Business Ethics

Code of Ethics

Business Ethics

• The standards of conduct and moral values governing actions and decisions in the work environment.– Social responsibility.– Balance between what’s right and what’s profitable.

• The moral values that governs business behaviour and restraints companies from pursuing the interest of the shareholder at the expense of all other considerations

Stakeholders

• People and groups that supply the business with its productive resources and have a claim on its resources– Shareholder– Suppliers– Distributors– Employer – Employee– Customer

Relations in a Business

• Employer-Employer Relations• Employee-Employer Relations• Company-Customer Relations• Company-Shareholder Relations• Company-Community/Public Interest

Ethical Issues

• Honesty – communication & behaviour consistent with facts– Disclosure of information– Promises/commitments– Laws and professional standards– Representation of others like shareholders

• Unfair Competition– Refrain from bribes and excessive gifts– Avoid quid pro quo transaction (what for what?)– Comply with anti-trust laws (pricing, monopolistic practices)

• Just Compensation– Respect intellectual property– Treat employees fairly

• Respecting rights of others– treat others with fairness and respect regardless of:

• Age, Religion, Ethnic group, Sex, Economic status

– Respect the community you operate in by paying fair share of economic costs

– Respect others and future generations by treating the environment well

Valuing of Ethical Behaviour

• Better Information– Trust from investors– Lower costs for audits, controls, investigations– Better allocation of resources– Customers will be more loyal– Lower costs from suppliers– Attracting and retaining better employee

• Better Competition– Lowers cost of business economy– Leads to a better decision making– Improve competitive nature of a country’s economy

• Just compensation– Creates a more vibrant, entrepreneurial economy– Attracts and retains better employees

• Rights of others– Draws upon talents of wider set of individuals– Develops long-term respect from the community– Maintains the environment for long term value to

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