House Rules:

1.Log in on time. Zoom link is open 10 minutes before

our class time.
2.Attendance is checked twice.
3.All requirements must be submitted on time. Late
submissions will not be accepted.
4.Quiz is not announced.
5.References and reading materials are all uploaded to
schoology.
6.It is your responsibility to your learning.
www.schoology.com
Course Requirements:

Written Analysis of Case (WAC)

Reaction Paper
Final Exam
EXPECTATIONS SETTING
REVIEW
The term ‘ethics’ defines the standards
that bear on right and wrong issues of
society.
Business ethics is thus a set of
professional standards, which emphasize
principles of honesty and duty to the
business and the general public.
Why is it important to businesses to strictly
observe and practice ethical principles?

It will lead to a decent business

environment and create healthy
relationships in the organization.
Why do some do not practice ethics?
1) Ignorance and indifference to issues

2) Selfishness

3) Imperfect reasoning
CONCEPT OF BUSINES
How do corporations and companies
function? Through their BUSINESSES
The term business can be broken as
‘busy-ness’; an activity that keeps an
individual busy.
WHAT IS BUSINES?
‘Business may be defined as an activity in which
different persons exchange something of value,
whether goods or services for mutual gain or
profit.’
- Peterson and Ploughman
Nature of Business

1. Economic activity:
What makes a business an ECONOMIC
ACTIVITY?

Business is an essential economic activity.

Profit motive is the key element that
inspires a businessman to work efficiently.
Nature of Business

1. Economic activity
2. Human activity
Why is a business HUMAN ACTIVITY?

Business is considered to be an economic

activity of human beings only. A business is
by the people and for the people.
Nature of Business

1. Economic activity
2. Human activity
3. Social process
What makes a business SOCIAL PROCESS?

All the individuals involved in a business,

such as owners, customers and
employees, are an integral part of
society. Business has to fulfil its social
responsibilities.
Nature of Business

1. Economic activity
2. Human activity
3. Social process
4. System
How is a Business a SYSTEM?
• A system is a combination of things or parts
forming a unitary whole.
• It is an established arrangement of components
for the attainment of objectives.
• Similarly, business is a system consisting of
various subsystems that are operated in a
balanced and coordinated way.
Types of Business Activities

Industry: An industry includes the activities

connected with the production and
processing of goods.

Manufacturing enterprises are engaged in the

production of goods.
Types of Business Activities
Commerce: It is the total of all those activities that
are engaged in the removal of hindrances of
persons or trade, places or transportation, risk of
loss or insurance and time, such as warehousing,
banking and financing of commodities.

2 Categories:
- Trade (Internal/External)
- Aid to Trade
CHARACTERISTICS OF BUSINESS
1. Exchange or Sale
2. Creation of Utilities
3. Social Institution
4. Profit Motive
5. Risk and Uncertainty
6. Customer Satisfaction
▪ Business goals are derived from
mission statements.
▪ Business goals are task oriented
▪ Business goals are short term in
nature.
▪ Business goals are challenging as
they challenge the individuals who
are responsible for its attainment.
▪ Business goals must specify the
conditions that are necessary for
the attainment of organizational
goals.
OBJECTIVES OF BUSINESS
1. Economic Objectives
a. Incentive
b. Survival
c. Growth
d. Measurement of Efficiency
e. Prestige
OBJECTIVES OF BUSINESS
2. Social Objectives
a. Service to Society
i. Better Product
ii. More Employment
iii. Better Environment
iv. Better Living Standard
OBJECTIVES OF BUSINESS
2. Social Objectives
b. Service to Employees
i. Fair Wages
ii. Growth and Promotion
iii. Partnership in the Prosperity
of Business
OBJECTIVES OF BUSINESS
3. Human Objectives
▪ Fair wages, bonus, dearness allowance,
provident fund, medical facilities and
educational and other facilities to employees
▪ Workers’ participation in management
▪ Encouragement of creativity, initiative and
provision of growth opportunities for
employees
3. Human Objectives
▪ Job satisfaction and other provisions to raise
the morale of workers
▪ Congenial working conditions
▪ Security of employment for workers
▪ Profit sharing schemes for the workforce
OBJECTIVES OF BUSINESS
4. National Objectives
▪ Ensuring social justice
▪ Development of skilled personnel
▪ Development of small entrepreneurs
▪ Export development
▪ To abide by laws passed by local, state and central
governments
Responsibilities of a Business towards Various Interest
Groups
1. Responsibilities Towards Consumers
• To produce goods that meet the needs of consumers of
different tastes, classes and purchasing power
• To establish the lowest possible price with efficiency and
reasonable profit to the business
• To ensure fair distribution of products
• To respond to complaints
• To answer inquiries related to the company, its products
and services.
Responsibilities of a Business towards Various Interest
Groups
2. Responsibilities Towards Shareholders
• The basic responsibility of a business is to ensure the
safety of investment and higher rate of return on
the investment.
• The interest of shareholders lies in participating in the
management and getting regular dividends at appropriate
rates.
• Improve communication between the company and its
shareholders.
Responsibilities of a Business towards Various Interest
Groups
3. Responsibilities Towards Community
• Financial help to improvement social conditions
• Help the community by aiding hospitals, schools, colleges,
religious institutions, and so on
• Organize community forums and group discussions to
promote better understanding of national and local affairs
• Encourage sports and provide recreational facilities
Business Ethics
Business ethics has different meanings for different people, but
generally it is to decide what is right or wrong in the business.
According to Wallace and Pekel, ‘attention to business ethics is
necessary during times of fundamental change as the moral
values that were not taken seriously are strongly questioned at
that time’.
Business ethics enables the leaders and employees to act at the
time of crises and confusion in the business.