Business Ethics

Unit-1

Ethics

Ethics is a branch of social science. It deals with moral principles and social values. It helps us to
classifying, what is good and what is bad? It tells us to do good things and avoid doing bad
things.

So, ethics separate, good and bad, right and wrong, fair and unfair, moral and immoral and
proper and improper human action. In short, ethics means a code of conduct. It is like the 10
commandments of holy Bible. It tells a person how to behave with another person.

What does Business Ethics mean?

In short, business ethics means to conduct business with a human touch in order to give welfare
to the society. The main aim of business ethics is to define and examine the responsibilities of
businesses and their agents as a part of the general moral environment of a given society. The
products of this field of research are sets of rules and codes of conducts, which serve as a means
of protection from the possible infringements of moral codes as a result from the general
activities and responsibilities of a firm to its stakeholders (e.g. generating profits for shareholders
and taxes to the government).

Examples of Business Ethics

So, the businessmen must give a regular supply of good quality goods and services at reasonable
prices to their consumers. They must avoid indulging in unfair trade practices like adulteration,
promoting misleading advertisements, cheating in weights and measures, black marketing, etc.
They must give fair wages and provide good working conditions to their workers. They must not
exploit the workers. They must encourage competition in the market. They must protect the

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 interest of small businessmen. They must avoid unfair competition. They must avoid
monopolies. They must pay all their taxes regularly to the government.

Definition of Business Ethics

According to Andrew Crane,

“Business ethics is the study of business situations, activities, and decisions where issues of right
and wrong are addressed.”

According to Raymond C. Baumhart,

“The ethics of business is the ethics of responsibility. The business man must promise that he
will not harm knowingly.”

Nature of Business Ethics

The characteristics or features of business ethics are:-

 Code of conduct: Business ethics is a code of conduct. It tells what to do and what not to do for
the welfare of the society. All businessmen must follow this code of conduct.

 Based on moral and social values: Business ethics is based on moral and social values. It
contains moral and social principles (rules) for doing business. This includes self-control,
consumer protection and welfare, service to society, fair treatment to social groups, not to exploit
others, etc.

 Gives protection to social groups: Business ethics give protection to different social groups
such as consumers, employees, small businessmen, government, shareholders, creditors, etc.

 Provides basic framework: Business ethics provide a basic framework for doing business. It
gives the social cultural, economic, legal and other limits of business. Business must be
conducted within these limits.

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 Voluntary : Business ethics must be voluntary. The businessmen must accept business ethics on
their own. Business ethics must be like self-discipline. It must not be enforced by law.

 Requires education and guidance : Businessmen must be given proper education and guidance
before introducing business ethics. The businessmen must be motivated to use business ethics.
They must be informed about the advantages of using business ethics. Trade Associations and
Chambers of Commerce must also play an active role in this matter.

 Relative Term : Business ethics is a relative term. That is, it changes from one business to
another. It also changes from one country to another. What is considered as good in one country
may be taboo in another country.

 New concept : Business ethics is a newer concept. It is strictly followed only in developed
countries. It is not followed properly in poor and developing countries.

Importance / Need of Business Ethics

More and more companies recognize the link between business ethics and financial performance.
Companies displaying a “clear commitment to ethical conduct” consistently outperform
companies that do not display ethical conduct.

 Long-term growth: sustainability comes from an ethical long-term vision which takes
into account all stakeholders. Smaller but sustainable profits long-term must be better
than higher but riskier short-lived profits.

 Protecting the interest of various stakeholders

 Preserving Limited resources: the planet has finite resources but a growing population;
without ethics, those resources are repleted for purely individual gain at huge cost both to
current and future generations.

 Attracting and retaining talent: People aspire to join organizations that have high
ethical values. Companies are able to attract the best talent and an ethical company that is
dedicated to taking care of its employees will be rewarded with employees being equally
dedicated in taking care of the organization. The ethical climate matter to the employees.
Ethical

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 Organizations create an environment that is trustworthy, making employees willing to
rely, take decisions and act on the decisions and actions of the co-employees. In such a
work environment, employees can expect to be treated with respect and consideration for
their colleagues and superiors. It cultivates strong teamwork and Productivity and support
employee growth.

