BUSINESS ETHICS (A)

Reporter #1 - Jerico Pilariza

INTRODUCTION TO ETHICS
Ethics can be defined broadly as a set of moral principles or values that govern the actions and decisions
of an individual or group. While personal ethics vary from individual to individual at any point in time,
most people within a society are able to agree about what is considered ethical and unethical behavior. In
fact, a society passes laws that define what its citizens consider to be the more extreme forms of
unethical behavior.
Each of us has such a set of values, although we may or may not have considered them explicitly.
Philosophers, religious organizations, and other groups have defined in various ways ideal sets of moral
principles or values. Examples of prescribed sets of moral principles or values at the implementation
level include laws and regulations, church doctrine, code of business ethics for professional groups such
as CPAs, and codes of conduct within individual organizations.
Ethics is a topic that is receiving a great deal of attention throughout our society today. This attention is
an indication of both the importance of ethical behavior to maintaining a civil society, and a significant
number of notable instances of unethical behavior. Much of what is considered unethical in a particular
society is not specifically prohibited. So how do we know whether we are acting ethically? Who decides
what standards of conduct are appropriate? Is any type of behavior "ethical" as long as it does not violate
a law or a rule of one's profession?
It is common for people to differ in their moral principles or values. Even if two people agree on the
ethical principles that determine ethical behavior, it is unlikely that they will agree on the relative
importance of each principle. These differences result from all of our life experiences. Parents, teachers,
friends and employers are known to influence our values, but so do television, team sports, life successes
and failures, and thousands of other experiences.
CHARACTERISTICS AND VALUES ASSOCIATED WITH ETHICAL BEHAVIOR
The following list of ethical principles incorporates the characteristics and values that most people
associate with ethical behavior.
1. Integrity
Be principled, honorable, upright, courageous and act on convictions; do not be twofaced or
unscrupulous.
2. Honesty
Be truthful, sincere, forthright, straightforward, frank, candid; do not cheat, steal, lie, deceive or
act deviously.
3. Trustworthiness and Promise Keeping
Be worthy of trust, keep promises, full commitments, abide by the spirit as well as the letter of an
agreement; do not interpret agreements in an unreasonably technical or legalistic manner in
order to rationalize noncompliance or create excuses and justification for breaking commitments.
4. Loyalty (Fidelity) and Confidentiality
Be faithful and loyal to family, friends, employers, client and country; do not use or disclose
information learned in confidence; in a professional context, safeguard the influences and
conflicts of interest.
5. Fairness and Openness
Be fair and open-minded, be willing to admit error and, where appropriate, change positions and
beliefs, demonstrate a commitment to justice, the equal treatment of individuals, and tolerance
for acceptance of diversity; do not overreach or take advantage of another's mistakes or
diversities.
6. Caring for Others
Be caring, kind, and compassionate; share, be giving, be of service to others; help those in need
and avoid harming others.
7. Respect for Others
Demonstrate respect for human dignity, privacy, and the right to self-determination of all people;
be courteous, prompt, and decent; provide others with the information they need to make
informed decisions about their own lives; do not patronize, embarrass, or demean.
8. Responsible Citizenship
Obey just laws; if all law unjust, openly protest it; exercise all democratic rights and privileged
responsibly by participation (voting and expressing informed views), social consciousness, and
public service; when in a position of leadership or authority, openly respect and honor
democratic processes of decision making, avoid unnecessary secrecy or concealment of
information, and assure that others have all the information they need to make intelligent choices
and exercise their rights.
9. Pursuit of Excellence
Pursue excellence in all matters; in meeting your personal and professional responsibilities, be
diligent, reliable, industrious and committed; perform all tasks to the best of your ability, develop
and maintain a high degree of competence, be well informed and well prepared; do not be
content with mediocrity.
10. Accountability
Be accountable, accept responsibility for decisions, for the foreseeable consequences of actions
and inactions, and for setting an example of others. Parents, teachers, employers, many
professionals and public officials have a special obligation to lead by example, to safeguard and
advance the integrity and reputation of their families, companies, professions and the
government itself; an ethically sensitive individual avoids even the appearance of impropriety,
and takes whatever actions are necessary to correct or prevent inappropriate conduct of others.
Reporter #2 - Rohan Mercado
CATEGORIES OF ETHICAL PRINCIPLES
The three categories:
 Personal ethics - refers to the ethics that a person identifies with in respect to people and
situations that they deal with in everyday life.
 Basic justice, fairness - These are often used interchangeably but in simple terms:
o Justice - usually has been used with reference to a standard of rightness,
o Fairness - used with regard to an ability to judge without reference to one's feelings or
interests.
 Respect for the right of others
 Concern for the right of others
 Concern for the well-being or welfare of others
 Benevolence, trustworthiness, honesty
 Compliance with the law

