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1.) Is corporation a morally responsible person? Explain in detail with respect to Satyam.

. (2) Let's start with the concept of whether corporations are "morally responsible agents." Corporations are, of course, legal constructs; we often refer to them as "legal persons." The primary reasons for their existence are twofold: (1) to allow individuals to pool their resources together to engage in economic activity on a scale that they could not achieve individually; and (2) to limit the liability of such individuals ("investors") should the operation go belly-up. Obviously, a corporation can only act through its "agents," i.e., its board of directors, officers, and employees. When these humans act in their agency role, however, they are not simply a bunch of people with titles doing whatever they want. They are acting on behalf of their principal, the corporation. They have a fiduciary duty to put the interests of the corporation ahead of their own. As a result of their collective nature, corporations are extremely powerful actors in our economic system. They do a tremendous amount of good - adding trillions to our gross domestic product each year. For example, corporations do medical research, build skyscrapers, transport us by air and automobile, and supply us with endless means of entertainment. But corporations also do some things that are not so good. For example, they occasionally breach contracts and engage in tortuous activity. Just because a corporation acts through human agents, does it make any sense to say that it is not a "morally responsible agent" when its contract breach costs taxpayers millions of dollars or its poorly designed automobile blows up on impact and kills innocent people? One could take the position that the corporation is not morally responsible for these acts; rather the responsible human or humans behind the corporate veil are. But this is not a satisfactory answer for two main reasons. First, the harm is often if not always an outgrowth of the collective nature of the enterprise itself. One person, for example, can't design, build, and mass-market an automobile. Thus, quite literally, the collective entity is at the root of the wrong - and it should take responsibility for it. Second, if we laid blame for harms caused by corporations solely at the doorstep of individuals, the result would be unworkable: no one person in the organization has the money or insurance to compensate for a contract breach or make victims of a tort whole. The corporation does. Thus, corporations are undoubtedly morally (and legally) responsible for their contract breaches and tortuous behaviour. In one of the biggest frauds in India's corporate history, B. Ramalinga Raju, founder and CEO of Satyam Computers, India's fourth-largest IT services firm, announced on January 7 that his company had been falsifying its accounts for years, overstating revenues and inflating profits by $1 billion. Ironically, Satyam means "truth" in Sanskrit, but Raju's admission -- accompanied by his resignation -- shows the company had been feeding investors, shareholders, clients and employees a steady diet of asatyam (or untruth), at least regarding its financial performance. However where there is implicit collusion, as witnessed in Satyams case, where certain stakeholders (independent directors, regulatory authorities etc.) may have had some knowledge of the goings on but took no action, the problem becomes more acute. Detection of such collusion is often very challenging, especially in a culture where capital-related offences are not considered as serious, or attract as severe a penalty as crime against a person. Only if there be a policy in place that encourages an enterprise to report collusion, reward the informant (the whistleblower) and use the information against the remaining enterprises, such scams can be held in check. But the whistle blowing part wasnt done by the people who were aware of the same and not even by the auditors and hence this scam boiled for longer than usual. And for this reason Satyam as a company should be held morally responsible for the same. 2.) Does a corporation have a conscience of its own? Analyze the statement in detail. The corporation is a good example of a machine with no conscience says Ray Kurzweil. In charting the historical evolution of corporations, they evolved from a relative few, specially chartered associations in the 18th century and were generally organized to complete projects for the public good. Much has changed, for today they have become modern profit-making behemoths of modern world. Corporations may be subjected to regulation, but only in response to public outcry against perceived abuses of power. The corporate evolution has resulted in a general separation of ownership and control. With regard to the corporate conscience,

though corporations do not have one in the traditional sense of the word, the corporation is run by corporate managers who can act based upon their own sense of morals, but that alone does not account for corporate behavior that benefits society as a whole. But corporations do tend to act based upon the decisions of management as they interact with other factors. There is certain ambivalence about business ethics in modern society. We begin with skepticism about the moral credentials of the profit-driven market system. In business, as in campaign politics, we witness too often an unbalanced pursuit of goals and objectives. Over the last thirty-five years we have seen this pathology at work from Watergate to WorldCom to Satyam. We have seen it in the career crashes of inside-traders like Ivan Boesky and R. Raju, in the corporate crashes of Enron and Andersen and Satyam. Call this the stimulus problem: a business system that lends itself to certain kinds of excess. The ambivalence becomes evident when we recognize our reluctance to prescribe the most obvious cure for the stimulus problem: the use of moral criteria (beyond economic and political competition) to balance managerial (and political) decision making. Both our laws and our social norms caution managers and boards of directors (as agents of the corporation) against thinking that strays too far from a strict duty of care to shareholders. Perhaps we fear that incompetence might parade as virtue, or that ethical judgment might mean moral fanaticism. Either way, we seem to resist our most obvious alternative to amorality. A corporation can and should have a conscience. Organizational agents such as corporations should be no more and no less morally responsible (rational, self-interested, altruistic) than ordinary persons. The analogy that holds between the individual and the corporation makes it possible to project to corporations the concept of moral responsibility as it applies to persons. 3.) Profitability & morality can co-exist Explain with Indian examples. (3) There's a view that soaring profits and ethics are mutually exclusive concepts, however, the two can co-exist. The world of business is generally perceived as jungle where the bottom line takes precedence over all other matters. While it is certainly true that profits are the true measure of success, commercial ruthlessness doesn't necessarily lead to unethical practices. There sometimes arises an inevitable conflict in the company between their moral obligations and improving the bottom lines. But ultimately companies following the path of ethical value system succeed in long run as sooner or later consumers learn to separate fact from fiction. Hence in situations such as these referring to morality to help decide what needs to be done should take precedence. Nowadays Money and Ethics are seen to be diametrically opposed to each other but it turns out money and ethics do have much in common. Any corporation large or small ultimately lives by its reputation. Ethics must sit at the top of the mountain for any successful company that wants the trust of the consumers and investors. There are very few second acts once the public perceives the organization flawed by dishonesty or inferior quality. As is very rightly said by Henry Ford - A business that makes nothing but money is a poor kind of business. Ethical decision-making gets especially interesting when organizations must reconcile their core values and show a healthy bottom line which end up in conflict with one another. The company and its management might get diversified to malpractices. Enron, WorldCom, Satyam, Xerox and other scandals shook public confidence in ethical value system of organizations. But it must understood very clearly Relativity applies to physics, not ethics (Albert Einstein) Profits and ethics are in reality part of the same equation. A corporation that wishes to grow and increase its financial return to its owners must balance ethics and operations. This is a complex journey especially during tremendous economic pressures. The drive for success in the marketplace and to maximize return of capital can lead a company astray with disastrous results. Successful businesses fail, profitably running businesses suffer from a downfall and some seemingly effective corporate receive a great fall in their profits and popularity all due to the lack of business ethics. There are companies that have crossed ethical lines in the pursuit of profit, and momentarily gained fame and fortune but what was the end result?? Many companies strive for and achieve ethical behavior. Looking at names like Tata group, Ford India, Rockwell Automation, Infosys Technologies, Hindustan Unilever, ITC, ONGC it is inferred that Ethics remain being important in business and strong ethical values takes the business a long way. Ethics are important not only in business but in all aspects of life because it is an essential part of the foundation on which civilized society is build. A business that lacks ethical principles is bound to fail sooner or later.

