Unit 1 Moral Philosophy and Business

WHAT IS ETHICS
ETHICS in Latin language is called Ethicus and in Greek , it is called
Ethikos. Infact, this word has originated from Ethos, meaning character, norms, morals and ideals. Ethics may be referred to some standardized form of conduct or behavior of individuals understood and accepted in a particular field of activity Ethics is a mass of moral principles or set of values about what conduct ought

to be. They give an idea what is right or wrong, true of false, fair or unfair, just
or unjust, proper or improper, e.g. Honesty, obedience, equality, fairness, etc and respect and then doing the right thing

Simply stated, ethics refers to standards of behavior that tell us how human
beings ought to act in the many situations in which they find themselves-as friends, parents, children, citizens, businesspeople, teachers, professionals, and

so on.

Character of a man

Conduct of a person

Series Of actions

Good or Bad, Right or Wrong, Moral or Immoral

Ethics is a branch of philosophy and is considered a normative science because it is concerned with the norms of human conduct, as distinguished from formal sciences such as mathematics and logic, physical sciences such as chemistry and physics, and empirical sciences such as economics and psychology. Ethics, as a science, involves systemizing, defending and recommending concepts of right and wrong behaviour. The principles of ethical reasoning are useful tools for sorting out the good and bad components within complex human interactions.

For this reason, the study of ethics has been at the heart of intellectual
thought and its ongoing contribution to the advancement of knowledge and science makes ethics a relevant, if not vital, aspect of management

theory.

Principles of Personal Ethics

Personal values are the conception of what an individual or a group

regards as desirable.
Personal ethics refer to the application of these values in everything one

does.
Personal ethics might also be called morality, since they reflect general

expectation of any person in any society, acting in any capacity. The principles of personal ethics are:
1.

Concern and respect for the autonomy of others.

2.
3. 4.

Honesty and the willingness to comply with the law.

Fairness and the ability not to take any undue advantage of others. Benevolence and preventing harm to any creature.

Principles of Professional Ethics

A profession is a vocation founded upon specialised educational

training, the purpose of which is to supply disinterested counsel and service to others, for a direct and definite compensation, for example,

the profession of a doctor, advocate, professor, scientist or a business

manager.
A professional is a person who prosecutes anything professionally, or

for a livelihood.
Professional behavior in a work place means you conduct yourself in a

way that represents your company at all times. Proper attire, respect for co-workers as well as management, speaking without bad language and keep personal conversations, phone calls and emails to a minimum. In other words.. Work is not the place for Fun..

WHEN AND WHERE DO WE DEVELOP ETHICAL VALUES?

According to those who study the history and philosophy of ethics, infants would not survive without a nurturer who teaches them about right and wrong behavior. In human society, a series of nurturer and teachers influence the ethical views of each individual.

Business Ethics
Business ethics means the scale where you measure the do's or don't for the purpose of the future of business. Ethical business behavior is expected by the public, it facilitates and promotes good to society, improves profitability, fosters business relations and employee productivity, reduces criminal penalties from public authority and regulators, protects business against unscrupulous employees and competitors, protect employees from harmful actions by their employer, and allows people in business to act consistently with their personal ethical beliefs. Business ethics is based on the principle of integrity and fairness and concentrates on the benefits to the stakeholders, both internal and external. Stakeholders include those individuals and groups without which the organisation does not have existence. It includes shareholders, creditors, employees, customers, dealers, vendors, government and the society.

 Carter McNamara has defined: Business ethics is generally coming to

know what is right and wrong in the workplace and doing what is rightthis is in regard to efforts of products/ services and in relationships with stakeholders. Business ethics set the standard for how your business is conducted. They define the value system of how your operate in the marketplace and within your business. With legal scandals concerning insider trading and employee theft making the news, it is no wonder that businesses are increasingly giving attention to the ethical basis of their business and how to lead in an ethical way. While the examples above seem to be clear cut breaches of ethics, many ethical dilemmas that not so clear cut are faced on a daily basis in business. In fact, there may not even be a "right" or "wrong" answer to the dilemma, but how you deal with it will say much about you and your business. These decisions are often referred to as being in the "gray" area. They are not black-or-white, but could be argued appropriately either way.

How To Resolve Ethical Dilemmas In Business

In todays business, the workforce comprises of people who are diverse

in their nationality, religion, caste, race, age, education and even socioeconomic status. They are all expected to work together as a team towards the success of the organization. Dilemmas are bound to rise in issues such as downsizing the staff, pollution control, toxic waste disposal, utilization of resources, changes in law and technology, issues related to discrimination, employee rights and even on product quality. All these issues are relatively complex and are difficult to resolve. Entrepreneurial managers have to rely on their individual judgment while resolving all these different dilemmas related to business.

 Ethical resolution of conflicts requires discussion, analysis,

problem solving and decision making.

In order to resolve ethical dilemmas, managers need to

have interpersonal communication and negotiation skills, conflict resolution skills and critical thinking.
Before making any decision, one has to analyze all the

positive and negative consequences that are connected with the issue.