 Professional Ethics - refers to the ethics that a person must adhere to in respect of their
interactions and business dealings in their professional life. Like values, professional ethics
provide rules on how a person should act towards other people and institutions in such an
environment. But it must be noted that unlike values, professional ethics are often codified as a
set of rules, which a particular group of people use , which means that all those in a particular
group will use the same professional ethics, even though their values may be unique to each
person. Ethical principles may differ depending on the profession; for example, professional
ethics that relate to medical practitioners will differ from those that relate to lawyers and such.
 Integrity, impartiality, objectivity
o Integrity demands honesty and candor which must not be subordinated to personal gain
and an advantage.
o Objectivity is essential for any professional person exercising professional judgement. It
is the state of mind which has regard to all considerations relevant to the task in hand but
no other. It is sometimes described as ‘independence of mind’.
o Impartiality means ensuring equality, without any bias or prejudice in general.
 Professional competence
o The capability to perform the duties of one's profession generally, or to perform a
particular professional task, with skill of an acceptable quality.
 Confidentiality
o Confidentiality is that practice which helps to keep secret all information deemed
desirable to keep secret.
 Professional behaviour
o Professional behaviour is a form of etiquette in the workplace that is linked primarily to
respectful and courteous conduct.
 Avoidance of potential or apparent conflict of interest
o Conflicts of interest are not necessarily unethical, at least until someone acts on them.
Avoiding conflicts of interest is necessary because otherwise they are omens for other
corrupt and unethical actions, like fraud or bribery.

 Business Ethics - refers to the standards of moral conduct, behaviour and judgement in business.
Involves making the moral and right decisions while engaging in such business activities as
manufacturing and selling a product and providing a service to customers.
 Fair competition
 o Fair competition refers to a free market in which all the players operate on a level
playing field. Businesses base their competitive practices on price, quality and customer
service rather than, for example, predatory pricing.
 Global as well as domestic justice
o So basically Global and domestic justice simply means that the business is observing
truthfulness and compliance to international and local regulations in performing it's daily
operations.
 Social responsibility
o Social responsibility is a means of achieving sustainability. ... The responsibility of an
organization for the impacts of its decisions and activities on society and the
environment, through transparent and ethical behavior that: Contributes to sustainable
development, including health and the welfare of society.
 Concern for environment
o This just in short means that aside for conducting business which is primarily for
generating profit , the business should take into consideration about the environment in
which they could affect . Like the issues on pollution or getting environmental resources
exhaustively and other environmental issues which the business might help to mitigate
and such.

The Need for Professional Ethics

To understand the importance of a Code of Ethics to professionals, one must understand the
nature of a profession as opposed to other vacation.

There is no universally accepted definition of what constitutes a profession; yet for generations,
certain types of activities have been recognized as professions while others have not.

Medicine, law, engineering, architecture, and theology are examples of disciplines long accorded
professional status. Public accounting is relatively new as far as the ranking of the professions is
concerned but it has achieved widespread recognition in recent decades.

All the recognized professions have several common characteristics. The most important of these
characteristics are:

(l) a responsibility to serve the public

(2) a complex body of knowledge
(3) standards of admission to the profession
(4) a need for public confidence

Careless work or lack of integrity of a professional may lead the public to a negative view toward the
entire profession. All professionals must have public
Confidence of the public to be successful. Consequently, the members of the different professions act in
unison by deriving their respective code of conduct.
Code of Good Governance for the Profession in the Philippines (E.O. No. 220, June 23, 2003)
The Code is adopted the Professional Regulation Commission (PRC) and the 42 Professional
Regulatory Boards to cover environment of good governance in which all Filipino professionals
shall perform their tasks. While each profession may adopt and enforce its own code of good
governance and code of ethics, it is recognised that there is a general commonality among the
various codes. This Code covers common principles underlying the codes of various professions
could be used by all professionals who face critical ethical questions in their work.

General Principles of Professional Conduct

Professionals are required not only to have an ethical commitment, a personal resolve to act
ethically, but also have both ethical awareness and ethical competency .Ethical awareness refers to
the ability to discern between right and wrong, while ethical competency pertains to the ability to
engage in sound moral reasoning consider carefully the implications of alternative actions.

Specific Principle of Professional Conduct

1. Service to Others
Professionals are committed to a life service to others. They protect life, property, and public
welfare. To serve others, shall be prepared for heroic sacrifice and genuine selflessness in carrying
out their professional duties even at the expense of personal gain.

2. Integrity and Objectivity

To maintain and broaden public confidence, professionals shall perform their responsibilities with
the highest sense of integrity and imbued with nationalism and spiritual values. In the
performance of any professional service they shall at all times, maintain objectivity, be free of
conflicts of interest, and refrain from engaging in any activity that would prejudice their abilities
to carry out their duties ethically. They shall avoid making any representation that would likely
cause a reasonable person to misunderstand or to be deceived.

3. Professional Competence
In providing professional services, a certain level of competence is necessary, i.e., knowledge,
technical skills, attitudes, and experience. Professionals shall, therefore, undertake only those
professional services that they can reasonably deliver with professional competence. Corollary to
this, it is their express obligation to keep up with new knowledge and techniques in their field,
continually improve their skills and upgrade their level of competence and take part in a lifelong
continuing education program.