"If you have integrity, nothing else matters. If you don't have integrity, nothing else matters." -- Alan K. Simpson Indian Example: - ITCs E-Choupal (Saving farmers from exploitation) / ACC Cement (Gujarat Plant CSR) (Please elaborate) 4.) Values make characters & characters makes nation Explain with Indian Example. (3) According to Father of Indian Nation M. K. Gandhi - "If wealth is lost nothing is lost","If health is lost something is lost", "If character is lost everything is lost". Best of all things is character. Every one knows that life is precious that life is important. We all protect our life because we care for it more than anything else. If life is so important, the values of life are even more important. Values are guiding principles, or standards of behaviour which are regarded desirable, important and held in high esteem by a particular society in which a person lives. The Importance of Values and Morals are the code we live by in a civil and just society. They are what we use to guide our interactions with others, with our friends and family, in our businesses and professional behaviour. Our values and morals are a reflection of our spirituality; our character. They are what we hope to model for our children and the children around us, because children do watch us as they develop their own sense of right and wrong. Value education means inculcating in the children sense humanism, a deep concern for the well being of others and the nation. This can be accomplished only when we instil in the children a deep feeling of commitment to values that would build this country and bring back to the people pride in work that brings order, security and assured progress. If there is righteousness in the heart, there will be beauty in character, if there is beauty in character, there will be harmony in the home, when there is harmony in the home, there will be order in the nation, when there is order in the nation there will be peace in the world. A person with proper values will not be afraid to face problems. He or she will expect and accept them as part of life. He or she will not give unnecessary importance to anything that happens in life. Such a person will be an example to the rest. One must love our own values in life, to build a strong character. It will help us to lead our life as it should be lead. It is very necessary for the fulfilment of lifes purpose. "LET NOBLE THOUGHTS COME TO ME FROM ALL DIRECTIONS". Indian Examples: - M. K. Gandhi, JRD Tata (Please elaborate) 5.) What are the 3 As of advertising & explain morality of advertising? (3) The most successful advertising messages contain a call to action. It is the company's chance to turn audiences into customers. It convinces the undecided and strengthens interest in people familiar with the brand/offering. If you're involved in direct marketing, there are a lot of things you can do to perk up customer response rate. In doing such ads, you should always bear in mind these three A's. Alignment The placement of your call to action must clearly be visible to the target market. Whether on the sales page or email newsletter, placing the most important message above the scroll (before the customer scrolls down the page to see more) can considerably increase conversion. Those who are in a rush or otherwise not that interested will immediately move on if you don't do this. On the other hand, if something about your message catches their attention at first glance, they will be encouraged to know more. Approach Make a strong impact with your message by choosing powerful words to convey your message. If you're trying to elicit specific reactions, state it clearly and directly. Basically, you need to avoid the passive tone in writing a direct copy. It is also important to be careful in phrasing your meaning. Place yourself in the reader's shoes;

are you enticed by what you read? Did you become interested in "join", "subscribe", or even "donate" after what you have read? Appearance Words are powerful but it is not enough in some cases. It can be used together with compelling designs and layout to make a stronger impact. The look of your copy should catch attention to the most important parts of your message. On the web, it is a good idea to use big buttons and red fonts to draw attention. Split test different designs to come up with the right formula that works for you. Morality of advertising Advertising can be very simple a local, even neighbourhood,' phenomenon or it can be very complex, involving sophisticated research and multimedia campaigns that span the globe. It differs according to its intended audience, so that, for example, advertising aimed at children raises some technical and moral issues significantly different from those raised by advertising aimed at competent adults. Like every coin that has two sides advertising comes with its own set of benefits & harms:a.) Economic Benefits of Advertising: - Advertising can play an important role in the process by which an economic system guided by moral norms and responsive to the common good contributes to human development. It is a necessary part of the functioning of modern market economies, which today either exist or are emerging in many parts of the world and which provided they conform to moral standards based upon integral human development and the common good currently seem to be "the most efficient instrument for utilizing resources and effectively responding to needs" of a socio-economic kind b.) Political Benefits of Advertising: - Advertising can play an important role in the process by which an economic system guided by moral norms and responsive to the common good contributes to human development. It is a necessary part of the functioning of modern market economies, which today either exist or are emerging in many parts of the world and which provided they conform to moral standards based upon integral human development and the common good currently seem to be "the most efficient instrument for utilizing resources and effectively responding to needs" of a socio-economic kind. c.) Cultural Benefits of Advertising: - Because of the impact advertising has on media that depend on it for revenue, advertisers have an opportunity to exert a positive influence on decisions about media content. This they do by supporting material of excellent intellectual, aesthetic and moral quality presented with the public interest in view, and particularly by encouraging and making possible media presentations which are oriented to minorities whose needs might otherwise go unserved. d.) Moral & Religious Benefits of Advertising: - In many cases, too, benevolent social institutions, including those of a religious nature, use advertising to communicate their messages messages of faith, of patriotism, of tolerance, compassion and neighbourly service, of charity toward the needy, messages concerning health and education, constructive and helpful messages that educate and motivate people in a variety of beneficial ways. Harms of advertising

a.) Economic: - Advertising can betray its role as a source of information by misrepresentation and by

withholding relevant facts. Sometimes, too, the information function of media can be subverted by advertisers' pressure upon publications or programs not to treat of questions that might prove embarrassing or inconvenient. also can obstruct it. This happens when, for example, the costs of advertising limit political competition to wealthy candidates or groups, or require that office-seekers compromise their integrity and independence by over-dependence on special interests for funds.

