Group Members

• Syed Salman Abbas

• Ghani Younas
• Tauheed Akram
• Farrukh Imtiaz
• Muhammad Umar
Business Ethics
Overview
What is Business Ethics ?
• The behavior that a business
faces to in its daily dealings
with the world

• The principle Standards that

define acceptable conduct in
business.
 Two Major
characteristics

• Tells people what they must to do ?

• Set of principles or rules

 Ethic’s Purpose

• The discipline of dealing with what is good

and bad, and with moral duty and
obligation

• Guides an individual in dealing with others

• Lacks ethical principles is bound to fail

sooner or later
4 Concepts of Ethics
 Relativism

• There is no universal standard by which

morality can be judged.

• What is correct for one society may be

wrong for another.

• Ethics and morality are relative

 Relativism Problems

Relativism is the idea that some elements or aspects of

experience or culture are relative to, i.e., dependent on, other
elements or aspects.

Common statements that might be considered relativistic include:

"That's true for you but not for me."

"Beauty is in the eye of the beholder."

"You can't judge other cultures by the standards of your own."

 Egoism

o Egotism:
o An excessive or exaggerated sense of self-importance.
o Ethical Egoism
o The principle that holds that individuals have to do what is
in their self-interest.
o Physiological Egoism,
o The principle that holds that individuals are always
motivated by self-interest.
o Rational Egoism,
o The belief that it is normal to act in one's self-interest.
 Egoism Problems

• Externalities associated with private actions to

dump toxic wastes as long as don’t get caught
 Utilitarianism
Utilitarianism is the idea that the moral worth of an action is determined slowly by its contribution to overall utility: that is, its contribution to happiness or
o pleasure as summed among all people. It is thus a form of consequential, meaning that the moral worth of an action is determined by its outcome.

Utilitarianism is often described by the phrase "the greatest good for the greatest number of people", and is also known as "the greatest happiness principle".
o
 Deontologism
• Deontological ethics or
deontology from Greek ,
"obligation, duty“ is an approach
to ethics that determines
goodness or rightness from
examining acts, rather than the
consequences of the act as in
consequentialism, or the
intentions of the person doing the
act as in virtue ethics.
Categorical Imperative
 Guidance in Dealing with People

• People should never be treated as a means to an end, but as ends in

themselves.

• To treat people as ends requires respect for persons.

 General Ethical Behavior

• Builds security, friendliness, cooperation and trust in a society.

• These are public goods created by generally ethical behavior.

Ethical Test
Benefit Cost Test

Categorical Imperative
 Light of Day Test

Do Undo other Tests

• Golden Rule – If you would like others to do the same to you passes the test.
 Ventilation Test

• Seek out others views. Discuss the 5 tests with them. If others feel it is OK -
passes the test
Conflict of Interest
 Two Interests

• Private Interest Conflicts with Corporate

o Business Interest Conflicts with Public.

Whistle blowing
Types
Cause of Disturbance In An
Organization
 Punishments
• Fired

• Blacklisted / Murder Possible

• Transfer to Undesirable Location

• Lifestyles, and mental stability questioned

 For Example

• A whistleblower is a person who raises a concern about

wrongdoing occurring in an organization or body of people,
usually this person would be from that same organization.
This misconduct may be classified in many ways; for example,
a violation of a law, rule, regulation and/or a direct threat to
public interest, such as fraud, health/safety violations, and
corruption. Whistleblowers may make their allegations
internally
 Bribery
• Bribery constitutes a crime and is defined by Black's Law Dictionary as the offering, giving,
receiving, or soliciting of any item of value to influence the actions of an official or other person in
discharge of a public or

• same as bribery - recipient of payment initiates transaction

Extortion
 Bluffing & Deception

Deception, beguilement, deceit, bluff, and subterfuge are acts to propagate a beliefs that are not true, or not the whole truth (as in
•
certain types of half-truths and omission).

To bluff is to pretend to have a capability or intention which one does not actually possess
•
Examples
 Social Responsibility
Management’s consideration of profit, consumer satisfaction, and societal well-being of equal value in evaluating the
•
firm’s performance

Contributions to the overall economy, job opportunities, and charitable contributions and service.
•

Organizations measure through social audits

•
 Areas Of
Responsibility
 To Jeneral Public

• Public Health Issues. What to do about inherently dangerous products

such as alcohol, tobacco, vaccines, and steroids
• Protecting the Environment. Using resources efficiently, minimizing
pollution.
• Recycling. Reprocessing used materials for reuse
• Developing the Quality of the Workforce. Enhancing quality of the
overall workforce through education and diversity initiatives
• Corporate Philanthropy. Cash contributions, donations of equipment and
products, and supporting the volunteer efforts of company employees.
 To Customers

• The Right to Be Safe. Safe operation of products, avoiding product liability.

• The Right to Be Informed. Avoiding false or misleading advertising and providing

effective customer service

• The Right to Choose. Ability of consumers to choose the products and services they
want

• The Right to Be Heard. Ability of consumers to

express legitimate complaints to the appropriate parties
 To Employees
• Workplace Safety. Monitored by Occupational Safety and Health Administration.
• Quality-of-Life Issues. Balancing work and family through flexible work schedules,
subsidized child care, and regulation such as the Family and Medical Leave Act of 1993
• Ensuring Equal Opportunity on the Job. Providing equal opportunities to all
employees without discrimination; many aspects regulated by law
• Age Discrimination. Age Discrimination in Employment Act of 1968 protects workers
age 40 or older
• Gender Discrimination. Equal pay for equal work without regard to gender.
 To Investors

• Obligation to make profits for shareholders

• Expectation of ethical and moral behavior.

• Investors protected by regulation by the

Securities and Exchange Commission and state regulations.
 Conclusion

• Ethics are important not only in business

but in all aspects of life because it is an
essential part of the foundation on which of
a civilized society is build. A business or
society that lacks ethical principles is
bound to fail sooner or later.
 Case Study

Whistleblowing & the Environment:

• Chantale Leroux works as a clerk for Avco Environmental Services, a small toxic-waste
disposal company
 Continue

• The company has a contract to dispose of medical waste

from a local hospital. During the course of her work,
Chantale comes across documents that suggest that Avco
has actually been disposing of some of this medical waste in
a local municipal landfill. Chantale is shocked. She knows
this practice is illegal. And even though only a small portion
of the medical waste that Avco handles is being disposed of
this way, any amount at all seems a worrisome threat to
public health.
 Continue

• Chantale gathers together the appropriate documents and takes them to her immediate superior, Dave
Lamb. Dave says, "Look, I don't think that sort of thing is your concern, or mine. We're in charge of
record-keeping, not making decisions about where this stuff gets dumped. I suggest you drop it.
 Continue

• The next day, Chantale decides to go one step further, and talk to
Angela van Wilgenburg, the company's Operations Manager.
Angela is clearly irritated. Angela says, "This isn't your concern.
Look, these are the sorts of cost-cutting moves that let a little
company like ours compete with our giant competitors. Besides,
everyone knows that the regulations in this area are overly
cautious. There's no real danger to anyone from the tiny amount
of medical waste that 'slips' into the municipal dump. I consider
this matter closed."
 Continue

• Chantale considers her situation. The message from her superiors

was loud and clear. She strongly suspects that making further noises
about this issue could jeopardize her job. Further, she generally has
faith in the company's management. They've always seemed like
honest, trustworthy people. But she was troubled by this apparent
disregard for public safety. On the other hand, she asks herself
whether maybe Angela was right in arguing that the danger was
minimal. Chantale looks up the phone number of an old friend who
worked for the local newspaper.