Dr. Navkiranjit Kaur Dhaliwal2
“Business ethics,” a subject that for years has been low profile in business publications and business school curriculum, has suddenly gained status. The word “ethics” was once considered irrelevant by corporate loyalists, but now discussion of it is increasingly seen as not only important but also as critical to a company’s success. Till the 1990,s Indian corporate regarded business ethics as a mere extension of philanthropy. Although corporate giants like Tatas and Birlas contributed generously to philanthropic causes, it was only after the entry of MNCs in the Indian market that the definition of business ethics has broadened from the concept of philanthropy. The word ‘ethics’ is derived from the Latin word ‘ethicus’ and the Greek word ‘ethikos,’ meaning character or manners. This meaning can also be extended to imply systematizing, defending and recommending concepts of right and wrong behaviour. Ethics is thus said to be the science of moral, moral principle and recognized rules of conduct.
The character of a man is expressed in the terms o this conduct or actions. These actions can be ‘good’ or ‘bad’; ‘right’ or ‘wrong’; ‘moral’ or ‘immoral’. However, they may be amoral as well, which means that they are beyond the sphere of morality. For instance, a petrol bunk owner engaged in selling both petrol and diesel to the customers for a profit is an example of amoral conduct of business. But, if the owner indulges in mixing petrol with kerosene and sells it to customers, then this act is said to be immoral. Thus, ‘right,’ ‘wrong,’ ‘moral,’ and ‘immoral’ are termed as moral judgments. Moral judgments require moral standards by which one judges human conduct. Ethics can thus be defined as ‘the science of character of a person expressed as right or wrong conduct of action.
Philosophers viewed ethics as system of moral principles and the methods for applying them. It deals with values relating to human conduct with respect to the right and wrong of certain actions and to the goodness and badness of the motives and ends of such actions. While others consider emerging ethical beliefs to be ‘State of Act’ (legal matters), i.e. what is an ethical guideline today is often translated to a law or regulation. Business can be defined as a primary economic institution through which people in modern societies carry on the task of producing and distributing goods and services. And business ethics refers to the application of ethical judgments to business activities. Business ethics explains that business can generate profits being ethical. But this thought (business ethics) till last decade was being contradicted. Due to expansion of business, the application of ethical practices and its implications has created a need for practicing business ethics. Today more and more importance is being given to the application of ethical practices in business dealings and the ethical implications of business decisions.
Human beings have the ability to choose. When choice is provided between right and wrong or good and bad, an individual chooses one of the alternatives by distinguishing between the options available. This concept applies to the business, since businesses are operated by human beings, they should be able to distinguish between right or wrong decisions in the business. Thus, businesses also have choices or alternatives, such as to maximize profits, increase sales volume, provide employee benefits and concern for society. However, at times profits and social responsibility cannot coexist. Because, while earning profits entrepreneurs may neglect social responsibility. For instance, some chemical firm driven by profit motive may postpone its investment in social welfare projects like Effluent Treatment Plant (ETP), although the industrial waste left into the environment in...