 Investor Loyalty: Investors are concerned about ethics, social responsibility and
reputation of the company in which they invest. Investors are becoming more and more
aware that an ethical climate provides a foundation for efficiency, productivity and
profits. Relationship with any stakeholder, including investors, based on dependability,
trust and commitment results in sustained loyalty.

 Customer satisfaction: Customer satisfaction is a vital factor in successful business

strategy. Repeat purchases/orders and enduring relationship of mutual respect is essential
for the success of the company. The name of a company should evoke trust and respect
among customers for enduring success. This is achieved by a company that adopts ethical
practices. When a company because of its belief in high ethics is perceived as such, any
crisis or mishaps along the way is tolerated by the customers as a minor aberration. Such
companies are also guided by their ethics to survive a critical situation. Preferred values
are identified ensuring that organizational behaviours are aligned with those values. An
organization with a strong ethical environment places its customers’ interests as foremost.
Ethical conduct towards customers builds a strong competitive position. It promotes a
strong public image.

 Regulators / Avoiding intervention of Regulatory bodies: Regulators eye companies

functioning ethically as responsible citizens. The regulator need not always monitor the
functioning of the ethically sound company. The company earns profits and reputational
gains if it acts within the confines of business ethics. To summaries, companies that are
responsive to employees’ needs have lower turnover in staff.

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 SCOPE OF BUSINESS ETHICS

Ethical problems and phenomena arise across all the functional areas of companies and at all
levels within the company.

1. Ethics in Compliance

Compliance is about obeying and adhering to rules and authority. The motivation for being
compliant could be to do the right thing out of the fear of being caught rather than a desire to be
abiding by the law. An ethical climate in an organization ensures that compliance with law is
fuelled by a desire to abide by the laws. Organizations that value high ethics comply with the
laws not only in letter but go beyond what is stipulated or expected of them.

2. Ethics in Finance

The ethical issues in finance that companies and employees are confronted with include:

 In accounting – window dressing, misleading financial analysis.

 Insider trading, securities fraud leading to manipulation of the financial markets.

 Executive compensation.

 Bribery, kickbacks, over billing of expenses, facilitation payments.

 Fake reimbursements

3. Ethics in Human Resources

Human resource management (HRM) plays a decisive role in introducing and implementing
ethics. Ethics should be a pivotal issue for HR specialists. The ethics of human resource
management (HRM) covers those ethical issues arising around the employer-employee
relationship, such as the rights and duties owed between employer and employee.

The issues of ethics faced by HRM include:

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 Discrimination issues i.e. discrimination on the bases of age, gender, race, religion, disabilities,
weight etc.

 Sexual harassment.

 Issues affecting the privacy of the employee: workplace surveillance, drug testing.

 whistle-blowing.

 Issues relating to the fairness of the employment contract and the balance of power between
employer and employee.

 Occupational safety and health.

4. Ethics in Marketing

Marketing ethics is the area of applied ethics which deals with the moral principles behind the
operation and regulation of marketing. The ethical issues confronted in this area include:

 Pricing: price fixing, price discrimination

 Anti-competitive practices like manipulation of supply, exclusive dealing arrangements, tying

arrangements etc.

 Misleading advertisements

 Content of advertisements.

 Children and marketing.

 Black markets

5. Ethics of Production

This area of business ethics deals with the duties of a company to ensure that products and
production processes do not cause harm. Some of the more acute dilemmas in this area arise out
of the fact that there is usually a degree of danger in any product or production process and it is
difficult to define a degree of permissibility, or the degree of permissibility may depend on the
changing state of preventative technologies or changing social perceptions of acceptable risk.

 Defective, addictive and inherently dangerous products and

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 Ethical relations between the company and the environment include pollution, environmental
ethics, and carbon emissions trading.

 Product testing ethics.

The most systematic approach to fostering ethical behaviour is to build corporate cultures that
link ethical standards and business practices.