4. Solidarity and Teamwork

Each Profession shall nurture and support one organization for all its members. Though a deep
spirit of Solidarity, each member should put the broader interest of the profession above one's
personal ambition and Preference Through teamwork within a cohesive professional
organization, each member shall effectively observe ethical practices and pursue continuing
professional development as well as deepen one's social and civic responsibility.
5. Social md Civic Responsibility
Professionals shall always carry out their professional duties with due consideration of the
broader interest of the public. They shall, therefore, serve their clients/employers and the publics
with professional concern and in a manner consistent with their responsibilities to society. As
 responsible Filipino citizens, they shall actively contribute to the attainment of the country’s
national objectives.

6. Global Competitiveness
Every professional shall remain open to challenges of a more dynamic interconnected world. He
or she shall rise up to global standards and maintain levels of professional practices fully aligned
with global best practices.

7. Equality of All Professions

All professionals shall treat their colleagues with respect and shall strive to be fair in their
dealings with one another. No one group of professionals is superior or above others. All
professionals perform an equally important, yet distinct, service to society. In the eyes of the PRC,
all professions are equal and, therefore, every one shall treat one other professionals with respect
and fairness.

Reporter #3 - Yma Pangilinan

BUSINESS ETHICS

- Refers to standards of moral conduct, behavior and judgement in business.

- Involves making the moral and right decision.
- An area of corporate responsibility where businesses are legally bound and socially
obligated to conduct business in ethical manner.
- Based on the personal values and standards of each person engaged in business.

PURPOSES OF BUSINESS ETHICS

 MAIN PURPOSE
- Help the business and would-be business to determine what business practices are
right and what are wrong.
 SPECIAL PURPOSE
1. To make businessmen realize that they cannot employ double standards.
2. To show businessmen that common practices which they have thought to be right
because they see other businessmen doing it, are really wrong.
3. To serve as a standard or ideal upon which business conduct should be based.
CODE OF ETHICS

- The business world today does not have one universal standard code of ethics, each
man has to evaluate a situation according to his own belief.
- One of the reason or specific purpose of business ethics is to assist the business
world in formulating code of ethics.
SCOPE AND IMPACT OF BUSINESS ETHICS

- Business ethics covers all conduct, behavior and judgement in business.

- Involves making the right choices while engaging in such business activities as
manufacturing and selling a product or selling and rendering a service.
- Actions that are not forbidden by law are ethical. In some cases, what is legal may be
unethical.
 - Based on the personal values and standards of each person engaged in business.
- A businessman who provides fair business competition is the most likely to observe
the business ethical rules of conduct, behavior and judgement.
ECONOMIC IMPACT
 A business has an economic impact on society through the wages it pays to its employees,
the materials that it buys from their suppliers and the prices it charges to its customers.
 Positive impact on its employees, suppliers and effect on customers;
o If they are paid fair living wages and benefits.
o If they paid fairly and on time for their supplies.
o If the business gives them good value for the price they pay for the products and
services.
SOCIAL IMPACT
 The social impact of corporate governance contributes to ethical climate of society.
 Ethics of society suffer;
o Businesses offer bribes to secure work or other benefits, engage in accounting fraud,
breach regulatory and legal limitations on their operations.
ENVIRONMENTAL IMPACT
 Environmental protection is a key area of business influence on society.
 Businesses that implement good environmental policies to use energy more efficiently,
reduce waste and in general lighten their environmental footprint can reduce their internal
cost and promote positive image of their company.
IMPACT ON BUSINESS MANAGERS
 The concept and principles for the ethical conduct in business are relegated top the
managers of the business enterprise.
 A manager should;
Acknowledge that his role is to serve the business enterprise and the community.
Avoid all abuse of executive power.
Reveal the fact to his superiors.
Be actively concerned the difficulties and problems of subordinates.
Recognize that his subordinates have a right to information on matter affecting
them.
Fully evaluate the likely effects on employees and the community.
Cooperate with his colleagues.
ETHICAL CHALLENGES IN TODAY’S WORLD
 Ethical challenges in today’s world is written by Ms. Mercedes B. Suleik and was published
in the Business Mirror on February 13, 2018 and she expresses her insight on “Business
Ethics”.
 Cited in this article is the message of Pope Francis in his Ecumenical, Evangeli Guadium
“Humanity is experiencing a turning point in its history as can be seen from the advances
occurring in the sciences and technology. We are in age of knowledge and information and that this
has led to new and often anonymous kinds of power. We have today an economy of exclusion and
inequality.”

“In a system that idolization increased profit, everything that stands in its way is pushed aside.
Behind this attitude lurk a rejection of ethics. Ethics has come to be viewed with derision as being
counterproductive. Ethics is felt to be a threat because it condemns the manipulation and debasement
of the person and that ethics leads to a call for a committed response, which is outside of the categories
of the marketplace.”
 She also quoted Pope Benedict XVI’s Encyclical Caritas in Veritate
“Humanity has a mission and the means to transform the world in justice and love in human
relations, even in the social and economic field. Market economics must be underpinned by
commitments to particular moral goods and a certain version of the human person if it is to serve
rather than undermine humanity’s common good. The economy needs ethics in order to function
correctly-not and ethics which is people oriented.”

