14 Principles of Management

Prepared for:
Barrister Ishtiak Abdullah
fAdjunct faculty
Department of Management
North South University
Course abbreviation: PHI 401
Section: 10
Date of submission:

Submitted by:
NAME ID
Anamul haque 1531068030

Table of Contents
Stakeholder Theory..........................................................................................................................1
Parts Of Stake Holder Theory..........................................................................................................1
Utilitarianism...................................................................................................................................1
Egoism Compare.............................................................................................................................1
Concept Of CSR..............................................................................................................................1
Influences -Morality- Ethical Theory..............................................................................................3
Development Of Ethical Theory......................................................................................................3
Globalization....................................................................................................................................3
Sustainability...................................................................................................................................3
Sustainable Development................................................................................................................3
Employee's Rights And Duties........................................................................................................3
Company's Requirement..................................................................................................................3
Ethical Issues...................................................................................................................................3
Marketing And The Consumer........................................................................................................3
Conclude..........................................................................................................................................3
Stakeholder Theory
A theory of organizational management and business ethics that responsible for multiple constructions of
a business that, impacted by business entities like employees, suppliers, communities, investors, and
others (Evan & Freeman, 1993).

Who is a Stakeholder?
According to Edward Freeman (1984), a stakeholder is Any group or individuals who are affected or can
affect by the achievement of the organization’s objective. So, anyone who is related to the organization is
a stakeholder. Like, shareholders, employee suppliers, and Customers. (p.46)

For example, in a big corporation there are managing director, there are employee, then the raw material
supplier, and finally the customer in this whole circle everyone that is related to the corporation, is a
stakeholder.

Parts of Stakeholder Theory

Principles of Stakeholder Theory
Mr. Freeman and Evan (1993) defined the affects and affected by the stakeholders.

 Principle of corporate rights - the corporation has the obligation not to violate the rights of
others (Edward & Freeman, 1984).
 Principle of corporate effect – companies are responsible for the effects of their actions on
others (Edward & Freeman, 1984).
Why stakeholders matter

1. Legal Perspective 
2. Economic Perspective 
These are discussed one by one. 

1. Legal Perspective:
In practice, there are, besides shareholders, other groups as well related to a corporation by different sorts
of contracts. Therefore, it is not true to say that the only group with a (legitimate) interest in the
corporation is shareholders (Sinha, 2014). 

For example, the Factory Act, 1948 and the Minimum Wages Act, 1948 in India protect certain employee
rights in relation to working conditions and pay, thus, suggesting that from an ethical point of view, it has
already been agreed that corporations have certain obligations toward employees.

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 2. Economic Perspective:
The first argument in favor of stakeholder interest comes from economic perspective in the context of
institutional economics. This argument objects to the traditional stockholder theory based on externalities.
The objection raised is,

For Example, an organization closes its plant in a small town and, in turn, layoffs its 132 employees
/workers (Sinha, 2014). 

Looking at it from an economic perspective, the closer of industry has not only its direct relation with the
132 employees/workers that is directly affected, its other economic effects are the shop owners will lose
their customers or business, tax payments to fund, schools and public utilities and services will also be
affected (Sinha, 2014). 

Type of Stakeholder Theory

 Normative Stakeholder Theory, this theory gives justifications why corporations should take
into account stakeholder interest (Donaldson & Preston, 1995).
For Example: when an attempt to provide a reason why corporations should take into account
stakeholder interests

 Descriptive Stakeholder Theory, this theory ascertains whether or how corporations actually do
take into account stakeholder interests (Donaldson & Preston, 1995).
For Example: then after providing the reason why and how the corporation could manage to take
action the matter.

 Instrumental Stakeholder Theory, this theory answers the questions how it is beneficial for the
corporation to take into account shareholder interests (Donaldson & Preston, 1995).
For Example: after finalizing the decision that why and how corporations will proceed on the matter,
is the decision is beneficial or not for the stakeholder.

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Utilitarianism
Utilitarianism is a philosophical concept or ideology of how we can handle a broad variety of situations
including decisions made by individuals. Behavior, rules, regulations, character characteristics, and moral
values are amongst the factors that can be tested. Utilitarianism is a type of consequentialism, and it is
based on the premise that it is the consequences or effects of acts, rules, strategies, etc. that decide
whether they are good or evil, right or wrong. In general, we can pick the one that will yield the best
cumulative outcomes whatever is being assessed. In utilitarian terms, we should select the alternative that
"maximizes usefulness," that is to say, the decision or strategy that generates the greatest amount of value.
Such a philosophy is counter to egoism, the belief that a person should follow his or her own self-interest
even at the detriment of others, and any ethical principle that considers some actions or forms of actions
to be right or wrong regardless of their implications (see deontological ethics). Utilitarianism thus differs
from ethical philosophies that make the fairness or wrongness of an act contingent on the agent 's
motivation, because, according to the utilitarian, the best thing should be done from a bad purpose.
Nevertheless, utilitarian may separate the aptitude to compliment or condemn an individual from whether
the act was correct.