Level of business ethics

1. Individual Level

Since organizations and their various components are run by organizational leaders, the ethical
standards of day-to-day activities and decisions of individuals in the business are an important
consideration.

Individuals may well have a very different set of ethical standards from their employer and this
can lead to tensions.

Factors such as peer pressure, personal financial position, and socioeconomic status all may
influence individual ethical standards. Leaders should be aware of this to manage potential.
We all experience individual or personal level ethical challenges. These include situations
leaders face in their personal lives that are generally outside the work context. Questions or
dilemmas that we might face at the personal level include:

 Should I tell the cashier that he gave me change for a $20 bill when all I gave him was a $10
bill?

 Should I notify my bank that it credited someone else’s $100 to my checking account?

 Should I cheat on my income tax return by overinflating my charitable contributions?

 In a supply-contract negotiation, is it OK for a company buyer to give preferential treatment to

a supplier with whom he has developed a long-standing business relationship or should
supplier arrangements be governed purely by financial considerations?

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 Organizational Level

At an organizational level, ethical standards are embedded in the policies and procedures of
the organization, and form an important foundation on which organizational strategy is built.
These policies derive from the influences felt at macro level and therefore help an organization
to respond to changing pressures in the most effective way.
People also confront ethical issues at the organizational level in their roles as leaders or
employees. Certainly, many of these issues are similar to those we face personally. However,
these issues may carry consequences for the company’s reputation and success in the community
and also for the kind of ethical climate or culture that will prevail on a day-to-day basis at the
office.

Some of the issues posed at the organizational level might include:

 Should I overlook the wrongdoings of my peers and direct reports in the interest of
company harmony?
 Should I perform an unethical or illegal act to earn a division or work unit profit?

4. Industry Level

The industry level is another level at which organizational leaders and others might influence
business ethics. The industry might be insurance, stock brokerage, manufactured homes, real
estate, automobiles, or a host of others.
Related to the industry might be the profession of which an individual is a member—law,
medicine, accounting, pharmacy, or engineering. Some examples of questions that might pose
ethical problems or dilemmas at this level include the following:

 Is this standard contract we condominium sellers have adopted really in keeping with the
financial disclosure laws that have recently been strengthened?
 Is this practice that we stockbrokers have been using for years with prospective clients
really fair and in their best interests?
 Is this safety standard we mechanical engineers have passed really adequate for protecting

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 the consumer in this age of do-it-your-self-ers?

At this level, conflicts of interest and conscience can arise in such situations. At this level,
professionals can refer to their professional association’s character code of ethics for guidelines
on conducting business or the set of ethical practices of a particularly industry.

5. Societal, National and International Levels

At the societal and international levels, laws, norms, customs, and traditions govern the legal and
moral acceptability of behaviors. Business activities acceptable in China or Turkey or Greece
maybe immoral or illegal in the United States, and vice versa.
Common Myths about Corporate Ethics

The following are common myths of corporate ethics:

1. It’s impossible to manage ethics.

2. It’s ethical if it’s legal.
3. It’s ethical if it’s for a good cause.
4. It’s ethical if everyone’s doing it.
5. It’s ethical to fight fire with fire.
6. It’s ethical if it’s part of my job.
7. It is a personal, individual affair, not a public or debatable matter.

Theories of business ethics

The majority of professional ethics are based on the idea of doing what is best for the group and
focusing on the moral aptitude of the action, rather than the result. The two main business ethics
theories are deontological theory and utilitarianism theory.
Deontological theory states that ethical behavior should follow an established set of rules or
principles in all types of situations. Even though the actual outcome of following established
moral principles may differ, the result does not determine whether the action is ethical. For
example, according to deontological theory, it would always be unethical to lie even if lying
would prevent an unfavorable consequence, such as death.

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Business ethics theories based on Kant's philosophy should treat humans as ends rather than as
means. In other words, when developing a code of conduct, an individual should not use others
to serve his own purpose or advantage.

