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SUBMITTED BY NAME: ENROLLMENT No.: COURSE CODE: STUDY CENTRE: SESSION: Abhineet Bhardwaj 0911000929 PG Gurgaon 01 January 2009/ Sem-6
TABLE OF CONTENTS
WHAT ARE ETHICS? NATURE OF BUSINESS ETHICS DEFINITIONS FEATURES OF BUSINESS ETHICS NEED/OBJECTIVES OF BUSINESS ETHICS IMPORTANCE OF BUSINESS ETHICS GOOD ETHICS IS GOOD BUSINESS ETHICAL DILEMMAS o ETHICAL BUSINESS PRACTICES o UNETHICAL BUSINESS PRACTICES REASONS FOR THE PRESENCE OF UNETHICAL BUSINESS PRACTICES IN INDIA CORPORATE CULTURE & ETHICAL CLIMATE CAN ETHICS & BUSINESS CO-EXIST PRINCIPLES OF BUSINESS ETHICS POSITION OF BUSINESS ETHICS IN INDIA TATAS CODE OF CONDUCT GLAXOSMITHKLINES CODE OF CONDUCT MOTOROLAS CODE OF CONDUCT ROLE OF TRADE ASSOCIATIONS TRADE ASSOCIATION- FEI o ENFORCEMENT OF BUSINESS PRACTICES o DIFFICULTIES IN DECISION MAKING SUGGESTIONS FOR ETHICAL DECISION MAKING 10 PHASES IN ETHICS BIBLIOGRAPHY
Business ethics suggests certain golden rules which are fair to all and should be followed by businessmen. Business ethics is a part of social responsibility which the businessmen have to honour in practice. It is the application of ethical values to business. Business ethics from the Legal point of view If it is legal, it is ethical too is their approach. This is inadequate and even dangerous oversimplification of the concept of business ethics. Sometimes line of demarcation between ethical and unethical is very thin.
DEFINITIONS:
According to Wheeler, Business ethics is an art or science of maintaining harmonious relationship with society, its various groups and institutions as well as reorganizing the moral responsibility for the rightness or wrongness of business conduct
There are two theories when we talk about nature of ethics: The theory of moral unity essentially advocates the principles that business actions should be judged by the general ethical standards of society. There exists only one ethical standard which applies to business and to non-business situations. Second theory is the theory of amorality, which argues that business can be amoral, and the actions of businessmen need not be guided by general ethical standards. Managers may act
selfishly because the market mechanism distills their actions into benefits to shareholders and society at large.Adam Smith argued that the invisible hand of the market assures that by pursuing his own interest frequently promotes that of the society more effectively than when he really intends to promote it. In this way, capitalism provides moral justification for the pursuit of profit through behaviour which is not purposefully ethical.
Business ethics gives protection to consumers and other social groups such as shareholders, employees and the society at large. Business should give priority to social interest or social good. Such ethical approach creates good name and status to business and facilitates its expansion. 4.Provides basic framework. Business ethics provides the framework within which business is to be conducted. It suggests a legal, social, moral, economic and cultural limit within business is to operate. It suggests what is good and what is bad in business. 5.Needs willing acceptance for enforcement. Business ethics cannot be enforced by law or by force. It must be accepted as self-discipline by businessmen. It should come from within. Businessmen should go for ethical trade practices on their own and not by force of law. 6.Education and guidance required for introduction. Businessmen should be given proper education, guidance and training in order to motivate to follow ethical business practices. Trade associations and chambers of commerce have to play a positive role in this regard. 7.Not against profit making. Business ethics is not against fair profit making. However, it is against profiteering by cheating and exploiting consumers, employees or investors. It supports expansion of business activities but by fair means and not through illegal activities activities or corrupt practices. 8.Acts as summum bonum of human life. Ethics, as a science seeks to determine the summum bonum of human life. It passes judgments of value upon human actions with references to the moral values. Judgments of value are judgments of what ought to be. Such judgments may be different from the judgments of facts as they are judgements of what is.
