Business Ethics

Only available on StudyMode
  • Download(s) : 136
  • Published : January 19, 2013
Open Document
Text Preview
BUSINESS ETHICS DEFINITION
Business ethics (also corporate ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations. Business ethics has both normative and descriptive dimensions. As a corporate practice and a career specialization, the field is primarily normative. Academics attempting to understand business behaviour employ descriptive methods. The range and quantity of business ethical issues reflects the interaction of profit-maximizing behaviour with non-economic concerns. Interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia. For example, today most major corporations promote their commitment to non-economic values under headings such as ethics codes and social responsibility charters. Adam Smith said, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." Governments use laws and regulations to point business behaviour in what they perceive to be beneficial directions. Ethics implicitly regulates areas and details of behaviour that lie beyond governmental control. The emergence of large corporations with limited relationships and sensitivity to the communities in which they operate accelerated the development of formal ethics regimes. ETHICAL DILEMMA

An Ethical dilemma is a complex situation that often involves an apparent mental conflict between moral imperatives, in which to obey one would result in transgressing another. This is also called an ethical paradox since in moral philosophy, paradox often plays a central role in ethics debates. "Love your neighbour" (Gospel of Matthew 5:43) is sometimes in contradiction to an armed rapist: if he succeeds, you will not be able to love him. But to pre-emptively restrain them is not usually understood as loving. This is one of the classic examples of an ethical decision clashing or conflicting with an organismic decision, one that would be made only from the perspective of animal survival: an animal is thought to act only in its immediate perceived bodily self-interests when faced with bodily harm, and to have limited ability to perceive alternatives - see fight-or-flight response. ETHICAL ISSUES IN STRATEGY

1.SELF DEALING : Self-dealing is the conduct of a trustee, an attorney, a corporate officer, or other fiduciary that consists of taking advantage of his position in a transaction and acting for his own interests rather than for the interests of the beneficiaries of the trust, corporate shareholders, or his clients. Self-dealing may involve misappropriation or usurpation of corporate assets or opportunities. Self-dealing is a form of conflict of interest. 2.INFORMATION MANIPULATION: occurs when managers use their control over corporate data to distort or hide information in order to enhance their own financial situation or the competitive position of the firm. SATYAM scam is the perfect example for this category. 3.ANTI COMPETITVE BEHAVIOUR/PRACTICES: Dumping, where a company sells a product in a competitive market at a loss. Though the company loses money for each sale, the company hopes to force other competitors out of the market, after which the company would be free to raise prices for a greater profit. Exclusive dealing, where a retailer or wholesaler is obliged by contract to only purchase from the contracted supplier. Price fixing, where companies collude to set prices, effectively dismantling the free market. Refusal to deal, which is done by two companies agreeing not to use a certain vendor. Dividing territories, an agreement by two companies to stay out of each other's way and reduce competition in the agreed-upon territories....
tracking img