Utilitarianism is the idea that business conduct should take into account the consequence that
would benefit the largest amount of people. As far as business ethics theories are concerned, it is
one that is probably open to a great amount of interpretive differences. For example, in
international commerce, the consequences of the decision to impose tariffs might be more
beneficial to the group of people on one particular side of the transaction. In addition, it could be
argued that the decision's consequences might benefit the largest amount of people in the short-
term, but harm a greater amount in the long run.

Different Approaches towards Ethical Behaviour in Business:

There are different ways of thinking about ethical behaviour. Some situations offer clean-cut
ethical choices. Stealing is unethical. There is no debate about it. There are other situations
where two or more values, rights, or obligations conflict with each other and a choice has to be
made.

For example, suppose that a police officer attends his brother’s wedding and finds some guests
using drugs there, which is against the law. Should the officer arrest the drug users? Should he be
loyal to his brother or to his job? It offers a difficult choice. Various approaches to ethical
behaviour give some guidance in making some choices. Some of these approaches are:

1. Teleological approach:
Also known as consequentiality approach, it determines the moral conduct on the basis of the
consequences of an activity. Whether an action is right or wrong would depend upon the
judgement about the consequences of such an action. The idea is to judge the action moral if it
delivers more good than harm to society. For example, with this approach, lying to save one’s
life would be ethically acceptable.

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Some of the philosophers supporting this view are nineteenth century philosophers John Stuart
Mill and Jeremy Bentham. They proposed that ethics and morality of an act should be judged on
the basis of their ultimate utility.

An act would be considered moral if it produced more satisfaction than dissatisfaction for
society. It must be understood that this satisfaction or happiness should be for the society in
general and not to the people committing the act or the people who are directly involved in the
act.

For example, not paying the money to someone whom you owe may make you happy but it
disrupts the social system of fairness and equity thus making the society as a whole unhappy.
Accordingly, this would not be considered as a Similarly, a party who breaks a contract may be
happy because it is beneficial to it, but it would damage the society’s legal framework for
conducting business in an orderly fashion. Hence, it would not be an ethical act.

2. Deonotological approach:
While a “teleologist” focuses on doing what will maximize societal welfare, a “deonotologist”
focuses an doing what is “right” based an his moral principles. Accordingly, some actions would
be considered wrong even if the consequences of these actions were good. According to
DeGeorge:

“The deonotological approach is built upon the premise that “duty” is the basic moral category
and that the duty is independent of the consequences. An action is right if it has certain
characteristics or is of a certain kind and wrong if it has other characteristics or is of another
kind”.

This approach has more of a religious undertone. The ethical code of conduct has been dictated
by the Holy Scriptures. The wrongs and rights have been defined by the word of God. This gives
the concept of ethics a fixed perception. Since the word of God is considered as permanent and
unchangeable, so then is the concept of ethics.

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Holy Scriptures like those of the Bible, the Holy Quran, Bhagwad Gita and Guru Granth Sahib
are considered to be the words of God and hence must be accepted in their entirety and without
question.

This means that morality would be considered unconditional and applicable to all people at all
times and in all cases.

3. Emotive approach:
This approach is proposed by A.J. Ayer. He suggests that morals and ethics are just the personal
viewpoints and “moral judgements are meaningless expressions of emotions.” The concept of
morality is personal in nature and only reflects a person’s emotions.

This means that if a person feels good about an act, then in his view, it is a moral act. For
example, using loopholes to cheat on income tax may be immoral from societal point of view,
but the person filing the income tax returns sees nothing wrong with it.

Similarly, not joining the army in time of war may be unethical and unpatriotic from the point of
view of the society and the country, but the person concerned may consider war as immoral in
itself. According to this approach, the whole idea about morality hinges on the personal view
point.

4. Moral-rights approach:
This approach views behaviour as respecting and protecting fundamental human rights, equal
treatment under law and so on. Some of these rights are set forth in documents such as Bill of
Rights in America and U.N. Declaration of Human Rights. From ethical point of view, people
expect that their health and safety is not endangered by unsafe products.

They have a right not to be intentionally deceived on matters which should be truthfully
disclosed to them. Citizens have a fundamental right to privacy and violation of such privacy
would not be morally justifiable.