Reporter #4 - Vane Pineda

COMMON UNETHICAL PRACTICES OF BUSINESS ESTABLISHMENTS
The two most common unethical practices of business establishments is Misrepesentation and
Over-persuasion
Misrepesentation is the false statement made intentionally by the business and it can be classified
into two types
Misrepresentation
Direct Indirect
For Direct Misrepesentation, this means actively or directly promoting misrepresented products
or service to the customers. This includes

✖ Deceptive Packaging

✖ Misbranding or Mislabeling

✖ Misleading Advertising

✖ Adulteration

✖Short weighing

✖Short measurement

✖Short numbering
In Deceptive Packaging, this is can be in many forms and types. It is packaging intended for
deception or the product is packed in such a way that it misleads the buyer about the content, size,
shape, quantity and other elements of the product.

Another example is slack-fill packaging wherein 85%-95% only of the container is filled.
“slack-fill”

Misbranding or Mislabeling. Mislabeling which is the practice of putting false claims or statements
on the label of the product that is misleading or confusing, or if the label does not correspond to the
proper product.
Examples include Incomplete identification of a product, unproven claims about the outcome of
using the product, or an inaccurate or incomplete explanation of the ingredients or materials.
Misbranding – making the container or packaging similar to a well-known product
Ex. Mislabeling

Misbranding
Misleading Advertising - a product is being advertised with
false, misleading or deceptive information.
Ex.

Adulteration - imitating or counterfeiting a product by adding another substance in order to

increase the quantity, or by substituting an inferior product for a superior one.
Ex.

Short weighing - weight less than the stated weight or less than one is charged for.
Short measurement - measuring stick or standard is shorter than the real length or smaller in
volume

Short numbering – number of products is less than what was paid for

Indirect Misrepresentation - business intentionally omits unfavorable information about the

product or service.
Among the most common are:

✖ Caveat emptor

✖ Deliberate Withholding of Information

✖ Passive deception

Caveat emptor – “let the buyer beware”. A very common practice among salesmen. Under this
concept, it assumes that the buyer purchases at his own risk that he will not have a recourse or the
product is not warranted if it may fail to meet expectations or have defects.
Deliberate Withholding of Information – concealing significant information or knowledge hiding
Passive Deception – seller is unable to provide complete information needed for making a fair
decision

Persuasion is a form of influence that is used to appeal to the emotions of a potential customer
to urge or convince him to buy the product.
Over-Persuasion – persuasion only for the sole benefit of selling at the expense of the buyer

Reporter #5 - Mark Hulipas

CORPORATE ETHICS
Unethical Practices of Corporate Management
Practices of corporate management that involve ethical considerations may be classified into two:
practices of the Board of Directors and practices of executive officers. In many cases, the practices
may apply to both categories of corporate management and the only dividing line is in the financial
magnitude and implications of a particular corporate management practice.
Some Unethical Practices of the Board of Directors
1. Plain Graft
Some of the Board of Directors help themselves to the earnings that otherwise would go other
stockholders. This is done by voting for themselves and the executive officers huge per diems, large
salaries, big bonuses that do not commensurate to the value of their services. They can also reduce
the earnings going to the other shareholders by authorizing purchases of goods and services for the
company's use at a price higher than normal, in consideration of a certain percentage of the
purchase value or commission accruing to them.
2. Interlocking Directorship
Interlocking directorship is often practiced by a person who holds directorial positions in two or
more corporation that do business with each other. This practice may involve conflict of interest and
can result to disloyal selling. Disloyal selling happens when this person is compelled to decide
which of the two corporation's interest should be protected or upheld. Thus, whatever decisions the
person makes, he betrays the trust reposed on him by the shareholders of either of the two
companies.
3. Insider Trading
Insider trading occurs when a broker or another person with access to confidential information
uses that information to trade in shares and securities of a corporation, thus giving him an unfair
advantage over the other purchasers of these securities.
4. Negligence of Duty
A more common failure of the members of the Board of Directors than breach of trust is neglect of
duties when they fail to attend board meetings regularly. It is only in regular attendance that they
can protect the rights and interests of the shareholders and their non-attendance of board meetings
could result to betrayal of trust of the parties who elected them to their positions.
Some Unethical Practices of Executive Officers and Lower Level Managers
To a lesser extent, executive officers may also guilty of unethical practices. All the unethical
practices of the members of the Board of Directors discussed are activities they are also capable of
engaging in though perhaps to a lesser degree because of certain limits to their authority. Unethical
practices that are more common to executive officers and lower level managers are:

