IBM 224

MORALITY, ETHICS AND BUSINESS

Topic 4 08TH August 2023

 Unit Learning Outcomes

Students will be able to:

1. Explain key terms of Morality, Ethics and Business.

2. Explain what do ethics and morals have to do with business?
3. Explain Morality and Law
4. Analyse Moral Philosophies.
 BUSINESS ETHICS

Business ethics is the study of what constitutes

right and wrong, or good and bad, human conduct • Accountability
in a business context. • Respect
• Honesty
• Transparency
• Loyalty and respect
Business ethics guide an organisation in their operations for commitments
and keep them in line with laws and regulations.

This guidance helps the business maintain a positive

public image and reputation of respectability.
 BUSINESS ETHICS
Examples of Business Ethics

1. Personal responsibility: Complete assigned task, be on time, being honest in the

workplace, and own up to their mistakes and work towards correcting them.
2. Corporate responsibility: Businesses should honour their responsibilities to their
employees, partners, and customers. They need to respect the interests of all parties
involved with the business. These interests may take the form of written contracts, verbal
agreements, or legal obligations.
3. Social responsibility: Ensuring environmental protection and giving back to the
community, and improving working conditions.
 MORAL

• Motivation or will.
• “morale” implies some sort of value judgement.
To act “morally”, means to act in
• Moral Standards are about things that matter, compliance with some norm or
that we value. rule that's being approved/held
up by a social group.
• It tells us what's the right thing to do.

"Unmoral” or “immoral” is a behaviour that does not comply with some set of moral rules or
norms.
 MORALITY
Morality is a set of rules that shapes our behaviour in various social situations. It is
more sensitive doing the good instead of the bad, and therefore, it establishes a level
of standard for virtuous conduct.

Coca Cola makes it clear that the company is inclined towards a good business
morality. Its corporate governance code starts with these starting announcements.

“At the Coca-Cola Company, we aim to lead by example and to learn from
experience. We set high standards for our people at all levels and strive to
consistently meet them. We are guided by our established standards of corporate
governance and ethics. We review our systems to ensure that, we achieve
international best practices in terms of transparency and accountability. The
foundation of our approach to corporate governance is laid out in our Corporate
Governance Guidelines and in the charters of our Board of Directors’ committees.”
 MORAL STANDARDS
In terms of business ethics, whether
Moral standards are concern behaviour that is of products are healthful or harmful, work
serious consequence to human welfare, that can conditions safe or dangerous, personnel
profoundly injure or benefit people.
procedures biased or fair, privacy respected
or invaded are also matters that seriously
The moral norms against lying, stealing, and affect human well-being.
killing deal with actions that can hurt people.

The standards that govern our conduct in

And the moral principle that human beings should be
business matters are moral standards.
treated with dignity and respect uplifts the human
personality.
 Where Do Moral Standards Come From?
• Our early upbringing
• The behavior of those around us
• The explicit and implicit standards of our culture.
• Our own experiences, and
• Our critical reflections on those experiences.

For Example:
Sometimes, we thinks such The way we practice our
• Stealing in workplace practices are normal, but ethical and moral
• Swearing in the office they are morally unethical behaviors in workplace or
• Disrespecting your superiors behaviors. business is influenced by
• Come late to work all the time the way we came from.
 Moral Philosophies

Moral philosophy refers to the set of principles, or

rules, that people use to decide what is right or wrong.
Difference between Moral
These principles, rules, or philosophies present guidelines philosophy and Business Ethics:
for resolving conflicts and for optimizing the mutual
benefit of people living in groups. ❑ A moral philosophy is a person’s
principles and values.

❑ Business ethics refers to what the

Businesspeople are somewhat guided by moral group, firm, or organization defines as
philosophies as they formulate business strategies and right or wrong actions that pertain to
its business operations.
resolve specific ethical issues.
 Moral Philosophies

Two most important moral philosophies/ theories include:

TELEOLOGY DEONTOLOGY
Egoism
Utilitarianism
 Moral Philosophies
Teleology
• EGOISM is when making decisions that maximize their
refers to moral philosophies in which an act is own self-interest.
considered morally right or acceptable if it • Egoism = physical well-being, power, pleasure, fame, a
produces some desired result such as satisfying career, a good family life, or wealth.
pleasure, knowledge, career growth, the
realization of self-interest, utility, wealth, or • Enlightened egoism: Putting well-being of others first
even fame. before ones own self-interest.

