This document discusses broader ethical issues in society related to corruption and bribery. It defines ethics, corruption, and bribery. Corruption involves the illegitimate use of power for private gain, while bribery is the offering of value to influence someone's actions or duties. Corruption can occur on different scales and hurt businesses through losses, discouraging investors and shareholders, damaging image and reducing efficiency. Bribery is also discussed, along with factors that may push businesses to pay bribes like competition or government controls.
2. Meaning of Ethics
• A branch of philosophy that involves systematizing,
defending and recommending concepts of right and
wrong conduct, often addressing disputes of moral diversity
• Term comes from Greek word ethos which means
"character", "habit", "praxis“
• Philosophical ethics investigates what is the best way for
humans to live, and what kinds of actions are right or wrong
in particular circumstances
• Ethics seeks to resolve questions dealing with human
morality—concepts such as good and evil, right and
wrong, virtue and vice, justice and crime.
3. Cont’d…
• Ethics may be divided into four major areas of study:
• Meta-ethics-the theoretical meaning and reference of
moral propositions and how their truth values (if any)
may be determined;
• Normative ethics-the practical means of determining a
moral course of action;
• Applied ethics draws upon ethical theory in order to ask
what a person is obligated to do in some very specific
situation, or within some particular domain of action
(such as business);
• Descriptive ethics-known as comparative ethics, is the
study of people's beliefs about morality;
4. Key Points
• Ethical behavior is based on written and unwritten
codes of principles and values held in society
• Ethical principles and values serve as a guide to
behaviors on a personal level, within professions,
and at the collective organizational level
• Business ethics involves personal, professional, and
corporate behaviors
5. Business Ethics
• A form of applied ethics or professional ethics that
examines ethical principles and moral or ethical
problems that arise in a business environment
• It applies to all aspects of business conduct and is
relevant to the conduct of individuals and entire
organizations
6. Importance of Ethics in Business
• Ethical behavior and corporate social responsibility
can bring significant benefits to a business
– attract customers to the firm's products, thereby boosting
sales and profits
– make employees to stay with the business, reduce labor
turnover and therefore increase productivity
– attract more employees wanting to work for the business,
reduce recruitment costs and enable the company to get
the most talented employees
– attract investors and keep the company's share price high,
thereby protecting the business from takeover.
7. Corruption
• The word corrupt means “utterly broken”
• Corruption is described as the illegitimate use of
public power to benefit a private interest
• Corruption is an action to (a) secretly provide (b) a
good or a service to a third party (c) so that he or she
can influence certain actions which (d) benefit the
corrupt, a third party, or both (e) in which the
corrupt agent has authority
8. Scale of Corruption
• Corruption can occur on different scales
– Petty corruption occurs at a smaller scale and within
established social frameworks and governing norms
– Grand corruption is defined as corruption occurring at
the highest levels of government in a way that requires
significant subversion of the political, legal and
economic systems
– Systemic corruption (or endemic corruption)[5] is
corruption which is primarily due to the weaknesses of
an organization or process
9. Effect of Corruption on Business
• Corruption is one of the worst enemies of business
because it can result in far-reaching consequences,
including total closure of the company
• Corruption in business involves misappropriation of
funds, bribery, misuse of office by company officials
and dishonesty in financial matters
• Corruption can hurt the image of the business and
jeopardize its profitability
11. Bribery
• It an act of giving money or gift giving that alters the
behavior of the recipient
• Bribery refers to the offering, giving, soliciting, or
receiving of any item of value as a means of influencing
the actions of an individual holding a public or legal
duty
• It constitutes a crime such as offering, giving, receiving
of any items of value to influence the actions of an
official or other person in charge of a public or legal
duty
• Bribe is the gift bestowed to influence the recipient's
conduct
12. Factors That Push Business to Pay Bribe
• Competitors are giving bribes to obtain business
(which can cause the misuse of the country’s
resources)
• The pressure for higher levels of performance by top
management and shareholders
• This is an accepted practice in the host country.
• Tax laws of the country encourage bribery. It can be
written off as a business expense.
• Government control over business activities.
13. Cont’d..
• In economics, the bribe has been described as rent
• Government officials are poorly paid and use
bribery to supplement salaries.
• Bureaucratic delays can be costly for business.
• Pressure from politicians to make contributions to
political parties or causes.