It is a fact that many undesirable and unethical practices entered in the business field along with its growth and development. Market competition, large-scale production; lust for money and economic power are some major factors responsible for the downfall of the ethical values in Business. Conduct of business activities on unethical principles is harmful to the society and also to the businessmen in the long run. Ethical principles and values should so be introduced in the business. The following points justify the need of business ethics. 1.Checking business malpractices: Business ethics is needed to make business activities fair to consumers. It checks business malpractices and offers protection to consumers. 2.Improving consumer confidence: Business ethics is needed in order to improve the confidence of consumers as regards quality, price, reliability, etc. of goods and services. 3.Making businessmen conscious of social responsibilities: Business ethics is needed in order to make businessmen conscious as regards their duties and responsibilities towards consumers and other social groups. The old fashioned slogan that, the business of business is business is no more valid. Businessmen have to accept certain social responsibilities for their benefit and also for the welfare of the society. 4.Safeguarding consumer rights and social welfare: Business ethics is needed for the protection of rights of consumers at the business level. It is also needed for raising social welfare. 5.Protecting other social groups: Business ethics is needed in order to protect the interests of all those concerned with business the employees, shareholders, dealers and suppliers. It avoids their exploitation through unfair trade practices. 6.Developing cordial relations between business and society:
Business ethics is needed in order to develop cordial and friendly relations between business and society. It is also needed for social regulation and support to business. 7.Creating good image of business: Business ethics is needed in order to create good image of businessmen in the society and also for avoiding public criticized by all. The need for business ethics is felt more in recent years. This may be the net result of various factors. They include growing competition in business, growing alertness among consumers as regards their rights and growing awareness among employees, shareholders and the local community. People are not in a mood to tolerate unethical business. The oppose business malpractices and other anti-social policies of businessmen. Even the government will not allow unethical business practices. It may introduce new legal provisions for controlling unfair trade practices. In general, the socio-economics situation in India as well as in other countries is not favorable to unethical business. As a result, the importance of ethics in business is growing in recent years than ever before. Unfortunately, ethics (moral values) is the conspicuous casualty in the emerging business scenario. However, businessmen should be told that ethical and ethical business alone would help them to survive and move towards prosperity. They will have social respect, social recognition and consumer support only when they follow ethical principles in their business without any compromise. Ethics was an important aspect of business in the olden days. Its relevance is felt more now than ever before due to changes in the business environment. We are reaching to a stage of No ethics, No business. This suggests the growing need and importance of ethical business.
3) Guidance to businessmen:
Business ethics offers guidance to businessmen in decision making for social good and not simply for profit maximization.
Advantages to employees/workers:
1) Fair deals: Employees get justice and fair deal when ethical rules and standards are followed while dealing with them. 2) Fair wages: Employees get fair wages and other monetary and nonmonetary benefits, their exploitation is also avoided. 3) Fair treatment:
Employees are treated with dignity and this raises their moral and mental satisfaction. 4) Benefit of profit sharing: Employees get a share of profits of the company in the form of bonus/ profit sharing or other special monetary benefit. Business ethics involves protection of consumers and other social groups, honor and respect to social responsibilities and conduct social relations for the growth of business. This will lead to more expansion and diversification of business activities. Reasonable profit is possible even when ethical practices are respected/honored by businessmen. It is rather unfortunate that in the present world, in the pursuit of economic objectives, moral and ethical scruples fall prey to neglect and finally decay. Moreover concern for such scruples is considered as pursuit of outdated values. Businessmen should decide what is good and what I bad and act accordingly. By following this rule, they can make their business ethical and also beneficial to them and also to the society at large. Business ethics is important as it offers long-term benefits. It is rightly said, Truth and Ethics are more important to build, business and development, than just profits and growth. Business ethics may not give quick profit or quick expansion of business. However, it creates good image of the business and facilitates its development over a long period. Ethical business creates favorable atmosphere for public confidence and government support.
benefits and happiness. Businessmen should conduct business with high ethical standard. Ethical values should not be discarded in any human activity and business is not an exception to this rule. Businessmen should not run after profit maximization at any cost. They should support ethical values while managing business activities. Such outlook is beneficial to them and also to the entire society and social system. One can support the slogan of Good business is good ethics with many examples of usual business activities. The slogan Good ethics is good business has special significance/relevance in India. Ethical business is useful to businessmen and also to the society. Businessmen should act as friends and well-wishers of consumers. This is possible when they avoid the exploitation of different social groups but offer protection and support to them. It is rather unfortunate in todays world; moral and ethical scruples fall prey to neglect and finally decay. It is always desirable to strike a balance between economic performance and social performance of a business unit. Business ethics facilitates such balance. Businessmen should decide what is socially good and what is socially undesirable and act accordingly. This will make their business ethical and also beneficial to them and to the society at large. Business also gets public support when it is conducted in a fair manner. In this regard, reference may be made to another slogan, which again indicates the importance of ethics in business. This slogan is: No Ethics, No Business. It suggests one eternal truth in regard to business. It is possible to expand business or earn profit far a short period through unethical business activities. In other words, consumers can be exploited or cheated by unfair trade practices for a short period but not permanently. In the long run, the survival, growth and popularity of business depend on the use of ethical business practices. A business enterprise may not be able to conduct over a long period if it fails to honor moral/ethical values. There are some principles of business ethics. Businessmen are expected to honor them honestly and on their own. Their long term survival and growth depend on their support to ethical values. They will be forced to stop their business if they failed to honor
business ethics in theory and also in practice. This means that unethical business has no chances of survival over a long period. In this sense, the slogan No Ethics, No Business is true and acts as a guideline to businessmen/business enterprise. It also indicates the importance of ethics in business.