b.) Political: - Political advertising can support and assist the working of the democratic process, but it

c.) Cultural: - Advertising also can have a corrupting influence upon culture and cultural values. We have
spoken of the economic harm that can be done to developing nations by advertising that fosters consumerism and destructive patterns of consumption. Consider also the cultural injury done to these nations and their peoples by advertising whose content and methods, reflecting those prevalent in the first world, are at war with sound traditional values in indigenous cultures. Today this kind of "domination and manipulation" via media rightly is "a concern of developing nations in relation to developed ones," as well as a "concern of minorities within particular nations."

d.) Moral: - Advertising can be tasteful and in conformity with high moral standards, and occasionally

even morally uplifting, but it also can be vulgar and morally degrading. Frequently it deliberately appeals to such motives as envy, status seeking and lust. Today, too, some advertisers consciously seek to shock and titillate by exploiting content of a morbid, perverse, pornographic nature. Ethics and Morals to be followed by advertisers: Truthfulness in advertising: - Even today, some advertising is simply and deliberately untrue. Generally speaking, though, the problem of truth in advertising is somewhat more subtle: it is not that advertising says what is overtly false, but that it can distort the truth by implying things that are not so or withholding relevant facts. To be sure, advertising, like other forms of expression, has its own conventions and forms of stylization, and these must be taken into account when discussing truthfulness. People take for granted some rhetorical and symbolic exaggeration in advertising; within the limits of recognized and accepted practice, this can be allowable. The dignity of the human person: - There is an "imperative requirement that advertising respects the human person, his rightduty to make a responsible choice, his interior freedom; all these goods would be violated if man's lower inclinations were to be exploited, or his capacity to reflect and decide compromised." These abuses are not merely hypothetical possibilities but realities in much advertising today. Advertising can violate the dignity of the human person both through its content what is advertised, the manner in which it is advertised and through the impact it seeks to make upon its audience. We have spoken already of such things as appeals to lust, vanity, envy and greed, and of techniques that manipulate and exploit human weakness. In such circumstances, advertisements readily become "vehicles of a deformed outlook on life, on the family, on religion and on morality an outlook that does not respect the true dignity and destiny of the human person." Advertising and social responsibility: - Advertising that fosters a lavish life style which wastes resources and despoils the environment offends against important ecological concerns. "In his desire to have and to enjoy rather than to be and grow, man consumes the resources of the earth and his own life in an excessive and disordered way. ... Man thinks that he can make arbitrary use of the earth, subjecting it without restraint to his will, as though it did not have its own requisites and a prior Godgiven purpose, which man can indeed develop but must not betray."

6.) What do you understand by corporate governance & explain its importance in modern times? (3) Corporate governance refers to the set of systems, principles and processes by which a company is governed. They provide the guidelines as to how the company can be directed or controlled such that it can fulfill its goals and objectives in a manner that adds to the value of the company and is also beneficial for all stakeholders in the long term. Stakeholders in this case would include everyone ranging from the board of directors, management, shareholders to customers, employees and society. The management of the company hence assumes the role of a trustee for all the others. Corporate governance is based on principles such as conducting the business with all integrity and fairness, being transparent with regard to all transactions, making all the necessary disclosures and decisions, complying with all the laws of the land, accountability and responsibility towards the stakeholders and commitment to conducting business in an ethical manner. Another point which is highlighted in the SEBI report on corporate governance is the need for those in control to be able to distinguish between what are personal and corporate funds while managing a company. Fundamentally, there is a level of confidence that is associated with a company that is known to have good corporate governance. The presence of an active group of independent directors on the board contributes a great deal towards ensuring confidence in the market. Corporate governance is known to be one of the criteria that foreign institutional investors are increasingly depending on when deciding on which companies to invest in. It is also known to have a positive influence on the share price of the company. Having a clean image on the corporate governance front could also make it easier for companies to source capital at more reasonable costs. Unfortunately, corporate governance often becomes the centre of discussion only after the exposure of a large scam.

Corporate governance has most recently been debated after the corporate fraud by Satyam founder and Chairman Ramalinga Raju. In fact, trouble started brewing at Satyam around December 16 when Satyam announced its decision to buy stakes in Maytas Properties and Infrastructure for $1.3 billion. The deal was soon called off owing to major discontentment on the part of shareholders and plummeting share-price. However, in what has been seen as one of the largest corporate frauds in India, Raju confessed that the profits in the Satyam books had been inflated and that the cash reserve with the company was minimal. Ironically, Satyam had received the Golden Peacock Global Award for Excellence in Corporate Governance in September 2008 but was stripped of it soon after Raju's confession. 7.) Explain the role of audit committees in maintaining the corporate governance of commercial organization. (3) The Audit Committee of the Board is today seen as a key fulcrum of any company. Being mandatory under Clause 49 and section 292A of the Companies Act -1956, the Audit Committee can be of great help to Board in implementing, monitoring and continuing good corporate governance practices to the benefit of the company and its stakeholders. The Audit Committee is formed to regularly review processes and procedures to ensure the effectiveness of internal control systems so that the accuracy and adequacy of the reporting of financial results is maintained at high level at all times. It is important for the members of Audit Committee to have formal knowledge of accounting and financial management or experience of interpreting financial statements. As required by section 292A of the Companies Act, 1956, every public limited company (listed or unlisted) having a paid-up capital of at least Rs. 5 crore shall constitute a Committee of the Board to be known as Audit Committee. The Audit Committee is formed by the members of the Boards of Director. The provisions in respect of the same are as follows: 1) Committee members are drawn from members of the Company's board of directors, with a Chairperson selected from among the members. 2) The Chairperson should be an independent Director. 3) The Committee shall have at least three (3) members (directors). 4) 5) 6) Two-third (2/3) of the members shall be non-executive directors. The Board of Directors shall prescribe the Committees terms of reference in writing. Auditorsinternal and externaland Director (Finance) shall attend the meeting but not have right to vote.

