Business Ethics

the king: a servant of the state
 In the happiness of his subjects lies the

king’s happiness, in their welfare his
welfare. He shall not consider as good only
that which pleases him but treat as
beneficial to him whatever pleases his
subjects.
– Arthashastra
There are seven things that will destroy us
 Wealth without work;

 Pleasure without conscience;
 Knowledge without character;
 Religion without sacrifice;
 Politics without principle;
 Science without humanity;
Business without
ethics.
ethics.
 Meaning:
 Systematizing,defending and recommending
concepts of right and wrong behavior.
 Ethicsis a all about what is right or wrong, fair

or unfair, proper or improper.
 Whatis right is ethical and what is wrong is

unethical.
ethics.
 Ethics is not a recent discovery.
 The word Ethics coined from

Latin word: Ethics
Greek word: Ethikos
Both represents, character,
ethics.
 Definition:
 According to Oxford Dictionary, ‘ethics is relating to

morals; treating of moral questions; morally correct;
honorable.
 ‘Ethics’ refer to the code of conduct that guides an
individual while dealing in a situation. It relates to the
social rules that influence people to be honest in dealing
with the other people.
Meaning of Ethics
Taken
together
Leads to considered
Decided BY
as
Good or
Character Conduct Bad, Right
Series of
of Man of the or Wrong,
Actions
Person Moral or
Immoral
By which we
can judge Moral
Moral Judgment
again
Standards
Ethics and Related Terms
 Morality and Ethics:
 Morality is “a code of value to guide man’s choice and
actions.” What is right / Wrong, good or evil.
 Morality evaluate actions on the basis of customs,
expectations of society, and some beliefs.
 Same as ethical principles also give an idea about right
or wrong.
 However, ethics gives code of conduct developed by
proper testing to guide the human behavior.
 Ethics & Religion:

 Ethics gets idea from religion
 Through experiments it approves them as “code of
conduct.”
 The development of ethics is dependent on the religious
morality.
 Ethics and Law:

 Law is a code of conduct, which the authority in power
prescribes for society.
 It is the minimum regulation necessary for public order.
 Ethics is a much wider term than law.
 Ethics concentrate on the do’s and Laws on the don’ts.
 Respect your elders.
 Ethics & Values:
 Values are deep-seated ideas and feelings that manifest
themselves as behavior or conduct.
 There is a very thin line, between ethics and values.
 Both drive what is right and what is wrong in human
conduct.
 By knowing consequences of our actions, we can convert
values into rules of behavior that can be derived as
ethics.
 Value + Knowledge = Ethics

Ethical Action
 Action:
One use to perform various actions through his life

span. These actions are:
 1. Constructive actions:
These are the actions which should be
undertaken.
 2. Destructive actions:
These are prohibited actions, which should be
avoided.
Ethical Action
 Ethical Actions:
can be explained as a social, organizational,
national or personal activity into which
individual is ready to function entirely in the
spirit of service and dedication.
“World survives because of ethical action done

by all”.
Ethical Action
 Characteristics of Ethical Actions:
 Ethical actions are essential not only for outward
activities but also for the inner disposition of the
mind.
 It is a mind were good or bad thoughts emerges
first.
 Good thoughts need to be converted into action,
& it leads to ethical action.
Ethical Action
 Karma Yoga is the way of ethical action.
 Action performed with detachment and without

interest in the fruit of action does not bind man to
the world.
 Active resistance to unethical action is the

central idea of in the Karma doctrine.
Ethical Action
 A person following the Karma doctrine understands:

 that his concern is with action alone.
 that he has no concern with results.
 that he should not entertain the motive of gaining
a fixed result for given action.
 that these idea do not mean that he should sit
back courting inaction.
Ethical Mind
 Mind is man.
 As the mind, so the individuals and their

