BUSINESS ETHICS INTRODUCTION Ethics can be defined as

BUSINESS ETHICS

INTRODUCTION • Ethics can be defined as a set of principles used to determine what is right and what is wrong in the conduct or behaviour of an individual.

LEVELS OF BUSINESS ETHICS • MACRO LEVEL- Relating to conduct of business in economic, political, legal and social systems. • CORPORATE LEVEL- Relating to ethical standards embedded in the policies and procedures of the organisation • INDIVIDUAL LEVEL- Relating to the behaviour or conduct of an individual.

FEATURES OF BUSINESS ETHICS • • • CODE OF CONDUCT BASED ON MORAL AND SOCIAL VALUES DISCIPLINE PROVIDES BASIC FRAMEWORK VOLUNTARY RELATIVE TERM NEW CONCEPT PERSONAL DIGNITY RELATED TO HUMAN ASPECT

Contd. . . • • STUDY OF GOALS AND MEANS REQUIRES EDUCATION AND GUIDANCE GREATER THAN LAW GIVES PROTECTION TO SOCIAL GROUPS BUSINESS SOCIAL RELATIONSHIPS DIFFERENT FROM SOCIAL RESPONSIBILITY NOT AGAINST PROFIT MAKING

TYPES OF BUSINESS ETHICS • 1. METAETHICS – Study of origin and meaning of ethical concepts. • 2. DESCRIPTIVE ETHICS – Morals of a society describing how people behave. • 3. NORMATIVE ETHICS – Study of principles, rules or theories that guide our actions and judgements. • 4. APPLIED ETHICS – Analysis of specific, controversial, moral issues like abortion, animal rights.

SOURCES OF BUSINESS ETHICS

IMPORTANCE OF BUSINESS ETHICS • 1. REDUCED BUSINESS MALPRACTICES • 2. CREATES GOOD IMAGE AND IMPROVE CUSTOMERS' CONFIDENCE • 3. CONSUMER SATISFACTION • 4. SAFEGUARDING CONSUMERS' RIGHTS • 5. PROTECTING EMPLOYEES AND SHAREHOLDERS • 6. CREDIBILITY WITH THE EMPLOYEES • 7. ATTRACTING AND RETAINING EMPLOYEES • 8. LOYAL INVESTORS

continued • • • 9. DEVELOPS GOOD RELATIONS 10. SURVIVAL OF THE BUSINESS 11. HEALTHY COMPETITION 12. CORRESPONDS TO BASIC HUMAN NEEDS 13. BETTER DECISION MAKING 14. PROFITABILITY 15. SMOOTH FUNCTIONING 16. PROTECTION OF SOCIETY 17. LONG-TERM GROWTH 18. COST AND RISK REDUCTION

SCOPE / AREAS OF BUSINESS ETHICS 1. ETHICS IN COMPLIANCE • High level oversight • Written policies and procedures • Education and training programs • Monitoring and auditing • Investigating and reporting • Response and prevention • Enforcement and discipline • Program effectiveness

2. ETHICS IN FINANCE • 1. To act with honesty and integrity, avoiding real or clear conflicts of interest in personal and professional relationships. • 2. To provide information which is full, fair, accurate, complete, objective, relevant, timely and understandable with regard to reports and documents of the company to be submitted to the public. • 3. To act in accordance with all applicable laws, rules and regulations of governments and other appropriate private and public regulatory agencies. • 4. To act in good faith, responsibly, with due care, competence and carefulness without misrepresenting material facts or allowing any independent judgment to be subordinated. • 5. To respect the confidentiality of information acquired in the course of business except when authorized or otherwise legally obligated to disclose the information. It should not be used for personal advantage. • 6. To promote ethical behavior among the other associates.

