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07. what are business ethics

Business ethics refers to implementing moral standards and principles within business operations and practices. It examines ethical issues that can arise in business such as corporate governance, insider trading, discrimination, social responsibility, and fiduciary duties. Understanding business ethics helps ensure trust between businesses and consumers by promoting fair treatment. While laws set basic guidelines, integrating ethics into daily operations helps companies avoid legal issues and enhance their reputation.

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BUSINESS ETHICS What are Business Ethics? Prepared by: Hamdoon Hussain B.Sc (Economics), MBA HRM Karachi University Business School (K.U.B.S)
Business Ethics- Terminologies What is Business : An entity which is engaged in industrial, commercial to earn profit and also for non- profit mission to served charitable mission. OR Business is just adding value in the customer life through your product or services.
What are Business Ethics What are Ethics: Ethics demonstrated to what is wrong? What is right. Ethics are the study of general morals, specific morals philosophy and set of professional morals, and standard which is generated by the business or enterprise. Ethics determine behavior in terms of right and wrong.
What are Business Ethics Business Ethics is a form of applied ethics or professional ethics that examine ethical principles and moral or ethical problems that can arise in business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organization. Understanding of Business ethics Business ethics ensure that a certain basic level of trust exists between consumers and various forms of market participants with
What are Business Ethics Business ethics is the study of how a business should act in the face of ethical dilemmas and controversial situations. This can include a number of different situations, including how a business is governed, how stocks are traded, a business' role in social issues, and more. Business ethics is a broad field because there are so many different topics that fall under its umbrella. It can be studied from a variety of different angles, whether it's philosophically, scientifically, or legally. However, the law plays the biggest role in influencing business ethics by far.
What are Business Ethics KEY TAKEAWAYS Business ethics refers to implementing appropriate business policies and practices with regard to arguably controversial subjects. Some issues that come up in a discussion of ethics include corporate governance, insider trading, bribery, discrimination, social responsibility, and fiduciary responsibilities. The law usually sets the tone for business ethics, providing a basic guideline that businesses can choose to follow to gain public approval.
What are Business Ethics Understanding Business Ethics: Business ethics ensure that a certain basic level of trust exists between consumers and various forms of market participants with businesses. For example, a portfolio manager must give the same consideration to the portfolios of family members and small individual investors. These kinds of practices ensure the public receives fair treatment.
What are Business Ethics The concept of business ethics began in the 1960s as corporations became more aware of a rising consumer-based society that showed concerns regarding the environment, social causes, and corporate responsibility. The increased focus on so-called social issues was a hallmark of the decade. Since that time period, the concept of business ethics has evolved. Business ethics goes beyond just a moral code of right and wrong; it attempts to reconcile what companies must do legally versus maintaining a competitive advantage over other businesses. Firms display business ethics in several ways.
What are Business Ethics Varieties of business ethics Many people engaged in business activity, including accountants and lawyers, are professionals. As such, they are bound by codes of conduct promulgated by professional societies. Many firms also have detailed codes of conduct, developed and enforced by teams of ethics and compliance personnel. Business ethics can thus be understood as the study of professional practices, i.e., as the study of the content, development, management, and effectiveness of the codes of conduct designed to guide the actions of people engaged in business activity. This entry will not consider this form of business ethics. Instead, it considers business ethics as an academic discipline
What are Business Ethics Why Business Ethics/Reason To Study Business ethics are important because they add a line of define to protect the company, enable companies growth saved money and allow to avoid certain legal: Identify ethical issue of company. Crises management. Greater scrutiny of ethical misconduct. Benefit of Business Ethics Enhance a company reputation. Retain good employee. Positive work environment. Avoid legal problems.
What are Business Ethics Conceptual and evolutionary aspects of business ethics: Ethics is the part of philosophy that studies the morality of human acts, as being free and ordered to its ultimate end. Ethics was defined as an inquiry about nature, based on morality. It is also understood as moral judgments, standards and rules of human conduct, with an emphasis on the determination of what is right and what is wrong. A company is considered ethical if it adopts an ethical stance as a business strategy, that is, to act honestly with all those who have some kind of relationship with it, the stakeholders. Customers, suppliers, partners, employees, government and society as a whole are involved in this group. “Having ethical standards means maintaining good business in a more lasting way”
What are Business Ethics Determining Right and Wrong Acting ethically ultimately means determining what is “right” and what is “wrong.” Basic standards exist around the world that dictate what is wrong or unethical in terms of business practices. For example, unsafe working conditions are generally considered unethical because they put workers in danger. An example of this is a crowded work floor with only one means of exit. In the event of an emergency – such as a fire – workers could become trapped or might be trampled on as everyone heads for the only means of escape.
What are Business Ethics Ethics Improves Your Business Reputation When you have a reputation for consistently being ethical in how you source and build products, and treat employees, customers and the community. Business Ethics Help You Retain Top Talent: Good ethics at a business start at the top. If you’re a business owner or manager, it’s important to lead by example. When employees see you make ethical choices, it lets them know that they can have confidence in the company; they know that you’ll do right by them and your customers. Limit Risk with Good Business Ethics: Businesses that practice good business ethics face less risk for fines and other legal trouble. Sure, the law and regulations are complicated, but a lot of trouble can be avoided just by doing what’s morally right. If business decisions are made with that in mind, you can save the stress of having to defend your company against lawsuits and fines.
What are Business Ethics Understanding Business Ethics in Three Parts To truly break down business ethics, it’s important to understand the three basic components that the term can be dissected into. #1 History #2 Scandals #3 Integration
What are Business Ethics #1 History The first part is the history. While the idea of business ethics came into existence along with the creation of the first companies or organizations, what is most often referred to by the term is its recent history since the early 1970s. This was when the term became commonly used in the United States. The main principles of business ethics are based in academia and on academic writings on proper business operations. Basic ethical practices have been gleaned through research and practical study of how businesses function, and how they operate, both independently and with one another.