7) The Chairman of the Audit Committee shall attend the annual general meeting to provide clarifications on matters relating to audit. 8) The constitution and composition of the Audit Committee is to be disclosed in the annual report of the Company. 9) Any default in complying with the provision of section 292A may attract imprisonment up to one year or fine up to Rs. 50000 or both. The prosecution lies against the company and every officer of the company who is in default. The offence is compoundable under section 621A. 10) The Listing Agreement requires at least one director having financial management and accounting knowledge expertise to be a member of Audit Committee while other members should be financially literate. Section 292 A (5).

Functions of Audit Committee under Section 292 A The Audit Committee constituted under this section shall act in accordance with terms of reference to be specified in writing by the Board. The Audit Committee should have periodic discussions with the auditors about the following matters: (a) Internal Control System. (b) Scope of audit including the observation of auditors. (c) Review the half-yearly and annual financial statement before submission to the Board. (d) Compliance of internal control system. The Audit Committee shall also have authority to investigate into the matters in relation to the items specified in this section or matters referred to it by the Board of Directors. To carry out such investigation the Audit Committee will have full access to information contained in the records of the Company and external professional advice, if necessary. The recommendations of the Audit Committee on any matters relating to financial management including the audit report shall be binding on the Board. In case the Board does not agree with the recommendations made by the Audit Committee, the Board shall record the reasons for disagreement and communicate the same to the shareholders to be reported in Annual General Meeting. Generally the major Functions of Audit Committee are as follows: * overseeing the Companys financial reporting process and disclosure of financial information to ensure that the financial statements are correct, sufficient and credible, * recommending the appointment and removal of external auditor, fixation of audit fee and approval for payment of any other services, * reviewing with the Management the annual financial statements before submission to the Board, * reviewing with the Management the annual financial statements of the subsidiary companies, * reviewing with the Management and the external and internal auditors, the adequacy of internal control systems, * reviewing the adequacy of internal audit function, * discussing with internal auditors any significant finding and follow up on such issues, * reviewing the findings of any internal investigations by the internal auditors in matters where there is suspected fraud or irregularity, or a failure of internal control systems of a material nature, and then reporting such matters to the Board, * discussing with external auditors before the audit commences on the nature and scope of audit, as well as having post-audit discussion to ascertain any area of concern, * reviewing the Companys financial and risk management policies; and * examining reasons for substantial default in the payment to depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors, if any. In addition to the areas noted above, the Audit Committee looks into the controls and security of the Companys critical IT applications, internal and control assurance audit reports of all the major divisions and deviations from the Code of Business Principles, if any

8.) Explain the Indian Ethos in management & its applicability in todays economy. (2) Cambridge Advanced Learners Dictionary defines Ethos as the set of beliefs, ideas, etc. about social behaviour and relationship of a person or group while Oxford Advanced Learners Dictionary defines it as the moral ideas and attitudes that belong to a particular group or society. Indian Ethos is all about what can be termed as national ethos. Formally, the body of knowledge which derives its solutions from the rich and huge Indian system of ethics (moral philosophy) is known as Indian Ethos in Management (IEM). Is IEM some kind of Hindu concept of management? Certainly not. Management is behavioural science and it has to be culture specific. IEM has as its basis, the culture base of India and as a country whose culture has its roots in religion - it does draw its lessons from the religions of the land - be it Hinduism, Buddhism, or any other. The salient ideas and thoughts of Indian Ethos in Management revealed by our ancient scriptures are: 1. Atmano Mokshartham, Jagat hitaya cha: All work is an opportunity for doing good to the world and thus gaining materially and spiritually in our lives 2. Archet dana manabhyam: Worship people not only with material things but also by showing respect to their enterprising divinity within. 3. Atmana Vindyate Viryam: Strength and inspiration for excelling in work comes from the Divine, God within, through prayer, spiritual readings and unselfish work. 4. Yogah karmashu Kaushalam, Samatvam yoga uchyate: He who works with calm and even mind achieves the most. 5. Yadishi bhavana yasya siddhi bhavati tadrishi: As we think, so we succeed, so we become. Attention to means ensures the end. 6. Parasparam bhavayantah shreyah param bhavapsyathah: By mutual cooperation, respect and fellow feeling, all of us enjoy the highest good both material and spiritual. 7. Tesham sukhm tesham shanti shaswati: Infinite happiness and infinite peace come to them who see the Divine in all beings. 8. Paraspar Devo Bhav: Regard the other person as a divine being. All of us have the same consciousness though our packages and containers are different. Basic principles of Indian Ethos for Management (IEM): 1. Immense potential, energy and talents for perfection as human being has the spirit within his heart. 2. Holistic approach indicating unity between the Divine (The Divine means perfection in knowledge, wisdom and power), individual self and the universe. 3. Subtle, intangible subject and gross tangible objects are equally important. One must develop ones Third Eye, Jnana Chaksu, the Eye of Wisdom, Vision, Insight and Foresight. Inner resources are much more powerful than outer resources. Divine virtues are inner resources. Capital, materials and plant & machinery are outer resources. 4. Karma Yoga (selfless work) offers double benefits, private benefit in the form of self purification and public benefit. 5. Yogah Karmasu Kaushalam - Excellence at work through self-motivation and self-development with devotion and without attachment. 6. Co-operation is a powerful instrument for team work and success in any enterprise involving collective work. Principles of IEM are universally applicable. IEM can help develop an effective and holistic management pattern which will assure all round growth in productivity, marketing and profitability. This will help in

synchronizing private and public benefits and encourage individuals to lead an enriched quality of life together with worldly achievements. The best form of management has to be holistic and value driven which is the objective of IEM.


