Ethics and Corporate Governance Notes

Module I :
Introduction
Descriptors/Topics
Introduction to Business Ethics

Business ethics is the moral principles, policies, and values that govern the way companies and individuals engage in business activity.
What do you mean by business ethics?
What Is Business Ethics? By definition, business ethics refers to the standards for morally right and wrong conduct in business. Law partially defines the conduct, but “legal” and “e
acceptable behaviors beyond government control.
Ethical businesses try to minimise any negative impact they make on society or the environment. They may also try to make a positive impact on a particular cause – a business mod
Morals and values,

Although the terms values, morals and ethics are often used interchangeably, society generally attaches a fine distinction among them: Values -- an individ
standards of right and wrong, very similar to ethics.
Concepts of Utilitarianism and Universalism- Theory of rights,

Under Utilitarianism, if the majority benefits then the action is acceptable. In contrast, Universalism is a model that argues there are certain "universal" pri
there may be to certain parties.
Where the Universalist approach focuses on good intentions and discourages using anyone as a means toward our ends, the Utilitarian approach f
be used as a means toward the desired end.
Theory of justice-
A Theory of Justice holds that every individual has an equal right to basic liberties, and that they should have the right to opportunities and an equ
Virtue ethics-
Virtue ethics is an approach that treats virtue and character as the primary subjects of ethics, in contrast to other ethical systems that put consequences of v
authority in the primary role
ethics of care-
The ethics of care is a normative ethical theory that holds that moral action centers on interpersonal relationships and care or benevolence as a virtue. EoC
by some feminists and environmentalists since the 1980s
and Ethics- the Nature of Ethics in Management
What is ethics and the nature of management?
Ethics in management refers to a company's social responsiveness. It is 'the discipline that deals with what is good and evil, or right and wrong, or mo
management can be defined as a set of moral principles.
- Business Standards and Values- Value Orientation of the firm.

What is the values of a business?
Company values are the core values or standards that guide the way you do business. They sum up what your business stands for, influences the organis
business plans and strategies may change, the core values of your business will usually remain the same.
Module II:
Issues and Complexities in Business
Ethics
Environmental Pollution &

What is meant by environmental pollution?
Environmental pollution is unwarranted disposal of mass or energy into earth's natural resource pool such as water, land, or air that results in long- or short
negatively impact the living beings and their life both quantitatively and qualitatively
Society- marketing Ethics (in Products, Pricing, Promotion and Place)
Marketing ethics are a set of moral principles that guide a company's promotional activities. Organizations that establish and implement marketing eth
expectations of consumers
and Consumer protection-

Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Cons
Ethics in Human Resources Management (Recruitment and promotion policies,

Supports Employee Well-Being: Ethical behavior in HR includes creating a safe and healthy work environment, supporting employee wellness and w
These practices can help improve employee morale and well-being, increasing job satisfaction and productivity
Working Conditions,
Working conditions refers to the working environment in which one works, as influenced by factors such as working hours, physical aspects, legal r
damage employees' health and put their safety at risk.
Down Sizing Workforce).

What is downsizing the workforce?
Downsizing is the permanent reduction of a company's labor force through the elimination of unproductive workers or divisions. Downsizing is a
downturns and failing businesses.
Conflicts in decision making from ethical and economic point of view-
What are the conflicts in ethical decision making?

Ethical conflicts arise when disagreements or dilemmas are related to ethical principles, values, or behaviors within the organization. These conflict
interpretations of ethical guidelines, or conflicts between personal and organizational ethics.
Ethical Dilemma- Solving ethical dilemma,

What is ethical dilemma and examples?
An ethical dilemma is a paradox that comes up when there are two or more options, but neither of them are the best ethical or moral option. False account
—these are just some of the ethical dilemmas that happen in today's workplace.
Managerial integrity and decision making.
Developing a strong sense of integrity in decision-making involves aligning choices with core values and maintaining consistency. Transparency is key
accountability for their outcomes, whether positive or negative.
Module III
Corporate Governance
Introduction to Corporate Governance,

Corporate governance is the system of rules, practices and processes by which a company is directed and controlled. Corporate Governance refers to th
identifies who has power and accountability, and who makes decisions.
Features and Importance of Corporate Governance,

Corporate governance is the structure of rules, practices, and processes used to direct and manage a company. A company's board of directors is the p
governance can destroy a company's operations and ultimate profitability.
Theories and Models of Corporate Governance,

In addition to fundamental theories of corporate governance such as agency theory, steward theory, hazard theory, stakeholder theory, resource depen
authors have identified the ethical theories that can be closely associated with corporate governance.
ownership pattern
A company's ownership structure looks at who owns the respective company. Those with private structures can control who buys and sells shares. Compa
shares on the open market. Ownership structure can impact how companies make decisions
- Issues in Managing public limited firms- Agency problems.

Challenges Faced By Public Limited Companies: How to Overcome Them?
 Increased competition. ...

 Short-term pressure from shareholders. ...
 Changing market trends. ...
 Regulatory compliance. ...
 Managing risk. ...
 Cyber security threats. ...
 Economic uncertainty.
Module IV
Internal and External Corporate Governance Mechanism
Descriptors/Topics
Board of Directors-
What Is a Board of Directors? A board of directors (BofD) is the governing body of a company, whose members are elected by shareholders (in the case of
the interests of shareholders and stakeholders. Every public company must have a board of directors.
Functional Committees of Board;
BOARD COMMITTEES
 COMMITTEES OF THE BOARD. ...