Ethics is a leadership issue. Poor ethics can sap business production and long-term results. Here is a concise list of ethical behavior you can keep to guide you in your future dealings (or make a copy for your boss to do the same). My Ten Commandments of Ethical Business Behavior have their roots in "Ethics: Easier Said than done," by Michael Josephson. 1 Be honest: To be honest means to be truthful, sincere, forthright, straightforward, frank and candid. You should have zero personal tolerance for lying, stealing, cheating, deceiving or acting deviously. 2. Have integrity: Always be principled, honorable, upright and courageous, acting upon your convictions. Strive not to be unscrupulous or two-faced with a philosophy that the-end-justifiesthe-means. 3. Keep your word: Be worthy of others' trust by keeping promises, fulfilling commitments and abiding by the spirit as well as by the letter of an agreement. Shy away from the temptation to rationalize non-compliance or create an excuse to break a commitment on the basis of technical or legalistic interpretations of agreements.
4. Maintain fidelity: Be faithful to your employees, family, friends and country, and never disclose information earned in confidence. Scrupulously avoid undue influences and conflicts of interest lest they cloud your ability to make independent and impartial decisions. 5. Always be fair: Be open-minded, willing to admit errors and change positions. Demonstrate a commitment to justice, with equal treatment of all, and a tolerance for diversity. Never take undue advantage of another's mistakes or adversities. 6. Care for others: Be kind, sharing and compassionate; share, give of yourself and serve others. Help those in need and avoid actions that will bring harm to others. 7. Respect others: Demonstrate respect for human dignity, privacy and the right of self-determination of all people. Be courteous, prompt and decent. Provide others with information they need to make informed decisions and do not patronize, embarrass or demean. 8. Be a responsible citizen: Obey just laws (and protest unjust ones). Exercise democratic rights and privileges responsibly by participation, social consciousness and public service. When in a position of leadership, openly respect the democratic decisionmaking process, avoid unnecessary secrecy or concealment of information and ensure others have the information they need to make intelligent decisions and exercise their rights. 9. Rigorously pursue excellence: Pursue excellence in all you do. Be diligent, reliable, industrious and committed in meeting personal and professional responsibilities. Perform all tasks to the best of
your ability while developing and maintaining a high degree of competence. Be well informed and well prepared. Never be content with mediocrity, and never strive to win "at any cost." 10. Always be accountable: Being accountable means accepting responsibility for decisions and the foreseeable consequences of actions and inactions, and for setting an example for others. Employers, along with parents, teachers, professionals and public officials have a special obligation to lead by example and to safeguard and advance the integrity and reputation of their companies, families, professions and the government. Avoid even the appearance of impropriety and take whatever actions are necessary to correct or prevent inappropriate conduct by others. The consequences of lost ethics are summed up well in an ancient Chinese proverb, "He who sacrifices his conscience to ambition burns a picture to obtain the ashes."
Are our businessmen ethical? The answer (with honorable exceptions) is in the negative. As is too well known, most of our businessmen are lured by the fast-buck culture, i.e., to earn as much money and as fast as possible. Ends justify the means for our businessmen.
ETHICAL DILEMMAS:
The ethical dilemmas stem from three sources are face-to-face ethics, corporate policy ethics and functional-area ethics.
printing this statement on the package and using it in the advertisement will increase sales. What would you do? You are interviewing a former product manager who just left a competitors company. You are thinking of hiring him. He would be more than happy to tell you all the competitors plans for the coming years. What would do you? You have a chance to win big account that will mean a lot to you and our company. The purchasing agent hinted that he would be influenced by a gift. Your assistant recommends sending a fine colour television set to his home. What would you do?
return to shareholders, to utilize natural resources in best possible manner and to pay fair wages to employees etc .are the ethical practices, which a businessman should follow. They also facilitate the expansion of business activities. Consumers always support ethical business practices as they are for their own good so is it advisory for a businessman to follow ethical business practices.
