
Responsibility
Business Ethics
Business Ethics: Ethical Trilogy








Corporate
Ethics
Corporate
Governance
Corporate
Social
Responsibility
Why Business Ethics for
B-Schools?
A business that makes nothing but money
is a poor kind of business. - Henry Ford

Why Business Ethics for
B-Schools?
Market
Economy
Wealth
Material
Welfare
Enriching
Power
Unbridled
Greed
Some Trivia
Where was business ethics first
introduced?
Why was ethics introduced in
management courses?
Concepts have undergone change due to
internationalization
Will undergo modifications due to nature of
future workplaces, and business relations
Relationship between Business
and Ethics
Unitarian view
Separatist view
Integration view

Nature of Business Ethics
Ethical decisions differ with the individual
perspectives of different persons
Ethical decisions are not limited only to
themselves, but affect a wide range of other
situations as well
Most ethical decisions involve a tradeoff
between costs incurred and benefits received
The consequences of most ethical decisions are
not clear: they are ambiguous in nature
Every person is individually responsible for the
ethical or unethical decision and action that he
or she takes
The Ethics of Action
Bribery
Coercion
Theft
Unfair discrimination
Adulteration (adultery)
Wrong disclosure
Under disclosure
Evasion of duty
False claims
Insider trading
Puffery
Deception
Deliberate
wrongdoing
Anchoring
Wastage (resources,
food, time, )
Unfructuous work to
keep people engaged

The Ethics of Action
Gifting
Lobbying
Canvassing
Solicitation
Taboos
Plagiarism
Ethnocentrism
Stereotyping



Advertising Ethics
Deceptive advertising
False advertising
Misleading ads
Impression
management
Harmful products
Celebrity
endorsements
Hidden surcharges
Puffery
Exaggeration
Ambiguity
Psychological effect

Volvo Ad

Basis for Ethical Decisions
Utilitarianism
Justice
Equity
Term concept
Option concept
Systems concept
Reversibility
Intention
Impact

Why Organizations are
Vulnerable to Ethics Violations
Authority structures
Incentive systems
Role of (at times lack of) corporate governance
Role of decision making lapses
Escalation of commitment (a decision making
bias where people commit additional resources
to a failing course of action)
Easier wrong that gives results
Leader behaviour
Non institutionalization of value systems

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