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2  BUSINESS OBJECTIVE V. ETHICS  Often ethical conflict between making money and doing what is right  People in business claim they are bound only by law, not by normal norms  Business is no concern with ethics  Moral is personal matter

3 Positive business ethics: i.e – personal ethics, fairness, integrity, truth telling, dependability, business plan, values based.

4  ETHICS AND MORALITY  Ethics  Solomon – ethics means character/custom  How people ought to act - individual character  Its basic concept:- A.individual character – ‘a good person’ B. the social rules that govern and limit our conduct – ‘morality’

5  Ethics means how people ought to be distinguish from morality which refers to human conduct & values.  Ethics presupposes the existence of morality.  The morality of society is related to its customs and law of society.

6  Morality  Rules of human behavior/human conduct and values  Specifies certain act as wrong or immoral  Action can be viewed from moral perspective – including business  Those practices & activities that are considered importantly right and wrong  The rules that govern those activities  The values that embedded, fostered or pursued by those activities & practices

7  BUSINESS ETHICS  Part of general field of ethics  What is business ethics? A study what constitutes right and wrong/good and bad in business activities Thus, it is not the study of what is legal but of the application of moral standards to business decisions. Moral standard s are canons of personal behaviour that are neither legislated nor changed by legislation.

8  AMERICAN MYTH OF A MORAL BUSINESS  A popular & widespread view among American businessman  It describes how American Business and businessman perceive themselves & are perceived by others.  Business is concerned primarily with profit

9  Business & people in business are not explicitly concerned with ethics  They are not unethical or immoral  Business is not expected to be concerned with ethics

10  RELATION BETWEEN BUSINESS AND MORALITY  Business and moral are related  Business is an important part of contemporary society  Morality consist of rules of human behaviors & specifies that certain actions are wrong or immoral or vice versa  Business presuppose a background of morality & would be impossible without it.

11 BUSINESS RESPONSIBILITIES  Merely profit making or  Social responsibilities?  Narrow view – profit maximization  Frieman: ‘business has no special responsibilities other than to maximize profits’

12 Broader view – corporate social responsibility  Keith Davies: ‘ social responsibility implies that business decision maker in the process of serving his own business interests is obliged to take actions that also protect and enhance society’s interest…’  In this manner, harmony is achieved between business’s action and the larger social system.  The businessman becomes concerned with social as well as economic outputs and with total effect of his institutional actions in society.