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Harassment in Workplace Managing Workplace Ethics – Guidelines 1. BUSINESS ETHICS Define – (a) Ethics, and (b) Business Ethics Ethics: Ethics are the principle of conduct governing an individual or a group. Ethics relates to what is good or bad, and having to do with moral duty and obligation. Business Ethics: Ethics in business refers to the application of day-to- day moral or ethical norms to business. Business Ethics are the principles and standards that determine accept able conduct in business organizations. Business Ethics in a business organization relates to a corporate culture of values, programs, enforcement and leadership.
Business ethics is a set of principles or reasons which should govern the conduct of business – at the individual firm bevel or at the collective Industry Level, by the application of ethical reasoning to specific business situations and activities. 3. Requirements: Being ethical in business requires acting with an awareness of- a). The need for complying with rules, e. G. – (1) laws of the land, (ii) customs & expectations of the community, (iii) principles of morality, (iv) policies of the organization, and () general concerns such as the need s of others and fairness. ). How the products, service and actions Of a business enterprise, can affect its stakeholders (I. E. Employees, customers, Suppliers, Shareholders, and community / Society as a whole), either positively or negatively. Distinguish between Morals and Ethics. Particulars Morals Ethics 1 . Meaning Moral is defined as relating to principles of right and wrong. Ethics relates to what is good or bad, and having to do with oral duty and obligation. 2. Root word & Analysis Latin word “moss”, meaning “custom”.
Custom is defined by a group over time. Societies have “Custom”. Greek word “ethos”, meaning “character’. Character is a personal attribute. People have “character” 3. Nature Morals are accepted from an authority. (cultural, religious, etc. ) Ethics are accepted because they;; follow from personally accepted principles. 4. Expression Moral Norms can usually be expressed as general rules, and statement, e. G. “always tell the truth”. Ethical Norms are comparatively abstract and cannot be described in general rules and statements. 5.
Absorption Morals are typically first absorbed as a child from family, friends, school, religious teachings and other associations. Ethics are adopted/ absorbed by an individual gradually by taking reasonable actions / decisions n appropriate situations. 6. Scope Morals work on a smaller scale than ethics, more reliably, but by addressing human needs for belonging and emulation. Ethics has a much wider scope, and includes evaluation of moral standards of an individual or society, to see whether these standards are reasonable or unreasonable in concrete situations and issues. Write short notes on Ethical Issues.
An Ethical Issue ins an identifiable problem, situation or opportunity that requires a person to choose from among several actions that may be evaluate as right or wrong, ethical or unethical. In business, such a choice nearly involves comparing monetary profit against what may be appropriate conduct, I. E. Financial vs. no- financial implications. Learning to recognize ethical issues is the most important step in understanding Business Ethics. Write short notes on Ethical Dilemmas. Ethical Dilemma: A Ethical Dilemma is a situation where the decision ?? maker has to choose between right and right.
For example, in Ramadan, Ram had to choose between TV Dharma – (a) to abide by his Father’s words and proceed to the forest for 14 years, or (b) to ignore his father’s words and rule the country as a Ashtray Prince. Both these alternatives constitute ‘right action” by applying different yardsticks / viewpoints. Ethical Dilemma in business: In business, the manager / decision ?? maker is faced with moral and ethical decisions daily. He has to tackle ethical issue and choose between – )I) right and wrong, (ii) right and right.
For example, in the case of a Salesperson, does offering a gift to a customer constitute a bribe or sales promotion? Outline the need / importance for ethics in business. Use of Resources: Society bestows upon businesses, the authority town and use land and natural resources. In return, In return, society has the right o expect that productive organization (I. E. Business enterprises) will cater to the general interests of consumers employees and community. Fairness: Society may also expect that business enterprises honor existing rights and limit their activities within the bounds of justice, equity and fairness.
Implied Contract: All productive enterprises can be viewed as engaging in an implied contract with the Society. So, under this “social contract” between society and business, the behavior of business enterprises is guided by “Buss news Ethics”. Corporate governance: in the process of corporate session ?? making, managers contribute, consciously or unconsciously to the shaping of human society – it is not a choice between profits and ethics, but profits in an ethical manner. This has lead to the evolution of “corporate governance”.
Stakeholders must support organizational ethics initiatives because it makes good business sense in the long term. Comment. The advantages / benefits of Business ethics are Social Well ?? being: Focus on business Ethics has improved social will -being. Exploitation of workers, monopolistic price fixing and profiteering, intimidation and harassment of employees at workplace, etc. Anton be practiced by business enterprises now. The Society has demanded that business enterprises place high value on fairness and equal rights, thus resulting in improved social welfare.
Public Image: the fact that an organization regularly gives attention to its ethics can portray a strong and positive corporate image to the public. Society regards organizations as valuing people more than profit, and striving to operate with utmost integrity, fairness and equity. Maintaining moral course in times of change: Business ethics is useful during times of fundamental change, where there is no clear oral compass to guide leaders though complex conflicts about what is right or wrong. Continuing attention to ethics in the workplace sensitizes leaders and staff for maintaining consistency in their actions.