consumers who feel that they are treated to ethical business practices. However, the consumer protection act, 1986 puts control on such practices. Businessmen should be aware of these unethical business practices as they can bring in bad name of the firm as well the entrepreneur. Consumers can oppose these practices individually and collectively. These unfair practices affect the consumers but also the employees, shareholders, government and the society at large. Their main purpose is to exploit the specific social group for profiteering. For example, artificial scarcity, price rise, adulteration and misleading advertising are unethical practices in the case of consumers while low wages, bad working conditions and absence of welfare facilities are unethical pratices in regard to employees. The usual unethical practices in India noted are as follows: 1) Giving false, confusing and misleading advertisements of the products and services. 2) Supplying inferior quality goods to consumers. 3)Disregard to labour laws and other rights of the employees including the right to from trade union and right to make strike. 4)Exploitation of child labour and women workers. 5)Charging high prices by creating artificial scarcity for profit maximization. 6)Supplying inadequate information on the packages. 7)Lack of safety measure to workers and not give them the benefits of permanent services. 8)Over invoicing. 9)Inadequate measures in regard to pollution control and violation of legal provisions relating to pollution control. 10) Paying low rate of dividend. 11) Formation of business combinations for avoiding competition and creating monopolies. 12) Creating inconveniences to local people due to growing industrial activities without due care to local community. 13) Avoiding payment of taxes as per existing laws. 14) Using unfair sales promotion techniques.
15) Giving bribes, gifts, donations, and payment of kickback money to politicians and government officers for certain benefits. 16) Misbranding, hoarding and black-marketing. 17) Disregard to business laws, government policies and misuse of facilities and incentives offered by the government. 18) Providing inefficient services to bank depositors/customers. 19) Misuse of funds and mismanagement of the company with which the shareholders are closely linked. 20) Paying low wages, providing inferior quality welfare facilities and indecent treatment to employees. 21) Adulteration and short weights and measures.
The consumers in India are such in a bad condition that even if they are aware of unethical practices they do not take any action against it. This attitude of accepting injustice silently has also lead to unethical business practices. 3) Absence of well organized consumer movement at the national level: Absence of well-organized consumer movement at the national level is one more cause adding to the presence of unethical business practices. As the consumers do not have consumer education and guidance, they accept such unethical business practices.
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The presence of unethical business practices is also due to ineffective laws for consumer protection in India. Many laws are made for consumer protection. However, they are not executed properly. Unethical business practices are used even when laws are against such practices.
There are many more causes responsible for the presence of unethical business practices in India, which include lack of education, training of businessmen, and limited interest of political parties in consumer protection and inadequate support of the government to consumer movement for its rapid growth. Unethical business practices are now reducing in India. This trend is going on in the right direction and also pro-consumer. Growing market competition, economic reforms, globalization, growing consumer awareness are the major causes due to which the intensity of unethical business practices is reducing in India.
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Egoism Self-interest Economic efficiency Benevolence Friendship Social responsibility Principle Personal Laws and Morality Professional codes
knowingly do harm others) are equally applicable to business. No one since early historical period has supported the view that business is not concerned with moral or ethical values. On the other hand, it is universally accepted that businessmen should be honest to all social groups. Business should be conducted with certain ethical values. Moreover, businessmen can earn adequate profits even by supporting / following ethical values. Thousands of e.g. can be given to prove that ethical business has wealth, social recognition and happy life to businessmen. It is not correct to say that profit can be earned only by using unethical practices. In short, ethics and business can stay together and move together. Peaceful co-existence of the two is easily possible if businessmen are honest, properly educated and socially conscious as regards their social obligations.
Socially conscious and progressive businessmen support ethical business: Many of our businessmen are lured by fast buck culture, i.e., to earn as much money and as fast as possible. However, there are some cultured businessmen who respect and follow business ethics with honesty. Tatas, Godrej, L&T are some companies which give protection to consumers, liberal wages and welfare facilities to employees , attractive dividend to shareholders , positive contribution to pollution control, ecological balance and community service activities. Some may not be able to follow business ethics due to reasons beyond their control. A businessman, for e.g., has to bribe someone in order to get the work done quickly even when he is not favorable to such bribe giving. His business may suffer if the matter is delayed due to non payment of such bribe. 5) Business environment in India is not favourable for business ethics: The importance of business ethics is now well accepted by the professional management in India. Progressive business enterprises in India do understand the importance of business ethics and try to follow ethical business practices. However, in general, the business environment in India is not favourable for business ethics. The business community also shows limited initiative in the introduction of ethical norms in their regular business activities. Even the role of trade associations and chambers of commerce in guiding businessmen in this regards is rather insignificant.
