UNIT – 1 BUSINESS ETHICS – AN OVERVIEW

Introduction of Ethics : The word Ethics is derived from the Latin word “ethicus” and the greek word “ethikos’ means character and manners. Ethics is said to be the science of moral, moral principle and recognized rules of conduct. Definition : The science of character of a person expressed as right or wrong conduct of action. Nature of Ethics: • Ethics is a subject that deals with human beings capable of judging between right and wrong and good and bad behavior. There was an argument whether ethics is a science or art. It is a systematic knowledge about moral behavior and conduct of human beings. Ethics is a normative (guidelines) science Ethics deals with human conduct.

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Objective of Ethics : • Ethics deals with human behavior whether decision taken by an individual is moral or not. To establish moral standards and norms of the behavior To hudge human behavior based on these standards and norms To assess human behavior and express an opinion or attitude about the behavior. To set a standard for the moral behavior and make recommendations about the desired bahavior.

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Business Ethics: Definition : The normative study of moral standards as they apply to business policies, institutions and human behavior. Business Ethics explains that business can generate profits being ethical. Human behavior have the ability to choose. When a choice is provided between right and wrong or good and bad, an individual chooses one of the alternative by distinguishing between the options available.

marketing and personnel policies. theft. An ideal ethical decision comprises of following virtues. Overt ethical problems deals with bribery. capital investment etc. Relationship between business and ethics : 3 types 1. They are complex. clear and have deft ethical solutions. • • • • • • Right – morally correct Equitable – just and equal Good – highest good for all concerned Proper – appropriate and acceptable Fair – honesty Just – action. .. 2. The Unitarian View of Ethics: The business should concentrate on society and it has a major role to play in serving the society and ushering in society welfare.Nature of Business Ethics : 2 types of ethical problems 1. They are clear and reprehensible. collusion etc.. Covert ethical situations occur in corporate acquisitions.

Society 3. market system. Business Ethics Stages of Ethical consciousness in Business:Stage – 1 : Law of the jungle Stage – 2 : Anything for Profit Stage – 3 : Profit maximization in the short-term Stage – 4 : Profit maximization in the long-term Stage – 5 : Stakeholders concept Stage – 6 : Corporate Citizenship .2. Morality and ethics has no role in business. The Integration View of Ethics: Business and morality are inter-related and are guided by external factors like government. law and society. The Separatist View of Ethics: The businesses in order to flourish should concentrate on its goals – profit maximization.

Need for Business Ethics: • • • • • To exist in the market To gain loyal customer To perform social responsibility To maintain a proper image of their company in public mind. To discharge the social obligations to survive in the long-run Criticism about Business Ethics: • • The motto of any business is profit maximization but not to do with ethics and morals If business ethics were allowed to form a part of corporate culture. . the consumer would have to bear the extra cost.

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