1. Claiming a vacation trip to be a business trip. The President or a Vice President reports his
personal vacation in Europe or in the United States as a business trip so he can get reimbursement
for his expenses including those of his family's.
2. Having employees do work unrelated to the business. Executive officers and lower managers ask
company employees to do personal things for them on company time such as having the company
janitors water and mow their lawns, having the maintenance men do house or appliance repairs for
them, and having subordinate employees secure a license or type letters pertaining to their other
businesses.
3. Loose or ineffective controls. Managers do not provide adequate controls to remove temptation
and to prevent or discourage employees from engaging in unethical practices. A manager has the
moral obligation to provide the proper control atmosphere so that his subordinates will not be
tempted to commit dishonest acts. A manager indirectly betrays the trust placed on him by higher
executive officers if the administrative and accounting controls in his office are so weak or effective
that employees are given the opportunity to misappropriate funds or engage in petty thievery.
4. Unfair labor practices. The labor code lists the following as unfair labor practices committed by an
employer on employees or a group of employees who have organized themselves into a union.
a. To interfere with, restrain or coerce employees in the exercise of their right to self-organization: b.
To require as a condition of employment that a person or an employee shall not join a labor
organization or shall withdraw from one to Which he belongs:
c. To contract out services or functions being performed by union members when such will interfere
with, restrain or coerce employees in the exercise of their rights to self-organization;
d. To initiate, dominate, assist or otherwise in with the formation or administration of any labor
organization, including the giving of financial or other support to it:
e. To discriminate with regard to wages, hours of work, and other terms or conditions of
employment in order to encourage or discourage membership in any labor organization.
f. To dismiss, discharge, or otherwise prejudice or discriminate against an employee for having
given or being about to give testimony under the Labor Code:
g. To violate the duty to bargain collectively a prescribed by the Labor Code;
h. To pay negotiation or attorney’s fees the union or its officers or agents as part of the settlement of
any issue in collective bargaining or any other dispute;
i. To violate or refuse to comply with voluntary arbitration awards or decisions relating to the
implementation or interpretation of a collective bar gaining agreement;
j. To violate a collective bargaining agreement.
5. Making false claims about losses to free themselves from paying the compensation and benefits
provided by law. There are employers who claim non-existent losses so they can be exempted from
paying the minimum wage and emergency-cost-of-living allowances required by law.
6. Making employees sign documents showing that they are receiving fully what they are entitled to
under the law when in fact they are only receiving a fraction of what they are supposed to get.
7. Sexual Harassment. Work, education or training-related sexual harassment is committed by an
employer, employee, manager, supervisor, agent of the employer, teacher, instructor, professor,
coach, trainer or any other person who, having authority, influence or moral ascendency over
another in a work or training or education environment, demands, requests or otherwise requires
sexual favor from the other, regardless of whether the demand, request or requirement for
submission is accepted or not by the object.
Some Unethical Practices of Employees
There are some employees who are not mindful of their moral obligations to their employers. They
take advantage of their position and the trust of their employees by committing unethical practices
harmful to their employers' interest these unethical practices may be classified into conflict of
interest and dishonesty.
1. Conflicts of Interest
A conflict of interest arises when an employee who is duty bound to protect and promote the
interests of his employer violates this obligation by getting himself into a situation where his
decision or actuation is influenced by what he can gain personally from it rather than what his
employer can gain from it. Some common examples of conflicts of interest are:
a. An employee who holds a significant interest or shares of stock of a competitor, supplier,
customer or dealer favors this party to the prejudice of his employer.
b. The employee accepts cash, a gift or a lavish entertainment or a loan from a supplier, customer,
competitor or contractor. In this situation, the decision or action of the employee is influenced by
his being indebted for a favor or loan from a party with whom the company is doing business. He,
therefore, cannot act impartially.
c. The employee uses or discloses confidential company information for his or someone else's
personal gain. An example is revealing his employer's formula or menu for a well-liked food to a
competitor.
d. The employee engages in the same type of business as his employer. He may attend to his
business only after office hours because he has somebody to mind it for him but it is still unethical.
An example is an auditor employed full-time in a public accounting firm but maintains his own
auditing office where he works after office hours. e. The employee uses for his own benefit a
business opportunity in which his employer has or might be expected to have an interest.
2. Dishonesty
Business ethics is not just limited to business transactions with outside parties. It also covers
employee-employer relationship, especially with respect to an employee's honesty as he carries out
his assigned duties in the office. Examples of dishonest acts of employees are:
a. Taking office supplies home for personal use.
b. Padding an expense account through the use of fake receipts when claiming reimbursements.
c. Taking credit for another employee's idea