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Individuals have the right to object and reject directives that violate their moral or religious
beliefs. For example, Sikhs are allowed to wear turbans instead of putting on a hat as required by
Royal Canadian Police, because of their religious beliefs.

5. Justice approach:
The justice view of moral behaviour is based on the belief that ethical decisions do not
discriminate people on the basis of any types of preferences, but treat all people fairly, equitably
and impartially, according to established guiding rules and standards. All mankind is created
equal and discriminating against any one on the basis of race, gender, religion, nationality or any
such criteria would be considered unethical.

From organizational point of view, all policies and rules should be fairly administered. For
example, a senior executive and an assembly worker should get the same treatment for the same
issue, such as a charge of sexual harassment.

Justice as an ethical approach is where all humans are treated equally through society, regardless
of rank, position, class, creed, or race. This is also known as the fairness approach in business
ethics theories. If people are not treated fairly — such as one employee receiving higher
compensation than another — a justifiable reason must exist, such as higher technical skills or
the exclusiveness of a job position.

6. Virtue Approach

Virtue Approach This approach lays special emphasis on virtues like courage, honesty,
compassion, tolerance, generosity, integrity, self-control, fairness, fidelity, prudence and love.
These guide us in unleashing the highest potential of our character for the development of
humanity.

Business ethics and changing environment

Environmental Forces and Stakeholders Organizations and individuals are embedded in and
interact with multiple changing local, national, and international environments, as the above

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discussion illustrates. These environments are increasingly merging into a global system of
dynamically interrelated interactions among businesses and economies. We must “think globally
before acting locally” in many situations. The macro- level environmental forces shown in
Figure 1.1 affect the performance and operation of industries, organizations, and jobs. This
framework can be used as a starting point to identify trends, issues, opportunities, and ethical
problems that affect people and stakes in different levels. A first step toward understanding
stakeholder issues is to gain an understanding of environmental forces that influence stakes. As
we present an overview of these environmental forces here, think of the effects and pressures
each of the forces has on you.

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Business ethics and stakeholders management

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VALUES

Every person believes in certain critical values. Jesus Christ valued love, Mahatma Gandhi
valued truth, Plato valued wisdom, and Moses valued justice. Value is anything which has utility
or worth. It may be a physical or intrinsic value (in psychological or philosophical sense). A
value is a general belief which helps differentiate good from bad. Values guide actions in your
personal or social life. It is a particular standard that a community gives importance to. In most
communities, moral values are assigned to fairness, justice, honesty and integrity to name a few.
Mostly our actions are guided by our values. Moral value is something that is esteemed, or
highly revered. When we can assign values to particular objects, it becomes easier to make a
choice. Values are related to culture, society or a system. When a particular thing conforms to
our basic value or conviction, we prefer it, compared to another alternative which may appeal
more to another person with another point of view. As a social phenomenon, values are
inculcated and sustained through an adaptive process. Values are desires that have content and

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intensity. The content aspect of value indicates the nature of achievement or the ultimate benefits
as realized by the user. The intensity attribute of value indicates the degree of its importance in a
particular context. Individual values are commitments to which a particular person subscribes,
like social justice, honesty, and so on.

Significance of Value

A set of values is critical since it gives a person direction and motivation to live in a desired way.
Value is also socially useful and has many positive external influences for others. For instance, if
a person is non-violent, he is helping others by not hurting them. Similarly, a person of good
character is not only an ideal man but he is also a source of good work and inspiration for others.
A knowledgeable man helps himself and others by disseminating his knowledge and new ideas.

 The value system helps a person in making clear decisions.

 The value system helps build the perception of an individual.

 A clear value premise helps a person arrive at fl awless logical deductions and moral
reasoning.

 It gives clarity of understanding to a person confronted with a particular situation.

Types of Values

Three classificatory schemes are generally used by researchers in the categorization of value.

