MATH Excellence Academy of Binalonan, Inc.

Canarvacanan, Binalonan, Pangasinan

ACADEMIC HANDOUTS
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY
Quarter 4, Week 1

Most Essential Learning Competency

Discuss the responsibilities and accountabilities of an Entrepreneur to: a. employees, b.
government, c. creditors, d. suppliers, e. consumers, f. general public, and g. other stakeholders

Topic/lesson: RESPONSIBILITIES AND ACCOUNTABILITIES ON AN

ENTEPRENEUR

THINGS TO REMEMBER:

 RESPONSIBILITY - Refers to the duty or obligation to satisfactorily perform or

complete a task (assigned by someone, or created by one's own circumstances) that one
must fulfill, and which has a consequent penalty for failure.
 ACCOUNTABILITY - Refers to the obligation of an individual or a organization to
account for its activities, accept responsibility for them, and to disclose the results in a
transparent manner.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

EMPLOYEES

 Pay Wages and Taxes - Entrepreneurs have the responsibility to pay their employees of
their business at least the minimum hourly wage in their locality and to pay each
employee money owed from working per pay period, including overtime, sick leave and
vacation wages.

 Create and Maintain a Safe workplace - Entrepreneurs must also make employees
aware of areas in their business that have a high risk for injury and train their employees
in safety procedures to minimize the risk of injury.

 Facilitate Workers' Compensation Insurance - When injuries occur through no fault of

their employees, it's their responsibility to file a claim with their workers' compensation
insurance provider. Businesses must treat their injured employee with respect and file the
claim without attempting to cause a delay in processing or attempt to deter the worker
from filing a claim at all.

 Enforce Anti-Discrimination Law (EEO) - employees cannot be disadvantaged,

dismissed, or not given employment for any of reasons mentioned.
Any problems or issues that arise with guests or colleagues from overseas may require
the involvement of embassies, government agencies, local cultural groups, or diplomatic
services to help resolve them.

 Respect Human Rights - Business operations are interrelated with a wide range of
people and societies throughout the world, and implements and enforces a code of
conduct that fosters respect for human rights.

 Support Career Development - Provide a human resources development system that

supports the careers of employees, a self-development support program, and transfer
opportunities for willing employees.

 Train and Educate Employees - Acquisition of new knowledge and skills through the
professional and personal development of employees is a prerequisite and a guarantee of
business success.
THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:
GOVERNEMENT

 Compliance of Government Rules - The rules framed by the government for business
should be fully complied with. The entrepreneur should follow the laws regarding
obtaining licenses for a specified business, the operation of the business, price
determination and production, etc.

 Payment of Taxes - The government imposes various types of taxes, like, Income Taxes,
sales tax, exercise duties, tariff duties and wealth tax on the entrepreneur and business,
for raising financial resources. The entrepreneur should honestly pay these taxes.

 Not to Correct the Government Machinery - The government appoints the officers to
implement its policies. The social responsibility of the entrepreneur is that he may not
correct the government officers and employees for getting wrong favors or some Anti-
Social purposes.

 Not to Seek Political Patronage by Unfair Means – the responsibility of the

entrepreneurs is that they do not seek political patronage by providing undue economic
help to any political party or persons, during elections. By giving Anti-Social activities
with political patronage hits the democratic values.

 To Cooperate with Government for Economic Development - The government sets

the targets for the balanced and rapid economic development of the country. For that, the
entrepreneur should provide cooperation to the government by proper utilization of
available resources in accordance with the government targets. For example, the
Government of India Lays emphasis on the establishment of industries in rural areas for
their development. Therefore, the entrepreneur should establish industries in rural areas.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

CREDITORS

 To Obtain Loans on Reasonable Conditions - Some certain conditions are required to

be fulfilled to obtain any type of loan. These conditions should be reasonable, both for
the creditors and the business organization. The entrepreneur should follow these
conditions.

 To Follow Mortgage Rules -The creditors provide loans in secured and unsecured
forms.

 To Follow Business Ethics - Both the entrepreneurs and creditors should follow the
business ethics in providing loans and in repayment of loans. The loan procedures should
be honestly complied with.

 Proper Utilization of Debt Capital - Loans are obtained for particular objectives.
Hence, entrepreneurs should utilize the loan amount only for the desired objectives.

 Regular Payment of Installment and Interest - The entrepreneurs should pay loan
installments and interest regularly, according to repayment conditions.

 Repayment of Loan - Loans should always be paid in on the maturity date, which
facilitates regular capital flow in the business society and also saves the Banks and
Financial Institutions from adverse effects.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

SUPPLIERS

 Plain Speaking - In the most basic sense, it is important to offer suppliers a fair
opportunity to earn your business through open communication. That's especially true if
 you use multiple suppliers in similar categories. While you don't necessarily want to take
open bids in every situation, it is important to act honestly to keep suppliers interested in
doing business with you.
 Paying Bills - Some buyers take suppliers for granted when it comes to paying invoices.
Don't repeat their mistake. Not only do you need to pay for what you buy, you should do
so in a timely way. Some suppliers extend you credit to induce purchases. 