Reporter #6 - Karl Luzung

CHAPTER 10 INITIATIVES TO IMPROVE BUSINESS ETHICS AND REDUCE CORRUPTION
INTRODUCTION Improvement of business ethics is a common concern of everybody. It is imperative
that all parties involved - manufacturers, sellers, consumers, government, and relevant
organizations must participate in improving business ethics. Unless there is a concerted effort on
the part of everybody, we cannot effectively remind businessmen and professional of their ethical
responsibility to each other, to their customers and clients.
Unethical practices are ever present. Even people who have not yet been victims of these practices
are vaguely aware that they exist and agree that something must be done to rid the world of them.
Accordingly, various approaches to improving business ethics have been brought forward not only
in the Philippines but also in other countries.
THE INTEGRITY INITIATIVE CAMPAIGN
In 2010, a private sector-led campaign aiming to strengthen ethical standards in business, the
Integrity Initiative was organized after the Philippines received a grant from Siemens. The Makati
Business Club (MBC) and the European Chamber of Commerce of the Philippines (ECCP) serve as
the Integrity Initiative Secretariat.
* The Makati Business Club (MBC) was established in October 1981 by Enrique Zobel and a small
group of businessmen with the intention of creating a voice for the Philippine business community.
Its vision was to serve as a “forum for constructive ideas,” not only speaking out on the issues of the
time but also, and more importantly, recommending solutions for those issues and challenges. It
spoke out on economic and social issues. The analysis and policy advocacy behind its views were
based on an economic and policy research program, which it set out to do through a professional
research staff and secretariat.
* the ECCP offers a strong business network that holds great potential in translating to tangible
business opportunities. The Chamber strives to make its members’ viewpoints heard on economic
and business issues, legislative measures, and administrative regulations.
The Integrity Initiative is a multisectoral campaign that seeks to institutionalize Integrity
standards among various sectors of society — business, government, Judiciary, academe, youth,
civil society, church, and media. Led by the private sector, the initiative aims to help in
diminishing, if not fully eradicating, the vicious cycle of corruption in the Philippines, which
has not only exacerbated property but also obstructed the development of a competitive
business environment that operates on a level playing field.
Ultimately, the Integrity Initiative hopes to build equitable society and fair market conditions
. This will result in improved competitiveness and increased business confidence, which will be
evident with increase in domestic and foreign investments, and more employment for
Filipinos. Subsequently, with more Filipinos employed in a vibrant and dynamic Philippine
economy, the alleviation of poverty should become inevitability. Through the initiative, the
Philippines will become a benchmark in the transformation process of any country regarded as
highly corrupt to one that fosters an ethical and progressive business environment.
To achieve this goal, consultations, roundtable discussions and public forums involving business
leader compliance officers, corporate governance, academics, and practitioners from small and
medium enterprises to Fortune 500 companies. "An Integrity Compliance Handbook" containing the
key, and toolkits in Integrity Initiative was published for the use of organizations promote ethical
business practices. – end

Need for a Code of Conduct

A code of conduct is a formal expression of the organization's values and ethics. A code of conduct
should:
-guide directors and senior executives, as a minimum, as to the practices necessary to maintain
confidence in the organization's integrity. Other members of staff should also have a code of conduct
relevant to them which may be the same as that for directors and senior executives or may be a
complementary version;
-promote responsibility and accountability of individuals for reporting and investigating reports of
unethical practices; and
- ensure compliance with legal and other obligations to legitimate stakeholders.
An organization's code of conduct recognizes the important role that business ethics play in the
success of today's business, encouraging the board to actively develop an organizational culture that
is established on transparency, accountability, and integrity.

One of the most significant accomplishments of the Integrity Initiative is the preparation of the
"Unified Code of Conduct for Business". The Code's purpose is two-fold.
First, it harmonizes existing ethical standards among business operating in the Philippines. It
ensures that different market players adhere to the same rules of the game to create fair market
conditions and promote transparency in doing business.
Second, the Code formally communicates the signatories' commitment to upholding high
standards of ethics in all business transactions. It articulates the belief that securing profit at the
expense of integrity is an unacceptable and unsustainable way of conducting business and that
measures have been taken to enforce and cultivate integrity habits within the signatories' respective
organizations.
Managing, protecting and enhancing reputation has become one of the greatest challenges facing
today's board. The reputation of a business is a critical factor in the determination of its value. The
values and ethics of the organization need to be explicitly managed.
THE UNIFIED CODE OF CONDUCT FOR BUSINESS
  Top management
 Human Resources
 Sales and Marketing
 Finance and Accounting
 Procurement
 Logistics
 Implementation and Monitoring
Top management
-Our top management leads by example by consistently demonstrating the value of conducting
business with integrity.
-Our officers strongly communicate our organization's position bribery, corruption, and unethical
business practices within the broader public
- Management strongly supports integrity practices and allocates com resources for their
implementation.
Human Resources
-We strive to instill culture of integrity among our employees. The management maintains open
lines of communication with employees particularly on matters relating to honesty, transparency
and integrity in business transactions.
-In the spirit of fairness and due process, all employees have the right to file and respond to
complaints against practices suspected to be illegal or unethical.
- We have appropriate tools to confidentially receive, monitor, and act on internal and external
complaints.
- Employees filing complaints will be protected from all types of retaliation, while those involved in
unethical practices will be subject to commensurate disciplinary actions.
-We have instituted training programs on business ethics covering levels of the organization.
Sales and Marketing
- We clearly communicate rules and guidelines on giving gifts, entertainment, tokens of hospitality,
and contributions to/from public and private organizations and their representatives.
-Employees and all third parties engaged by our company to act as our intermediaries, agents or
representatives are not permitted to offer, promise, or give, as well as demand or accept concessions
— directly or indirectly — to obtain, retain, or secure any undue advantage in the conduct of
business.
-We abide by existing laws when transacting with government agencies (as stipulated under RA
6713 - Code of Conduct and Ethical Standards for Public Officials and Employees and RA 3019 --
Anti-Graft and Corrupt Practices Act).
Finance and Accounting
-We require all our employees to ensure that all books and records they create or are responsible
for are complete and accurate.
- Our financial records conform to standard accounting principles, comply with Securities and
Exchange Commission requirements on disclosure and transparency, and abide by anti-money
laundering laws (RA 9160) and international conventions.
-We pay taxes in compliance with all laws.
Procurement
A track record of integrity and compliance with existing laws is a prerequisite when we vet third
party consultants, suppliers, intermediaries, and agents. Our company has transparent procurement
procedures, provides equal opportunities for all suppliers, and prohibits, collusion between and
among our employees and suppliers.
Recognizing that the Integrity Initiative is sustained through widely shared ethical practices within
the business community, we enter integrity pacts with our suppliers and ensure that they comply
with the provisions of our pact. Contracting a third party to bribe or commit corrupt practices on
behalf of the company is strictly prohibited.
Logistics
We comply with laws and regulations pertaining to supply chain management.
We do not tolerate any breaches in existing laws in exchange for undue advantage and unethical
concessions or favors. We pay and taxes based on transparent assessment of goods and services
Employees are not penalized for refusing to pay bribes or facilitation payments even if it results in
failure to meet deadlines revenue.
Implementation and Monitoring
We will continually align our operations to the principles contained in this Code periodically assess
and monitor our compliance to it. We will continue to share best practices with the business
community to strengthen ethical business processes in the Philippines.

