Chapter 14 Ethics Professionalism and Social Responsibility.ppt

Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 1  CHAPTER 14 ETHICS PROFESSIONALISM AND SOCIAL RESPONSIBILITY Fundamentals of Entrepreneurship All Rights Reserv...

Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 1  CHAPTER 14 ETHICS PROFESSIONALISM AND SOCIAL RESPONSIBILITY Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 2  Objectives The objectives of this chapter are to:  know, understand, appreciate and realize the importance of good morals, ethics and professional values in working life  understand the meaning being professional in their work  appreciate the importance of social responsibility agenda to a business organization Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 3  Learning Outcomes At the end of this chapter, students should be able to:  learn that good character is a very important ingredient for success in life in the long term. Success should not be based merely on material achievement alone but include the practises of good moral and ethical principles.  know, understand, appreciate, and relate to corporate social responsibility project undertaken by any business organization. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 4  Introduction  Ethics involve personal believe, values and good practices such as being disciplined, honest, responsible and trustworthy and it is the basis of judgement whether a person’s action is good or bad, or right or wrong, virtue or vice, justice or crime, etc.  Professionalism means a person is competent and qualified to do a specific task and he undertakes to do the task in the manner that is to be expected from a professionally competent person such as acting with due care, skill, diligence and complying with the rule of law, regulations and code of practice.  Being socially responsible mean a person will ensure that his action will contribute benefits to the society, environment and country and it will not create harmful output or impact to the society and country. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 5  The Importance of Ethics and Code of Good Professional Conduct for Individuals and Corporate Organizations  Fundamentally, entrepreneurs operate their business to offer products and services to their customers and in the process make some profit. The process by which a person does his business should be ethically and legally right, contribute benefits to the society and does not pose any harmful impact to the society or environment.  In the long term, our success will always depend on our skill and characters. As the chairman of one of the largest and most successful pharmaceutical company, Bristol-Myers Squibb, puts it, ‘Men succeed less by their talents and more by their character’ (George, 1997).  Ethics encompasses honesty, forthrightness, reciprocity, fair play, keeping commitments, and kindness.’ (George, 1997). Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 6  The Importance of Ethics and Code of Good Professional Conduct for Individuals and Corporate Organizations  Success in life is not merely based on material achievement alone. Worldly achievement void of ethical principle and good deed in most cases is only success waiting to crumble.  Life on this earth should have a greater meaning than just merely self-interest in the form of big houses and cars only. Everyone has the potential to create wealth that is beneficial to him, society and nation.  Good names, character and integrity are always the foundation of success and they are the final test of a person true quality. Success that is based on good ethical and moral conduct is more holistic, meaningful, satisfying and an example for others to emulate. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 7  The cost of non-ethical, non- professional and socially irresponsible  Success in life is not merely based on material achievement alone. Worldly achievement void of ethical principle and good deed in most cases is only success waiting to crumble. Achievement void of ethical principle and good conduct is only an achievement that appears to be successful outwardly but internally, it is often full of worry, anxiety, sleepless-night, depression and self-doubt that may cause a person self-destructive process.  Money obtained through illegal means is supposed to give one prosperity and happiness but it often become a source of misery and shame to the person and his family.  Warren Buffett, the famous American investor and businessman, said that ‘a good name and reputation may take years to be established but it can be destroyed in a matter of minutes only if one is not careful. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 8  Factors That Influence Individual Ethical Values And Practises  Family Influences  Life Experiences  Peer Influences  Religious Beliefs  Situational Factors or Conflict of Interest Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 9  Islamic Ethical Values A Muslim should find it easy to resolve any Islamic ethical issues, as in most cases, the moral, behavioural and ethical guidance provided on business dealings in Islam are very comprehensive and details. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 10  Islamic Ethical Values (cont.) The followings are key Islamic principles that have been found to have great influence on a Muslim way of life including his moral and behavioural practises in doing business: His fundamental believe in the oneness of god and his role is to be an obedient servant who follow all the prescribe teaching of Islam outline in the Qur’an and prophet S.A.W practises (Sunnah). Islamic teaching prescribe that a Muslim behaviour and etiquette (Akhlak and Adab) toward other fellow Muslim, non-Muslims and all other god creations such as environment (Makhluk). Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 11  Islamic Ethical Values (cont.)  His believe in the life of the hereafter where his every act in this world will be examined and given rewards and punishment accordingly. Hence, he should be mindful of not to transgress Islamic legal limit (Syariat) as outline in Islam.  The important of making sure that whatever earnings he pursues and obtains should be ‘halal‘ i.e. permissible by Islam. Clear guide lines are provided to determine whether something is halal or otherwise. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 12  Islamic Ethical Values (cont.)  He should be willing to use his assets and earnings to pay obligatory religious contribution (Zakat) and contribute donation (Sadaqah) to the unfortunate such as orphanage, etc. and he must avoid being greedy or act like a miser. Whatever his materials contribution will be rewarded in the hereafter.  The concept of god blessing (Barakah) mean that a smaller earnings can be superior than a bigger earnings if it is earn through ethical and legal mean and as such earning is full of Allah’s blessing. Any illegal and unethical earning that was used to feed one’s family lacked god’s blessing, will tainted his soul and may bring harmful effects to the family. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 13  Islamic Ethical Values (cont.)  In the pursuit of material gain, a Muslim is govern by a few values such as being ready, satisfied and willing to accept whatever is ordain to him by god (Qanaah), being thankful to god at all time (Syukur) and being steadfast in any undertaking and patience in any difficulties (Sabar). These values should help him to be mindful not to succumb to bad desire, temptation and avoid transgressing the ethical limit provided by the Islamic legal limit (Syariat) and the country law.  In short, a practising Muslim will always want to earn income that will lead him to prosperity, happiness, purify his soul and get God’s blessing in this world and be equally successful in the hereafter. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 14  What is Social Responsibility? Corporate social responsibility (CSR) refer to the practices of assuming a certain responsible acts by corporate organizations to create positive impact to environment, consumers, employees, communities, stakeholders and all other members of the public sphere. Social responsibility means organizations or individuals practice good ethical principles and act as a good corporate or individual citizen of the country. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 15  What is Social Responsibility? (cont.) An entrepreneur business activity should benefit him as a person and at the same time it should contribute macro benefit to the society and nation. Business projects that polluted the environment and caused suffering to the society in fact contribute negatively to the society and nation. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 16  What is Social Responsibility? (cont.) Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 17  Views on Social Responsibility The general view on business is that entrepreneurs are willing to sacrifice anything in order to get their profit. In recent years, incidents of poor quality products, imitation products, addition of harmful material into manufactured food (e.g. addition of melamine to milk in China), irresponsible act of throwing poisonous material into the river, etc. are examples where corporate irresponsibility are frequently being highlighted in the newspapers. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 18  Views on Social Responsibility (cont.) Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 19  Views on Social Responsibility (cont.) Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 20  Views on Social Responsibility (cont.) Example of an irresponsible act that caused irreparable damaged of Minamata Mercury Poisoning (sourced from Wikipedia). Minamata is a neurological syndrome caused by severe mercury poisoning. Symptoms include ataxia, numbness in the hands and feet, general muscle weakness, narrowing of the field of vision and damage to hearing and speech. In extreme cases, insanity, paralysis, coma and death follow within weeks of the onset of symptoms. A congenital form of the disease can also affect fetuses in the womb. Minamata disease was first discovered in Minamata city in Kumamoto prefecture, Japan in 1956. It was caused by the release of methylmercury in the industrial wastewater from the Chisso Corporation's chemical factory, which continued from 1932 to 1968. This highly toxic chemical bioaccumulated in shellfish and fish in Minamata Bay and the Shiranui Sea, which when eaten by the local populace resulted in mercury poisoning. While cat, dog, pig, and human deaths continued over more than 30 years, the government and company did little to prevent the pollution. As of March 2001, 2,265 victims had been officially recognised (1,784 of whom had died) and over 10,000 had received financial compensation from Chisso. By 2004, Chisso Corporation had paid $86 million in compensation, and in the same year was ordered to clean up its contamination. On March 29, 2010, a settlement was reached to compensate as-yet uncertified victims. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 21  Views on Social Responsibility (cont.) Balance Consideration to All Stake Holders Interest: Entrepreneurs/ businesses need to take active steps in protecting the needs of their stake holders. They need to adopt a balanced approached in order to achieve its social responsibility goals. Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 22  Benefits of Social Responsibility Fundamentals of Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2013 1– 23