1. Terminal Values and Instrumental Values

Terminal values are those that a person wants to address at the end. As against the end, there
may be many means to achieve the terminal value or the desideratum. These values are called
instrumental values. In terms of spirituality, to be just or righteous is instrumental in the

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realization of God which is the terminal value. An instrumental value is necessary to achieve the
ultimate goal.

2. Personal Values

The following are basic categories of personal values:

■ Egocentric value: The value is directed towards satisfying the ego.

■ Socio-centric value: The value aims at socialization and adaptation to society.

■ Existentialist value: This value is in conformity with the existing reality.

■ Supernatural value: It a type of a metaphysical value beyond norms of the physical world to
achieve the ultimate reality.

■ Deontic value: It considers one’s own duty as the supreme religion.

■ Utilitarian value: In this type the aim is to realize the net benefits over cost.

■ Consequentiality value: In this case, an important value is assigned to those actions having
good consequences.

3. other values

Religious values

■ Economic values

■ Social values

■ Aesthetic values

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■ Political values

■ Logical values

Characteristics of Value

● A value or values are chosen freely without any coercion or compulsion.

● A value is chosen from a number of options.

● The choice of value is made after taking into account different consequences of this choice.

● The value that is chosen is practiced and then sustained and applied at different stages of your
life.

● Value makes a man. It shows up in every situation of his life.

● Value becomes a part of yourself and being. It persists and stays on, unless some drastic value
changing situation and experience arises.

● Values are partly genetically determined, and partly acquired through experience and
interactions.

Sources of Values and Attitudes

There are many sources of values:

● Parents and family

● Teachers and classmates

● Peer groups and friends

● Reference groups

● Culture and tradition

Let us elaborate on some important sources of value:

Family

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The most important source of value formation is the family. Parents are the first people to instill
the ideas of right and wrong and good and bad in the minds of young children. The conscience of
the parents and their ideas on morality gradually are drilled into the minds of youngsters. If
parents tell lies, the children pick up that habit and it will be very difficult to erase it in the
coming years. Children experience moral development and distinguish between right and wrong
through reward and punishment by parents too. Children in the course of time, internalize these
moral lessons. At a young age children accept certain values without questioning them. They
have blind faith in their parents. Thus, it is evident that moral reasoning does not develop at a
young age. However, as children grow up they become capable of developing their own sense of
moral reasoning.

Peer Groups

The second important source of value formation peer groups, friends and colleagues with whom
you interact in day-to-day life. In the adult days, a person is influenced by the value system of his
classmates, religious institutions, clubs and playmates. During this phase of life, the adult is
confronted with several challenging issues involved in his acquired value system. He may, after
moral reasoning once again, either retain his values or reject them in favour of new values. He
may experience a wave of creative destruction. A good peer group may be helpful in inculcating
good moral values and vice versa.

Role Models

In our lives you meet some people whom you admire, respect, adore and emulate. These people
may be one of your teachers, a sportsman, a fi lm star or a political leader. They exert a profound
influence on the minds of an adolescent especially. A film hero’s moral behaviour in a fi lm
which has become famous or notorious influences the minds of millions of fans all over the
country. Like peer groups, the role models can also modify the values of people from good to
bad, or from bad to good.

Institutions

Institutions exert a strong and significant influence on the minds of people regarding moral
development of values. The institutions may be educational, religious or social. Social

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institutions through the process of socialization may mould values and attitudes. Similarly, a
religious institution like a church influences value premise and value system. They bring about
positive change and there influences have far reaching effects. Thus, a regular church-goer
inculcates a value system that is morally progressive with qualities like compassion, care, love,
kindness and sacrifice.

The Spiritual values are The notions that allow human beings to establish a relationship with
one or more deities.

The human being develops these values throughout his life as he receives a moral formation,
since these are translated in the good behavior and customs endorsed by the culture.

Usually, the spiritual values most treated by the theology Are harmony, truth, charity, faith and
hope.

These values are defined as fundamental so that the human being can establish a deep
relationship with a god outside the human and material plane.

In general, spiritual values focus on those things that contribute to the spiritual development of
human beings without any relation to the material plane.

They are highly influential in the sense of personal fulfillment of human beings and affect how
they relate to each other.

