MODULE 11:

PROFESSIONAL
ETHICS
OUMM3203

CHAPTERS
1.
2.
3.
4.
5.

MORAL REASONING AND

ETHICAL THEORY
STAKEHOLDERS RELATIONSHIP
NATURE OF ETHICS IN MODERN
BUSINESS
MANAGERIAL ETHICS AND RULE
OF LAW
ORGANIZATIONAL APPROACHES
IN IMPROVING ETHICAL
BEHAVIOUR

CHAPTERS
SOCIAL RESPONSIBILITY AND
ORGANIZATIONS
7. CORPORATE GOVERNANCE
8. MORAL DIMENSIONS OF
ECONOMIC SYSTEM
9. EMPLOYEES AND THE
WORKPLACE
10.LOYALTY TO A COMPANY
6.

CHAPTER 1: MORAL REASONING

AND ETHICAL THEORY
SYNOPSIS:
Aims to introduce the learner to
fundamental concepts and
theories of morals, history and
the development of ethical
theories, and a systematic study
of right and wrong with a critical
applications of ethical theories to
current social problems.

1.1 Moral Reasoning and Ethical

Theory
Problems are complex because of
the followings:
Extended consequences
Multiple alternatives
Mixed outcomes
Uncertain consequences
Personal implication

Ethical problems are also

pervasive because managers
make decisions and take actions
that affect other people.
Affect other people negative
Harm or hurt other people in ways
beyond their individual control.

1.1.1Meaning of Ethics
Ethics

can generally be defined as the

principles of morally acceptable
conduct of individuals. Ethics also
means an individuals personal beliefs
about right and wrong behaviour.
3 implications warrant additional
considerations:
a. Individually defined
b. Vary from one person to another
c. Is relative

1.1.2 Meaning of Business

Ethics
Refers

to the application of
ethical values and ideas on issues
that arise in the business context.

1.1.3 Meaning of Professional Ethics

Indicates

the moral values that a

group of similarity trained people
developed to control their task
performance or use of resources.

1.1.4 Why Should Business be

Ethical
2 reasons:
Significance influence on
environment and stakeholders
affect the natural environment
and the organizations various
stakeholders.
Enhance the business
performance

1.1.5 Formations of Individual

Ethics
Factors

that form individual

ethics:
I.
family influence
II.
peer influence
III.
life experience
IV.
personal value and morals
V.
situational factors

1.2 Normative Philosophy and

Ethical Relativism
Philosophy

is the study of thoughts and conducts

how we should behave.
Normative philosophy have attempted to establish
a logical thoughts process based upon an
indisputable principle that would determine
whether an act is labelled as:
I. Right or wrong
II. Good or evil
III. Fair or unfair
. Ethical relativism stated that ethical principles
should be defined according to historical period,
societys culture, special situational behaviour or
personal view .

1.3 Ethical Principles

Five

major theories in ethical

principals are:
Eternal law theory
Classical teleological ethical
theory
Classical deontological ethical
theory
Distributive justice theory
Personal liberty theory

1.4 Normative Philosophy As

Basis for Moral Choice
2

ethical perspective are:

Golden rule Christian principles

Kantian Rule free consent /
privacy / freedom of conscience /
freedom of criticising / fairness

THE END

CHAPTER 2: STAKEHOLDERS
RELATIONSHIP
SYNOPSIS:
Focuses on stakeholder
relationship Stakeholders are
individuals or groups who can be
affected by the actions,
decisions, policies or goals of am
organizations. Stakeholders can
be categorised into market and
non market stakehlders.

THE END

CHAPTER 3: NATURE OF ETHICS

IN MODERN BUSINESS
SYNOPSIS:

Deals with the question of finding

a balance economic performance
and the social performance of an
organizational when faced with
ethical dilemma.

3.1 Ethical Problems as

Managerial Problems
Because

they present conflict

between organisations economic
performance and social
performance.
There should be right balance
between performance and social
performance.

3.2 Characteristics of Ethical

Problems in Management
Hosmer

(1991) there are 5

characteristics:
Extended consequences
Multiple alternatives
Mixed outcomes
Uncertain consequences
Personal implications

3.3 Examples of Ethical Problems

in Management
Pricing

Level
Advertising Message
Product Promotions
Working Conditions
Customer Service
Workforce Reductions
Environmental Pollution
Community Relations
Supplier Relations

3.4 Analysis of Ethical Problems

in Management
Economic

Analysis
Legal Analysis
Ethical Analysis

3.5 Ethics in Islam

2

possible methods are:

Historic or horizontal method
which simply follows the
chronological line of development
An analytical or schematic
method which deals with major
ethical themes vertically

3.5.1 Universal Message

Islamic

Unity of
Unity
God of
Good

Holistic Approach

Unity of
Humankind

Unity of
Religion

3.5.2 Syariah
Based

on Quran
Which requires a Muslim at all
times and in all circumstances to
act in what can be translated
from Arabic as a decent and
benevolent way and from refrain
from wrong doing.

3.5.3 Commerce and

Business
Commerce

and business have

remained central subjects in
Islamic ethical tradition.
Islamic teachings has essentially
been through individual
proselytisation more particularly
of trade and commerce.

3.5.4 Teachings about Economic

Practices
Islamic

economics and business

conceptions are very much the
equivalent of a free enterprise,
private sectors market economy
approach, thought they do not
exclude the right of society to
impose limitations for greater
benefits of the community.

THE
END