Muchenje B.

UZ

BUSINESS ETHICS & CORPORATE

GOVERNANCE
BS425

PREPARED BY:
MRS B. MUCHENJE
(bzmuchenje@gmail.com,0772815871)
FACULTY OF BUSINESS MANAGEMENT
SCIENCES & ECONOMICS, TLH
Department
Office G10
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WELCOME REMARKS

 2 Timothy 3:16-17 New International

Version (NIV)
 16 All Scripture is God-breathed and is useful
for teaching, rebuking, correcting and training
in righteousness, 17 so that the servant of
God may be thoroughly equipped for every
good work.

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CONTINUED:
But this shall be the covenant that I will make with
the house of Israel; After those days, said the
LORD,
I will put my law in their minds and write it on
their hearts. I will be their God, and they shall be
my people. Jer.31 v33 (NIV)
 I will give you a new heart and put a new spirit
in you; I will remove from you your heart of
stone and give you a heart of flesh. Ezekiel
36v26 (NIV)

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1. ETHICS DEFINITIONS & THE IMPORTANCE

OF THE SUBJECT

 It is the knowledge of the good and bad,

right and wrong, the just and unjust.
 It is the set of principles people choose to
live by.
 It is a code of values that guide our choices
and actions and determines the purpose
and course of our lives.
 It is the discipline that deals with moral duty
and obligation.
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CONTINUED:

 It is what ought to be done.

 It is a study of people’s rights and
duties, the moral rules that people apply
in making decisions and the nature of
relationships among people.
 It is all about how individuals' decisions
affect other people.

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CONTINUED:
 Ethics is practised daily in daily key terms of
the ethical language which are: values,
rights, duties, rules and relationships.
 Values are relatively permanent desires that
seem to be good in themselves, like peace
and goodwill.
 A right is a claim that entitles a person to
take a particular action.
 A duty is an obligation to take specific steps
or obey the law.

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WHAT IS BUSINESS ETHICS?

Business ethics is the application of ethical values to
business behaviour.
They are the moral principles that guide the
operations of a company or business.
Business ethics seeks to elaborate the values of
business life and how it fits into society.
Because popular social issues often drive business
ethics, when different issues come to the forefront,
organizations respond by bringing their ethical tenets
in line with new social norms.
Business is part of society and therefore the actions
of people in business are subject to moral rules.

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ETHICS BACKGROUND

Business Ethics in the '60s

 The 1960s brought the first major wave of changes
in business ethics as cultural values were shifting, with
individualism and fierce dedication to social issues
coming into trend.
 Business ethics saw a notable shift in the 1960s when
more companies started embracing social
responsibility, environmental issues and employee-
employer relations.
 Another transition phase came in the 1970s and 1980s
when philosophy shifted from pure authoritarianism
towards greater collaboration. 8
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THE '90S AND ENVIRONMENTALISM

 The 1990s saw a rebirth of

environmentalism, new heights in social
responsibility reaching, and graver legal
ramifications for ethical missteps.
 Companies faced heightened scrutiny, along
with several important lawsuits over the
public health ramifications of their products.

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THE ONLINE REALM IN 2000+

From the year 2000 forward, business ethics have

expanded to the online realm. The big ethical
dilemmas of the 21st century have mostly
centered on cybercrimes and privacy issues.
A major leap forward in human history is that we
are now living in an information regime when
businesses are more transparent than they ever
have been before.
For this reason alone, company ethics are more
important than they’ve been in past decades since
they are on spot light.

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THE MILLENNIAL FACTOR

It’s important to realize that millennials are the

next generation of talent entering the
professional world and they are dictating
what’s important for companies.
Their advanced technical expertise puts
organizations to a big task of transparency or
they suffer a shame.

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OTHER FACTORS TO CONSIDER

 Increased Competition-the more businesses
realize the importance of responsible and
ethical practices, the more they invest in those
efforts, which means any businesses that don’t
follow suit are going to look worse by
comparison.
 The Bottom Line-ethics has become the
currency to buy trust.

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WHY THE NEED OF PRACTICING

ETHICS?
When business people speak about “business
ethics” they usually mean one of three things:
(1) avoid breaking the criminal law in one’s
work-related activity;
(2) avoid actions that may result in civil lawsuits
against the company; and
(3) avoid actions that are bad for the company
image.
Businesses are especially concerned with these
three things since they involve loss of money
and company reputation.
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DOES IT PAY TO BE ETHICAL?

Before answering this think about the following questions?
 How many times do you think of others before you make
a decision or take an action?
 How often do you clash with others in any matters?

 How many times did you benefit at the expense of

others?
 Do you ever think of any possible results of your
decisions before you act?
 Do your decisions and actions serve to make or destroy
your relationship with others.
 Do you really know yourself and how do you judge
yourself with others?
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DO ORGANIZATIONS BENEFIT IN ANY

WAY FROM ETHICS?
Questions that must be asked prior to the
answer are such as:-
i. Does the nature of business really address
public needs?
ii. How user and environmentally friendly are
the company’s production processes?
iii. How safe is the good or service to the
consumers?
iv. Is the organization not benefiting at the
expense of other stakeholders?
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ETHICAL DILEMMA

Business is a
complex web of
relationships, and
it’s easy to
increase revenues
or decrease costs
by exploiting some
of those
relationships.

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THE ETHICAL DILEMMA

The harder question is whether ethical
violations committed by the firm or for the
firm’s benefit are profitable.
Cheating customers, avoiding taxes,
circumventing costly regulations, and
undermining competitors can all directly
increase shareholder value.
Of course bad ethics can be extremely
profitable in the short run.
But what happens in the long run? 17
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SO WHAT’S THE BETTER WAY

FORWARD?

Dilemma is a situation in which a difficult choice has to be made between two

courses of action, either of which entails transgressing a moral principle. 18
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WHAT ARE THE BENEFITS OF BEING

ETHICAL?
 Identify and explain the benefits of ethics to
the various business stakeholders.
 Are ethics valid in this century?

 What are the challenges of upholding ethics

in this era?
 What is your best advice to the business
operators concerning ethics?

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WHAT ARE THE CONSEQUENCES OF

BEING UNETHICAL?

Name them.

How can organizations instill ethical values

among their employees?

Give the ways and strategies.

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