Reporter #7 - Vea Galang

BISHOPS-BUSINESSMEN’S CONFERENCE PHILIPPINES CODE OF ETHICS FOR THE PHILIPPINE
BUSINESS

The Bishop-Businessmen’s Conference for Human Development is an association composed of

leaders of the church and business sectors organized in 1971 through the initiative of the Ala-Ala
Foundation.

The first conference was held at Baguio city with 35 Bishops and 30 businessmen that is why it is
called Bishops-Businessmen’s Conference. It is to explore areas of cooperation and concern
compelled by the socio-political and economic problems at that time. It was the beginning of
sharing, of planning, of working towards a common goal, and that common goal is the promotion of
total human development and the advancement of the Filipino towards a fuller human life.

VISION

Based on a common faith in Jesus Christ, the BBC is a partnership of bishops and businessmen, both
on the national and local levels, collaborating towards total human development, in cooperation
with various sectors of Philippine society.

BBC considers widespread poverty and social injustice in our country today` a contradiction to the
Christian understanding of the human person.

MISSION

Its mission is to bring about upliftment of the quality of the Filipino through the promotion of social
justice and through the increase of the nation’s total wealth - that is equitably distributed in total
rejection of poverty in this country.

Towards the achievement of these goals, BBC will catalyze the participation of various sectors of
society - rich poor, powerful and powerless - in solidarity for total human development.

Code of Ethics for the Philippine Business

It is issued by the Bishops-Businessmen’s Conference Philippines for reasons of continuing

applicability, relevance and significance to entities doing business in the Philippines.

A code of ethics is a written collection of the rules, principles, values, employee expectations,
behavior, and relationships that an organization considers significant and believes are fundamental
to their successful operation. Common issues that fall under the umbrella of business ethics include
employer-employee relations, discrimination, environmental issues, bribery and insider trading,
and social responsibility. That is why Both businesses and trade organizations typically have some
sort of code of ethics that their employees or members supposed to follow.

Preamble

This Code of Ethics has been formulated impelled by the belief that man has a dignity that must be
respected, and that all the resources of the earth has been created for his growth and development.

As here presented, this Code is considered a major step in the on-going and changing process of
understanding the growing role of business activity in the development of man and, as such, is open
to further improvement.
This Code seeks to express systematically and coherently the principles of business practices
accepted and professed by Philippine business at its best and seeks to apply these to current and
changing needs.

It is a general Code intended to be influential rather than coercive.

The concepts

Business which embraces commerce and industry is not an accidental human activity but an
integral element of the social order. Its primary purpose is to meet society's human needs by
providing goods and services as efficiently as possible.
Those engaged in business should, therefore, recognize the following basic concepts:

 The interest of all those members of society must be taken into account in formulating
business policy.
 They are entitled to receive the proper worth of their contributions.
 The contribution to the success of the enterprise should be properly recognized and
rewarded.
 Business enterprise has a public responsibility to use all its resources efficiently.
 Competition and incentives are essential for the maintenance and continuing improvement,
but a consistent standard of business behavior must be established and observed.