Teamwork and Productivity: Where a Firm finds disparity between its preferred value and the values actually reflected by workplace behavior, continuous attention and dialogue regarding values, builds openness, integrity and community, all critical ingredients of strong terms in the workplace. Employees feel strong alignment between their values and those of the organization. They react with strong motivation and performance. Employee- Friendly Policies: Attention to ethics ensures highly ethical policies and procedures in the workplace.
For example, in the matter of ethical treatment of employee visa-a -visa hiring, evaluatingћ disciplining, training, terminating etc. Most Firms feel that it is far better to incur the cost of mechanisms to ensure ethical practices than to incur costs Of litigation later. CORPORATE GOVERNANCE & CORPORATE SOCIAL RESPONSIBILITY Write short notes on Stakeholders. Management is not accountable solely to Investors (Shareholders), but to there interest groups / constituents who are affected by corporate activity.
The word “Stakeholders” describes such constituents of an organization ?? the individuals,; groups or other organizations which are affected by, or can affect the organization in pursuit of its goals. Stakeholders of a company would include- Employees, Trade Unions, Customers, suppliers, Shareholders and investors, Competitors, Government, Industry as a whole, and Society at large. Write short notes on corporate Governance. Meaning: Corporate Governance deals with promoting corporate fairness, transparency and accountability.
It is concerned with structures and processes for decision – making, accountability, control and behavior at the top level of organizations. It influences how the objectives of an organization are set and achieved, how risk is monitored and assessed and how performance is optimized. Defied notion: Corporate Governance can be defined as “the formal system of accountability and control for ethical and socially responsible organizational decisions and use of resources”. Accountability relates to how well the content of workplace decisions is aligned with the organization’s stated strategic direction.
Control involves the recess Of auditing and improving organizational decisions and actions. Scope: Corporate Governance arrangements are key; determinants of a Firm’s relationship with the society at large, and encompass the following aspects, (a). Power given to Management and control over Management’s use of such power, (b) Management’s accountability to stakeholders, (c) Formal and informal processes by which stakeholders influence management decisions. 4. Pervasive: The question of good ‘Corporate Governance” arises in all categories of Indian Companies- (a) Public Sector Units (Us) where the Government is the majority
Shareholder and the general public holds minority stake. (b) Multi – National companies (Mans) where the Foreign Parent is the dominant stake, and the balance is held by the general public. (c) Domestic Business Groups where the Promoters (and their friends & relatives) are the dominant shareholders, Government owned financial institutions hold a comparable stake, and the balance is held by the general public. 5. Legal Framework: In India, the legal framework of corporate governance is contained in Sec. AAA of the companies Act (relating to Audit Committee) and luaus 49 of Listing Agreement with SIB (in respect of Listed Companies).
What are the key issues / major factors in evaluating corporate Governance? Generally, Corporate Governance measures include – (a) appointing Non Executive Directors, (b) placing constraints on management power and ownership concentration, and (c) ensuring proper disclosure of financial information and executive compensation. Some key issues considered while evaluating corporate Governance are- Aspect Description Accountability of Board of directors (BODY) BODY is the link between Management & shareholders, and potentially the cost effective instrument of good governance.
Directors on the Board are elected by Shareholders to establish corporate management polices and make decisions on make decisions on major issues pertaining to the Company. Independent directors ensure that the Board does not operate outside the sphere of management influence. Large Investors seek out companies where there are more Independent Directors who have no companies where there are more Independent directors who have no commercial links to the firm and who demonstrate an objective willingness to question the decisions of the management.
Financial Disclosure and controls The corporate structure should include and Audit committee composed of Independent Directors with significant exposure on financial transactions. The Committee should have the sole power to appoint the company’s Auditors and approve non -audit services from the Auditor. Top Management Remuneration should be determined by measurable performance goals CROCK, ROE, etc. ) and should also be finalized by an independent Remuneration Committee. This Remuneration package / benefits should be fully disclosed to the shareholders.
Stock Options Executive Board Directors may grant generous Stock options to Top Managers. While Stock options offer managers an incentive to perform well, overloaded Stock – Options create the possibility of unwanted share value dilution. Corporate Governance seeks to avoid misuse of stock ?? Options. What are the features of good Corporate governance? A Good Corporate Governance should be – 1 . Efficient and effective (I. E. Doing the right things and doing things and doing things right) 2. In tune with the applicable legal requirements. 3. Transparent as regards decisions and actions. 4.