A fundamental characteristic of spiritual values is that they are linked to religious beliefs and in
this sense make it viable that there is a sustainable relationship between humans and a god. They
seek the improvement of the individual on a supernatural plane.

Values represent the essence and quintessence of the knowledge acquired by humanity for
thousands of years. Values give man the knowledge he needs to grow, develop, and progress on
an ongoing basis.

The 5 most common spiritual values

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1- Harmony

Life is generally full of contradictions, conflicts and disagreements. The spirit is a unity that
must be based on harmony. In this way, by expressing and keeping our lives in harmony, we are
working hard to reach a state of Spiritual awareness .

When this state of harmony is reached, the spirit opens itself to unexpected opportunities, there is
a process of expansion of consciousness outside the physical plane and the human being
experiences a permanent state of joy, having the ability to discover its reality in another way and
acquire superior knowledge.

Harmony allows human beings to crave wellness for everything around them. It is a state of
peace and fulfillment that allows the soul to move towards happiness.

An example of harmony can be seen when an individual is dedicated to doing what makes him
happy and in turn, seeks to make other people happy.

2- Truth

Truth is the ultimate expression of divinity. Truth is essentially reality. To have true thoughts,
both words and actions must be aligned with the rest of our lives in a coherent way, only then
can we reach a greater state of consciousness.

Being honest is not just talking to the truth, it is being completely transparent with our attitudes
and attitudes towards life.

In this way, it is said that all circumstances are lived inflexibly true, allowing the soul to rise
above the plane of human consciousness, reaching spiritual height.

To live according to the spiritual value of truth is to live consistently. For example, if we
fervently believe in something, we act according to our beliefs and not in a contradictory way.

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3- Charity

Spiritual progress means going beyond the limits of the ego. The ego only cares about your well-
being and pleasure. To genuinely change the direction of our lives, we must change from ego to
spirit.

Many times, it is normal to see that in practice, one individual helps another expecting something
in return. These actions are not charitable and seek love, material goods or favors in
consideration.

Charity means that we do not feel superior or give others what they need to feel better about our
lives. Charity brings with it genuine and deep joy to do good to other people, without being very
aware of what is given.

This spiritual value is understood as compassion for a person alien to our reality. He tries to feel
the pain of the other as if it were his own, to seek a remedy for this pain without expecting
anything in return.

4- Faith

Faith is often regarded as a faculty and not as a value. However, the mind can accept the idea of
faith and turn it into a dynamic principle of life. Faith is described as the knowledge of the soul
that the mind does not yet master.

Everything we do in life requires having faith in something, in our capacities, in technology, in

the law, in the honesty and values of other people, among others.

Often our faith is limited by our past experiences and our willingness to trust others.

In order for faith to be part of a person's spiritual values, we must first change the orientation of
our confidence from ourselves, other people, money, or any material element, to our spirit. When
you trust in the spirit, you understand life from a higher reality.

Faith is the blunt affirmation that there is a higher divinity willing to contribute to our personal
development and well-being.

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For this reason, the value of faith helps the human being to mitigate his worries, not to lose hope
and face life without fear

5- Hope

Hope is a spiritual value that plays a fundamental role in Religions Like the Catholic and
Christian.

At the spiritual level, this value is based on the belief that the spirit of human beings is not a
ephemeral element, but transcends a supernatural plane after death.

Out of the Christian religion, hope is more than a spiritual value and is also understood as a
personal value that gives human beings the possibility of living life with optimism, directing
energy to the fulfillment of goals.

It is an engine that allows us to open and build roads that lead us to what we long for. It is the
possibility to dream and operate as a motor of life.