Here is an example. Ritu has been operating a consulting business for about a year and has been doing very well. About a month ago, she decided she needed to hire someone to help her. After interviewing several candidates, she decided to hire the best one of the group, Gita. She called Gita on Monday to tell her she had gotten the job. They both agreed that she would start the following Monday and that Gita could come in and fill out all of the hiring paperwork at that time. On Tuesday, of the same week, a friend of Ritu's called her to say that she had found the perfect person for Ritu. Ritu explained that she had already hired someone, but the friend insisted. "Just meet Pooja. Who knows, maybe you might want to hire her in the future!" Rather reluctantly, Ritu consented. "All right, if she can come in tomorrow, I'll meet with her, but that's all." "Oh, I'm so glad. I just know you're going to like her!" Ritu's friend exclaimed.

And Ritu did like her. She like her a lot. Ritu had met with Pooja on Wednesday morning. She was everything that Ritu had been looking for and more. In terms of experience, Pooja far surpassed any of the candidates Ritu had previously interviewed, including Gita. On top of that, she was willing to bring in clients of her own which would only increase business. All in all, Ritu knew this was a win-win situation. But what about Gita? She had already given her word to Gita that she could start work on Monday. And yet she only had the resources to hire one person at this point. Clearly, the best business decision was to hire Pooja. But what about the ethical decision? If her business did poorly or Gita couldn't provide enough support, the business would suffer. As a result, her family would suffer. Money was already tight, what with two boys in college. And yet she knew Gita also had a family she was supporting. Plus, she had been so enthusiastic about starting to work.

Obviously, Ritu had a problem - an ethical problem. Should she hire Gita (whom she'd already given her word) or Pooja (who was obviously the best person for the job)? Questions like these touch on our deepest values. Depending on who you would ask, you would get strong arguments for both decisions. This is what we mean when we talk about "gray" area. So what is the answer? According to Kenneth Blanchard and Norman Vincent Peale, authors of The Power of Ethical Management, there are three questions you should ask yourself whenever you are faced with an ethical dilemma. Is it legal? In other words, will you be violating any criminal laws, civil laws or company policies by engaging in this activity?

Is it balanced? Is it fair to all parties concerned both in the short-term as well as the long-term? Is this a win-win situation for those directly as well as indirectly involved? Is it right? Most of us know the difference between right and wrong, but when push comes to shove, how does this decision make you feel about yourself? Are you proud of yourself for making this decision? Would you like others to know you made the decision you did? Most of the time, when dealing with "gray decisions", just one of these questions is not enough. But by taking the time to reflect on all three, you will often times find that the answer becomes very clear.

What is not Business Ethics? Ethics Is Different From Religion Though all religions preach high ethical/moral standards generally, they do not address all the types of problems people confront today. For instance, cyber crimes and environment-related issues are totally new in the context of most religions. Moreover, many persons today do not subscribe to religious beliefs and have turned agnostics. But ethics applies to all people, irrespective of their religious affiliations.

Ethics Is not synonymous With Law

Ethics is not following the law. A good system of law does incorporate many ethical standards, but law

can deviate from what is ethical. Law can be a function of power alone and designed to serve the interests of narrow groups. Law may have a difficult time designing or enforcing standards in some important areas, and may be slow to address new problems.

Ethics is not following culturally accepted norms.

Some cultures are quite ethical, but others become corrupt -or blind to

certain ethical concerns (as the United States was to slavery before the Civil War). "When in Rome, do as the Romans do" is not a satisfactory ethical standard. For instance, our system of castes reflects an unethical streak in as much as it tends to take for granted that some people are superior to others in Gods creation.

Ethics is not the same as feelings.

Feelings provide important information for our ethical choices. Some people have highly developed habits that make them feel bad when they do something wrong, but many people feel good even though they are doing something wrong. And often our feelings will tell us it is uncomfortable to do the right thing if it is hard.

Ethics is not science.

Social and natural science can provide important data to help us make better ethical choices. But science alone does not tell us what we ought to do. Science may provide an explanation for what humans are like. But ethics provides reasons for how humans ought to act. And just because something is scientifically or technologically possible, it may not be ethical to do it.

Code of Conduct and Ethics for Managers

Managers must observe the following ethical values: Responsiveness to the public interest Accountability Honesty

Transparency
Integrity Impartiality

Global Ethical Issues

Wages and hours Child labour Discrimination Legal and ethical business practices

Product safety and quality

Environment

FACTORS THAT AFFECT ETHICAL BEHAVIOUR

INDIVIDUAL CHRACTERECTICS

ISSUE INTENSITY

ETHICAL DILEMA

STAGES OF MORAL DEVELOPMENT

MODERATORS

ETHICAL / UNETHICAL BEHAVIOUR

STRUCTURAL CHARECTERISTICS OF ORGANIZATION

ORGNIZATIONAL CULTURE

What causes unethical behaviour

Stress Confusion

Pressure to perform at expected levels

Competition within the industry No knowledge

Some of the Unethical Business practices are :

Cutting corners on quality

Covering up incidents
Abusing or lying

Lying customers
Stealing from the company Taking credits from co-workers ideas/work Taking or giving bribe

Unethical business practices (contd)

Government corruption Financial scandals Product safety discrimination Sexual harassment Firing an employee for whistle blowing Divulging confidential information

Whats in it for me to be ethical?

-

A more accurate perception of the world around you, follow your conscience. when it is hard or costly.

-Have the courage to do what is right and do try new things even

-Dont loose heart if you fail or dont get what you want

-A stronger personality, and greater likelihood of being happy in

life