ETHICAL

BEHAVIOUR
OUTLINE
What is ethical behavior?
Business Ethics
Advantages of ethical behavior
Disadvantages of ethical behavior
Code of ethics
Statistical information
Obstacles to ethical decision making
Causes of unethical behavior
How to analyze an ethical issue
WHAT IS ETHICAL BEHAVIOUR?
Ethics can be defined as the critical, structured examination of how
we should behave in particular, how we should constrain the
pursuit of self-interest when our actions affect others.
(Chris MacDonald,2010)
A system of moral principles.
It is legal, socially responsible and in accordance with community
standards.
BUSINESS ETHICS

Business ethics are moral principles that guide the way a business
behaves.

Acting in an ethical way involves distinguishing between right and

wrong and then making the right choice.
ADVANTAGES OF ETHICAL BEHAVIOR
Builds customer loyalty
Retains good employees
Creates a positive work environment
Gets easier to avoid legal problems
Makes profit in the long run
DISADVANTAGES OF ETHICAL BEHAVIOR
Reduce companys freedom to increase profit
Diversity in achievements
Extra expenditure in some cases
CODE OF ETHICS
A set of rules about good and bad behavior

Elements of Code of
ethics
CODE OF ETHICS CONTD..
This provides guidance on

What is expected of individual behavior

How to avoid unlawful or improper

behavior

How to treat customers

 Global survey on business ethics, 2000 respondents, by American
Institute of certified Public Accountants

80 % -has a code of ethics to guide the staff

57 %- provide training on ethical standards
25 %- offer incentives for staff
60 %- their board of directors has formal responsibility for ethics
OBSTACLES TO ETHICAL DECISION MAKING
The false necessity trap
The doctrine of relative filth trap
The rationalization trap
The self deception trap
The ends justify the means trap
CAUSES OF UNETHICAL BEHAVIOR
Excessive emphasis on profit
Misplaced corporate loyalty
Obsession with personal advancement
Expectation of not getting caught
Unethical tone set by top management
HOW TO ANALYSE AN ETHICAL ISSUE
Is it legal?

Identify an Does it meet

Ethical Issues
alternative company policy?

Does it comply with

the code of ethics?

Is it ethical?
THANK YOU