Utilitarianism holds that with the largest number, the most ethical decision is the one that will yield the
most benefit. It is, as such, the only normative principle able to explain military action or war. In
comparison, utilitarianism is the most prevalent approach to economic ethics in that it allows for costs and
profits. Utilitarianism is already commonly used as an approach to business ethics, but it is not well
known in the literature. Utilitarianism offers a driving decision-making paradigm embedded in mutual
value that helps steer enterprise towards more responsible behavior. However, the negative social
consequences are constantly referred to as proof of the wrongness of these actions and events, and the
positive social consequences of bailouts and other plans are used as ethical support for those plans to right
the wrongs.

In industry, an example of rule utilitarianism is tiered pricing for a product or service for various
categories of consumers. For example, in the aviation industry, many airlines offer seats of the first,
business, and economic class. Customers traveling in the first or second class pay a far higher premium
than those in economy seats, but they still have more amenities — simultaneously, those who are unable
to afford upper-class seats benefit from the economy. For the most people this practice creates the greatest
benefit. Moreover, an example of act utilitarianism could be when pharmaceutical companies release
drugs that have been governmentally approved, but with known minor side effects because the drug is
able to help more people than are bothered by the side effects. Act utilitarianism often demonstrates the
concept that “the end justifies the means”—or it's worth it.

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In the workplace, though, utilitarian ethics are difficult to achieve. This principle also can be challenging
to maintain in our business culture, where a capitalistic economy frequently encourages people to focus
on themselves at the detriment of others. Monopolistic competitiveness also allows one company to
prosper at the expense of another.

Egoism
Comparison between Egoism and Utilitarianism
Concept Of CSR
Corporate social responsibilities are types of business self-regulation with the aim of being social

responsibility. CSR program is an opportunity for company to demonstrate their good corporate

citizenship

Corporate Social responsibilities initiatives based on four different categories:

1. Ethical responsibility
2. Philanthropic responsibility
3. Environmental responsibility
4. Economic responsibility

Ethical Responsibility is about looking after the welfare of their employees by ensuring fair

labor practices for the employees and philanthropic responsibilities means to serve the humanity

and focus on the unprivileged and needy people who badly require our support to sustain on this

planet. On the other hand, for environmental we need to focus on reducing greenhouse gases and

limiting pollution. Lastly economic responsibility is and interconnected field which focus on

strikes a balance between business, environmental and philanthropic practices.

This corporation believes that CSR in Bangladesh comes under serious spotlight in the wake of

Rana Plaza collapse. Corporation has also launched a CSR desk to further expand. Currently this

corporation focus on various CSR programs. Those based on

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1. Education: - Education is the backbone of a nation. So, our corporation puts immense priority

on education on light with the vision of the corporation. The corporation spends more than 40 %

of its CSR budget in the education sector. Some of the projects are: - BRAC University

scholarships, University of Dhaka Scholarship and many more.

2.Health: After this corona virus pandemic health care is the important agenda in countries like

Bangladesh. So, this corporation take top priority on health initiatives. Corporation invests in areas

where it is s needed most. Some of their projects are: - partnering with diabetic association of

Bangladesh, Support to Bangladesh Thalassemia Hospital

3.Enviromental: Corporation is known as a “planet caring organization”. Through them

promotion they will support Green initiatives and to do something for mother nature. This

Corporation invests 10 % of CSR Budget in climate Risk Mitigation &Adaptation programs. As an

example, our corporation trying to create customer awareness and commitment to green banking.

4.Socail Welfare: This is also a socially responsible organization who feel that it must do

something for welfare of community.so those are work as social commitments that this

corporation fulfills. As an example life time support for a freedom fighter., Free meal for

underprivileged people

5.Art and Culture: Corporation believes that arts and culture is the identity of a country. It

refines human soul and creativity of the society. As a Corporation they are trying to promote and

cultural and heritage of the country. Corporation always link with art and culture and concerns

community about ethics and morality. As an example, our corporation is partnering with “Shahitya
Puroshkar”

6. Disaster Management: Corporation always focus about disaster management and support

their country. For this reason, corporate always invest in this sector.

