BECG ASSIGNMENT

(By: PRERIT JAIN ,16BSP1812 , Section-F )

Answer 1:
 DIFFERENCE BETWEEN VALUES, MORALS, AND ETHICS

What are Values?

According to the dictionary, values are “things that have an intrinsic worth in usefulness or
importance to the possessor,” or “principles, standards, or qualities considered worthwhile or
desirable.” However, it is important to note that, although we may tend to think of a value as
something good, virtually all values are morally relative – neutral, really – until they are
qualified by asking, “How is it good?” or “Good to whom?” The “good” can sometimes be just a
matter of opinion or taste, or driven by culture, religion, habit, circumstance, or environment,
etc.

What are Morals?

Morals have a greater social element to values and tend to have a very broad acceptance.
Morals are far more about good and bad than other values. We thus judge others more
strongly on morals than values. A person can be described as immoral, yet there is no word
for them not following values.
What is Ethics?

You can have professional ethics, but you seldom hear about professional morals. Ethics tend
to be codified into a formal system or set of rules which are explicitly adopted by a group of
people. Thus you have medical ethics. Ethics are thus internally defined and adopted, whilst
morals tend to be externally imposed on other people.
If you accuse someone of being unethical, it is equivalent of calling them unprofessional and
may well be taken as a significant insult and perceived more personally than if you called them
immoral (which of course they may also not like).

Example

 If the son of a big politician has committed a crime and he uses his powers to free his
son from legal consequences. Then this act is immoral because the politician is trying to
save a culprit.
  A very close friend or relative of an interviewer comes for an interview and without
asking a single question, he selects him. This act is unethical because the selection
process must be transparent and unbiased.
 A grocer sells adulterated products to his customers to earn more profit. This act is
neither moral nor ethical because he is cheating his customers and profession at the
same time.

 ROLE PLAYED BY LAW IN THESE CONTEXTS IN VALUES, ETHICS, MORALITY

• Law is a code of conduct which the authority in power prescribes for society.

• Law is consistent set of universal rules, published, generally accepted and enforced.

• Moral standards deal with right ( what ought to be done) and wrong behaviour. Law
compels individuals to act in the desired manner. Law differs from ethics in its option to
use force when requiredand in fact it is backed by power.

• The Law does not always represent collective moral judgment. Whereas Charity is
considered a moral act, but no laws are framed for it. Law like “Stop at red & move on
green” is morally inert i.e. has no moral angle

• The requirements of law tend to be negative while moral / ethical standards tend to be
positive. Laws represent a minimum set of standardsfor human behavior in society.

• Human behavior beyond the minimum standardshave to come from individual

initiatives.

• Law may forbid “unethical behavior” like theft, but at the same time there is no law to
“help the needy”. An individual may feel that it is his moral duty to help an accident
victim, but there is no law that requires this.

 MESSAGE BY KOHLBERG’S MODEL

• People progress through the previous six stages.

• Cognitive moral development should be viewed as a continuum.

• People’s moral beliefs and behavior change as they gain education and experience.

• There are universal values by which

people in the highest level of moral
development abide.
Answer 2:
An ethical dilemma is a moral situation in which a choice has to be made between two equally
undesirable alternatives.

MAJOR THEORIES OF ETHICS

 Utilitarian theory: Do the benefits exceed the cost?

Assessment of net benefits includes any important indirect effects.
Example: assessing the effects of pollutant discharge from a factory on the immediate
surrounding environment and those down stream or down wind from the factory.

 Rights theory: Do they respect human & moral rights rights ?

Focuses on the person’s actions or the actions of others toward the person
• Legal rights: defined by a system of laws
• Moral rights: based on ethical standards

Features
• Respect the rights of others
• Lets people act as equals
• Moral justification of a person’s action

Examples
• Legal right: right to a fair trial in the United States
 • Moral right: right to due process within an organization

 Justice theory : Does it distribute benefits and burdens evenly or on a rational basis?

 Looks at the balance of benefits and burdens distributed among members of a group
 Can result from the application of rules, policies, or laws that apply to a society or a
group
 Just results of actions override utilitarian results
 Rejects view that an injustice is acceptable if others benefit the action

 Deontological (action-oriented) approach:

An ethical standard consistent with the fact that it is performed by a rational and free
person.

These are inalienable rights of human beings and reflect the “characteristic and defining
features of our nature”.These fundamental moral rights are inherent in our nature and
are universally recognized.

An example of deontology is the belief that killing someone is wrong, even if it was in self-
defense.

 Teleological (results-oriented) ethics:

The moral character of actions depends on the simple, practical matter of the extent to
which actions actually help or hurt people. Actions that produce more benefits than
harms are “right”; those that don’t are “wrong”.