 AUDIT COMMITTEE. ...
 NOMINATION & REMUNERATION COMMITTEE. ...
 RISK MANAGEMENT COMMITTEE. ...
 CORPORATE SOCIAL RESPONSIBILITY AND ESG COMMITTEE. ...
 STAKEHOLDERS RELATIONSHIP COMMITTEE.
Code of Conduct,
A company code of conduct is a set of rules which is commonly written for employees of a company, which protects the business and informs the em
the smallest of companies to create a document containing important information on expectations for employees.
whistle blowers.
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwj9rvT38_KEAxXPTWwGHRqgCwMQvOMEKAB6BAgQE
%2Fwho-was-john-barnett-the-boeing-whistleblower-found-dead-in-us-9210094%2F&usg=AOvVaw1FDG5tM6agQ5VgTPkZxKPK&opi=89978449
What does it mean if someone is a whistleblower?

A Whistleblower is any individual who provides the right information to the right people. Stated differently, lawful whistleblowing occurs when an individu
wrongdoing to an authorized recipient.
What is an example of a whistleblower?
On February 2, 1976, Gregory C. Minor, Richard B. Hubbard, and Dale G. Bridenbaugh (known as the GE Three) "blew the whistle" on safety problems at
instance of whistleblowing".
What is the role of a whistleblower?
External whistleblowers report misconduct to outside people or entities. In these cases, depending on the nature of the information, whistleblowers may report the misconduct to lawyers, the media, law enforc
s it OK to be a whistleblower?
No one should ever be subject to or threatened with reprisal for coming forward with a protected disclosure. It is unlawful for any personnel action to be taken against you because of your whistleblowing.
Negative consequences to whistle-blowers include occupational, legal, financial, socioemotional, and other (e.g., physical health, character assassination ) effects.
CSR and Corporate Communication. Regulators

Also, CSR is seen “as integrated corporate activities abiding by the legal regulations and going beyond compliance, and investing more in human capital, the environment and the relations with stakeholders; a
environmental aspects;
, Gate keepers,
For the purposes of conducting corporate governance smoothly, a corporation can appoint a 'Gatekeeper of Governance' who are professionally responsible to look into and prevent corporate misconduct.
management.
What are gatekeepers in business?
A gatekeeper is an employee who handles administrative responsibilities for executives and members of the C-suite, specifically acting as an intermediate and controlling access between other parties and deci
Institutional Investors,
Institutional investors are large entities such as pension funds, hedge funds, and insurance companies that hire finance and investment professionals to manage large sums of money on behalf of thei
An institutional investor is an entity which pools money to purchase securities, real property, and other investment assets or originate loans
Corporate raiders.
A corporate raider is an individual or a party that purchases a substantial position (enough to gain a controlling position) in a company that is deemed undervalued. In other word
hostile takeover) of an undervalued company.
In summary. What is a corporate raider? It's an investor who acquires enough control in a company they think is undervalued. After making any and a
Module V Recent Trends in Corporate Governance

Descriptors/Topics
Board Quality & Composition
Quality Manager means the individual identified by the Design-Builder who is responsible for the overall Quality Control program and Quality Control activities ...
, Executive Compensation,
Executive compensation is composed of both the financial compensation (executive pay) and other non-financial benefits received by an executive from their emplo
The five key elements of executive compensation include:
 Cash Compensation.
 Incentive Rewards.
 Enhanced Benefits.
 Executive Perks.
 Change-in-Control Payments.
Environmental, Social, &
E&S issues typically include environmental pollution, hazards to human health, safety and security, impacts on communities and threats to a region's biodiversity an
Environmental risk is a measure of the potential threats to the environment, life and property. Consequence .. Effect due to occurrence of the event, which may enda
property. This risk can be defined as the exposure to adverse consequences stemming from population-based activities and negative public perception. In other word
influences inside every one of us—beliefs, emotions, mental health, fears and anxieties
Governance Risk
Governance, or corporate governance, is the overall system of rules, practices, and standards that guide a business. Risk, or enterprise risk management, is the process
eliminate their financial impact.
, Kotak Committee recommendations 2018
& Corporate Governance in India.

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Module I :

Introduction to Business Ethics

Morals and values,

Concepts of Utilitarianism and Universalism- Theory of rights,

and Ethics- the Nature of Ethics in Management

What is ethics and the nature of management?

- Business Standards and Values- Value Orientation of the firm.

Environmental Pollution &

and Consumer protection-

Ethics in Human Resources Management (Recruitment and promotion policies,

Down Sizing Workforce).

Conflicts in decision making from ethical and economic point of view-

What are the conflicts in ethical decision making?

Ethical Dilemma- Solving ethical dilemma,

Introduction to Corporate Governance,

Features and Importance of Corporate Governance,

Theories and Models of Corporate Governance,

- Issues in Managing public limited firms- Agency problems.

 Increased competition. ...

Functional Committees of Board;

 COMMITTEES OF THE BOARD. ...

What does it mean if someone is a whistleblower?

CSR and Corporate Communication. Regulators

Module V Recent Trends in Corporate Governance

Board Quality & Composition

Environmental, Social, &

, Kotak Committee recommendations 2018

& Corporate Governance in India.

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