2
Business Ethics and
Social Responsibility
Course: BUS 101
Lecturer: Aunima Nazmun Nahar (NNA)
Concern for Ethical and Societal Issues
Business Ethics
The standards of conduct and moral values regarding right
and wrong actions in the work environment
Social responsibility
Balance between what’s right and what’s profitable
Often no clear-cut choices
Often shaped by the organization’s ethical climate
From Obligation to Responsiveness to
Responsibility
• Social Obligation
– The obligation of a business to meet its economic and
legal responsibilities and nothing more.
• Social Responsiveness
– When a firm engages in social actions in response to
some popular social need.
• Social Responsibility
– A business’s intention, beyond its legal and economic
obligations, to do the right things and act in ways
that are good for society.
The Contemporary Ethical Environment
Companies are now moving towards CSR.
Vast majority of businesses are ethical.
Being ethical also means doing something for
the environment.
Minimum Requirements for Ethics
Compliance Program
 Establishing compliance standards &
procedures
 High-level personnel responsibility
 Communication of standards & procedures
 Establishment of standards
 Enforcement of standards
 Appropriate response to offense
 Self reporting
 Applicable industry practice or standards
Individuals Make a Difference
Individuals can make the
difference in ethical
expectations and behavior.
Putting own interest
ahead of the
organization
Lying to employee
Misrepresenting hours
Safety violations
Internet abuse
Technology is expanding
unethical behavior.
Development of Individual Ethics
Common Business Ethical Challenges
• Conflict of Interest: situation in which an
employee must choose between a business’s
welfare and personal gain
• Integrity: Adhering to deeply felt ethical
principles in business situations
• Loyalty vs Truth: Individuals may have to decide
between loyalty to the company and truthfulness
in business relationships.
• Whistle -blowing: Employee’s disclosure to
government authorities or the media of illegal or
unethical practices committed by an organization.
How Organizations Shape Ethical Conduct
Ethical Awareness
Code of Conduct:
Formal statement that
defines how the
organization expects
and requires employees
to resolve ethical
questions.
Ethical Education
Codes of conduct
cannot detail a solution
for every ethical
situation, so
corporations provide
training in ethical
reasoning.
However, the question is
Can Ethics be Taught?
Ethical Action
Helping employees
recognize and reason
through ethical
problems and turning
them into ethical
actions.
e.g: Employee Hotline
Ethical Leadership
Executives must
demonstrate ethical
behavior in their actions.
use clear, explicit language
rather than euphemisms for
corrupt behavior
encourage behavior that
generates and fosters ethical
values
practice moral absolutism,
insisting on doing right even if
it proves financially costly
Areas of Responsibility
Responsibilities to the General 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.
3Rs
Green marketing
Renewable energy source
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.
Responsibilities to Customers
CONSUMERISM
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.
Responsibilities 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 the Equal Employment Opportunity
Commission.
Age Discrimination. Age Discrimination in Employment Act of
1968 protects workers age 40 or older.
Sexual Harassment and Sexism. Avoiding unwelcome
actions of a sexual nature; equal pay for equal work without
regard to gender.
Responsibilities to Investors and the
Financial Commuity
Obligation to make profits for
shareholders.
Expectation of ethical and moral
behavior.
Protection of investors by the
Securities and Exchange Commission
and state regulations.