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For
*Conduct
professionalism, high moral & Transparent &
To engage only in activities benefit from any information Beneficial to the national interest or group which constitutes Of country they operate in. information.
To be fully transparent in accounting management any actual or And financial reporting standards. of the code or an event that To fully strive for the establishment becomes aware of, that could And support of a competitive open business or reputation of employee Market economy and to abhor Tata company Unfair trade practices.
*Report to the
Possible violation the employees affect the or any other
To neither give nor take any illegal employees to pursue an active role in Payment, remuneration, gift, donation affairs as long as it does not Or comparable benefit to obtain favours business or interests of the
*Permits
civic in political affect the
Or business. Company or the group. To comply with all regulations regarding The preservation of environment. To be good corporate citizen & to actively Assist in the improvement of the quality Of life of the community with the objectIve of making it self-reliant. These social Activities are regarded as an integral part Of their business plans & not as an optional Part. To co-operate & share physical, human & Management resources with other Tata Companies so long as this does not adversely Affect its business interests& shareholders Value.
practices
Tata Motors has won the Jamnalal Bajaj Uchit Vyavahar Puraskar2003 for Fair Business Practices in the 'Manufacturer- Large' category, conferred by CFBP (Council for Fair Business Practices). The award was presented by the chief guest - Former Chief Justice of India, Mr. S. P. Bharucha at a ceremony held on February 7, 2004 at the Indian Merchants' Chamber, Mumbai. The award was received by Mr. P. P. Kadle, executive director, Finance and Corporate Affairs. Last year, Tata Motors received a merit certificate for being the runner-up.
operate within the letter and spirit of the law and maintain high standards of ethical business behaviour. GSK has a specific policy on Prevention of Corruption which fully reflects major US and UK legislation on the subject. The policy does not contain any exception permitting facilitating payments, and there is a separate policy relating to political contributions or donations. GSK also recognizes the dangers regarding employees accepting inducements and there is a separate policy on Acceptance of Gifts or Entertainment by GSK employees. Their audit system enables them to identify and deal with breaches of company policy. They also operate confidential phone lines and an offsite PO Box address for employees to report unethical behaviour. Disciplinary action including dismissal is a potential consequence of any policy violation. Management Certification promotes awareness of GSKs ethical standards and the Code of Conduct. It emphasizes the importance of the Code to thousands of other GSK employees who, in the course of their daily activities, must comply with the law and company policies in the conduct of company transactions. GSK can make a valuable contribution to the debate on public policy issues relating to research and development, the use of pharmaceuticals and healthcare. They also comply with relevant industry codes of practice, such as the International Federation of Pharmaceutical Manufacturers Associations (IFPMA) Code of Pharmaceutical Marketing Practices and the PhRMA Code on Interactions with Healthcare Professionals. GSKs risk mapping process is used by business units and functions to document, manage and report on risks and mitigation plans. GlaxoSmithKline aims to produce safe and effective medicines and vaccines that benefit patients by addressing their unmet medical needs.
o Motorola is committed to acting on them--through the potential of the technology and the way they conduct their business. o Motorola has established the Ethics Line for its employees, business partners and others to report any questions or concerns they may have about compliance with the Motorola Code of Business Conduct, or the laws, regulations or contract provisions that govern Motorola's business. o Times will change. Our products will change. Our people will change. Our customers will change. What will not change is our commitment to our key beliefs. o This Code is neither a contract nor a comprehensive manual that covers every situation Motorolas throughout the world might encounter. It highlights key issues and identifies policies and resources to help Motorolas reach decisions that will make Motorola proud. o Abusive, harassing or offensive conduct is unacceptable, whether verbal, physical or visual. o Responsible for immediately reporting accidents, injuries and unsafe equipment, practices or conditions to a supervisor or other designated person. o They build long-term relationships with our customers by demonstrating honesty and integrity. o Motorolas who deal with government officials and contracts are responsible for knowing and complying with applicable laws and regulations. o Require honest and accurate recording and reporting of information. This includes such data as quality, safety and personnel records, as well as all financial records. o Motorola and all their employees are required to comply with the antitrust and unfair competition laws of the many countries in which they do business. o Motorola is committed to protecting the environment by minimizing the environmental impact of operations and operating businesses in ways that foster sustainable use of the world's natural resources.
o Motorola will provide fair, accurate, timely and easy to understand information to the public. o The Ethics Line offers information, advice and suggestions. o The Audit Committee Line has been established to allow access to the Audit and Legal Committee of the Motorola, Inc. Board of Directors for any interested party with a concern about Motorola's accounting, internal controls or audit matters.
honest is to build character and character is the greatest asset even in the case of businessmen. 3 Moral Sanctions: Trade association can introduce incentives to those members who follow business ethics honestly. Press publicity should be given to members who respect business ethics.