experiences.
 If the mind is good, the individual is good if the

mind is disturbed, the individual is disturbed.
Ethical Mind
 Basic of mind Management:
 Our present day life is summation of all
yesterdays which we have lived.
 Our various activities, & those activities are
influenced by our past intellectual thoughts &
emotional feelings.
 When thoughts of individual are expressed in
words it becomes action.
 Our thoughts determines our actions, good
thoughts leads to actions and vise versa.
Ethical Mind
 Objective and Subjective Minds:
 Mind is constituted of two distinct sides
Side One: Facing the word of stimuli that reaches it
from the object of the world & it is objective mind.
Side Two: Facing the “within” which react to the
stimuli received & it is subjective mind.
 The objective and subjective mind should work in
unity for revealing right experience.
 Subjective mind influences object mind.
Ethical Mind
Real World
Objective Subjective
Mind Mind
Egoistic Desires
World of
Action
Ethical Mind
 Objective and Subjective Minds:
 Our mind has the layers of egoistic desire in between
Objective & Subjective mind.
 The greater the distance between these two, the
greater the confusion in us.
 In the state of confusion mind become unsteady and
loses its moral.
 We become incapable of facing the challenges of
life.
Ethical Mind
 Dual Personality:
 Every one of us has a picture of the ideal self.
 We have a self concept of a morally strong, ethical,
physically loving and socially disciplined person.
 But this ideal remains only in the realm. We miss judge
our self as a ideal person.
 The dark feature of our personality may be:
 1. Ostentation 2. Arrogance 3. Anger;
Ethical Mind
 Dual Personality:
The dark feature of our personality may be:
 1. Ostentation:
Pretending to be righteous but living unrighteous ways of

life.
 2. Arrogance:
Excessive pride of learning, wealth, social status of family

connections & imagined self-importance lead to arrogance.
 3. Anger:
When an arrogant man looks around him and finds that

world’s estimate of him is different from his own estimate he
gets anger.
Ethical Mind
 Dual Personality & Self development:
 We find selfish man in society criticizing the slightest
trace of selfishness in others.
 As long as we do not realize the existence of this dual
personality in ourselves, there can not be any self
development.
Ethical Mind
 Path of Action:
Through intelligent action, an individual can exhaust

his existing impressions and make his subjective mind more
clear and crystalline.
The path of action is also called as Karma Yoga.

Ethical Mind
 Path of Knowledge:
Life’s ideal can be attained only through knowledge.
The path of knowledge is moving from ignorance to

knowledge.
The way of action and the way of devotion are the means of
the ways of knowledge.
Ethical Mind
 Path of Discrimination:
The path of knowledge is to control of the emotions of
attachment, fear and anger.
Attachment: develops desire.
Fear: Sense of insecurity.
Anger: anger arises towards those who come between the self
of attachment.
Anger is directly proportional to the amount of fear one
entertains from the person creates obstacles in achieving
once desire.
Ethical Mind
 Path of Sacrifice of Wealth:
Most of the time we use money for our selfish motives.
When we part wealth in charities with no expectations it is
sacrifice of wealth.
It helps in strengthening positive tendencies and
overcoming greed.
All the religions of the world emphasize on giving regular
charities .
Ethical Mind
 Path of Self-control:
This path is similar to Jainism.
Vardhaman Mahavir, conquered his self, his body desire,
drives and dualities like love and hate.
This path believes in the life self-control and absolute
detachment from all the belongs to our physical body.
According to Patanjali self control is of five kinds:
Non injury, truthfulness, non-stealing, celibacy and non-
acceptance of gifts,
which means refusal to accept instruments of pleasure.
Ethical Mind
 Path of Mind-control:
It involves concentration and meditation.
Concentration is the fixing of the inner sense upon object,

an idol or image of God. It is devotion of God.
Meditation is the continuity of concentration.
This path is known as path of Yoga.

Business
Ethics
Business Ethical
Business ethics: can be defined as written and unwritten codes

of principles and values that govern decisions and actions
within a company.
In the business world, the organization’s culture sets

standards for determining the difference between good and
bad decision making and behavior.
Business Ethical
Organization culture: they define the way things are done
within the organization.
Organization culture has three main elements:
1. Basic values, attitudes and beliefs of the organization.
2. Organizational goals, polices, structures and strategies

which are shaped by these basic values, attitudes & beliefs.
3. Organizational way of doing day to day things.