. As an Example: - Corporation recently donates 50 million to the Prime Minister’s Relief and

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Welfare Fund to help the Rohingya Refuges.

Corporation believes that there is some corporate duty for corporation. Profit maximization is

not only their goal and Corporate Social responsibilities also core part of their business. So

corporation is fully accountable for Corporate Social Responsibilities.

Influences Of CSR
Morality
In a company, morality is a collection of rules which builds our behaviour in different kinds of situation
related to society. The morality of a company hugely relies on company relationships. The origin of rights
and responsibilities are relationships. These comprises the relationships with shareholders, customers, and
stakeholders. For example, there is a huge importance of morality in a company. As a founder of a
company, that person will only build a business that he or she feels it will add value to the society.
Company will make more effective product or service so that it is least detrimental to the both people and
environment. The main purpose of any company will be good quality products and customer services
which makes it eminent with this simple philosophy. Customer loyalty normally comes to the company
conforming it. For this reason the company is not depended on just making money rather they give
service to their customers and society for a very long time so that they can contribute to make the world a
better living place for everyone [ CITATION And19 \l 2057 ].

Ethical Theory
Organization is built upon different ethical standards. These standards make up ethical theory for
organizations. Ethical theories help an organization to make decisions and shape their image. A different
vision of profitability can be seen through creation of ethical theory. Ethical theory helps employee make
tough decisions in ethically challenging times. Ethical theory develops through sharing common morals
and principles. Through these people develop a sense of theory on what to do.

Development of Ethical Theory

There are different ethical theories formed from certain behavior of the organization. Which can add
value for the organization.

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People must not be treated as means to an end. An organization where people are treated accordingly for
their good deeds is following this theory. According to this theory, people should work from their sense
of what is right or wrong.

This theory puts forward the notion that people should be treated judging the consequences from their
decision. Corporate culture stands on the result-oriented action. So, this theory is established.

Every man should be treated equally is the base of this theory. Regardless of the consequences the
followers of this theory believe in equal rights and distribution. Organization being fair and with treating
everyone the same can be termed as a follower of this theory. This theory follows a socialism structure of
doing things.

This theory suggests that people should practice doing good things for developing themselves. It is
similar to moral development. It believes in human potentialities.

Globalization
Globalization is deterritorialization. It is the elimination of the boundaries. There should be no
boundaries. Where we can see that today expanding a business in the global market is much easier
because of globalization. As most of the countries support globalization and agreed to support each other
that means it is now possible to perform business activities in other countries. Which is possible because
of the change is global politics. On the other hand, technological advancement also made I possible easily
communicate and conduct business in the global market.

But we need to consider three things which is 1. Culture 2. The legal framework of the culture and last
but not least the 3. The accountability part, means the accountability part of the business, and to whom the
business is accountable.

A business cannot change or eliminate the culture. Rather a business needs to adapt and respect the
culture. Even if we consider Geert Hofstede cultural dimension, we know that there are different cultural
where one’s value can be offending to other people who belong to another culture. As an example, eating
Pig is haram in Islam but in Christianity it is permissible. Also, On the other hand as the company doing
business in other countries, they have to follow the legal framework of that country, where the legal
framework of their home country will not be applicable. Lastly, the organization is accountable to its
stakeholder, the government and other organization. And failed to consider these factors will result in loss
of support from the consumer, increaser outside restriction and regulation and unproductivity which
ultimately result in business failure. The business will be unsustainable.

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Now, In Bangladesh there are many organizations is following and considering all the factors but there
are also examples of company who are not following or considering the cultural, legal and accountability

A year ago, we saw that there is a new trend which was an increase in Shisha Lounge business. But did
they consider our cultural, legal accountability factors? No, because Shisha is not accepted in our culture.
It perceived as drug or an addiction which cause unnecessary spending. Which does not add value to the
society as well as the people. And the result is the businesses have to race outside restriction. From the
government, police as well as its stakeholders. And ultimately, they had to postpone their busines.

In the meantime, some companies are really doing well. As an example, a ride sharing company who
launched female only ride sharing service where they are giving opportunity to female riders as well as
providing a comfortable ride to its customers. Now, we have found that they are doing well and have a
really good customer support. So, they have the support from the consumer, as well as they are providing
service maintaining proper legal framework. On top of it they are really committed to its stakeholders,
they are accountable to its consumer.