TRADE ASSOCIATIONS:
FEI's mission includes significant efforts to promote ethical conduct in the practice of financial management throughout the world. Senior financial officers hold an important and elevated role in corporate governance. While members of the management team, they are uniquely capable and empowered to ensure that all stakeholders' interests are appropriately balanced, protected and preserved. This Code provides principles to which members are expected to adhere and advocate. They embody rules regarding individual and peer responsibilities, as well as responsibilities to employers, the public, and other stakeholders. Violations of FEI's Code of Ethics may subject the member to censure, suspension or expulsion under procedural rules adopted by FEI's Board of Directors.
4. Act in good faith, responsibly, with due care, competence and diligence, without misrepresenting material facts or allowing one's independent judgment to be subordinated. 5. Respect the confidentiality of information acquired in the course of one's work except when authorized or otherwise legally obligated to disclose. Confidential information acquired in the course of one's work will not be used for personal advantage. 6. Share knowledge and maintain skills important and relevant to constituents' needs. 7. Proactively promote ethical behavior as a responsible partner among peers, in the work environment and the community. 8. Achieve responsible use of and control over all assets and resources employed or entrusted. 9. Report known or suspected violations of this Code in accordance with the FEI Rules of Procedure. 10. Be accountable for adhering to this Code.
Management Commitment: The Institute will do all in its power to conform to the letter and spirit of this code. In order to monitor its performance in this regard, the IBE has sought and obtained accreditation from Good Corporation. This takes into account the views of all our stakeholder groups and, through an independent assessment process, verifies that we 'practice what we proclaim'. The work of the Institute, as expressed in its publications, meetings and other activities, will endeavour to be objective and reflect current best practice in topics addressed. The Institute has identified five principle constituents to whom it has a responsibility: employees; subscribers and other users of our services; suppliers; the community and its trustees.
Employees: The IBE values its staff highly and respects their dignity and rights. We
will be open and honest with our staff; provide clear and fair terms of employment; provide clean, healthy, safe and secure working conditions; have a fair remuneration policy; strive for equal opportunities; encourage staff to develop skills and progress in their careers; do not tolerate any harassment of our staff of any kind; do not discriminate on any grounds other than the ability to work effectively; only employ those who are eligible to work; meet requests for flexible working arrangements wherever possible.
Subscribers and other users of our services: The IBE treats its subscribers and others for whom it provides services with respect. We
seek to be honest and fair in our relationships; seek to provide standards of agreed service;
take all reasonable steps to ensure that reports, training and other services we provide are of a high quality; treat all complaints seriously; treat all corporate and personal information confidentially
seek to be honest and fair in our relationships with suppliers including those from whom we commission work; pay suppliers in accordance with agreed terms; have a policy not to offer, pay or accept bribes or substantial favours; encourage suppliers to abide by the principles of our code; aim to procure goods and services from those demonstrating good ethical practice.
will make sure that there is a clear public benefit in our programmes; seek to be sensitive to our landlord's and the local community's needs; try to protect and preserve the local environment; endeavour to support ethical trade in our purchasing practices.
Trustees: The IBE is accountable to the trustees for the use of its funds. We
make available financial reports to our trustees that are accurate and timely and give a fair understanding of the current and future prospects of the organisation; communicate honestly our policies, achievements and prospects. when appropriate, invest financial resources in ethical funds; aim to protect IBE funds, manage risks and ensure that donations are used for the purpose for which they were given;
Implementation: This code will be given and explained to all staff, including those who are temporary or on contract. They will be expected to work within its letter and spirit. Good Corporation will be asked annually to assess how the Institute is performing in relation to this code. The code will be reviewed every two years.
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Education and guidance of businessmen as regards business ethics and fair trade practices by associations of business, press, TV and so on. Pressure from consumers, employees and the society at large on businessmen or business practices to follow fair trade practices and respect the ethical values. Effective execution of consumer protection laws by the government agencies. This will put pressure on businessmen to follow certain fair practices due to fear of punishment. Effective role of trade associations, chambers of commerce and other professional associations of businessmen in making business ethics as an integral part of
business management itself. Such associations can educate and guide their members through annual meetings, seminars; lectures etc. and encourage businessmen to follow business ethics on their own.
