Ethics and Nigerian Businessmen

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UNIVERSITY OF PORT HARCOURTSCHOOL OF GRADUATE STUDIES

MASTERS IN BUSINESS ADMINISTRATION II

SEMINAR IN MANAGEMENT(MGT. 616.1)

ETHICS AND NIGERIAN BUSINESSMEN

SUBMITTED BY:

SUMBITTED TO:

APRIL 2009


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INTRODUCTION

Ethical concerns in business are intertwined with other activities of management such as

personnel, finance, production and every other part of business activity. It is a part and

parcel of the routine practices of management. Individuals are a vital asset in the

organization and they can influence its activities. The values people have will inevitably

lead to constitutional integrity. On the other hand, organizations can and do influence

individual decisions and actions positively or negatively depending on goals, policies,

strategies and other characteristics that formalize relations among its members. As social

creatures, human beings do need communities and in communities their norms are

formed for better or for worse.

From the present happenings, it is discovered that Nigerians especially businessmen havegiven up moral values like honesty, integrity, respect, virtue, justice and the like. The aim

of ethics is to identify both the rules that govern peoples behavior and the goals that

are worth seeking. All ethical decisions are guided by the underlying values of the

individual, ethical climate in the industry, and the behavior of management. Don Baridam

and Nwibere (2008) defined values as principles of conducts such as caring, honesty,

keeping promises, pursuits of excellence, loyalty, fairness, integrity, respect for others,

and responsible citizenship.

ETHICS

Ethics (Nwachukwu 2006) is defined as the Science of conduct. It involves learning

what is right and doing the right thing. Business Ethics may be defined as knowing what

is right and wrong in the workplace and doing what is right. They are the principles,

policies and values that serve as operational guidelines for individuals and organizations

for decisions concerning what is morally right and or wrong.

Ethics has been defined as a branch of philosophy, and as the science of morals (Oxford

Advanced Learners Dictionary of Current English). It is derived from the Latin word,

ethos which means custom, character, and sentiment of the community (which

represents culture). Stahl (1995) defined it simply as doing the right thing the first time.

Baridam and Nwibere (2008) defined ethics as the system of rules that governs the


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ordering of values. According to Hart (1970), ethics pertains to precepts of right and

wrong that society views as positive guides regarding what ought to be done in certain

circumstances.

Ethics in business is concerned with morality in the practice or conduct of business, that

is, with the right and wrong or good and evil dimensions of business decision-

making. Lewis explains which provides guidelines for morally right behavior and

truthfulness in specific situations. Business ethics is also regarded as an attempt to give

a moral compass to the present generation of business professionals (Warren and

Tweedale, 2002).

THE NIGERIAN BUSINESS ENVIRONMENT

Business environments in Nigeria are diverse and dynamic. Each differs in size andculture. Many private businesses tend to be family owned and operated. The economy is

mixed and tries to operate towards the capitalist end of the political-economic continuum

while a dictatorial government keeps its heavy hand in the thick of the action.

Several factors affect how business is conducted in the Country. Nigerian has a

population 150 billion people with roughly a landmass of 924,000 square kilometers.

People from different ethic backgrounds inhabit it but the major ethic groups are the

Hausa, Ibo and the Yoruba. The British divided the Nigerian Republic into three regions

the North, West, and the East. Northern region is dominated by the Hausa, the

Southwest by the Yoruba, and the Southeast by the Ibo.

FEATURES OF NIGERIAN BUSINESS

The problem of foreign ownership of business was addressed shortly after the National

Development Plan when the Enterprise Promotion Act of 1972 was created. With this,

Nigeria wanted to place indigenous people in management positions. Continued Political

unrest brought about another military ruler in 1985 and this changed the face of national

budgets, the economy, and how business had been done in Nigeria. A second tier-Foreign

Exchange Market was begun and under this system, Nigerians would free up trade by

relaxing exchange controls, phasing out import licensing, and eliminating tariffs on

imports. This more liberal trade policy posed additional challenges and more confusion to

the Nigerian business community.


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MANAGEMENT IN NIGERIA: FAMILY-OWNED FIRMS

Most of the privately held firms tend to be family owned and operated. Generally the

owners of the firm usually employ members of the family as part of the company;

therefore he must consider how his actions and behavior interplay with the values and

expectations within his family. Companies in Nigeria have evolved from two primary

structures: the holding/functional and the Holding/decentralization. The

Holding/functional structure arose from the need of the patriarch of the company to

operate the business while the heir apparent receives adequate preparation to assume

Chief executive responsibilities. While younger members of the family are in school, a

companys founder would use professionals at functional positions while the founder

maintained control through the current holding structure. The holding/decentralization

structure gradually evolved as younger family members graduated from college. Oncechildren received adequate formal training, they were able to assume more responsibility

for operating the business. Over time, the founder began to relinquish some of his

responsibilities as his younger relatives assumed more.

WOMEN IN MANAGEMENT

Nigerian women are very enterprising; they are responsible for the marketing that brings

food to the Nigerian populace. They typically have less formal education than the men

and will adopt the husbands name after marriage. This was as a result of the conception

that the name will be lost so it was common to send the males to school and have the

women go into trading by collecting capitals from their husbands. Those who could not

afford this go into farming. Traditionally, it is frowned at that men demand money from

their wives but there are some parts of Nigeria that are becoming increasingly dominated

by women and their enterprising activities, such societies are accepting the role of women

as the breadwinners.

GOALS AND RESPONSIBILITIES OF BUSINESS

The primary aim of all businesses is to sustain itself. This is achieved through profit

maximization. It is expected that the organization also have responsibilities towards the

community where it exists and the people that lends it labor. This is a growing sentiment

in Nigeria. One of the many areas in which Nigerian businesses have been called to be

more responsible is in the area of consumer protection. Purchase of unsafe and hazardous


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products is quite common. False advertising is prevalent. There is little consumer

protection awareness though much has been done lately in the drugs and food-

manufacturing sector. The growing populations in the major cities are leading to more

water and air pollution problems. The organizations should have a greater sense of

responsibility for educating its workers. This should not be left to the colleges and

universities. Some jobs require specialized training by the specific company or industry

for which the person works.

RECENT DEVELOPMENTS

There has been a great deal of political unrest in the country. This has led to instability in

the economy and the regulations of business. There is the current meltdown in the

financial sector of the world.

Some unethical behaviors in business most frequently cited by the public include:

y Practices involving outright illegal activities such as embezzlement of company

funds, use of company resources for personal benefits

y Practices which compromise a recognized corporate code or policy like accepting

or giving bribes or gifts in exchange for preferential treatment, divulging

confidential information, and falsification of records

y Practices that result in physical harm to other persons such as production of dangerous commodities, improper disposal of toxic wastes and violation of

privacy.

Documents

Ethics and Nigerian Businessmen