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Chapter Five - Ethics and Business - Codes Dilemmas and Dialectics

The document discusses ethics and ethical responsibilities in business. It covers topics like ethical codes, ethical dilemmas, and unethical business practices. It provides characteristics and types of ethical dilemmas, and how they can be resolved through analyzing consequences and different approaches.

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Owusu-Afriyie
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33 views15 pages

Chapter Five - Ethics and Business - Codes Dilemmas and Dialectics

The document discusses ethics and ethical responsibilities in business. It covers topics like ethical codes, ethical dilemmas, and unethical business practices. It provides characteristics and types of ethical dilemmas, and how they can be resolved through analyzing consequences and different approaches.

Uploaded by

Owusu-Afriyie
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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CHAPTER FIVE

ETHICS AND BUSINESS: CODES,


DILEMMAS AND DIALECTICS
Learning Objectives
• Need for ethics in business

• Ethical responsibilities vs. Social responsibilities

• Adam Smith and Milton Friedman on the ethical responsibility of business

• Ethical dilemma: characteristics, types, causes, sources and resolution

• Dialectics of ethical development in business

• Ethical issues in business and society

• Some major unethical business practices


Introduction
• The standard of morality differs from country to country and
from situation to situation.

• Ethics, which was once the domain of philosophy, is now being


applied to various professions including business.

• It is gratifying to note that since 1970s, ethics has entered the


arena of business through the adoption of corporate social
responsibility.
Ethical Responsibility vs Social Responsibility
• SR is related to anything that promotes social development and enhances social
welfare such as setting up a school, etc.

• The concept of ER is a bit different as it gives a moral responsibility to a


person to do certain things (i.e. CSR activities).

• Thus, for a manager it is a moral responsibility to ensure that his employees are
given a reasonably good working environment.

• The basic purpose of SR is to help the society to enjoy certain benefits and it
may involve the production of public goods like road, etc
Ethical Responsibility vs Social Responsibility cont.
• The purpose of ER is to develop the ethical standard of givers and/or receivers.

•What is generally expected of a business enterprise is social responsibility and


not ethical responsibility.

•It is not proper to assign to a business organization the responsibility of the


moral development of people.
Code of conduct in business
• The basic purpose is to ensure a proper ethical behaviour in the
conduct of the business.

• All codes are based on the core values of the company, its mission
and vision.

• Core values are the guiding practices of the company meant to be


strictly adhered by all stakeholders.

• The basic business codes remain the same despite company


differences.
Some standard codes of conduct in business
• Compliance with laws, rules and regulations

• Respect and honour for human rights

• Maintenance of company’s goodwill, assets and property.

• Non-development of cartels and monopoly practices.

• No insider trading.

• There should be accountability and transparency


Ethical Dilemma
• A situation that involves at least an ethical issue where a clear decision
or a choice becomes problematic because of competing
claims/interests.

• There may be an ethical contradiction or conflict in the choice to be


made.

• A choice has to be made between two desirable/undesirable situations.

• Decision rules are not clear-cut and may be of conflicting values.

• The solution is not unique or universal.


Characteristic Features of Ethical Dilemmas
• Social cost and private gains are different.
• Competitive behaviour gains predominance in many cases.
• There may be an inconsistency between goals (e.g. materialism vs
altruism).
• Cross-cultural value differentials do exist.
• There are some pressures from somewhere.
• A problem of right choice is the main issue.
• The exact impact of the two alternatives may not be known.
Types of Ethical Dilemmas
Ethical dilemma may be of different types. Some of which are ethical
dilemma between;
 one ethically right and one ethically wrong alternative.

 two ethically wrong alternatives.

 two ethically right alternatives.

Ethical dilemmas are with respect to two situations created by two


institutions or value systems.
The Typology of Dilemma
• Organization vs. Persons (Employees)
• Persons vs. Society
• Local culture vs. Foreign culture
• Organization vs. Law
• Organization vs. Society
• Person vs. Law
• Right vs. Right
• Wrong vs. Wrong
• Right vs. Wrong
Causes and Sources of Ethical Dilemmas
• Individual: Individual values may be in conflict with social or
family values.

• Family: Family values may be in clash with values in the business.

• Organization/workplace: Organizational culture may be in


conflict with personal values.

• Society: Social norms may be in conflict with individual norms.

• Cross-cultural Level: The culture of one country may be in


conflict with the cultural practices of another country.
Resolution of Ethical Dilemmas
• Study the Nature of the Ethical Dilemmas
 Ethicists recommend the acceptance of what is right (right vs. wrong).
 Apply the one which is very close to your core values and is consistent with the accepted
ethical standard (right vs. right).
 Choose the less damaging to the person, organization or the society (wrong vs. wrong).

• Analyse the Consequences of Each Contemplated Solution


 Individual Gain vs Social Gain
 Truth vs Loyalty
 Justice vs Mercy
 Short-run vs Long-run Gains
How to Make the Resolution Workable?
• The resolution of ethical dilemma should be within the legal framework.

• The consequences of all the alternatives must be studied properly.

• It is, at times, necessary to make a compromise.

• The ethical resolution should be based as far as possible on a cognitive


ethical principle with justification.

• Resolve the ethical dilemmas in such a way that will win everybody’s
approval in the given situation.

• A balanced approach to the resolution of ethical dilemmas is immensely


necessary to make it acceptable to all types of stakeholders.
Some major unethical business practices
• Sexual Harassment at Workplaces

• Forced Labour and Bonded Labour

• Discriminations

• Fraud

• Theft

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