Ethics in Business

Ethics mean:
character or manners.
science of morals;
a treatise on moral principle,
recognised rules of conduct.
involves judgment as to good & bad,
right & wrong, and what ought to be.
things to be sought and things to be
avoided by one's way of life.
Business ethics
Measurers business behaviour on
standards of right and wrong.
Essential for smooth functioning.
No ethics no trust; and no scope for
business.
Has a role in a buyer /
seller/competitor relationship.
Ethics: objectives
Studying human behaviour and making an
evaluative assessment about them as
moral or immoral (diagnostic goal).
Establishing moral standards and norms
of behaviour.
Making a judgment upon human behaviour
based on these standards and norms.
Prescribing moral behaviour and making
recommendations about how to or how
not to behave (therapeutic goal).
Expressing opinions or attitudes about
human conduct in general.
Matsushita Electric Co. &
Seven 'Spiritual' Values:
1. National Service through Industry
2. Fairness
3. Harmony and Cooperation
4. Struggle and Betterment
5. Courtesy and Humility
6. Adjustment and Assimilation
7. Gratitude
Indian culture &
Deep-rooted values
1. The Individual Must be Respected
2. Cooperation and Trust
3. Jealousy is Harmful for Health
4. 'Chitta-Shuddhi' (Purification of the Mind)
5. Top Quality Product/Service
6. Work is Worship
7. Containment of Greed
8. Ethico-moral soundness
9. Self-discipline and self-restraint
10. Customer satisfaction
11. Creativity
12. The Inspiration to Give
13. Renunciation and Detachment

Characteristics of Ethics
1. Ethical decision differs with individual
2. Ethical decisions & unethical decisions have own
ramifications.
3. Involve a trade-off between costs incurred and
benefits gained.
4. Consequences of ethical decisions are ambiguous.
5. Ethical decisions have long-term impact. May have
bitter results in the short term but they reap
good results and benefits that last long.
6. Individually responsible for ethical/ unethical
decisions and actions. But consequences have to
be faced by whole organization.
7. Ethical decisions are voluntary human actions.






Decision-making: Questions in
Stakeholder Model
1. What is the moral dimension? What is the ethical
issue?
2. Who are the interested parties?
3. What values are involved?
4. What alternatives do you have in your decision?
5. What is the weight of the benefits and the burdens
of each alternative on each impacted party?
6. Are there any analogous cases?
7. Can I discuss the case with relevant others? Can I
gather additional opinions or perspectives?
8. Is the decision in line with legal and organisational
rules?
9. Am I comfortable with the decision? Can I live with
it?


Ethical Decision-making:
Dilemma for managers


1. I have to satisfy the inspector from the electricity board to maintain
adequate power supplies in times of recurrent shortages.
2. I have to oblige, entertain, and enrich an important customer to keep
him from switching over to a competitor.
3. I have to manipulate the accounts statement to show a higher profit
figure.
4. To increase profits, I have to sell the same product in three
different packing at different prices.
5. Without making any improvement in the product I have to advertise
so.
6. I have to sign transfer orders of an employee to satisfy the prejudice
of a high- level officer.
7. I have to oblige the bank officer to get loan for the project.
Mahatmas Talisman
"I give you a talisman, when you are in doubt or
when the self becomes too much with you, apply the
formula test. Recall the face of the poorest and the
weakest man whom you may have seen and ask
yourself if the step you contemplate is going to be
of any use to him, will he gain any thing by it, will it
restore him to a control over his ruined life and
destiny? In other words, will it lead to Swaraj for
the hungry and spiritually starving millions?

Then you will find your doubts melting away."