Business Ethical
Organizational values are found in mission statements, code
of ethics
Here is a list of ten desired values of a business organization:
1. National service through industry
2. Fairness
3. Harmony
4. Cooperation
5. Continuous improvement
6. Courtesy
7. Humility
8. Assimilation
9. Gratitude
Types of organization
Moral Concerns
High Holistic Balanced
Low Exploitative Manipulative
Low High
Values – Organizations Matrix
Economic Concern
On the basis of extent of economic & ethical concern

organization can be categorized into four types:
1. Exploitative
2. Manipulative
3. Balanced
4. Holistic.
1. Exploitative:
organizations with low economic and ethical concern
are exploitative in nature.
For ex. Child labour, use rivers for dumping wastes
and indulge in corrupt practices.
2. Manipulative organization:
These organisations have high concern for economic
performance but low for ethical concerns.
These organization manipulate tax laws, labour laws
and union leaders.
3. Balanced Organisation:
Balanced organizations have high ethical and
economical concern. These organisation are able to create
profit while fulfilling their economic obligation.
These organizations encourage freedom of enquiry,
support personal values and reinforce them.
4. Holistic organization:
There are organizations that have high ethical and low
economical concern.
Involves in charity work and are willing to spend money to spend
fulfill their social and ethical obligations.
Corporate Code Of Ethics
Codes of Ethics:
are statement of values and principles which defines the
purpose of the company.
The most common way of institutionalizing ethics in the
organization, apart from the mission statement is to
establish a code of ethics.
Three terms are used interchangeably
1. Code of ethics
2. Code of Conduct
3. Code of practice.
Corporate Code Of Ethics
Code of ethics:
The statements of values and principles which defines the
principles of the company.
Code of Conduct
Statements of rules comprised of a set of rules stated either
affirmatively or as prohibitions.
Code of practice.
This is how be do things around here.
Ethical Management
Management:
Management is an art of getting things done through people.
This definition categories two sets of people:

1. Managers
2. Workers
One group of people are dominating other.

Ethical Management
Ethical Issues In Organisations.

1. Deciding if a business gift is just a gift or a bribe.
2. Attaining fairness in employee performance appraisals
3. Initiating fairness in employee performance.
4. Executing an order to take action against staff
5. Managing a problem employee
6. Handling reports of wrong doing on the job.

Business Ethics

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the king: a servant of the state

 In the happiness of his subjects lies the

 Wealth without work;

 Ethicsis a all about what is right or wrong, fair

 Whatis right is ethical and what is wrong is

 The word Ethics coined from

 According to Oxford Dictionary, ‘ethics is relating to

 Ethics & Religion:

 Ethics and Law:

 Value + Knowledge = Ethics

One use to perform various actions through his life

“World survives because of ethical action done

 Karma Yoga is the way of ethical action.

 Action performed with detachment and without

 Active resistance to unethical action is the

 A person following the Karma doctrine understands:

 As the mind, so the individuals and their

 If the mind is good, the individual is good if the

Pretending to be righteous but living unrighteous ways of

Excessive pride of learning, wealth, social status of family

When an arrogant man looks around him and finds that

Through intelligent action, an individual can exhaust

The path of action is also called as Karma Yoga.

Life’s ideal can be attained only through knowledge.

The path of knowledge is moving from ignorance to

It involves concentration and meditation.

Concentration is the fixing of the inner sense upon object,

Meditation is the continuity of concentration.

This path is known as path of Yoga.

Business ethics: can be defined as written and unwritten codes

In the business world, the organization’s culture sets

Organization culture has three main elements:

1. Basic values, attitudes and beliefs of the organization.

2. Organizational goals, polices, structures and strategies

3. Organizational way of doing day to day things.

High Holistic Balanced

Low Exploitative Manipulative

Values – Organizations Matrix

On the basis of extent of economic & ethical concern

This definition categories two sets of people:

One group of people are dominating other.

Ethical Issues In Organisations.

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