 Social Responsibilities - Social responsibility is necessary in a business world where

customers have access to efficient technology and communication tools. If you act
irresponsibly in the way you operate, it doesn't take long for word to spread. Your
suppliers, buyers and partners may suffer guilt by association if you are dishonest,
irresponsible or unethical. 

 Supplier Development - Though it's not an obligation, some trade buyers take on the
responsibility of supplier development. This strategy often fits into an integrated supply
chain where you view suppliers as virtual partners. 

How to Establish a Good Relationship with Suppliers?

 Pay on time. Your suppliers are in business, just like you are; they want to get paid as
much as you do. If you foresee that you might have problems meeting your obligations,
work out favorable contract terms before signing.

 Get to know them. It's easy to get caught up in email communication, but face-to-face
contact and the occasional phone call is important. Visit their offices and invite them to
company functions.

 Make their job easier. Give your suppliers adequate lead time and communicate your
needs on an ongoing basis. Crises can't always be averted, but if you're the client who
repeatedly calls suppliers with last-minute jobs, they won't be happy. Don't expect your
suppliers always to anticipate your needs.

 Share information about your business. Keep suppliers in the loop about changes in
key staff, new product lines and special promotions. This lets suppliers know you value
the relationship.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

CONSUMERS

 Determination of Fair Prices - The entrepreneurs should determine fair prices for
commodities and services. The producers should regulate the production cost of
commodities and the distribution should earn marginal profit only.

 To Render Good and Economic Services - The business Institutions for organizations,
providing business services and other services, like banking, insurance, water, electricity,
transportation, communications, and publications, etc. have the responsibility of
providing good and cheaper services to the customer.

 Standardization of Goods - The entrepreneurs should get more and more goods. The
goods purchased by the customers should be perfect, or else some mishaps may occur
with the customers. It is not worth that on all standardized commodities, the sign of
country standard bureau should be marked.

 Best and Economic Packing of Products - To save the goods from being damaged or
spoiled, due to the weather or transportation, these should be packed well. The packing
should be economical. Special attention is given on the packaging of machines and food
materials.

 Right and True Advertising - Advertisements should not be untrue and false.
Customers or consumers attract to the goods mainly through advertisements.
  To Avoid Adulteration, Low Weight and Measurement of Products - The
entrepreneurs should avoid adulteration, low weight, and Measurement. Adulteration in
life-saving goods medicines, food items, and drinks are damaging for life.

 Redressal of Customers Complaints - On several occasions, customers make

complaints regarding the quality of the products, their packing, weight measurement,
technical defects, charging of higher prices and commodities not being in accordance
with the samples, etc.

 After Sales Service - For several commodities, After-sales services are required. Only
thereafter, these may be used properly.

 Efficient Distribution System - The commodities become costlier if the number of

intermediaries for their distribution is large. Hence, an efficient distribution system
should be adopted, so that commodities do not become costly.

 Good Behavior - There are various types of customers for the products of a business,
like the male, female, children, youth, old, educated, and educated farmers, and
urban, etc.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

GENERAL PUBLIC

 Encouragement to Healthy Competition - The entrepreneur should encourage healthy

competition among the local community and make good quality commodities available to
the public at fair prices.
 To Save Local Environment from Pollution - Risks of pollution of the environment at
the factory’s sites, due to the smoke of the coal, polluted water and manufacturing
process cannot be ruled out.
 To Help in Activities of Public Utility - The entrepreneur should cooperate in providing
facilities for the public utility to the local community, Like, Education, entertainment,
medical, housing, and Libraries, etc.
 To Provide Employment to Local Community - The entrepreneur should provide more
and more employment to the local people of the place, Where he is establishing his
business unit or is performing the business activities.
 To Improve Standards of Living - The entrepreneur should make all possible efforts to
improve the standard of living of the public.
 To Promote Public Relations - The entrepreneur should provide information to the
public about the policies and activities of his business or business organization and
should try to understand the feelings of the common man.

THE RESPONSIBILITIES AND ACCOUNTABILITIES OF AN ENTREPRENEUR TO:

OTHER STAKEHOLDERS

 Responding to Climate Change - Climate change is a growing concern to your

stakeholders: your customers, partners, shareholders, suppliers, employees and the
community around you. Your business can take steps to minimize its carbon footprint –
that is, reduce its emission of carbon dioxide and other greenhouse gases that contribute
to global climate change.

 Operating with an Ethical Supply Chain - Where do your supplies come from? More
to the point, how are they being produced? Stakeholders are increasingly aware of life-
cycle issues with business supply chains, and are insisting on ethical sourcing of
materials. 

 Actively Protecting the Environment - Many of the choices your business makes have
an impact on the environment that can be quite distinct from the issue of climate change.
Does your business have a recycling program? You may elect to use fewer toxic
chemicals for cleaning as a step towards avoiding pollution.

 Responding to Public Policy - Your stakeholders may also insist on knowing your firm's
stance on public policy issues. Sometimes, these are the so-called "hot button" issues like
 abortion or civil rights. Other times, issues may be more local or shorter-lived, but
stakeholder involvement can be just as heartfelt.

References:
Business Ethics - Responsibilities and Accountabilities of an Entrepreneur