Conflict of Values

Every professional has to live with two sets of values: personal and professional. These two
values could be conflicting at times. However, whenever a clash occurs between these two
values, professional and morally responsible people give preference to the professional value
over the personal value or interest. Thus, a judge may sentence his only son for murder or a
teacher may punish his daughter for not learning the lesson—there are several such cases in
society. Hence, in many cases, barring penal code cases, a compromise, trade off or a balanced
approach may be possible. For instance, you are the forest officer and on your inspection tour
you fi nd a woodcutter felling a tree from the forest illegally. On enquiry, you learn that he is
poor, jobless and his family is starving. If you are compassionate, you will tell him not to indulge
in this illegal act again and impose a penalty on him. You pay him money which helps him pay
his penalty and feed his family too. However, this kind of compromise although not impractical
is rare.

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Role and importance of business ethics and values:

What is an Ethical Dilemma?

An ethical dilemma is a situation that involves at least an ethical issue where a clear decision or a
choice becomes problematic because of competing claims or interests. There may be an ethical
contradiction or conflict in the choice to be made. In such a case, the solution may not lie in the
interest of the company or of the decision-maker. An instance will make the meaning clear.
Suppose John has been appointed as an assistant to the manager of a dairy firm, and on the very
first day of his work, he is asked by the manager to mix water in milk and sell it to the
customers. John is an innocent boy. He is shocked by this order because he comes from a
religious family and he does not want to indulge in unethical work. John is in ethical dilemma
now: his ethical principle does not allow him to mix water with milk, but if does not carry out the
order of the manager, may lose his new job which he wants very badly. In this type of ethical
dilemma, it is difficult to take an immediate, clear-cut decision. The decision of course is
possible if the person is straightforward and does not bother about the consequences of his

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decision. The problem is that, in many cases, the decision-maker has to consider the possible
consequences of his action.

In an ethical dilemma, the choice has to be made between two desirable/undesirable situations as
John is facing. He does not want either (perhaps) to lose his job or to mix water with milk. In a
dilemma, usually there may be two or more than two options or choices. In the case of an ethical
dilemma, the decision rules are not clear-cut and may be of conflicting values. For ethical
dilemma, the solution is not unique or universal; it depends to a great extent on the ethical
background and personality pattern of the decision-maker. If John has a weak moral background,
he will obey the order of his manager and will retain his job.

Characteristic Features of Ethical Dilemmas

If one analyses the causes of ethical dilemma, it becomes clear that in the case of dilemmas:

● Social cost and private gains are different.

● No linkage is established between the two alternative courses of actions (choices).

● Competitive behaviour gains predominance in many cases.

● There may be an inconsistency between goals (e.g. materialism vs altruism)

● There are some pressures from somewhere.

● A problem of right choice is the main issue.

Types of Ethical Dilemmas

Ethical dilemma may be of different types. Some of which are listed below:

● Ethical dilemma between one ethically right and one ethically wrong alternative.

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● Ethical dilemma between two ethically wrong alternatives.

● Ethical dilemma between two ethically right alternatives.

In the last two cases, the decision-maker has to make a choice on the basis of his own ethical
perception, judgment, background, ethical intensity and needs; such a choice is not often clear-
cut but involves dilemmas in the sense that one may have to decide whether to choose the more
immoral or less immoral option, as the rewards may be different, or, whether to choose the
morally more right one or the less right one, as the pay offs may be different. “More right” or
“less right” is the mental judgments of the assessor. In the case of two morally wrong situations,
the person may choose the one which brings least harm or injury to the smallest number of
people. This may be called the situation of reverse utilitarianism. Ethical dilemmas are with
respect to two situations created by two institutions or value systems. The typology of dilemma
may involve the following situations:

● Organization vs Persons (Employees)

● Persons vs Society

● Local culture vs Foreign culture

● Organization vs Law

● Organization vs Society

● Person vs Law

● Right vs Right

● Wrong vs Wrong

● Right vs Wrong

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Causes and Sources of Ethical Dilemmas

Several sources and causes are responsible for the phenomenon of ethical dilemma. These
sources are:

Individual (Individual values may be in conflict with social or family culture).

Family (Family values may be in clash with values in the business).

Organization/workplace (Organizational culture may be in conflict with personal values).

Society (Social norms may be in conflict with individual norms).

Cross-cultural Level (The culture of one country may be in conflict with the cultural practices of
another country). This type of dilemma is found mostly in international business.

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