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7/31/2019 1. Ethics Introduction
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Learning Objectives
An Overview of Business Ethics
Ethics & Conduct
Nature of Ethics
Objectives of ethics
Business Ethics
Managerial Dilemmas
Business Ethics & Profits
Relationship between business & ethics
Nature of ethics in business
Characteristics of Business Ethics Ethical Decision Making
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Ethics..
Latin term is ethicus
Greek term is ethikos
Means character or manner
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Ethics..
Is said to be - the science of morals, moral
principals or recognized rules of conduct.
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Conduct..
Is a series of actions that, when taken together,
can be termed as good or bad, right or wrong,
moral or immoral.
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Ethics.
Can also be termed as the science of character
of a person expressed as right or wrong
conduct or action.
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Nature of Ethics:
Deals with
human beings
only.
Is a field of
social science.
Is a normativescience.
Deals with
human conductwhich is
voluntary andnot forced by
persons or
circumstances.
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Objectives of ethics
Ethics establish moral standards and norms of
behaviour.
Make judgments on human behaviour based onthese standards and norms.
Prescribes moral behaviour and makes
recommendations on how to or how not to behave.
Expresses opinion or attitude about human conduct
in general.
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Business Ethics
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Business Ethics
Is the
application of
ethics inbusiness.
It proves that
business can be
ethical & stillgenerate profits.
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Managerial Dilemmas
At times profit maximization & discharging of social
responsibilities at the maximum limit cannot be carried
out simultaneously.
One is bound to affect the other adversely.
A conflict arises between profit concern & social concern.
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A business is considered ethical if it tries to
reach a trade off between pursuing its
economic objectives & its social obligations
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Business ethics & profits
Then.. Profit is a dirty word..
Jawarharlal Nehru ( 1950)
Now.. It is unethical for a company to make losses.
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Business ethics & profits
Business ethics dictates that the first
responsibility of business is to remain
profitable & generate revenue for its
shareholders and the society.
It is unethical for a company to make lossess.
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Relationship between business & ethics
The only objective of
business is to reap profits &
it has got nothing to do with
ethics
Church had taken upon itself
the moral responsibility ofbusiness, taking moral
decisions like business must
remain closed on Sundays..
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Relationship between Business & Ethics
The Unitarian View1
The Separatist View2
The Integration View3
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The Unitarian view
Was
emphasized
by the
church
Business is a
subset of
the moral
structure of
the society.
Business &
morality
cannot be
separated .
Business
must play
by the rules
of morality
set by thesociety.
Profit was a
dirty word.
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The Unitarian view
MORAL STRUCTURE
MORAL ETHICS
BUSINESS
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The Separatist view Was put forth by Adam
Smith and Milton Friedman
Asserted that the only goal
of business should be profitmaximization.
Ethics & morality play no
part in business conduct.
Business should go on with thebusiness of producing goods &
services efficiently & leave thesolution of social problems to
governmental agencies &
concerned individuals.
Th S ti t i
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The Separatist view
SOCIETY
BUSINESS ETHICS
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The Integration View
Was proposed by TalcottParsons,
Sought to integrate ethicalbehaviour & business into a
new area called BUSINESS
ETHICS.
The view states that business
is an economic entity & has
the right & the need to make
profits, but it must also
discharge its obligations to
the society where it exists &
operates. Profits is certainlynot a dirty word, but neither
is morality & ethics in
business.
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The Integration view
GOVT. LAW
MORALITY & ETHICS
BUSINESS
MARKET SYSTEM SOCIETY
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Nature of ethics in business
Overt ethical problems
Bribery, theft, Sabotage
etc
Clear for every one to see
Most business take care
not to be so overt
Covert ethical problems
Market wars, acquisitions,
personnel policies etc.
Are more complex
Not so transparent
Defy ethical solutions
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For a decision to be ethical, it should
possess the following:
That which is morally correctRIGHT
That which is just and equalEQUITABLE
That which brings in the highest good for all
concerned.GOOD
That which is appropriate & acceptablePROPER
That which is honest & due.FAIR
That justice is not only done but also seen
to have been done.JUST
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Ethics is unstructured & abstract in
concept.
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If an ethical decision merely results in benefit
to oneself, then it is not an ethical decision.
The very concept of being ethical means, that
it results in some good for the larger societyand not just for oneself.
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Characteristics of business ethics
1. Ethical decisions vary with the individual
perspective of different persons.
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2. Ethical decisions are not limited to
themselves but affect a wide range of other
situations as well.
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3. Most ethical decisions involve a trade off
between costs incurred & benefits received.
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4. The consequences of most ethical decisions
are not clear.
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5. Every person is individually responsible for
the ethical or unethical decision & action that
he or she takes
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6. Ethical decisions are voluntary human
actions.
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Group Discussion
For & against business ethics
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Group Activity
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THANK YOU