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Business Ethics and Social Responsibility Dr. Sanjay Mishra, PhD (BHU)

Disclaimer: Views expressed here are of the presenter

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Business Ethics is

• What is appropriate and what is not- in short or long term from the business viewpoint …..

• Appropriate in Business is-• Trust of the customer/party• Long term relations• Horizontal rapport• With a feeling of service to the society• After a certain level of satisfaction society pays

back to the business

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Business Ethics/Corporate Ethics• Business Ethics (also known as Corporate Ethics) is a form

of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment

• Business ethics has both normative and descriptive dimensions. As a corporate practice and a career specialization, the field is primarily normative. Academics attempting to understand business behavior employ descriptive methods.

• The range and quantity of business ethical issues reflects the interaction of profit-maximizing behavior with non-economic concerns. Interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia.

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Ethical Issues in Business

• Adulteration in edible items• Product Safety/ Unequal Standards• Product storage and logistics irresponsibility• Customers as quantity of consumption• Surrogate Advertising/ Treacherous Campaigns• Finished accountability after selling the product.• Less expenditure on social causes/wellbeing• Environmental issues

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Genesis • Ethics come from [Middle English ethik, from Old French ethique (from

Late Latin ḗthica, from Greek ḗthika, ethics) and from Latin thic (from Greek ḗthik), both from Greek ḗthikos, ethical, from ḗthos, character; see s(w)e- in Indo-European roots.]European meant for character/ manner or

• 1: (a) A set of principles of right conduct. (b) A theory or a system of moral values: "An ethic of service is at war

with a craving for gain" (Gregg Easterbrook).• 2: Ethics : The study of the general nature of morals and of the specific

moral choices to be made by a person; moral philosophy.• 3: Ethics : The rules or standards governing the conduct of a person or

the members of a profession: medical ethics.

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Major branches • Meta-Ethics, about the theoretical meaning and reference of

moral propositions and how their truth-values (if any) may be determined;

• Normative Ethics, about the practical means of determining a moral course of action.

• Applied Ethics, about how moral outcomes can be achieved in specific situations.

• Moral Psychology, about how moral capacity or moral agency develops and what its nature is.

• Descriptive Ethics, about what moral values people actually abide by.

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Inventory of ethical Issues in Business

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

Relations

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Why talk about Business Ethics?

• For last decade there are evidences that the frequency related to business ethics violation increased

• Recently food adulteration in National Capital region and around came into limelight

• Corporate, Governance, Service Sector Govt. machinery

• Due to professional lapses, incidences frequently take shaping and now a frequent phenomena in India

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Can we consider?

• “We Will Not lie, Steal or Cheat, No Tolerate Among Us Anyone Who

Does”• Which do you think is the tougher

part• Line 1 or Line 2 ? And Why?

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Ethics, Economics & Law

• Ethical etiquette is personal but larger in implications.

• Ethics pays in economic transactions and strengthens the mutual relations than anything in business expansion.

• Law is a watchdog, can check when it sniffs and affect the repercussions not the ethics straight.

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Business, Society & Ethics

• It is society that makes the business sustain, business is a tool to increase the frequency of economic activities, not to rule, control or govern the society.

• Exchange based society continued for long in the past with minimum conflicts than modern business.

• Physical form of business has less likelihood to incur crisis related to business than abstract form of business.

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SatyaAhinsa

SarvodayAparigrah

HINDUISM

JUDAISMCHRISTIANITY

ISLAAM

TAOISMBUDDHISM

CONFUCIANISMBAHAISM

UNIVERSAL VALUES : GANDHIAN ETHICS

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Gandhian Approach• He believed a business could and should be

conducted with complete honesty. • Indeed, a business that was run honestly would be

more successful than one which was not.• In business as well as personal life he subscribed to

the view : "Honesty is the best policy." A business person had every right to earn a livelihood from their business, although if vast income was earned from the business, the business person should give what he or she did not need to the community.

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Trusteeship

• In his theory of trusteeship, Gandhi perceived business as a form of service to the community.

• Gandhian approach to business ethics relate to today as much as to his lifetime.

• Gandhian thought need to go undergo interpretation because of development the business has undergone during last 50 years.

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Gandhi and business ethics

• Business is a way to foster neighborliness, to bring members of a community together and a means by which people can love and serve one another.

• Dr. Stephen Kovey one of world’s leading management consultants and author of the best selling book “The Seven habits of Highly Effective People” says in his book:

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Mahatma Gandhi said :• That seven things will destroy us:• Wealth Without Work• Pleasure Without Conscience• Knowledge Without Character• Commerce (Business) Without Morality (Ethics)• Science Without Humanity• Religion Without Sacrifice• Politics Without Principle

• © 1990 Stephen R. Covey. All rights reserved. Reprinted with permission. http://www.mkgandhi.org/mgmnt.htm

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Some case study• For-Profit Colleges in the US: A Morally

Bankrupt Sector? case study (Case Code: BECG117)

• BP's Continuing Safety Problems: The Gulf of Mexico Crisis(Case Code: BECG116)

• Bhopal Gas Tragedy: Revisited after Twenty-five Years(Case Code BECG115)

• Intel's 'World Ahead' Program - The Baramati Project in India (Case Code:BECG098)

• http://www.icmrindia.org/casestudies/Case_Studies.asp?cat=Business%20Ethics