Management (Oriented by Science and Technology, Western Approach) Production, Productivity, Profit at any cost Management guided by mind only, led away by ego and desire. Soulless management Worker development, management of others, profit maximization, human being only given lip sympathy 5 Ms as Resources men, money, materials, machines and markets. Science & Technology, information for decision making

Management (Oriented by Values and adopting holistic approach, Indian and Eastern) Material gain with belief in achieving human and social welfare in unison Management by consciousness, power beyond mind i.e., soul. Interiorized management Development of man, integrated growth harmony, happiness and health, management of self Men, machines, materials and methods as conscious partners all having consciousness whether manifested or dormant. Information and intuition for decisions. Ethics and values combined with skills Conflicts resolution through integration and synthesis on stressing super ordinate common goals so that enduring harmony and unity is assured. Self introspection, stepping back aids for solution Brain stilling Integrated development. Whole man approach, breath-control and meditation emphasized. Human enrichment and total quality Noble attitudes, inner guidance, team spirit, total harmony, global good





Problem solving

Conflict resolution by negotiation, compromise, arbitration. Liquidation of differences only for a temporary period. No reference to higher consciousness

Decision making Development process

Brain storming Physical, Vital and Mental only. Soul or spirit ignored. Material development only even at the cost of man and nature External behaviour. Mental, material, selfish only. Soulless


9.) Good managers make bad ethical choices Analyze in detail. (2) When managers are accused of lying, cheating or stealing blame is usually placed on the individual or on the company situation. Most people believe that individuals make ethical choices because of individual integrity which is true, but it is not the whole story. Ethical or unethical business practices usually reflect the values, attitudes, beliefs, and behavior patterns of the organizational culture, thus, ethics help in shaping an organization. Managers bring specific personal and behavioral traits to the job. Personal needs, family influence and religious background all shape a managers value system. Specific personality characteristics such as ego, strength, self confidence, and a strong sense of independence may enable managers to make ethical decisions. One important personal trait is the stage of Moral development that is a simplified version of one model of personal moral development as shown in the exhibit. At the pre-conventional level, individuals are concerned with external rewards and punishments and obey authority to avoid detrimental personal consequences. In an organizational context, this level may be associated with managers who use an autocratic or coercive leadership style, with employees oriented toward dependable accomplishments of specific tasks. At level two called the conventional level, people learn to conform to the expectations of good behavior as defined by colleagues, family, friends and society. Meeting social and interpersonal obligations is important. Work group collaboration is the preferred manner for accomplishment of organizational goals, and managers use a leadership style that encourages interpersonal relationships and cooperation. At the post conventional or principled level, individuals are guided by an internal set of values and standards and will even disobey rules or laws that violate these principles. Internal values become more important than the expectations of significant others. For example when the USS Indian polis sank after being torpedoed during World War II one Navy pilot disobeyed orders and risked his life to save men who were being picked off by sharks. The pilot was operating from the highest level of moral development in attempting the rescue despite direct order from superiors. When managers operate from this highest level of development they use transformative or several leaderships focusing in the needs of followers and encouraging others to think for themselves and to engage in higher levels of moral reasoning. Employees are empowered and given opportunities for constructive participation in governance of the organization. The great majority of managers operate at level two. A few have not advanced beyond level one. Only about 20 percent American adults reach the level three stage of moral development, people at level three are able to act in an independent, ethical manner regardless of expectations form others inside or outside the organization. Managers at level three of moral development will make ethical decisions whatever the organization consequences are for them. One interesting study indicates that most researchers have failed to account for the direct ways in which women view social reality and develop psychologically and have thus consistently classified women as being stuck at lower levels of development. Researcher Carol Gilligan has suggested that the moral domain be enlarged to include responsibility and care in relationships. Women may, in general, perceive moral complexities more astutely than men and moral decisions based on a set of absolute rights and wrongs but on principles of not causing harm to others. One reason why higher levels of ethics are increasingly important is the impact of globalization. Globalization has made ethical issues even more complicated for todays managers. American managers working in foreign countries need sensitivity and openness to other systems, as well as the fortitude to resolve difficult issues.


Short Notes:-

a.) Remuneration Committee: The remuneration committee is established to ensure that remuneration arrangements support the strategic aims of the business and enable the recruitment, motivation and retention of senior executives while complying with the requirements of regulatory and governance bodies, satisfying the expectations of shareholders and remaining consistent with the expectations of the wider employee population. This section of our site provides you with access to material on current issues facing Australian remuneration committees, including checklists, guides and a range of other useful publications relating to the committees operations and responsibilities. Aligning pay with performance... The remuneration committee should ensure remuneration arrangements focus executives on achieving long-term business objectives and growth in shareholder wealth. In satisfying this requirement, the committee should approve incentive arrangements, including KPIs and performance hurdles. The risk of total shareholder return (TSR): This research paper by Deloittes remuneration specialists provides a framework for boards considering whether and how to use TSR as a performance measure for long-term incentive plans. Remuneration reporting... The remuneration committee is required to ensure the remuneration report is prepared in accordance with legal disclosure requirements, listing rules as well as the recommendations set out in the corporate governance principles and recommendations, issued by Corporate Governance Council. Remuneration committees can also use the remuneration report to clearly communicate the commercial rationale behind remuneration decisions and demonstrate alignment between company performance and pay. Remuneration report assessment tool: This checklist sets out relevant regulatory requirements, rules and guidelines for companies preparing their remuneration report. b.) Independent Directors: One third of a listed company's directors are required to be independent. The erstwhile Company's (Amendment) Bill 2003 had stated that a majority of the minimum seven directors of public companies having share capital in excess of Rs. 5 crore should be independent. Clause 49 of the listing agreements defines independent directors as follows: "For the purpose of this clause the expression 'independent directors' means directors who apart from receiving director's remuneration, do not have any other material pecuniary relationship or transactions with the company, its promoters, its management or its subsidiaries, which in judgment of the board may affect independence of judgment of the directors." The key difference between a non-executive & non-executive independent director is that the latter is forbidden to have any pecuniary relationship with the company apart from receiving a sitting fee which at the time of writing that clause was Rs. 5000/- and has since been raised to Rs. 20,000/-. Independent directors are the cornerstones of good corporate governance. Theirs is the duty to provide an unbiased, independent, varied and experienced perspective to the board. Corporate scandals of ENRON & Worldcom have revealed how this independence has been compromised by a cosy relationship between the CEO even with the so-called independent directors. In the selection of independent directors we must not look simply for high profile names. The issue is not of lending a brand but having someone with an independent state of mind. In an economy fired by innovation, our biggest threat is obsolescence. Periodic training of directors is a must. Unfortunately there are few courses designed primarily for directors. Warren Buffet recently lamented about the failure of independent directors to protect the interest of shareholders. He blamed the cosy "boardroom culture" with "well-mannered people" finding it almost impossible to suggest replacing the chief executive. He said that questioning their remuneration would be like "Belching at the dinner table". Independent directors