What are Business Ethics #2 Scandals The second major meaning behind the term is derived from its close relationship and usage when scandals occur. Companies selling goods in the U.S. that were created using child labor or poor working conditions is one such scandalous occurrence.
What are Business Ethics #3 Integration Perhaps the most recent and continually developing aspect of ethics is the third piece – the idea that companies are building business ethics into the core of their companies, making them a standard part of their operational blueprint. As the world continues to grow more political – and more politically correct – an increased focus on proper business ethics and strong adherence to them become ever more the norm.
What are Business Ethics Examples of Ethical Behavior in the Workplace While understanding the basic principles of business ethics is important, it is arguably more important to understand how these ideas apply to day-to-day business operations. Here are some examples of how ethical behaviors can be practically applied.
What are Business Ethics Putting Customer Needs First Companies that build their workplace culture around putting customer needs first and hiring people who engage in this behavior are participating in ethical behaviors. For example, if a customer comes into a store looking for a product that meets very specific needs, it's important to provide them the best product for the situation described instead of up selling them or encouraging them to buy a product that won't meet their needs
What are Business Ethics Being Transparent Transparency and clear communication is paramount when it comes to ethical workplace behaviors. For example, when faced with a public relations crisis, companies should call a meeting and address the problem directly with their employees. It's important to truthfully describe the situation as it unfolded, present solutions, and accept criticism humbly.
What are Business Ethics Prioritizing Workplace Diversity Part of being fair is providing everyone with an equal opportunity to be employed at the company. For example, if someone notices that management tends to hire the same type of person, they may suggest getting employees more involved in the hiring process. This will introduce different perspectives to the hiring process and increase the possibility that different kinds of applicants will be selected for a position.
What are Business Ethics Respecting Customer Information Many businesses collect the personal information of their customers, whether it's payment information, health information, or similar. For example, a hospital may create and enforce aggressive policies around staff sharing patient information on social media. Having an employee share this kind of information on their personal accounts is not only disrespectful of the patient's privacy,
What are Business Ethics Providing Resources for Reporting Unethical Behavior If an employee notices unethical behavior in the workplace, they should have an outlet to report these behaviors For example, a research university should have a neutral office of compliance that is organizationally detached from the research arm of the institution. This provides a neutral space where academics can report unethical studies or harmful practices without fear of workplace repercussions.
What are Business Ethics Quality Control For another example, consider the matter of quality control for a company that manufactures electronic components for computer servers. These components must ship on time, or the manufacturer of the parts risks losing a lucrative contract. The quality-control department discovers a possible defect, and every component in one shipment faces checks.
What are Business Ethics Importance Of Business Ethics Every company should have their own moral principles and guidelines. Following business ethics has more benefits than you think. It will help you to keep and attract employees, customers, and investors.
What are Business Ethics Importance Of Business Ethics For example, consider that you are an “energy drink” manufacturing company and you’ve proclaimed on the labels and advertisements that you don’t add any preservatives to the drink, then You should adhere to the claims you’ve made. If you disobey your claims and sell the product by adding preservatives, then it is considered as unethical business practice. It will deteriorate your brand and eventually, you will lose trust from the customers. It also damages the reputation and keep away the stakeholders. Therefore, following business ethics is very important.
What are Business Ethics BENEFIT OF BUSINESS ETHICS Enhances Reputation Builds Trust-Internally & Externally Increases Awareness of Ethics Issues. Guides Decision Making Reduces Ethics Risk Questionable behavior decrease. Employee Relations Improve. Competitive Positions Improve.
What are Business Ethics Pillars of Business Ethics: Trustworthiness Respect Responsibility Fairness Caring Citizenship
Business Ethics for Executives: In addition to the Six Pillars of Character, the Josephson Institute offers 12 Ethical Principles for Business Executives: Honesty Integrity Promise-Keeping & Trustworthiness Loyalty Fairness Concern for Others Respect for Others Law Abiding Commitment to Excellence Leadership
Unethical Behavior in the Workplace: Taking Sides in an Employee Argument Lying Misusing Company Time Cultivating a Hostile Workplace Ignoring Conflicts of Interest
What are Business Ethics
BUSINESS ETHICS-CASE STUDY: Gray Matters To foster ethical discussion and understanding in the workplace, the Lockheed Martin company developed a quiz for employees called “Gray Matters.” The quiz is multiple choice, with a range of points awarded (or subtracted) depending on the response. Subsequently, the approach has been adopted by a wide range of corporations. Here’s a typical question matched with its possible answers and the corresponding points: Six months after you hired an assistant accountant who has been working competently and responsibly, you learn that she departed from the truth on her employment application: she claimed she had a college degree when she didn’t. You’re her manager; what should you do? Nothing because she’s doing her job just fine. (–10 points) Bring the issue to the human resources department to determine exactly how company policy determines the situation should be handled. (10 points) Fire her for lying. (5 points) Carefully weigh her work performance, her length of service, and her potential benefit to the company before informing anyone of what happened or making any recommendations. (0 points)
What are Business Ethics CONCLUSION AND RECOMMENDATIONS: This report has revealed that good ethical practices by businesses are very significant to the realization of organizational success. A business organization that embraces ethical ways of conducting its business affairs is more likely to achieve employees’ commitment, loyalty and satisfaction which in turn lead to quality of works and increased performance than unethical one. Such business will also portray good organizational value in the eyes of the stakeholders. It is also concluded that adopting good ethical behavior will increase being competitive, business sales, profit, customers retention and loyalty and investments to mention a few.
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