Business Ethics & Social Responsibility PDF

ACCOUNTANCY, Business Ethics BUSINESS AND 12 MANAGEMENT & Social Responsibility MODULE NO. 2 – Ethics and Business Most Essential Learning Competency Explain how fairness, accountability and transparency are practiced in busin...

ACCOUNTANCY, Business Ethics BUSINESS AND 12 MANAGEMENT & Social Responsibility MODULE NO. 2 – Ethics and Business Most Essential Learning Competency Explain how fairness, accountability and transparency are practiced in business and non-profit organization ABM_ESR12-IIIa-d-1.4 The time is always right to do what is right -Martin Luther King Objectives: After going through the module, you are expected to: 1. classify the situation if is shows fairness, accountability, or transparency; 2. explain the core principles of fairness, accountability, and transparency; and 3. illustrate how fairness, accountability, transparency and stewardship is observed in business and non-profit organizations. A. Directions: Classify each situation below whether it shows fairness, accountability, or transparency by putting a check in the proper column. An example is given below. Write your answers on a separate sheet of paper. A Directions: Cite two situations on how you can apply fairness, transparency, and accountability in dealing with your teachers and family/parents. Copy the table below and write your answers on a separate sheet of paper. B. Criteria Teachers Family/parents FAIRNESS TRANSPARENCY ACCOUNTABILITY Business are pressured to Shall I do something illegal and make profits to maintain and ensure that my business will grow their position in the prosper? market. Sometimes, they shall I use bribe to expedite need to make decisions that procedures? put them on the forked road: Shall I declare a lower income shall I do the right thing but to pay less tax? put my business in jeopardy? Shall I start a smear campaign to destroy my competitor? Controversies involving companies that do unethical business practices come out in the news from time to time. Long work hours, unhealthy workplace environment, low wages, unpaid workers, insufficient benefits, and other are only some of the issues that you may see being reported on mainstream media. Although there are laws that protect the workforce, they are not always implemented. Companies have codes of conduct, but they are not always observed. Making Ethical Decision Ethics enables a person to discern right from wrong. Derived from the Greek word ethos which means “character”, Ethics is branch of philosophy that involves “systematizing, defending, and recommending concepts of right and wrong conduct”. Making Ethical Decision Some people raise their eyebrows when applying ethics in business context because the nature of a business is to increase profitability, which does not necessarily mean that a company practices an ethical culture. However, Leaders have come to realize that unethical business practices do not bring good to the company. Making Ethical Decision For example, ignoring safety concerns may incur losses for an automotive company due to lawsuits that may be filed against the company. Harming the environment through chemical leaks and spills may force a company to close down. Unfair wages and labor practices may give a company a bad image n the eyes of consumers, at the very least. Big Idea Ethics , in a business context, is about ethical decisions must be based on promoting the greater good and doing what is morally right. Making Ethical Decision The concern today is not about the need or the rationale for ethics to be part of a business, but rather, about how ethics should be integrated in the business practices. Business ethics gives emphasis on ethical decision-making. Decisions made in every aspect of the company must consider ethics, remembering the greater good and doing what is morally right. Making Ethical Decision The concern today is not about the need or the rationale for ethics to be part of a business, but rather, about how ethics should be integrated in the business practices. Business ethics gives emphasis on ethical decision-making. Decisions made in every aspect of the company must consider ethics, remembering the greater good and doing what is morally right. Questions Were you ever involved in a situation where you had a moral dilemma? What happened? What did you have to do? Beyond Walls 2.1 Pies & Cakes owns several branches in ten different locations within Metro Manila. These branches are served by three delivery trucks which make daily deliveries of baked goods and ice cream cakes to the branches. Tow trucks, driven by Max and Lito, deliver to six branches in Quezon City, Mandaluyong, and Pasig, while one truck, driven by Cesar, delivers to four branches in Makati and Parañaque. One day, while the drivers were on their daily delivery routine, Cesar was flagged down due to a traffic violation. The traffic enforcer asked for his license and gave him a ticket for swerving. This is the third violation for Cesar in one month; he knows that if the company discovers about this, he will be suspended for five days as per company policy. He will also not receive salary for the days that he will be suspended, which will cut the budget for his kids’ food and school expenses. So, he decided to slip Php 200.00 under his license as a bribe to the traffic enforcer. Questions: 1. Do you think Cesar did the right thing? Why or why not? 2. If you were the traffic enforcer, what would you do? 3. What is the moral dilemma in this situation? What is the ethical thing to do for Cesar and the traffic enforcer? In the case study, an employee is faced with a dilemma that may compromise his personal integrity, as well as put his company’s image at stake. Social circumstances create barriers for freedom of decisions. You may be acting according to what you personally think is right (in Cesar’s case, not to get another ticket for traffic violation so he will not be suspended by the company), however, what is morally right is to keep your integrity and that of the company. The social environment greatly influences the behavior and decisions. Big Idea Ethical business leadership creates an environment where ethical behavior is encouraged – good people are able to do good, and bad people are prevented from doing bad. Making Ethical Decisions Leaders and managers are responsible for the creation of a corporate culture. This is the business environment created by an organization to foster a common understanding of what the company advocates. Making Ethical Decisions The environment created by the organization can encourage or discourage ethical behavior. Ethical business leadership provides where good people are able to do good deeds and bad people are prevented form doing bad decisions and actions. Making Ethical Decisions Ethics covers how we act and how we live our lives at its most basic level. According to philosophers, how we should live implies the practical side of ethics, which covers how we act, choose, behave, and do things. How we should act is the normative side of ethics, which deals with our reasoning on how we are supposed to act in certain situations. Making Ethical Decisions Ethics being a normative discipline deals