Some Principles for the Conduct of Business

Towards the employees

Business shall recognize the unique position of employees as individuals and provide:

 wages and salary policy should be based on the right of the employees to a fair and
improving standard of living, irrespective of race, sex, age, and creed.
 for a fair recruitment practice that affords equal opportunity to all qualified jobseekers
 for job security, adequate compensation for employees in cases of separation and
retirement, and for opportunities for fringe benefits.
 for a safe and healthy atmosphere in the work environment conducive to the physical and
moral well-being and growth of the employees.
 for conditions in which human potentials and relationships can be developed at all
levels of the work force, with a view to providing therein a sense of purpose and
achievement.
 for participative element so that knowledge, experience, and creativity of all who work in
the enterprise may contribute to the decision-making process.

Towards the customers

Business shall, in the production of goods and services:

 strive after a quality that will enable them to serve their purpose efficiently and effectively.
 avoid anything that would be harmful to the health, safety, or growth of the proper user of
such goods and services; and
 seek to apply or make use of the discoveries and inventions that will improve their
products or services.

In its marketing arrangements, business shall:

 deliver the product or service in the quality, quantity, and time agreed upon, and at a
reasonable price.
 establish an after-sales and complaints service commensurate with the kind of product or
service supplied and the price paid.
 ensure that all mass media, promotional, and packaging communications be informative and
true, and consider the principles of morality and the sound cultural values of the
community, and manifest respect for human dignity.

Towards the suppliers

Business shall ensure:

 that the terms of all contracts be clearly stated and honored in full unless terminated or
modified by mutual consent;
 that abuse of economic power in dealing with a smaller concern be avoided, and that terms
of payment be strictly and fully observed.
 that no supplier be encouraged to commit his resources for apparently long-term purposes

Towards the owners and other providers of capital

In the interest of the Owners and other Providers of Capital, business shall: 

 provide an adequate rate of return to those contributing capital to the enterprise and ensure
the security of their investment.
 use their financial resources to provide goods and services responsibly and efficiently.
 furnish the Owners and other Providers of Capital with such information as they may
responsibly require, provided that it does not adversely affect the security and efficiency of
the business; and
 pursue the specific objectives of the Owners and other Providers of Capital provided these
do not run conflicting to the principles stated herein.

Towards the local and National government

 it is the duty of the business:

  to participate in the discussion of proposed legislation and/or its implementation
affecting sectoral, regional, national and international interests; and 
 to propose sound policies in the use of human and material resources.

Towards society in general

Businessmen shall recognize in their decision-making the interest of the general public and,
realizing that they are utilizing to an important degree the nation’s resource, shall: 

 take regular stock of their response to the basic needs of society and thus ensure that
these needs are taken into account in all policy-making decisions;
 do their best to ensure that the way they deploy their resources benefits society in general.
 pay proper regard to the environmental and social consequences of their business activity,
with special attention to the duty of renewing resources where possible and minimizing
waste and pollution, and not sacrifice safety or efficiency in the interest of short-term
profitability; 
 as corporate citizens make such contributions as their resources will allow, to research,
development, and application of indigenous technology, and to the financing of social
development projects; 
 consider the human and social costs of mechanization and technology; 

Survey of Laws Advocating Business Ethics

RA 7394

"The Consumer Act of the Philippines" approved on April 13, 1992.

The Act aims to protect the “interest of the consumer, promote his general welfare and establish
standards of conduct for business and industry” by adopting the following measures:

 protection against hazards to health and safety.

 protection against deceptive, unfair and unconscionable acts and practices.
 provision of information and education to facilitate sound choice and the proper exercise of
rights by the consumer.
 provision of adequate rights and means of redress; and
 involvement of consumer representatives in the formulation of social and economic policies.

RA 3720

"The Food, Drug and Cosmetics” approved on June 22, 1963.

AN ACT TO ENSURE THE SAFETY AND PURITY OF FOODS, DRUGS, AND COSMETICS BEING MADE
AVAILABLE TO THE PUBLIC BY CREATING THE FOOD AND DRUG ADMINISTRATION. It is hereby
declared the policy of the State to insure safe and good quality supply of food, drug and cosmetic,
and to regulate the production, sale, and traffic of the same to protect the health of the people.

RA 8293

“The Intellectual Property Code of the Philippines" effective January 1, 1998.

Intellectual Property or IP refers to something that someone has thought of or created such as
designs, processes, songs, logos, discoveries, and symbols.

How to keep your intellectual property safe?

 Patent- is an exclusive right granted for an invention, which is a product or a process that
provides, in general, a new way of doing something, or offers a new technical solution to a
problem.
 Copyright- is a legal term used to describe the rights that creators have over their literary
and artistic works. Works covered by copyright range from art, music, writing, movies, and
even software.
 Trademark- is a word, a group of words, sign, symbol, logo, or a combination thereof that
identifies and differentiates the source of the goods or services of one entity from those of
others.
 Trade Secrets- are intellectual property (IP) rights on confidential information which may
be sold or licensed.

These rights are our rights that falls under the Code of Ethics for The Philippine Business to prevent
wrongdoing and to promote, among other things, honest and ethical conduct and to ensure to the
greatest possible extent that the Company’s business.