Sustainability
Sustainability of a company is still a growing concept in developing countries like Bangladesh. It is a
widespread and more admissible method with long term aspects for any company. It is a tough task
because of accomplishing the proper strategies in a company. Sustainability refers to the long-term
maintenance of systems according to environmental, economic and social considerations. It has three
components which are called economic, environmental and social sustainability.

Sustainable Development
Sustainability is all about long term maintenance of the system. It mainly focuses on the long-term
betterment of everyone and the future generation. Where sustainable development is the approach to
fulfill the current generation need without compromising the need of the future generation.

Here sustainability is the ultimate way to achieve sustainable development. Now, the terms triple bottom
line coined John Elkington is really important to follow for any kind of business.

It includes 1. People 2. Planet 3. Profit.

Now, company require to embrace those long-term values and goals so that they can sustain as well as
they will be able support the long-term maintenance the system for greater benefit.

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In order to achieve sustainable development a company need to craft its vision and embrace the values of
sustainability in its core. As a result, everything they will do will bring positive change to the society, the
environment as well as bring economic development.

As an example, there are companies out there who are polluting the nature as well as people and causing
damage. In 24th April, 2013 a garments factory collapse thousands of people injured and more than 1100
people died. And the aftermath, international buyers was withdrawing their cataract. All because of
unsustainable development. If the company was sustainable, they wouldn’t force their workers to work in
a hazardous facility. If the company was sustainable, they wouldn’t have thought about their short-term
benefit. Thus, we have faced this disaster. Huge number of garment worker lost their job because many
garments has to close for lack of compliance. Thus, it created poverty and hunger. Which will definitely
have a long-term impact on our society and economic system.

On the other hand, when a company involve racial activities it also indicates unstainable development.
Because in the long run they are damaging the society. Where everyone will be affected from children to
adult. As those kinds of racial product will not add any good value to the society rather bring long term
harm. Children will be discriminated; their usual growth may be compromised because of those racial
products. Also, there is a chance to increase depression and discrimination in the society which is the
polar opposite of sustainable development.

A sustainable development will be possible when a company will solve social problem and will benefit
humanity, planet and greater economic development. If the company built on sustainability. We can talk
about a bank who are doing many activities ranging from paperless office to higher education scholarship
to the Matrious student who can’t afford higher education, supporting freedom fighters, planting tree,
sponsoring events which encourages intellectual growth. And by doing this they are supporting the whole
system. where they are eradicating gender discrimination, supporting education, innovation, nature and
greater economic development. As a result, the whole society will be benefited and will able move
forward. And ultimately the current generations needs are being fulfilled by maintaining the system for
long term without compromising the need of the future generation.

Employee's Rights and Duties

Employees Rights
Right to freedom from discrimination: This refers to both males and females having equal
opportunities. The right to equal treatment requires that all individuals be treated equally before the law,
without discrimination. This organization has a policy for all of its employees that states non-
discrimination towards females, males or transgender. It hires, and promotes employees and judges

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employees based on an individual’s merit and without regard to age, sex, color, , gender identity, marital
status, ethnic origin, parental status, race, religion, sexual orientation, physical ability and health,
HIV/Aids, culture, beliefs or social background.

Right to healthy and safe working conditions: Includes the safety and wellbeing of all managers and
workers while sustaining the productivity of the business. It is the duty of the employers to provide
workplaces that are free from known dangers that could harm the employees and the organization is
making sure they fulfil this duty. The workers also have to make sure to avoid excessive working hours as
it has an impact on the employee’s overall state of mental and physical health.

Right to fair wages: It is the lowest possible wage an organization can pay to an employee. Minimum
wage of Bangladesh Government pay scale is TK.825 per month. The minimum salary of this
organization’s employee is higher than the Government pay scale.

Right to privacy: This is all about an employee's personal privacy rights while being in the workplace
and states the employer's policies, procedures, and practices regarding the disclosure of employee
personal information such as their residential address, and other identity information. This organization
does not sell, exchange, or release personal information about the employees to outside parties without
their consent.

Right to due process: the employees are given with the right of due process. Employees are given a
proper notice before termination. Either two months of time before termination or two months of pay if
immediate termination.

Right to participation and association: This includes the participation of employees in decision making.
In this organization, the trade union is strong. This company has a positive mind for the employees and
gives them the sense of belongingness.

Duties of employees
Duty to respect the employer’s property: It is the duty of the employees to work with care. They should
not use or misuse an employer’s assets without permission. They should not use the company’s resources
for private purposes. They must avoid theft, embezzlement and fraudulent activities.