Knowing How to Approach Situations Helps Make Ethics a part of Everyday Life.
Respect Organizational Resources. All organizations need to create revenue and control costs in order to survive. Most must make a profit. Don't turn a blind eye to misusing supplies and resources, leaving lights on, requesting overnight shipping unnecessarily and other actions that expend the resources of the company needlessly. If each employee, representative, or volunteer avoids using only $100 less per year, imagine the amount of money that your business could save and put to more productive use. Say NO To Negativity. Ever notice how some people always seem to gravitate toward negative behaviors? You know them - they're the folks who say things like "It'll never work" before they even consider how to make it work. They're the ones who openly criticize the organization, spread rumors about co-workers, moan, complain and try to pull others into their "woe is me" funk. Well, don't be one of them! Negativity is counterproductive. It erodes integrity and sometimes
fosters illegal acts. Negativity is wrong. This makes it unethical. Avoid it yourself, and discourage it in others. Make Sure The Mission Matters. Know and follow your organization's mission regardless of whether it appears in a formal written statement or a service promise on advertisements and brochures. Be about what the business says it is about. If you don't have a clear understanding of what the mission is, ask! You have the responsibility to understand it. Your supervisor or manager has the responsibility to clearly describe it to you so you do understand it. This will help you become the most effective and productive employee possible. Tame The Blame. Assigning blame is a destructive action that causes defensiveness and shapes an environment in which co-workers become afraid to apply innovation, creativity and risk taking. One simply but effective method for taming blame in a group is to identify a code word. This word can then be used by everyone to tactfully point out when someone has slipped into blaming mode and needs to switch to problem solving. Don't view the problem as being the issue that something wasn't accomplished or it was done wrong. That is simply a symptom. The real problem is WHY it was not accomplished or WHY it was done wrong. Taking action to solve the basic issue will show you are more interested to determining the root of problems, not simply blaming people. Be Truthful. Lying is often the gut-level defensive reaction to perceived danger. When you feel the desire to hide the truth, take time to jot down what you will get out of a trusting relationship versus the shortterm gain you might get out of evading the truth. Lying begins a dangerous cycle that breaks down trust and encourages additional lying. The long-term impact on you and the business is never worth the short-term possible benefit.
01/27/2005 Press release from: Center for Corporate Ethics Institute for Global Ethics Expands Focus on Business Practices with Center for Corporate Ethics. Group Aims to Make Trust Part of Corporate Culture .(CSRwire) CAMDEN, ME The Institute for Global Ethics announces the expansion of its business ethics practice with the opening of the Center for Corporate Ethics. The new division is based in New York City, the financial capital of the world, and is devoted to helping chief executives and business leaders focus on the challenges of maintaining integrity within large, complex, values-driven corporations. "The objective of the Center for Corporate Ethics is to work with companies to create and sustain the finest corporate culture with the highest sense of integrity, the greatest customer loyalty, and the most dedicated and mission-driven group of employees," says Rush worth Kidder, founder and president of the Institute for Global Ethics. Robert W. Hutchinson, a respected corporate consulting executive, will serve as the Center's managing director Hutchinson has spent a lifelong career as a trusted adviser to CEOs and corporate executives from around the world, whom he counsels on critical decisions affecting corporate policies and procedures and supply chain management. "Companies may be open about their business practices, but what are they doing to foster an open-door culture that promotes honest feedback from their employees," says Hutchinson. The Center for Corporate Ethics helps business leaders separate perception from reality by identifying gaps in employee attitudes regarding their business," says Hutchinson. "We help identify those gaps and develop solutions to sustaining a culture of integrity and
trust." Prior to joining the Institute for Global Ethics, Hutchinson served as national director and global practice leader of Supply Chain Management Consulting at KPMG. He was executive vice president of Garr Consulting Group, a division of Deloitte & Touche and vice president of W&H Systems. He also served in executive positions at Dayton-Hudson Corporation (now Target) as well as the United States Air Force. "Under Bob's leadership, the Center for Corporate Ethics is wellpositioned to equip companies with the tools, knowledge and strategies that help minimize the risks and costs of potential ethical lapses," says Kidder. The Center for Corporate Ethics' assessment tools, training seminars and custom consulting services give organizations insight into the attitudes and values of employees and how their ethical outlook may impact business.