CONFLICT OF UTILITARIAN APPROACH WITH JUSTICE APPROACH

Perhaps the greatest difficulty with utilitarianism is that it fails to take into account
considerations of justice. We can imagine instances where a certain course of action
would produce great benefits for society, but they would be clearly unjust. During the
apartheid regime in South Africa in the last century, South African whites, for example,
sometimes claimed that all South Africans—including blacks—were better off under
white rule. These whites claimed that in those African nations that have traded a
whites-only government for a black or mixed one, social conditions have rapidly
deteriorated. Civil wars, economic decline, famine, and unrest, they predicted, will be
the result of allowing the black majority of South Africa to run the government. If such a
prediction were true—and the end of apartheid has shown that the prediction was
 false—then the white government of South Africa would have been morally justified by
utilitarianism, in spite of its injustice.

CONFLICT OF UTILITARIAN APPROACH WITH RIGHT APPROACH

Act utilitarianism seems to offer a clear and straightforward way of discovering what is
right and wrong. We need to consider how much pleasure and pain (or preference
satisfaction) an action will cause.

Act utilitarianism is that no type of action is ruled out, in principle, as immoral. For
example, if torturing a child produces the greatest happiness, then it is right to torture a
child. Suppose a group of child abusers only find and torture abandoned children. Only
the child suffers pain (no one else knows about their activities). But they derive a great
deal of happiness. So more happiness is produced by torturing the child than not, so it is
morally right. This is clearly the wrong answer.

Answer 3:
Major responsibilities of Organization’s towards ethical behavior in respect of each
of the various aspects of Marketing are:

 Do no harm. This means consciously avoiding harmful actions or omissions by

embodying high ethical standards and adhering to all applicable laws and regulations in
the choices we make.
 Foster trust in the marketing system. This means striving for good faith and fair dealing
so as to contribute toward the efficacy of the exchange process as well as avoiding
deception in product design, pricing, communication, and delivery / distribution.
 Embrace ethical values. This means building relationships and enhancing consumer
confidence in the integrity of marketing by affirming these core values:
• honesty,
• responsibility,
• fairness,
• respect,
• transparency and
• good citizenship
 Moral Duty of Marketing firms to Consumers
• Duty to comply with express and implied claims of:
 • reliability
• service life
• maintainability
• safety
• Duty of disclosure
• Duty not to misrepresent
• Duty not to coerce

IMPORTANT RIGHTS OF CONSUMERS UNDER CONSUMER PROTECT ACT

• RIGHT TO CHOOSE : To the extent possible, consumers must have the opportunity to
select from a variety of products . This right is based on the philosophy of fair
competition -quality products at reasonable prices.
• RIGHT TO SAFETY: businesses have an obligation not to knowingly market a product
that could harm consumers.
• RIGHT TO INFORMATION: Any information, communicated in written or verbal format,
should be accurate, adequate, and free of deception, for consumers can make a sound
decision.
• RIGHT TO BE HEARD: This right relates to opportunities for consumers to voice their
concerns in the public policy process. This implies that governments have the
responsibility to listen and take consumer issues into account.
• RIGHT TO REDRESSAL: Consumers have the right to express dissatisfaction and seek
redressal from a business when a good or service does not meet their expectations.
• RIGHT TO PRIVACY: Consumers need to be aware of how personal data are collected
and used ( often for market research) ; and firms must protect this information.

DIFFERENTIATE BETWEEN THE PURPOSE OF ‘PATENT’ AND ‘COPY RIGHT’

 Patents:
A patent describes an invention for which the inventor claims the exclusive right.

invention patenable if.....

 new (novel)
 useful
 not obvious
 pertains to patentable
subject matter
 Invention
 Relates To A Process Or Product Or Both
 Involves An Inventive Step
 Be Capable Of Industrial Application
 A Machine

Life & Duration

• Term of the patent is 20 years from the date of filling for all types of inventions.
• Priority date- first to file
• The date of patent is the date of filing the application for patent.
• The term of the patent is counted from this date.

 Copyright

It is a right which Grants protection to the unique & original expression of Ideas.

What is covered by copyright?

• Literary
• Films
• Dramatic
• Musical
• Artistic
• Sound Recording

What is not covered by copyright?

• Ideas
• Facts
• Recipes
• Works lacking originality (e.g. The phone book)
• Names, titles or short phrases

Duration of Copyright

Copyright lasts for the-

 Author’s lifetime + 50 years from the end of the calendar year in which the author
dies,
 50 years for films and sound recordings,
  25 years for typographical arrangements of a published edition,
 Copyright protection always expires on December 31 of the last calendar year of
protection.