Duty to comply with labor contract: They should perform their best and use whatever skills they have
to perform a task. They shouldn’t rush through their work. Instead, they should focus on the quality.
Doing this will ensure that they’ll finish the task correctly the first time, saving money and time. Also, all
employees should be loyal towards their company. They should be committed to the success of the
company.

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Duty to comply with the law: All employees must comply with law. They must ensure the full
obedience of the state law and the rules of the company. The company will be penalizing any employee if
they are found guilty in any criminal case.

Company's Requirement
Every organization employee are the key factors. The key of prosperity for the organization are the
employee’s requirements. Employees are the assets of an organization. Therefore, recruiting the right
employees are of utmost importance. Every organization should have a dedicated HR team to meet the
requirements of the employees and foster them for a better future. The HRM team of an organization
should give different incentives to employees for a better output. An organization understands the value
of its employees. Employees are what an organization is made of. skilled, creative, dedicated employees
make creates reputation for the company. Employees with good moral values create discipline in the
organization. When these employees become leaders, they create ethical theories which fit for the
organization. Hence, we can state- employees with better moral values are of highest importance to an
organization. Every organization maintain responsibility for ethics and compliance. They take
responsibility for employee conduct to the end users or customers. For better ethical decisions
organizations do different corporate social responsibilities. Through this CSR activities organizations
become a better ethical decision maker. Profitability is an important organization. However, ethically
responsible employees can maximize profit. Resources are another important requirement for an
organization. Resources may include- building, lands, raw materials. this organization with moral values
can start collecting resources and make good use of it.

Ethical Issues Marketing and The Consumer

Ethical issues in marketing: Ethical issues in marketing indicates that the set of expectations the
relationship between consumers and how the transaction will occur.

Market Research: Some ethical issues in market research to the offense of privacy and stereotyping
which arises because of the analysis of the estimated population and separate the individuals in a group. 

Market audience: Selective targeting is used to deter or disenfranchise interest from so-called
unfavorable industries. For example, past attitudes towards the gay, ethnic minority, and plus markets are
unethical market exclusion. Another ethics dilemma affects the insecure populations in developed

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countries' emerging economies, so the population might not be aware in professional marketing
campaigns.

Ethics in advertising and promotion: Tobacco was once declared as health promotion in the 1940s and
1950s. An advertiser that cannot say the facts offends morals outside the rules today. The law makes
puffery (a legal expression, however). There are some people can be deeply offended by the marketing of
such items although they are of interest to others. Examples of these include feminine items of hygiene
and medications for hemorrhoids and constipation. The advertisement for condoms has become
appropriate, but some still view it as promiscuity. in the context of AIDS prevention. The advertiser
discusses the drawbacks of competing goods, not their own, through negative advertisement technologies.
In politics, these approaches are used in particular. Papery slope between plain pudding and scam. Sexual
innuendo is the secret to notoriety and also a form of sexual abuse. Violence is a phenomenon that is
extremely likely to be seen in kids' marketing and ads.

Deceptive advertising and ethics: True marketing is not limited to a particular target market and can be
unfamiliar to the public at times. There are several different methods of delivering misleading ads to
consumers; one of these is the use of satire. Humor offers a breakaway or escapes from any human
limitation, which some advertisers plan to use by misleadingly advertising a product that could possibly
relieve the restraint through humor.

Pricing ethics: Bidding for cheating constitutes a form of fraud where one party is offered a commercial
contract, but many other parties make an offer for the sake of appearance. Predatory pricing is the practice
of selling a product or service to rivals at very cheap prices or of barriers to entry for prospective new
competitors [ CITATION Lum1 \l 2057 ].

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 Ethical issues from consumers’ point of view: Until an organization can create a code of ethics for
customer service, their managers have to define their business ethics and how they can turn them into an
ethics code.

While a code of conduct for a client service is a collection of basic rules to be followed by staff at work
and, in certain circumstances outside of work, a code of ethics is a set of values and principles that the
organization is committed to dealing with. The ethics code is typically the basis for a code of conduct,
and in various ways, the code of conduct may refer to a code of ethics. The company's basic ethical
principles are: The following are the:

 Honesty
 Responsiveness
 Transparency
 Respect
 Value
 Loyalty
 A drive to solve problems

Just an abstract list of principles like this is a code of ethics. There are a number of declarations which
show how these principles direct the behavior of the organization. These agreements are the rules that
make the code of ethics accessible to employees. In his employee's manual, he also contains an ethical
code of customer service and all other rules in company ethics [ CITATION Lin19 \l 2057 ].

Conclusion

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