Ethical Issues in

Business and
Corporate
Environment
 Chapter Objectives

• Identify the typical ethical issues in a business

environment;
• suggest ways to enhance employer-employee
relationship and encourage just and fair business
policies and practices;
• advocate honest policies and practices in all aspects
of business operations.
How Ethical are
You?
SOMEONE YOU’VE JUST HIRED
SEEMS TO BE ATTRACTED TO YOU,
AND YOU’RE ALSO ATTRACTED TO
HER. BOTH OF YOU ARE SINGLE.
WOULD YOU:
A. Ask them out on a date
B. Have only a professional relationship
C. Ask the person if your intuition is
correct, and if it is, discreetly pursue a
romantic relationship
AT A FAMILY DINNER OUT, YOU USE
YOUR CORPORATE CARD BECAUSE
YOU FORGOT YOUR PERSONAL ONE.
WHEN IT COMES TIME TO DO YOUR
EXPENSES, WOULD YOU:
A. Put in a client’s name whose account has plenty of
cash in it
B. Mark as a personal expense and reimburse your
employer
C. Ask your boss to approve it because with all the late
nights you work, you’ve missed a lot of meals with
your family
IN A PUBLIC RESTAURANT, YOU
OVERHEARED YOUR COLLEAGUES
DISCUSSING CONFIDENTIAL CLIENT
INFORMATION AND MENTION THE
CLIENT BY NAME. WHAT WILL YOU
DO?
A. Ignore it
B. Talk with your colleagues about your
concerns and leave it at that
C. Report them to your supervisor
 Ethical Issues in Business

• When you have to judge what is

right or what is wrong.
• Day to day issues can involve.
 Most Common Ethical Issues in
Business

1. Sexual Harassment
2. Gifts and Bribery
3. Conflict of Interest
4. Abuse of Power
5. Labor Strikes
 Sexual Harassment

• A repeated, unwanted behavior of a

sexual nature perpetrated upon one
individual by another
• Sexual harassment is not restricted by
gender.
• EVERYONE CAN BE A VICTIM OF
SEXUAL HARASSMENT!
 Two Forms of Sexual Harassment
1. Quid pro quo
• is a Latin term which
means this for that.  In
sexual harassment cases,
it means when a
supervisor, manager, or
someone with real or
perceived authority over
another employee either
states outright or implies
that a job benefit can be
exchanged for a sexual
favor. 
 Two Forms of Sexual Harassment
2. Hostile Work
Environment
•the sexual harassment
makes the workplace
frightening, intimidating, or
offensive which makes
interferes the employee’s
ability to perform the job.
 Sexual Harassment Case 1
Jim has the habit of making sexual inferences and jokes in
most conversations making the atmosphere in the
workplace sexually charged.  Often the jokes are about
someone’s sexual orientation.  Most people laugh it off and
some even think it is funny.  However, it makes other
people feel uncomfortable.  Those who feel uncomfortable
do not know how to get Jim to stop this offensive behavior
and are afraid of a confrontation.  They try to give Jim
clues that they find the behavior offensive.  They walk
away without a response, they just stare at him without
laughing.  Jim has not changed his behavior, in fact, it is
escalating daily.  Some staff members have observed
Jim’s behavior and now engage in similar behaviors. 
 Sexual Harassment Case 2
Kent is Nancy’s supervisor.  Nancy has been on
the job for 3 weeks.  She is a single mom with
small children who has been out of work for six
months.  Nancy is delighted to have the job.  Kent
calls Nancy into his office and begins to discuss
her performance.  He criticizes Nancy for many
fabricated performance issues.  Then, with his
hand on Nancy’s knee, he implies that she can
improve her next performance discussion and
keep her job by meeting him at the local motel
where they could discuss her performance at
length.
 Strategies for Sexual Harassment
Prevention
1. Implement a clear sexual harassment policy.
The employee handbook should contain a policy
devoted to sexual harassment. That policy
should include:
a) definition of sexual harassment;
b) procedure for filing sexual harassment complaints;
c) full investigation of any complaint received
d) Sanctions or appropriate actions for the violators of
the provision
 Strategies for Sexual Harassment
Prevention
2. Train employees
At least once a year, do training meetings for
employees. These meetings should educate employees
what sexual harassment is all about, make clear that
employees have a right to a workplace without fear of
sexual harassment, assessment of complaint
procedures, and support employees to use it.
 Strategies for Sexual Harassment
Prevention
3. Train Supervisors and managers
At least once a year, carry out training meetings
for supervisors and managers that are separate from
the employee meetings.
 Legal Penalties of RA 7877 for those
who committed sexual harassment

1. Imprisonment of not less than one (1) month but not

more than six (6) months;
2. Fine of not less than Ten Thousand Pesos
(P10,000) but not more than Twenty Thousand
Pesos.
 Conflict of Interest
• Conflict of Interest in the organizational
context happens when someone acts in a
way that is advantageous to himself at
the expense of his employer.
• Occasionally, individuals have
incentives that violate their
responsibilities and hurt their client
and employers in manners that are not
visible to the public or in their own mind.
 Conflict of Interest Examples
• Accepting payment from another
company for information about your
employer.
• Dating or having a romantic relationship
with a supervisor or subordinate
• Reporting to a supervisor who is also a
close friend or family member.
Strategies to Avoid Conflict of Interest
• Avoid being biased by an interest that
may interfere in the ability to serve others;
• avoid obtaining interests that may bias
ones judgement;
• Avoid conflicting roles;
• Be open to all information
• Do not play favoritism
• Call for collective decisions.
 What is your
stand in giving
gifts to your
teachers?
 What is the
difference
between a gifts
and a bribery?
 Gifts and Bribery

• A gift is something of worth given with no

anticipation of returns. The premise of giving
gifts is an ancient way to express gratitude,
appreciation, and love.
• A bribe is the same thing given in the
expectation to influence the recipient’s
conduct.
 Gifts and Bribery

• A gift is given with no expectations

while bribes are given in return for a
favor.
• In some cases however, it becomes a
breach of ethics.
 Abuse of Power
• The application of one’s official position
for personal benefit is often abuse of
power.
• Abuse of power or authority may be the
prime source and true essence of moral
evil.
• It can be said that someone has power, if
that someone can with certainty
manipulate the reality of others.
 Ways to Prevent Abuse of Power

• Make tough calls

• Steer clear of the power trip
• Back up words with action
• Take the job seriously
• Willingly share the power
 Labor Strikes

• An employer that does not like the way

negotiations are going with employees
can threaten to just close the company, or
relocate it.
• The ability to strike gives employees a
threat of almost equal power.
 Labor Strikes
• Workers go on strike because they are
asking some of the following reasons:
1. Higher compensation
2. Improve the workplace
3. Shorten working days
4. Stop their wages from going down
5. More benefits
6. Unfairness by the company
 Labor Strikes
Unions can refuse to work unless an employer meets their
demands. Strikes are a powerful tool, but can be harmful
to a company and should not be used unless certain
criteria are met.
1.There must be just cause.
2.There should be proper authorization. Workers should:
•Agree to strike on their own without being forced and
•Strikers must attempt to attain union support.
3. Strikes should be a last resort.
4. Strikes should be nonviolent, non-coercive, and non-
destructive.
 COLLABORATIVE ACTIVITY

Setting up an
Ethical Workplace
Environment
Direction:
1. As a student, create an organizational
chart/poster where it states the provisions
regarding Sexual Harassment.
• Define sexual harassment;
• Create a procedure for filing sexual
harassment complaints;
• State the appropriate sanctions to be
imposed on violators against the
provisions.