Introduction to Business Administration Slide 3

Introduction to Business Administration

Session 3 – Business environment: doing business right

1. Ethics and social responsibility in Business

Ethics: Defined as the principles and standards of moral behavior that are accepted by society as right versus wrong.

What is Ethical Behaviour?
•Competing fairly and honestly.
•Communicating Truthfully.
•Not causing harm to others.

How to make Ethical decisions
•Is the decision legal? (Does it break any law?)
•Is it balanced? (Is it fair to all concerned?)
•Can you live with it? (Does it make you feel good about yourself))
•Is it feasible? (Will it actually work in the real world?)

Ethical situations can be classified into two general types:

• An ethical dilemma: A situation in which a person must choose between two conflicting but arguably valid sides.
• Ethical lapse: When a person makes a decision that is clearly wrong

2. Perspectives on Social responsibility

•Social responsibility: Is the idea that business has certain obligations to society beyond the pursuit of profits.
•Conflicts over social responsibility are often fueled by different perspectives that can be grouped into three categories.

•The traditional perspective: Business is making money.
•The contemporary perspective: Ethics pays.
•An emerging perspective: dynamically balancing ethics and profits.

3. Emerging Issues from the Ethics/Social Responsibility Debate

a. Responsibility toward investors
Given the scandals of recent years, many investors are concerned about the ethics of the company in which they invest.

b. Responsibility towards Consumers
•The right to safe products.
•The right to be informed.
•The right to be heard.

c. Responsibility toward employees
- The Push for equality in employment.
- Occupational health and safety.

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