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INTRODUCTION
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 can arise in a business environment. It applies to all aspects of business
conduct and is relevant to the conduct of individuals and entire organizations.
These ethics originate from individuals, organizational statements or from the legal
system. These norms, values, ethical, and unethical practices are the principles that
guide a business. They help those businesses maintain a better connection with
their stakeholders.
3. Conflicts of Interest-
Conflicts of interest can occur in teaching, research, and clinical practice, and they
may be obvious or subtle. No Principle or Rule of either the Code or the Issues in
Ethics statement can address all of the forms that such conflicts can take. This
Issues in Ethics statement gives guidance in identifying conflicts of interest and
suggests what should be done when a conflict is identified.
Many conflicts of interest involve commercial interests or financial arrangements.
Policies and procedures in workplace settings should be evaluated to safeguard
against biases or preferences being introduced into professional judgments. If a
professional is offered, or receives, gifts or incentives—even something as minor
as a free lunch—conflict of interest may be suspected.
5. Anti-Trust Compliance -
All employees have a duty to ensure that company’s business is conducted in a fair
and competitive manner. In carrying out its business, the company shall ensure
compliance of the Competition Act 2002, as amended from time to time and other
applicable provisions, which has been enacted to eliminate practices that may have
an adverse effect on competition and thereby promoting competition, protecting
consumer interest and ensuring freedom of trade.
6. Tax Evasion-
Tax takes many forms: income tax, corporate tax, land tax, capital gains tax, death
tax, inheritance tax, sales tax, customs and excise tax, and value-added tax are all
available to governments. Plus many more. Paying our taxes to fund public policy
initiatives and investments is a central necessity of most societies – and most of us
do meet these expectations.
But while there are those who seek to criminally evade their tax liabilities, or
fraudulently deceive the government, we also see varying levels of non-compliance
by others in society, raising questions about the ethics of minimising how much tax
you pay. This is loss to the nation arising from tax evasion.
7. Corruption-
Corruption is the single greatest challenge that erodes and defeats efforts made by
many nations, especially in the developing world, towards sustainable development
and towards the promotion and strengthening of democratic institutions and values.
8. Employee Behaviour-
Ethical issues for dealing with individual employees is difficult because managers
on the front line are responsible for various accounts such as hiring and firing
disciplining and performance evaluation also during all these procedures managers
are responsible for employee supervision because managers are role models for
their employees in their department it is critical the managers are able to ethically
resolve problems within the organization but unfortunately it is not always the
case. Employee behavioral problems that occur in the workplace can have a
dramatic effect on the overall atmosphere. It is the manager’s responsibility to
correct these problems in a morally right way.
9. Fraud-
Fraud means and includes any of the acts committed by a party to a contract or
with his connivance, or by his agents, with an intention to deceive another party
thereto his agent, or to induce him to enter into a contract. Corporate fraud defined
by CIMA is a type of fraud that essentially involves using deception to make
personal gain for oneself dishonestly or create a loss for others. The scale and size
of corporate frauds in India have increased in the last 15 years with over half the
cases of fraud dealing with transfer of funds by promoters/top management and
defrauding the lenders.
In today’s time, people have to fac lot of problems. Some of the reasons which are
responsible for degradation of ethical and moral values among Indian people are
mentioned below:
1. Reducing spiritual values-
While western countries are adopting more of family values from east and
practices like yoga, meditation, spirituality, the Indians are adopting more and
more of incorrect things in their culture. India has been faced a tough past with
instances of violence throughout its history.
4. Illiteracy-
Though India has been growing at a healthy rate of around 9% per annum, around
50% of the population is still illiterate. Illiteracy results in degradation of value
system. India with its strong religious background has had a good value system but
the presence of few traditions like sati, child marriage etc. has led to the
degradation of the value system of India.
6. Social Issues-
Most of the violent/ criminal/ anti-social incidences that have happened in our
system could have been prevented if the people had a good value system, a
thinking mind and thought about their actions and their implications. Also, most of
the continuing social issues like poverty, hunger, unemployment can be tackled if
more thinking individuals enter into the system to fight against these issues.
3. Lead by Example-
Employees follow the business owners and managers for direction on how they
should conduct their behaviour and activities in the organisations. Leaders should
talk about the importance of policies and processes, incentives, communications
and openness which helps in promoting the staff to behave ethically who have
behaved unethically otherwise.
4. Appreciation to the employees-
Human Resources professionals play an important role in building an
organizational ethos, designing and implementing best practice policy, fostering
trust, and advocating and guarding ethics. Human Resources have to ensure a
transparent and fair recruitment process, prompt selection and promotion
processes, and performance appraisal processes with compliance and honesty. So,
the business owners and managers must show appreciation to the employees for
their hard work and fruitful results on a regular basis to encourage loyalty.
5. Reward system-
It is necessary for the organisations to incorporate reward systems which promote
ethical means of achieving the specified objectives. The system should ensure
rewards for the employees who show good judgmental capabilities or take
proactive and ethical decisions that benefit the organization.
6. Ethics training-
Organisations can give ethics training, which can include group discussions, case
studies, and one-to-one meetings with senior managers, to emphasis the
importance of ethics. A work ethics assessment is also an effective tool as it helps
you understand a candidate’s likelihood of engaging in counterproductive work
behaviour. Ethics assessments provide the necessary framework for conducting
training and mentoring session that can help the attitude of employees to improve.
9. Whistleblowing-
It is an act whereby an employee of an organization informs the higher authorities
or public about unethical practices taking place in his/her organisations.
Whistleblowers help organisations in tracking and curbing unethical practices,
which would otherwise change the reputation of the organisations and can also
cause harm to the well-being of the employees.
10. Human Resources Role-
Human Resources professionals play an important role in building an
organisational ethos, designing and implementing best practice policy, fostering
trust, and advocating and guarding ethics. Human Resources have to ensure a
transparent and fair recruitment process, prompt selection and promotion
processes, and performance appraisal processes with compliance and honesty.
Other ethical culture to promote Indian companies are:
11. Reinforce consequences
12. Hire for values
13. Build a culture of transparency, openness and communication
14. Empower employees
15. Implement work ethics assessments
CONCLUSION-
Therefore, Ethics are important not only in business but in all aspects of life
because it is an essential part of the foundation on which of a civilized society is
build. A business or society that lacks ethical principles is bound to fail sooner or
later. A business is a collection of different proprietorships. Ethics is issues of
right, wrong, fairness, and justice. Therefore, business ethics places it focus on
ethical issues that arise in the commercial world.