are our only hope to instil some discipline in the murky world of corporate finance. We have to make sure that greed plays no part in their appointment - even if it means "belching at the dinner table". c.) Tangible & Intangible Profits (2) (Didnt find the same) d.) Goals of life according to Indian Ethos Man should not just learn to live a human life but should aspire to live THE SPIRITUAL LIFE. A life with valid and actual goals. We call these goals as PURUSHARTHA and are as follows: Dharma (Righteousness) Arth (Wealth Management) Kama (Desires) Moksha (Salvation Self Realisation) Out of the above four salvation is the Param Purushartha (Ultimate Goal) of human life as every soul in this cosmos is a part of GOD and is bound to unite with his almighty as ONE. We all are having infinite powers and capabilities as we all are the manifestations of GOD (Divine Mother) but we do not realise the same because of our limitations of mind, clouded with negative emotions. Moksha is getting rid of these emotions and realising the concept of Aham Brahmasmi.{we are the Brahman (Divine Power)}. Dharma is called Pradhan Purushartha (Primary Goal) as it plays a major role in living spiritual life with righteousness and helps us in sticking to the path of Divinity. It gives us strength to withstand all kinds of pressures of life and still striving for the Ultimate Goal of self realisation. Artha and Kama are just the Instrumental Goals as they play a major role in coping up with day to day worldly affairs and help us in achieving the other two Primary and Ultimate Goals of Life. Artha is to generate wealth and prosperity through right and valid means. Whereas Kamais to enjoy regulated sensual pleasure, where gradual liberation from sensual desires is preferred over oppression of same. e.) Five indebtedness of man to nature (Didnt find the same) f.) Whistle blower: A whistleblower is a person who tells the public or someone in authority about alleged dishonest or illegal activities (misconduct) occurring in a government department, a public or private organization, or a company. The alleged misconduct may be classified in many ways; for example, a violation of a law, rule, regulation and/or a direct threat to public interest, such as fraud, health/safety violations, and corruption. Whistleblowers may make their allegations internally (for example, to other people within the accused organization) or externally (to regulators, law enforcement agencies, to the media or to groups concerned with the issues). One of the first laws that protected whistleblowers was the 1863 United States False Claims Act (revised in 1986), which tried to combat fraud by suppliers of the United States government during the Civil War. The act encourages whistleblowers by promising them a percentage of the money recovered or damages won by the government and protects them from wrongful dismissal. Whistleblowers frequently face reprisal, sometimes at the hands of the organization or group which they have accused, sometimes from related organizations, and sometimes under law. Most whistleblowers are internal whistleblowers, who report misconduct on a fellow employee or superior within their company. One of the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behavior or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behavior, within an organization, if there are complaint

systems that offer not just options dictated by the planning and control organization, but a choice of options for individuals absolute confidentiality. External whistleblowers, however, report misconduct on outside persons or entities. In these cases, depending on the information's severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, state, or federal agencies. In some cases, external whistle blowing is encouraged by offering monetary reward. g.) Sarbanes Oxley Act (3): The SarbanesOxley Act of 2002 (Pub.L. 107-204, 116 Stat. 745, enacted July 29, 2002), also known as the 'Public Company Accounting Reform and Investor Protection Act' (in the Senate) and 'Corporate and Auditing Accountability and Responsibility Act' (in the House) and more commonly called SarbanesOxley, Sarbox or SOX, is a United States federal law that set new or enhanced standards for all U.S. public company boards, management and public accounting firms. It is named after sponsors U.S. Senator Paul Sarbanes (D-MD) and U.S. Representative Michael G. Oxley (R-OH). The bill was enacted as a reaction to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, Adelphia, Peregrine Systems and WorldCom. These scandals, which cost investors billions of dollars when the share prices of affected companies collapsed, shook public confidence in the nation's securities markets. The act contains 11 titles, or sections, ranging from additional corporate board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the law. Harvey Pitt, the 26th chairman of the SEC, led the SEC in the adoption of dozens of rules to implement the SarbanesOxley Act. It created a new, quasi-public agency, the Public Company Accounting Oversight Board, or PCAOB, charged with overseeing, regulating, inspecting and disciplining accounting firms in their roles as auditors of public companies. The act also covers issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure. The nonprofit arm of Financial Executives International (FEI), Financial Executives Research Foundation (FERF), completed extensive research studies to help support the foundations of the act. The act was approved by the House by a vote of 423 in favor, 3 opposed, and 8 abstaining and by the Senate with a vote of 99 in favor, 1 abstaining. President George W. Bush signed it into law, stating it included "the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt. The era of low standards and false profits is over; no boardroom in America is above or beyond the law." As a testament to the need for stricter financial governance SOX-type laws have been subsequently enacted in Japan, Germany, France, Italy, Australia, India, South Africa, and Turkey. Debate continues over the perceived benefits and costs of SOX. Opponents of the bill claim it has reduced America's international competitive edge against foreign financial service providers, saying SOX has introduced an overly complex regulatory environment into U.S. financial markets. Proponents of the measure say that SOX has been a "godsend" for improving the confidence of fund managers and other investors with regard to the veracity of corporate financial statements. h.) Maximum Profit & Optimum Profit (Didnt find the same) i.) Concept of karma yogi Karma Yoga is a good pathway for self purification and self-development, individual as well as collective growth and welfare, minimum play of passion, jealousy, hatred, greed, anger and arrogance, team spirit, team work, autonomous management, minimum control and supervision, etc. The result is all round happiness and prosperity. Karma Yoga is an end-state or an alias of Nishkam Karma (NK). Yoga means union between individual consciousness and supreme consciousnesses. Juxtaposed against the NK is

