Business Ethics
What we will learn today
• Define and discuss what business ethics
means
• Draw a mind map, diagram or list of the
ethical issues faced in business
• Answer questions on the ethical decisions
of three companies
What is meant by ethics?
An ethic is a moral principle or set of moral values held by
an individual or a group.
Ethical behaviour is behaviour which is considered to be
right and moral.
Business ethics are the values and principles which
operate in the world of business. They form the moral
framework of the organisation.
Business ethics help firms decide what
actions are right or wrong in certain
circumstances.
E.g. Should a firm relocate to a country
paying lower level of wages?
Should a firm release a life-saving drug
after limited testing?
Should advertising aimed at children be
restrained?
Comparing Working Conditions
Bangladesh
Wage per month:
Wage per week:
Wage per hour:
Hours per week:
£12
£3
33p
90hrs
The UK
£813
£203
£5.35
38hrs
What ethical issues are faced by
business?
• Should firms use child labour?
• Is animal testing needed in products and ingredients?
• What wages should firms pay to poor countries?
• To what extent should firms seek to be environmentally
friendly?
• Should firms get involved in certain activities?
e.g making weapons
Who cares about business
ethics?
•
•
•
•
•
•
Customers
Managers/Owners/Shareholders
Pressure Groups/Activists
Workforce
The Community
Trading Partners
Why be ethical?
•Create good image and good press
•To act within the law
•Because the owners want to be
•It is one of their unique selling points
•To attract customers/employees/investors
•To be socially responsible
Two sides to every story
• Companies often find it difficult to please all of its
stakeholders, as they have different interests.
•
Being ethical depends on an individual view of what is
right and wrong. What might be considered
good behaviour to one individual, may
seem bad to another.
• Ultimately companies aim to make a profit and
sometimes this can conflict with acting in a responsible way.
• Larger, global companies can often find it difficult to regulate
their activities in other countries.
The worst offenders
The Fraser 2006 rating on ethical reputation (1st being regarded
as least ethical), based on interviews with 1,300 adults:
1)McDonald's
2)Nike
3)Shell
4)Adidas
5)Barclays
6)Coca-Cola
7)BP
8)Camelot (National Lottery)
9)American Express
True or False?
Is the following statement true or false?
“Ethics has to do with whether my feelings are
right or wrong.”
True – but we must realise that
sometimes our feelings can
cloud are judgement and make it
difficult to see both sides.
True or False?
Is the following statement true or false?
“Ethics has to do with my religious beliefs.”
True – it can be linked to religious
beliefs, but remember it is much
more than this.
True or False?
Is the following statement true or false?
“Being ethical is doing what the law always
requires.”
True – people and business have
to follow law, but remember that
some laws may be unethical.
True or False?
Is the following statement true or false?
“Ethics consists of the standards of behaviour
our society expects.”
True – but remember that
society is sometimes
unpredictable and cruel.