• Some enlightened egoists may become whistle-blowers

Two important teleological philosophies that and report misconduct to a government regulatory
often guide decision making in individual agency to keep their job and receive a reward for
business decisions are egoism and exposing misconduct.
utilitarianism.
 Moral Philosophies
Customers who fly in business class pay
• UTILITARIANSM: Seeks the good for the greatest number higher than those in economy seats, but they
of people. also benefit from the economy rates. This
practice produces the highest good for the
• Utilitarians believe that they should make decisions that
greatest number of people.
result in the greatest total utility, that achieve the greatest
benefit for all those affected by a decision.
• Utilitarianism is concerned with maximizing benefit for the
greatest number of people.
• In making ethical decisions, utilitarians often conduct a cost–
benefit analysis, which considers the costs and benefits to all
affected parties.
 Moral Philosophies
Deontology

❑ Deontology is an ethical theory that says actions are good or bad according
to a clear set of rules.
❑ Developed by Emmanuel Kant.
❑ Every actions has its duty or responsibility.

❑ For Example:
o Equal respect must be given to all persons.
o It is wrong to kill an innocent person or commit a serious injustice
against someone because it would violate individual rights.
 Moral Standards

Moral standards
concern behavior
Human beings should be treated with dignity and respect that
that seriously
affects human uplifts the human personality. Whether products are healthful
well-being.
or harmful, work conditions safe or dangerous, personnel
procedures biased or fair, privacy respected or invaded––these
are also matters that seriously affect human well-being. The
Lying, stealing, and killing deal
with actions that can hurt people. standards that govern our conduct in these areas are moral
standards.
 Business Moral

Henry Ford on Business Morality

“There is one rule for the industrialist and that is: make the best
quality goods possible at the lowest cost possible, paying
the highest wages possible.”
 Morality & Etiquette

Etiquette refers to the norms of correct

conduct in polite society or, to any
special code of social behavior or Good business etiquette are;
courtesy. ❖ Returning phone calls,
❖ Dress appropriately.
Examples of Bad Etiquette: ❖ Don’t interrupt.
❖ Watch your language
• Chew with mouth open
• pick your nose when talking to someone ❖ Double check before you hit send.
❖ Acknowledge others.
Examples of Good Business Etiquette: ❖ No phone during meetings.
❖ say “please” or “thank you”
 Morality & Law
4 Kinds of Law:
Statutes, Regulations, Common law & Constitutional law

1. STATUTES
o Statutes are laws enacted by legislative bodies.
o The law that defines and prohibits theft is a statute.
o Laws regarding the environment
o Workplace safety,
o Consumer privacy,
o Licensing, and permits
 Morality & Law

2. REGULATIONS
o Refers to formal rules created by government bodies under
the authority of legislation.
o Examples of Regulations in Business:
• Licensing and permits.
• Privacy.
• Employment and labor regulations.
• Workplace anti-discrimination and harassment.
 Morality & Law

3. COMMON LAWS:
o Refers to the body of judge-made law.
o Are opinions explaining the bases of judges decisions in specific
cases,
o Each of these opinions became a precedent for later decisions in
similar cases.
o Examples include;
• Employee to read contracts
• Doctor-patient confidentiality
• Copyright
• Employment Laws
 Morality & Law

3. CONSTITUTIONAL LAWS:
• Refers to court rulings on the requirements of the
Constitution and the constitutionality of legislation.

• For Example:
• Laws for big corporates to pay tax,
• Trade law. E.g. PNG Trading Act 1949
 Professional Codes of Ethics

Professional codes of ethics are the

rules that are supposed to govern the EXAMPLES
conduct of members of a given profession.

❑ Clients Confidentiality
The members of a profession have agreed to abide by those ❑ Limitations on price competition
rules as a condition of their engaging in that profession. ❑ Teamwork
❑ Integrity
Violation of a professional code may result in the disapproval of
one’s professional peers and, in serious cases, loss of one’s
license to practice that profession.
 References

Ferrell. O. C., Fraedrich. J. & Ferrell. L. (2017). Business Ethics: Ethical Decision Making & Cases. 11 Ed. PART
1: AN OVERVIEW OF BUSINESS ETHICS. Cengage Learning 20 Channel Center Street Boston, MA
02210 USA

Ferrell. O. C., Fraedrich. J. & Ferrell. L. (2011). Business Ethics: Ethical Decision Making & Cases. 8 Ed. PART
1: AN OVERVIEW OF BUSINESS ETHICS. South-Western Cengage Learning 5191 Natorp Boulevard
Mason, OH 45040 USA

Hartman. L. P., DesJardins. J., & MacDonald. C. (2018). “Business Ethics: Decision Making for Personal
Integrity and Social Responsibilities. 4TH Ed. Chapter 1: Ethics and Business.