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Business Ethics1
Business Ethics1
Trusteeship, as applicable to the corporate world, refers to the act of holding and managing resources on behalf of the stakeholders of the firm.
Gandhian Philosophy of wealth management is based on the Servodaya principles of Truth, Non-Violence and Trusteeship; wherein class harmony between labour and management reigns supreme. According to Gandhiji, managers and proprietors of business firms are only the trustees of wealth of society. The idea of trusteeship advocated by Gandhiji, is based on and has its origin in the Bhagaved Gita-in the principles of aparigraha (non-possession) and Sambhawa (equalism) which were ardently followed by Mahatma Gandhi.
Unlike the Utilitarian motto of greatest good of the greatest number known as Teleology, Gandhijis motto was greatest good of all.
My ideal is that capital and labour should supplement and help each other. They should be a great family living in unity and harmony; capital not only looking to the material welfare of the labourers, but their moral welfare also-capitalists being trustees of the welfare of the labouring classes under them.
of
Politics without principles Education without character Commerce without morality Pleasure without conscience Wealth without work Science without humanity Worship without sacrifice
Meaning of CSR
By the term Corporate Social Responsibility (CSR) what is generally understood is that business has an obligation to society that extends beyond its obligation to its shareholders or owners.
More than 649 companies globally have signed the Global Compact
(www.unglobalcompact.org)
Definition of CSR
CSR means operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that the society has of business.
The World Business Council for Sustainable Development defines CSR as: the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.
Corporations serve wider range of human values than can be captured by a sole focus on economic values.
Ethical Responsibility
Discretionary Responsibility
Customers
Sell materials
Suppliers
Relations between a business firm and some of its other (secondary) stakeholders
Local Communities Positive, negative opinion
Jobs, environment Regulation, taxes Business Firm (Managers) Friendly, hostile Social demands
Governments
Media
& Customers
Community Goodwill
DIFFERENCE
GOOD COMPANY Excellent Products & Services GREAT COMPANY Excellent Products/services & Makes the world a better place
Drinking water
Corporate citizenship Realization that if social development is neglected, business cannot prosper. Government alone cannot handle all social issues.
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Social Audit
Gerald Vinten defines social audit as a review to ensure that an organization gives due consideration to its social responsibilities to those both directly and indirectly affected by its decisions, and that a balance is achieved in its corporate planning between these aspects and more traditional business related objectives
Community Investments e.g., companies can invest in sustainable development Programmes for the community.
Socially Responsible Investments e.g., Investors should to invest in companies who follow responsible business practices Share expertise and knowledge with peers and learn from others experience.
Corporate Governance: Transparent Financial Auditing / Verification and Accountability; customer redressals and grievances.
Invest in developing science and technology. Foster ethical trade practices
Reporting; addressing
Regulate suppliers CSR practices and distributors CSR practices. e.g. stop working with suppliers and distributors who do not follow responsible business practices Transparent financial reporting : Public financial reports in newspapers for public information.