with norms or those standards of appropriate and proper ( or “normal” )behavior. On the other hand, social sciences, such as psychology and sociology, look at the descriptive manner of people’s actions rather than the normative manner. Descriptive manner provides an account of how and why we act that way we do. Beyond Walls 2.2 GoodMed Drug Company produced an antibiotic that is supposed to treat a number of bacterial infections. However, its main objective is to capture the market of Goodwill Pharma Company’s antibiotic, which has become the household antibiotic in the Philippines with a whopping 50% market share. Based on GoodMed Drug Company’s research, customers want cheaper alternative for antibiotics. Thus, the company reduced the price to half of Goodwill Pharma. The catch is that the efficacy of the antibiotics is inferior to that of Goodwill Pharma. Beyond Walls 2.2 Mary Ann Ocampo, a seasoned medical representative, was appointed by GoodMed Drug Company to do a sales of the antibiotic to its network of doctors. The company promised her bonuses and other perks if she will be able to hit her target. Mary Ann is currently in deep financial crisis as her daughter was just recently diagnosed with leukemia and, therefore, this is a timely opportunity for her to recover from her finances. However, at the back of her mind, she knows that the product is still inferior, but she must sell it to the doctors as if it is effective as the competitor’s antibiotics. Beyond Walls 2.2 Questions: 1. What would you do if you were in Mary Ann’s position? Explain you answer. 2. do you think personal integrity is more important than social responsibility or vice versa, or they should go hand-in- hand? Why? 3. Identify the personal integrity issue and the social responsibility issue in this case study? Explain each. Big Idea: Personal Integrity - Refers to one’s own values that are applied to make ethical decisions. The “ we” in how we should live may apply to two interpretations: “We “ as a collective action, where individuals act and decide together as a group to promote good for everyone; and “We” as individual actions based on a common understanding of what is good. Beyond Walls 2.3 1.What should the school management do to Mr. Rodriguez given that what were circulating were just hearsays? 2.If the hearsays were true, what is Mr. Rodriguez doing wrong? What can you say about his personal integrity? A person will always face with decisions that will have an impact on the organizations. “What should I do? “ How should I act?”  - these are the common questions that one may ask to evaluate a situation that needs decision-making. Based on a person’s moral values, he or she may believe that honesty is important in everything he or she does; ethics calls for the application of this value to the decision that he or she has to make. Therefore, if the manager asked him or her to lies or cheat on a report, this person may effuse to do so based on his or her own set of moral values.  “How should we live?” refers to how we live together in consideration of the other members of the community. Society, social institutions, and organizations are supposed to mold their cultures in consideration of justice, public policy, law, civic virtues, organizational structure, and political philosophy.  This molding of cultures by society is called social ethics. Businesses should be concerned with how they are structured, whether they have a responsibility to the society (through practice of corporate social responsibility or CSR) and how their decisions will impact the lives of many people other than the person making the decisions.  For example, a manufacturing plant will have to determine how the company is making a difference in its employees’ lives by providing just benefits and wages and a safe workplace that is free from health and hazards and security threats. It will also have to produce environmentally friendly practices so it will not harm the environment (implementation of proper waste disposal practices instead of just dumping liquid and sold wastes to rivers) and the community around the factory.  One’s values are the basis for one’s personal integrity. There are different types of values in terms of the end they serve. Financial Values - are concerned with monetary ends; Legal Values – uphold the law, and so on. Ethical Values – uphold human well-being.  Action and decisions must be based on promoting human well-being - respect, dignity, freedom, and democracy are just some of the things that promote human well-being. This does not mean that human well-being promoted by ethical values is personal and selfish. They still should serve the greater good of everyone’s well-being.  Ethics perspective teaches that no one person’s welfare is more worthy than any others, and thus ethical acts and choices should be acceptable and reasonable from all relevant points of view. Questions: 1. What is ethical business leadership? 2. Explain the practical and normative interpretations of ethics according to philosophers. In contrast, what does descriptive manner imply according to social sciences. Questions: Was there ever a time when you had to make a decision against everyone else’s (for example, report your friends to the teacher because they were cheating on an exam) to preserve your personal integrity and do the ethical thing? Narrate what happened. How did it make you feel? Ethics and Law Laws govern a country, and the citizens are expected to follow what the laws require, expect, or permit. Business organizations must follow regulations and rules set by the government and other governing bodies (Advertising Board of the Philippines and the like). Ethics and Law The law provides important legal consideration to ethical decision – making. However, legal norms and ethical norms are not equivalent and the same. A company may pay entry-level workers with salary based on what the law mandates as the minimum wage. Ethics and Law However, the company may pay more or offer more benefits (rice allowance, health insurance, etc.) to provide better compensation for minimum- wage earners. Paying what the law mandates conforms to legal values, but offering more benefits to employees who need them satisfies ethical values. Example: Mr. Edwin Reyes, a bank manager, receives his basic salary from the Bank of Valenzuela. Aside from the basic salary, he is also provided with additional benefits like health benefits through a health card, additional bonuses aside from the th government mandated 13 month benefit, and educational benefits. Some companies now run programs that focuses on addressing their corporate social responsibility (CSR). CSR does not focus on merely complying with what is legal; it finds ways to make business practices better for all the stakeholders, including those that they directly or indirectly impact. Big Idea Corporate Social Responsibility (CSR) focuses on an organization’s responsibility to take action in upholding the welfare of the society. Questions: Should companies only focus on what is legal, rather than what is ethical? Why or why not? The Changing Business Environment Read and Answer Beyond Walls 2.4 The Changing Business Environment Myda pa continuation