the other attitude to work called Sakam Karma (SK). It is evident that NK offers the most wholesome work psychology and should therefore be the Right Attitude to Work because it is based purely on the tremendous logic in its theory and the infinite power in its practice. Lord Krishna in the Gita says: Karmanyeva Adhtkaraste Ma Phaleshu Kadhachana Ma Karma-phala-heturbuhu Ma The Sangab Asthu Akarmani This means You have the right only to action, and never to the fruits of your actions, nor be attached to inaction. A practitioner of NK should possess three important skills: (i) (ii) (iii) An ability to deal with situations in a mature way An ability to deal with relationships in a humane manner Understanding and tapping the power of the mind, which is infinitely flexible

j.) Theory of karma The Sanskrit word karma means "actions" or "deeds." As a religious term, karma refers to intentional (usually moral) actions that affect one's fortunes in this life and the next. Karma (or kamma in Pali) is a concept common to Hinduism, Buddhism and Jainism, but interpreted in different ways. This article focuses specifically on Hindu beliefs about karma. The concept of karma or "law of karma" is the broader principle that all of life is governed by a system of cause and effect, action and reaction, in which one's deeds have corresponding effects on the future. Karma is thus a way of explaining evil and misfortune in the world, even for those who do not appear to deserve it - their misfortune must be due to wrong actions in their previous life. In Hindu texts, the word karma first appears in the ancient Rig Veda, but there it simply means religious action and animal sacrifice. There is some hint of the later meaning of karma in the Brahmanas, but it is not until the Upanishads that karma is expressed as a principle of cause and effect based on actions. One example is in Brhadaranyaka Upanishad 4.4.5. Karma is regarded as a fundamental law of nature that is automatic and mechanical. It is not something that is imposed by God or a god as a system of punishment or reward, nor something that the gods can interfere with. The word karma refers primarily to "bad karma" - that which is accumulated as a result of wrong actions. Bad karma binds a person's soul (atman) to the cycle of rebirth (samsara) and leads to misfortune in this life and poor conditions in the next. The moral energy of a particular moral act bears fruit automatically in the next life, manifested in one's class, disposition, and character. Hindu texts also prescribe a number of activities, such as pilgrimages to holy places and acts of devotion that can wipe out the effects of bad karma. Such positive actions are sometimes referred to as "good karma." Some versions of the theory of karma also say that morally good acts have positive consequences (as opposed to simply neutral). In Vedanta and Yoga teachings, there are three types of karma: Prarabdha karma - karma experienced during the present lifetime Sancita karma - the store of karma that has not yet reached fruition Agamin or sanciyama karma - karma sown in the present life that will come to fruition in a future life The process by which karma is understood to work through various rebirths is as follows:

Good or bad actions create impressions (samskaras) or tendencies (vasanas) in the mind, which in time will come to fruition in further action (more karma). The seeds of karma are carried in the subtle body (linga), in which the soul transmigrates. The physical body (sthula sarira) is the field in which the fruit of karma is experienced and more karma is created. The purpose of life in Hinduism is thus to minimize bad karma in order to enjoy better fortune in this life and achieve a better rebirth in the next. The ultimate spiritual goal is to achieve release (moksha) from the cycle of samsara altogether. It may take hundreds or thousands of rebirths to get rid of all of one's accumulated karma and achieve moksha. The person who has become liberated (attained moksha) creates no more new karma during the present lifetime and is not reborn after death. Various methods to attain moksha are taught by different schools, but most include avoiding attachment to impermanent things, carrying out one's duties, and realizing the ultimate unity between one's soul or self (atman) and ultimate reality (Brahman). See the article on the Purpose of Life in Hinduism for more information. k.) Utilitarianism: Utilitarianism is an ethical theory holding that the proper course of action is the one that maximizes the overall "happiness". It is thus a form of consequentialism, meaning that the moral worth of an action is determined only by its resulting outcome, and that one can only weigh the morality of an action after knowing all its consequences. Two influential contributors to this theory are Jeremy Bentham and John Stuart Mill. Utilitarianism was described by Bentham as "the greatest happiness principle". Utilitarianism can be characterised as a quantitative and reductionist approach to ethics. It is a type of naturalism. It can be contrasted with deontological ethics (which do not regard the consequences of an act as a determinant of its moral worth), pragmatic ethics, virtue ethics (which focuses on character) and deontological varieties of libertarianism, as well as with ethical egoism and other varieties of consequentialism. Total utilitarianism advocates measuring the utility of a population based on the total utility of its members. According to Derek Parfit, this type of utilitarianism falls victim to the Repugnant Conclusion, whereby large numbers of people with very low but non-negative utility values can be seen as a better goal than a population of a less extreme size living in comfort. In other words, according to the theory, it is a moral good to breed more people on the world for as long as total happiness rises. Average utilitarianism, on the other hand, advocates measuring the utility of a population based on the average utility of that population. It avoids Parfit's repugnant conclusion, respectively the mere addition paradox, but causes other problems. For example, bringing a moderately happy person into a very happy world would be seen as an immoral act; aside from this, the theory implies that it would be a moral good to eliminate all people whose happiness is below average, as this would raise the average happiness. l.) Indian Psyche (Didnt find the same)

