Ethics, Governance and

ETHICS, GOVERNANCE AND
CSR
MODULE 1
DAY 2
9 NOVEMBER 2020
INTRODUCTION
•The value of what should be done and what should

not be done from the business point of view
•Public’s interest in business ethics increased during
the last four decades
•Public’s interest in business ethics spurred by the
media
INVENTORY OF ETHICAL ISSUES IN
BUSINESS
• Employee-Employer Relations
• Employer-Employee Relations
• Company- Customer Relations
• Company- Shareholder Relations
• Company- Community Public Interest
ETHICS: DEFINITION
• Ethics involves a discipline that examines good or bad practices within the
context of a moral duty•
• Moral conduct is behavior that is right or wrong•
• Business ethics include practices and behaviors that are good or bad
ETHICS ISSUES
• Product safety standards

• Advertising contents
• Working environment
• Unauthorized payments
• •Employee’s privacy
• Environmental issues
ETHICS: ORIGIN
• Ethics originated from a Greek word ithiki. It means character or

manners.
• Ethics is subjective while morality is objective
• Ethics is about sense of belongingness to society of business
• Formed with a limited vision for economic generation but
should resolve conflict with society by servicing the community
ETHICS: OBJECTIVES
• Studies human behavior and makes evaluative assessment about them as

moral or immoral
• Establishes moral standards and norms of behavior
• Makes judgment upon human behavior based on these standards and norms
• Prescribes moral behavior and makes recommendations about how to or
how not to behave
• Expresses an opinion or attitude about human conduct in general
BUSINESS ETHICS
• When business people speak about business ethics, they usually mean one of
three things
• Avoid breaking the criminal law in one’s work related activity
• Avoid action that may result in civil law suits against the company
• Avoid actions that are bad for the company image
• Businesses are especially concerned with these three things since they
involve loss of money and company reputation
ETHICS: MEANING
• Two Key Branches of Ethics

• Descriptive ethics
• Involves describing, characterizing and studying morality. (what is)
• Normative ethics
• Involves supplying and justifying moral systems (what should be)
THREE DIMENSIONS OF ETHICS
• Utilitarian View of Ethics:
• Business is a part of moral structure and moral ethics. Business and morality cannot be separated
and it must play by the rules of ethics of the community
• Separatists View of Ethics:
• Morality and ethics has no role in business. Society and law deals with ethics and morality.
Proposed by Adam Smith and Milton Friedman. Business is a distinct entity and does not include
ethics and morality.
• Integrated View of Ethics:
• Ethical behavior and business should be integrated in a new era called Business Ethics. Proposed
by Talcott Parsons
ETHICS AND MORALITY
• Ethics is about the field or domain of enquiry while morality is the object of enquiry
• Ethics or behavior accepted with in a group is recorded as credos - espoused value of
group or organization
• When espoused value become practiced values then the group is said to be Ethical
Group/ Organization
• Ethical theories can be classified into three subject areas:
• Meta ethics
• Normative ethics
• Applied ethics
META ETHICS
• Deals with entire scale of ethical issues: moral values of humans

• It is the branch of ethics that focuses on how we understand,
know about and what we mean when we talk about, what is right
and what is wrong
• Addresses questions such as: What is goodness? and How can we
tell what is good from what is bad?
APPLIED ETHICS
• Applied ethics is in the words of Brenda Almond co-founder of the Society for Applied
Philosophy “the philosophical examination from a moral standpoint of particular issues in
private and public life that are matters of moral judgment”.
• It is thus a term used to describe attempts to use philosophical methods to identify the
morally correct course of action in various fields of human life
• Example:
• Bio Ethics, Business Ethics, Environmental Ethics
APPLIED ETHICS
THERE ARE SIX DOMAINS TO IMPROVE SOCIAL AND GLOBAL ISSUES:
• Decision ethics or ethical theories and • Business ethics or individual based

ethical decision processes• morals to improve ethics in an
• Professional ethics or ethics to improve organization
professionalism • Organizational ethics or ethics among
• Clinical ethics or ethics to improve our organizations
basic health needs • Social ethics or ethics among nations
and as one global unit
NORMATIVE ETHICS
• That which guides and controls human conducts sets out certain standards
that determine what is right and what is wrong
• Golden principle behind this: WE SHOULD TREAT OTHERS THE SAME
WAYTHAT WE WANT OTHERS TO TREAT US
• There are Three leading theories of:
• Stockholders Theory
• Stakeholders Theory
• Social Contract Theory
SOURCES OF ETHICAL NORMS

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ETHICS, GOVERNANCE AND

•The value of what should be done and what should

• Product safety standards

• Ethics originated from a Greek word ithiki. It means character or

• Studies human behavior and makes evaluative assessment about them as

• Two Key Branches of Ethics

• Deals with entire scale of ethical issues: moral values of humans

THERE ARE SIX DOMAINS TO IMPROVE SOCIAL AND GLOBAL ISSUES:

• Decision ethics or ethical theories and • Business ethics or individual based

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