PROCESS PATENT AND PRODUCT PATENT

Under a process patent, the patent is granted for a particular manufacturing process,
and not for the product itself. Any other person can produce the same product through
some other PROCESS, modifying the various parameters. The implication is that there
will be more than one producer for the same product because of the possibility of
different process for the manufacturing of the product.

Weakness of the process patent regime is that it gives less protection for the inventor.
There is high tendency for competitors to reengineer the original invention by
discovering a new process with less strain and investment. Benefit of process patent
regime is that it reduces the element of monopoly.

In the case of product patent, it is an exclusive right given to the original inventor of a
product. This means that no other manufacturer can provide the same product through
the same or any other process. The implication is that there will not be a competitor for
the producer as it is the product which is patented. Product patent system gives higher
level of protection to the inventor as there will not be any other patent holder.

SUSTAINABILITY
The use of goods and services that respond to basic needs and bring a better quality of
life, while minimising the use of natural resources, toxic materials and emissions of
waste and pollutants over the life-cycle, so as not to jeopardise the needs of future
generations’

DOW JONES SUSTAINABILITY INDEX (DJSI)

• launched in 1999, they are a family of indices evaluating the sustainability performance
of the largest 2,500 companies listed on the Dow Jones Global Total Market Index.
• They have become the key reference point in sustainability investing for investors and
companies alike.
• The DJSI is based on an analysis of corporate economic, environmental and social
performance, assessing issues such as:
 corporate governance, risk management, branding, climate change mitigation, supply
chain standards and labor practices. The trend is to reject companies that do not
operate in a sustainable and ethical manner.
It includes general as well as industry-specific sustainability criteria for each of the 58
sectors defined according to the Industry Classification Benchmark (ICB).

Answer 4:
CHANGING VIEW OF ROLE & SOCIAL RESPONSIBILITIES OF BUSINESS

• Adam Smith, an 18th century economist and author of The Wealth of Nations, wrote “
individuals pursuing their own best self-interest would result in the greatest overall
good to society, and that levels and kinds of goods and services in the market should be
determined by the free market alone (i.e., not by government)”
• “Given sufficient motivation for personal gain, each person would work hard, and as a
result, society as a whole would benefit with more jobs, more competition, and better
quality goods and services.”
• Single-minded focus on profit maximization is what led to the creation of ‘bundled
mortgage backed’ securities that led to the housing bubble, that virtually melted down
the global economy in 2008

SALIENT POINTS OF ARCHIE CARROLL’S FOUR PART MODEL

Archie B Carroll (1991)brought out the four dimensions of responsibility of Business:

Economic, Legal, Ethical , and Voluntary ( including philanthropy).

• Economic responsibilities: being basically an economic entity, the primary responsibility

is economic, i.e. produce goods that society needs & sell them at profit.
• Legal responsibilitiesare also basic, must operate within laws of land.
• Ethical responsibilitiesrefers to behavior by the firm that is expected by the society –
but not codified in a law. e.g. till passage of foreign corrupt practices act in 1977 it was
not illegal in USA to bribe foreign officials. But there was public indignation to such
practice.
• Voluntary / discretionary responsibilitylike providing philanthropic contribution to an
educational institute . Few people expect corporations to fulfil ldiscretionary
responsibilities, but all expect a firm to satisfy ethical responsibilities.
• However, ethical and voluntary together constitute social responsibilities of a business.
 • Laws always lag expectations of society.(day care , equal rights)

NEW COMPANY LAW (COMPANIES ACT 2013) MANDATES CSR

• Effective 1st April, 2014

• Applicable for public & private limited companies, if they have
• Net worth of Rs 500cr
• Turnover of Rs 1000cr
• Profit of Rs 5cr
needs to spend at least 2% of its average net profit for the immediately preceding three
financial years on corporate social responsibility activities listed in Schedul VII of the Act

Schedule VII of Companies Act 2013

Lists Activities / Areas in which CSR spend (stated in Companies Act 2013) can be spent

• Eradicating hunger, poverty & malnutrition

• Promoting preventive healthcare
• Promoting education
• Promoting gender equality
• Setting up homes for women, orphans & senior citizens
• Measures to reduce inequities faced by socially & economically backward groups
• Contributions to Prime Minister’s national relief fund or other similar funds
• Development & welfare of SC, ST, OBCs, minorities & women
• Technology incubators located within academic institutions
• ensuring environmental sustainability and ecological balance
• animal welfare
• protection of national heritage and art and culture
• measures for the benefit of armed forces veterans, war widows and their dependents
• training to promote rural youth
• nationally recognized, Paralympic or Olympic sports
• Rural development projects.