Ethics in Business

Akhlaghi mohammadamin

IBS 5103

Index
1.Introduction

2.What is ethics in Business?

3.Violation of ethics by a company

4.Conclusion

1.Introduction
Ethics in business are based on following principles:

Honesty, Integrity, Promise-Keeping & Trustworthiness, Loyalty, Fairness, Concern for Others,
Respect for Others, Law Abiding.

People who are obsessed with wealth accumulation, greed, power , status and other selfish
interests are often push ethical principles aside for their quest for personal gain.

2.What is ethics in Business?

Business ethics is the study of appropriate business policies and practices regarding
potentially controversial subjects including corporate governance, insider trading, bribery,
discrimination, corporate social responsibility, and fiduciary responsibilities. The law often
guides business ethics, but at other times business ethics provide a basic guideline that
businesses can choose to follow to gain public approval.
Business ethics involves the application of general ethical principles to the actions and
decisions and the conflict of their personnel.
In modern time, leading business institutes are stressing on Ethics. Ethical practices are
driven by trust, honesty and with the thinking which is above profit. Any business
organization can deny to follow ethics as none can be compelled to follow ethics. On
short term view, Ethical practices can hamper profit of business but it is believed that
ethical practices are fruitful for every business on long term.

Ethical principles provide the foundations for various modern concepts for work, business
and organisations, which broaden individual and corporate priorities far beyond traditional
business aims of profit and shareholder enrichment. Ethical factors are also a significant
influence on institutions and public sector organisations, for whom the traditional priorities
of service quality and cost management must now increasingly take account of these
same ethical considerations affecting the commercial and corporate world.

3.Violation of ethics by a company

The ethical behaviour of most business professionals is regulated by codes of conduct.

Common ethics violations can include the mishandling of funds, conflicts of interest, and
lapsed licensing. Improper or fraudulent billing are ethics violations that can involve
charging customers for services they did not receive.
selfish interests:
Faulty oversight, enabling the unscrupulous, pursuit of personal gain.
Heavy pressures are the main reasons to violation of ethics. heavy pressures on company
managers to meet or beat performance targets.
To understand the importance of ethical practices, we should take examples of Enron,
Lehman Brothers, Infosys, Berkshire Hathaway and Google. Enron and Lehman Brothers
are some examples of business groups who fail due to unethical practices despite huge
size of business and rapid growth in their business in short times. On the other hand,
Infosys, Berkshire Hathaway and Google are some companies who are doing well in their
business.

 Enron faced an ethical accounting scandal in 2001 after using “mark-to-market”

accounting to fake their profits and misused special purpose entities, or SPEs. Enron
worked to make their losses look like less than they actually were, and “cooked the
books” to make their income look much higher than it was.

4.conclusion
Philosophers today usually divide ethical theories into three general subject areas: meta
ethics, normative ethics, and applied ethics. Meta ethics investigates where our ethical
principles come from, and what they mean.
Warren Buffett said: "We look for three things when we hire people. We look for
intelligence, we look for initiative or energy, and we look for integrity. And if they
don't have the latter, the first two will kill you, because if you're going to get
someone without integrity, you want them lazy and dumb.
Warren Buffett is the founder of the Berkshire Hathaway company and currently world’s 4th
richest man alive.