3. ETHICS IN HUMAN RESOURCES • 1. The HR executives are accountable for faithfully carrying out their responsibilities to the benefit of all the employees in the organization. • 2. The HR professionals should give fair and equitable treatment to all the employees. • 3. It is the duty of HR executives to keep the company information in the strictest confidence and protect the integrity of the company proprietary information while dealing with employees or individuals outside the company. • 4. Human resource professionals are responsible for learning and understanding the entire body of knowledge required to carry out their duties and responsibilities. They are also responsible for continuing education to remain experts in their field.

continued • 5. HR professionals must maintain competence in carrying out professional responsibilities and provide services in an honest and diligent manner. • 6. It is the duty of the HR executives to adhere to any statutory acts, regulation or by-laws which relate to the field of human resource management, as well as all civil and criminal laws, regulations and statutes that apply in one’s jurisdiction. • 7. The HR executives should support, promote and apply the principles of human rights, equity, dignity and respect in the workplace within the profession and in the society as a whole. • 8. The HR executives should strive to balance organizational and employee needs and interests.

4. Ethics in Marketing • A shared standard of truth in marketing communications. • A clear distinction between advertising and sensationalism. • Endorsements(a public or official statement of support or approval) should be clear and transparent. Consumers’ privacy should be maintained at all times. • Government standards and regulations must be adhered to and practiced by marketers.

5. ETHICS IN PRODUCTION • 1. No forced labourshould be employed in the process of production. Manufacturers shall acknowledge the right of their employees to leave their employer after reasonable notice. • 2. Manufacturers and suppliers shall not employ minors i. e. children below the age of 14. Young workers shall not work during night hours or in hazardous conditions. • 3. Manufacturers and suppliers shall not apply any type of discriminatory practice with regard to the recruitment, compensation, access to training, promotion, termination of the employment agreement or retirement, based on race, caste, creed, nationality, religion, age, gender, marital status, etc. • 4. Manufacturers and suppliers shall ensure that their employees, without distinction, have the right of association, union membership and collective bargaining. • 5. Manufacturers and suppliers shall treat their employees with dignity and respect.

• 6. Manufacturers and suppliers shall provide a safe and healthy workplace to their employees, ensuring minimum conditions of light, ventilation, hygiene, fire prevention, safety measures and access to a drinking water supply. • 7. Manufacturers and suppliers shall ensure that wages should always be enough to meet at least the basic needs of workers and their families and any other which might be considered as reasonable additional needs. • 8. Manufacturers and suppliers shall not require their employees to work, as a rule of thumb, in excess of 48 hours a week and workers shall be granted at least one day off in a week. Overtime shall be voluntary, not exceeding 12 hours per week and shall always be compensated. • 9. Manufacturers and suppliers must ensure the production of safe and good quality products. • 10. Manufacturers and suppliers shall be duly committed at all times to protect the environment and shall comply with the standards and requirements of the applicable laws and regulations.

6. ETHICS IN RESEARCH • 1. Honesty -To. Strive for honesty in reporting data, results, methods and procedures, and publication status. • 2. Objectivity–To avoid bias in experimental design, data analysis, data interpretation, peer review, personnel decisions and other aspects of research where objectivity is expected or required. • 3. Integrity –To. Keep the promises and agreements, act with sincerity, strive for consistency of thought and action. • 4. Carefulness–Toavoid careless errors and negligence, carefully and critically examining thework and the work of the peers. To keep good records of research activities such as data collection, research design and correspondence with agencies or journals. • 5. Openness - To share data, results, ideas, tools, resources. To be open to criticism and new ideas.

• 6. Respect for Intellectual Property -Tohonor patents, copyrights, and other forms of intellectual property by not using unpublished data, methods, or results without permission. • 7. Confidentiality – Toprotect confidential communications such as papers or grants submitted for publication, personnel records, trade or military secrets and patient records. • 8. Social Responsibility – To strive to promote social good and prevent or minimize social harms through research, public education and advocacy. It includes: • 9. Competence - To maintain and improve the professional competence and expertise through lifelong education and learning and to take steps to promote competence in science as a whole. • 10. Legality - To know and obey relevant laws and institutional and governmental policies.

PRINCIPLES OF BUSINESS ETHICS • • 1. Honesty 2. Integrity 3. Accountability 4. Loyalty 5. Fairness 6. Concern for others 7. Respect for others 8. Law abiding

• • 9. Leadership 10. Commitment to excellence 11. Reputation and morale 12. Promise-keeping & trustworthiness