Accountable to stakeholders. 5. Consensus- oriented and participatory in decision -making, I. E. Promote acceptability of decisions rather then forcing them on the parties concerned. 6. Equitable and inclusive. 7. Responsive and adaptive to environmental change. Write short notes on Corporate Social Responsibility. 1. Meaning : corporate Social Responsibility (CARS) focuses on the idea that a business has social obligations above and beyond making profit and follows from a decision by management to expand traditional governance arrangements to include accountability to the full range of stakeholders. . Scope: CARS is a way of integrating the economic, social, and environmental imperatives Of business activities. The term corporate citizenship denotes the extent to which business enterprises meet the (a) legal, (b) ethical, (c) economic and (d) voluntary / discretionary responsibilities, placed on them by their stakeholders. 3. Definitions: CARS is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of the life of the workforce and their families as well as of the local community and society at large.
Bring out the need for Social Responsibility of a Business Enterprise. 1. Iron Law of Responsibility: Society gives business its charter to exist and that harder can be amended or revoked at any time if it fails to live up to society expectations. Therefore, if a business intends to retain its existing social role and social power, it must respond to society’s needs constructively. This is called the Iron Law of Responsibility. In the long-run, those enterprises who do not use power in a manner that society considers responsible, will tend to lose it. 2.
Conversion Of Resistances into Resources: If the innovative ability of a business is turned to social problems, many resistances problems) can be transformed into resources and the functional capacity of resources can be increased many times. 3. Wealth creation: Social responsibility becomes an integral part of the wealth creation process – which if managed properly should enhance the competitiveness of business and maximize the value if wealth creation to society. 4. Effective use of Resources and Power: Businesses command power over the productive resources of a community.
They are obliged to use those resources for the common good of society. They should realizes that the power to command resources has been delegated to them by the society to generate more wealth for its betterment. They must honor social obligations while exercising the delegated economic power. 5. Long-Term business Interest: a better society would produce a better environment in which the business may gain long-term profit minimization. A firm which sensitive to community needs would, in its self-interest, like to have a better community to conduct its business.
To achieve that, it would implement special programmer for social welfare. 6. Better Public Image: Each Firm must enhance its public image to secure more customers, better employees and higher profit. Acceptance Of social responsibility goals lead to improved public image. 7. Avoiding Government Intervention: Regulation and control are costly to business, both in terms of energy and money and restrict its flexibility of decision ?? making. Failure of businessmen to assume social responsibilities invites Government to intervene and regulate or control their activities.
The prudent course for business is to understand the limit of its power and to use that power responsibly, thereby avoiding Government intervention. Various key developments have taken place in the last decade, to shape the direction of CARS. 1 . Increased Stakeholder Activism: Society is looking to the Private Sector to alp with complex social and economic issues. Companies which are perceived by the Society as not being socially responsible, are targeted through actions, e. G. Public demonstrations, public exposes, boycotts, shareholder Resolutions, ” denial of service” attacks on company websites, etc. . Engaging Stakeholders: Involving or engaging “stakeholders” (interest groups) is decision – making process has evolved from ‘Chapter to engage stakeholders” to “How to engage stakeholders”. Companies and stakeholders have, progressed beyond mere dialogue process, to a more meaningful and rational stakeholder participative process. . Codes, Standards and Indicators: New voluntary CARS standards, guidelines and performance measurement tools are added by various companies as part of their Annual Reports.
There is also a growing consensus to evolve a standard in CARS reporting and dissemination of information. 4. Value Chain concept: CARS is characterized by the expansion of boundaries of corporate accountability. Stakeholders may hold companies accountable for the practices of their Business Partners throughout the entire Value Chain with special focus on suppliers, Environment labor and human rights practices. Also, company purchasing Power is being viewed as a unique resource that contributes to economic development, investment capital, as well as facilitating basic trade of products and services. 5.
Transparency and Reporting: Companies have to meet increased demands for transparency and growing expectations that they measure, report, and continuously improve their social, environmental and economic performance. Companies are expected to provide access to information on impacts Of their operations, to engage stakeholders in meaningful dialogue about issues of concern that are relevant to ether party and to be responsive to particular encores not covered in standard reporting and communication practices. 6. CARS & Corporate Governance: Corporate Governance and CARS concepts have to be viewed in a convergent manner.
CARS activities have begum to stress the importance of Board and Management Accountability, Governance and decision – making structures, for effective institutionalizing of CARS Explain briefly the strategies in implementation of CARS. Some key strategies that can be used by Companies when implementing CARS policies and practices are – 1. Mission, vision and Values Statement: CARS deserves a prominent place in a company’s core mission, vision and aloes statements/ documents, which – (I) state a company’s gals & aspirations, and (ii) provide insight into the company’s values, culture and strategies for achieving its aims. . Plans vs. Performance: CARS requires an environment where innovation and independent thinking are welcomed. There must be a commitment to close the gap between what the company says it stands for and the reality of its actual performance. Goals and aspirations should be ambitious, but care should be exercised so that the company says what sit means and means what it says. 3. Management Structure: CARS management system seeks to integrate corporate responsibility concerns into a Company’s values, culture, operations and business decisions at all levels of the organization.