In a recent article in the October 2004 issue of Business Ethics Quarterly titled "The Development of International Business Norms," Duane Windsor, the Lynette S. Autrey Professor of Management at Rice University's Jesse H. Jones Graduate School of Management, describes the present state of international business ethics, business law and public policy and explains why consensus around a set of global business standards is unlikely in the near future. "The environment in which multinational businesses now operate is a very complicated world of multiple legal jurisdictions and varying standards of ethics and values," Windsor says. Pointing to an absence of international business norms coupled with disagreements among business ethicists, Windsor argues that global business standards may only come about as a result of initiatives outside the business community. He cites recent governmental and non-government efforts regarding corruption, environmental protection, human rights and fiduciary responsibility which may eventually define standards of acceptable, if not legallybinding, behavior within the international business community. "International business norms might evolve as a result of the interaction of enterprises, non-governmental organizations and stakeholders," Windsor says. "Their attempts to promote such issues as human rights, ecological sustainability and labor rights could eventually evolve into what I call informal or formal 'rules of the game' for global businesses." Windsor believes the path to global business norms is an issueby-issue, two-stage process, beginning with an agreement in principle on a particular standard followed by the adoption of enforcement legislation in each country. "If you can convince all parties to agree formally to a norm, such as the notion that sweat shops are bad, over time that agreement will evolve toward a general acceptance of the norm and better business behavior," he says Windsor's theory stems from his review of a number of governmental and non- governmental initiatives, in particular, passage of the U.S. Foreign Corrupt Practices Act. This
1977 legislation prohibited bribery of public officials abroad by U.S. corporations. . "Up to that point virtually every country prohibited bribery of its own public officials but none limited its corporations from bribing a public official abroad," says Windsor. "In fact, until recently, about 14 European countries permitted tax deductions of such bribes." Under pressure from the U.S. and a group of non-governmental organizations, increasing numbers of countries have cooperated to suppress business corruption of governmental and political officers. The United Nations adopted a formal condemnation of corporate bribery, as did the Organization of American States, the European Union and the Organization for Economic Cooperation and Development. Corporations such as British Petroleum, General Electric and Motorola also have taken positions on particular issues. BP has helped to establish a more environment-friendly approach for the energy industry, while the latter two companies have taken strong stands against corporate corruption. Regardless of whether companies are motivated by practical or moral concerns, Windsor stresses the fact that moral leadership on the part of a corporate executive means looking beyond simply the benefits to the company. Corporations may resist the development of global business norms because they think, in the short term; they are bad for business," Windsor says Issues facing multinational companies today, however, have long-term consequences for what has become a very interdependent world. Their leaders need to ask themselves what kind of world they want to help build."
A member of The Jones School faculty since 1977, Windsor has conducted research on corporate environment and social performance, business ethics, corporate governance, leadership, and socially responsible management. Some of his work appears as book chapters, most recently in Enron: Corporate Fiascos and Their Implications (New York: Foundation Press) and International Corporate Responsibility: Exploring the Issues (Pittsburgh: Carnegie Mellon University), and in the Journal of Public Affairs, the Journal of Corporate Citizenship, and the Cornell International Law Journal. A past president and program chair of the International Association for Business and Society and The 2005 program chair for The Academy of Management's Social Issues in. Management division, Windsor received his undergraduate degree from Rice and his master's and Ph.D. degrees from Harvard.
Treating everyone (customers, co-workers, vendors, etc.) with dignity and courtesy. Using company supplies, equipment, time, and money appropriately, efficiently, and for business use only. Protecting and improving your work environment, and abiding by laws, rules and regulations that exist to protect our world and our way of life.
The second "R" of business ethics is RESPONSIBILITY. You have a responsibility to your customers, your co-workers, your organization and yourself. Included are behaviors such as:
Providing timely, high-quality goods and services. Working collaboratively and carrying your share of the load. Meeting all performance expectations and adding value.
The third "R" of business ethics is RESULTS. Essential in attaining results is an understanding that the way results are attained the "means" are every bit as important if not more important than the ultimate goals the "ends." Using the phrase The ends justify the means is an excuse that is too often used to explain an emotional response, or action that was not well planned or carefully considered. Obviously, you are expected to get results for your organization and for your customers. However, you are also expected to get those results legally and morally, by being ethical. If you lose sight of the distinction, you jeopardize your job, your business and your career. By considering Respect, Responsibility and Results before taking action you will avoid the following common rationalizations for not doing what's right:
"Everyone else does it." "They'll never miss it." Nobody will care." The boss does it." No one will know." "I don't have time to do it right." "That's close enough."
BIBLIOGRAPHY: BIBLIOGRAP Y:
www.indiainfoline.com www.business.com Business Environment By Kale-Ahmed Principles of Management By Harold Koo