11.) Explain the concept of Trusteeship according to Mahatma Gandhi and its applicability in modern time. (2) Trusteeship is not merely a principle not even a philosophy. Some witty philosopher has defined 'philosophy' with withering humour, "it is a labyrinth of dead-end streets and blind alleys leading, from nothing to nowhere" To Promote Relationship: Trusteeship is the very stuff of life, the material of which life is made because life ultimately consists of relationships. There is no life without relationship. Relationship is the essence of life and trusteeship is calculated to promote relationship among men whose interests and whose roles seem to be conflicting. That, to my mind, is the very fundamental truth about trusteeship. So trusteeship is the very condition of our existing together. Neighborliness in all walks of life: That's the basic idea on which the scheme of trusteeship has been based. It is not merely neighbourliness in certain walks of life, because in Gandhiji's concept, life could not be divided into water-tight compartments. Life has been conceived as whole, which cannot be divided into compartments. So trusteeship is not merely for business relations, but for all relationships of men as they go in everyday affairs of life. A means of Radical Social Change: There is one more aspect of trusteeship. Trusteeship is a means of revolution or radical social change. In the economic field there is the idea of description, which has been propagated by Marxist revolutionaries. There is the method of confiscation of all property by the state. Then there is the accepted method of taxation which has been universally accepted even in the democratic countries. But all these methods agree in not bringing men closer to each other. This process of social change, to my mind, is a process of accent and all ascent must ultimately result in approach. So trusteeship is designed with a view to eliminate the distance between men and bring them, not only in body but also in mind, as close together as possible. Change of heart: Trusteeship was Gandhiji's peculiar contribution to the technique of social change. He called it "the technique of change of heart." Expropriation, confiscation and taxation are not calculated to conduct to this change of heart. Gandhiji is often quoted as saying that in the Ramarajya of his dream the status of the prince and the pauper will b- the same. If Gandhi means that in the Ramarajya of his dream the prince as well as the pauper will exist as prince and pauper, the be the same as long as status of the prince and the pauper can never the prince is prince and pauper is pauper. The prince and pauper will come together only when the prince is shorn of his royalty and the pauper is able to live a richer life, a fuller life. So Gandhiji's idea of trusteeship should not be linked with the idea of class-collaboration, We stand for the elimination of classes with the co-operation of men but collaboration of men for the elimination of classes. This idea of class-collaboration is not only vicious in principle but also abnoxious in practice. There can be no class-collaboration as long as the employer-employee relationship continues. You convert the whole people into a nation of government employees. That's not the idea of trusteeship. Trusteeship; my being responsible for my life, as well as for the life of my neighbour. This mutuality, mutual responsibility, is real trusteeship. Now let us think who really feels the pinch? It is the underdog, who lives a life of perpetual misery, drudgery and humiliation. It is for him that social change is the immediate need and it is necessary that this should come mainly through his efforts. Human Dignity and Charity: Human dignity cannot be preserved on charity. If those who live in perpetual misery are condemned to live on the sufferance of those who are well to do, I think no human dignity could be preserved and civilisation will come to an end sooner than later. So, this social change must in the main come through the efforts of those who are in misery and who need social change immediately. If this does not happen I think this idea of trusteeship will lapse with the device of charity i.e. giving alms to the poor. The Christian scriptures say that the poor shall never cease from out of the land. Trusteeship does not conceive of a society in which the from out of the land. Mutuality and Well-being: Trusteeship does not conceive of a society in which the poor shall remain poor and the rich shall remain rich. Both poverty and affluence for a few shall be eliminated. Mutuality and well-being shall be the rule of the society, in which men learn to live together in goodwill for one-another. That's trusteeship as I understand it and that is trusteeship as I think Gandhiji enunciated. Gandhiji was not, obscurantist, nor did he stand for statism. He believed in antyodaya -'the coming up of the last man.' Promote Relationship: Relationship is the oxygen of life. Trusteeship is calculated to promote relationship. That is why trusteeship is the vital breath of all our social relationships, more particularly our industrial relationships. I am reminded of the words of Daniel Defoe with which I shall conclude. These words are as true of labour as of capital. I do not like the crew; I shall not sink the ship. Rather I shall do my best and save it from disaster at the cost of my life. You see, w, are all in the same craft and sail or swim together." That is the basic idea which lies at the root of this scheme of trusteeship.

Concept of Trusteeship was derived from the conception of Aparigrah (non-possession) of the Gita. With the passage of time, Gandhi37 went on adding on economic and sociological content to the rather moralistic conception of trusteeship. He stated that in case, the rich would not become willing trustees, satyagrah was to be resorted to, against the holder of wealth. In 1938, he said, A trustee has no heir but the public. This implies that the community or the state has also a right in the prosperity of the moneyed classes. He wanted that the rich should become trustees of their surplus wealth for the good of the society. Thus the society was to be regarded as an extension of the family. Modern economics has solved almost all the problems of the production but the problem of distribution is a far cry even today. According to the Gandhian Theory in the ideal society, there should be equality of wages not only for labourer but also for the other members of the different professions. All persons should be supplied with the necessaries to satisfy their natural needs. Thus Gandhi inculcated the revolutionary doctrine of equality of wages for lawyer, the doctor, the teacher and the scavenger as the panacea for socioeconomic evils. He extends Ruskins conception40 of the equality of wages to all kinds of labour and pleads for equal distribution41. Thus, it is amply proved that only through Gandhian Economic thought the gigantic problem of distribution could be solved, which is the heart searching difficult exercise among the well wishers of the society as without this, the future of humanity seems to be dark and the greatest catastrophe is an on anvil and no one could avert it for all time to come. Hence, the relevance of Gandhian Economic Thought and Trusteeship principles has to be given a serious exercise. After almost 60 years of martyrdom, Gandhi is now more relevant on global level than before. Specially, after 9/11 of 2001, the terroristic attacks on Twin Tower World Trade Centre and Pentagon buildings of the USA, Gandhi is remembered more with reverence than merely casually. He is being recognized as a great leader of action, a Liberator and a Prophet Martyr all over the universe. What is needed at the hour is to implement his deeds, actions and thoughts into practice and thus, his relevance in different fields is unquestionable and unchallengeable. For the very survival of human being, it is imperative on our part to act upon his advice because only on his relevance, we shall survive together or if we fail in our venture, we are bound to perish together. He is the only hope of the future as he is the only Shining Star on the Horizon. 12.) Parties involved in Corporate Governance include the governing or regulatory body (e.g. The SEC in US or SEBI in India), The CEO, BoD, Mgmt & Shareholders, other stakeholders who take part include suppliers, employers, creditors, customers and the community at large Explain in detail. (The answer is present somewhere in here: http://www.oecd.org/dataoecd/5/41/1930657.pdf) 13.) The case of The portable sonograph (Only the case: http://xa.yimg.com/kq/groups/20541140/210499994/name/Business) 14.) Case of parable of the dark child of Narhi-la (2) (Only the case: http://xa.yimg.com/kq/groups/20541140/210499994/name/Business)