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FAtUL.TY:DY"AN1L~rj
Money, fame,
success, she
has it all. But
-'~, what she. -
consider~ of
paramount.
importance is \
the set of
-- \
values that she
has imbibed.
Neerja Birla.
the quiet B,rla
bahu with a
determined
sen~e of
identitr in
conver5;;.. tion
with'
Uma Ajmi:!rf;J.
. ,
'.
interests and her family
responsibilities.
Neerja's
responsibilities are
manifold. She heads the
Birla Academy of Art
fu\' and Culture in Mumbai
~.~ and the Art Access week.
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oney holds no fascination for me.
It.s just a tool. As a family, we believe
in ploughing back a part of our wealth
for the greater good of society, and in
our humble '.Vay,to the not.so-
privileged," says Neerja Bida, the
president of the Sangit Kala Kendra
youth wing and the head of the Birla
;\cademy of Art and Culture in
J\lumbai. The 32'year-old is also the
wife of Kumar Mangalam Birla,
chairman of the AVBirla Group and
tl1eEconom ic Times Business Leader
of The Yeal:
For most people, Neerja Birla is in
tl1e enviable position of someon8 who
I1;IScverything: money, fame, looks. a
SI!Cr.P.S~flllhllsl1;I11(1al1(1a hann\'
'SO" c''.
"f:~{
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;~~~~~,:
.
:',':1)
law - Shri Basant l(ul1larj: Bida ..nd
Sarla Devi Bir:a --ha\le alsJ always
been a const1Jnt sOllrce of
encouragement." :;l1cadds. And she is
adamant thaI the values imparted to
her bv her 11Jtc!;lthcr.jl1-lalV a;'e what
she \\:ill instil in her two children,
nine.yeat'.old .o\nanyashree and six.
year.old Arvaman Vikram.
. Being the \\'ii,; cf 1Jl(~ia's most
admireJ CE{: ;;;;;: ;K;il.~ a part of the
Birla family could very easily have
stiDed the sense of idcntity of a lesser
woman. HCld sh0. been cnmpletcly
overshadowed by her family's
importance r,:<1 stature in society, it
would not ha\'c been a surprise. But
Ne(~I'ia Hida has r.;II'w!d a lliclH! Ii)!'
which is a platform for
artists of all ages and
stature from across the
countrr She also assists
various charitable
projects like CPAA,
Akanksha and Make.A,
Wish,Foundation. Her
passion and desire to make a
difference in the lives of children is a
major motivating factol- for her. She
says, "I love kids. Anything that gets
a smile on their faces l~1eans a lot to
me." As president of the Sangit I{ala
Kendra youth wing. Neerja's latest
venture - a l11usica]\\'ith 75 children
that presents the Hamayana in a
unique manner - is ample proof of
that. "Called 'Its Sho\.:time Folks,
Hamayana Hevisitecl, the play is
simply magical. And the way in
which these litlle' -::hildn~n, with their
imaginative and ingenious minds,
have achieved the impossible. is truly
admirable, Every little star onth~ I
sta~e shines wilh ston1lJing energv..

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-
. Pl80fits & Ethics
Why (~S;RMakes Business Sense
ByDipankarGupta
There are three ways' n which corporate
social responsibility ( ~SR) is understood,
but only one of them is sustainable in the
long run. CSR's sustainability depends not
so.much on goodwill or CEO stamina as it
does in the way it is integrated with ,;,0;:
proven competencies of the firm.
But what needs to be clarified at the
outset is that CSR is not the same as obeying
the ~aw.Very often, executives believe that if
they obey the law with regard to pollution,
child labour and pension/provident fund
deductions, they are abiding by the charter
of CSR. Whether one likes it or not, there is
no escape from obeying the law-I have heard
it being said that the law is so often trifled
with by the rich and powerful, that if large
business houses obey the law then that
should count as CSR.
One could perhaps say that such organ i-
sations are abiding by the normq and
requirements of corporate citizenship
when they obey the law, but CSR is an
entirely different matter. Further, CSR is
not really corporate philanthropy either.
While corporate philanthropy has played
a useful role in many
societies, including India,
the way it functions does
not require corporate back-
ing and support, other
than just the money. In that
sense there is little to
distinguish one kind of
money from another.
Corporate philanthropy,
in spite of its many illus
trious contributions de-
pends a great deal on the
initiatives of specific corpo-
rate leaders. If they lose interest, or if
those to whom they delegated the task
prove to be inefficient, they might drop
the projects altogether. After all, such
initiatives are not central to the functioning
of their companies and, therefore, run the
danger of being marginalised.
In India, the rate at which projects
that were started by corporate philanthropy
atrophy gives evidence of the inherent
limitations of corporate philanthropy.
NGOs often begin their relationships with
corporate houses on philanthropic projects
that are soon shelved because things do not
work out as they were originally envisaged.
Given the Indian reality where public
goods are both scarce and poorly-
distributed, there is an urgent need for
corporate philanthropy. There is little point
in trying to undermine the importance of
corporate involvement in getting drinking
water to villages, helping in setting up
schools, or providing for alternative sources
of income for the needy, whether in
urban or rural areas. Yet, such meaningful
interventions do not amount to sustainable
CSR because they do not beat with the same
pulse as the inner logic of the organis;:ltions
that sponsor them. CSR, in its true sense, is
hard work and must be seen in conjunction
,- I~
@
with the basic functioning of the company.
It ~~st radiate out,,:,a:cts~othe society fro~
wIthm the core effIC1enc.Iesof the firm m
order to strengthen them I~ the not-t?o-long-
run. CSR, ~hus, self-c?nscH;>uslyraIses the
stakes for Itself and m domg so sets new
:~c:;:'~: an~ challenges that eventually
Impact the mdustry as a whole.
It need not have done any of this, but it
is CSR that compels it to do so. For
example, Amul encouraged dairy farming
and animal husbandry in the region
from where it gets its milk. Lipton in
Etawah did a simil~ thing with great
success. Pharmaceutical concerns can
set up public health clinics to better under-
stand how people react to illness and then
factor that knowledge into research and
development. Mechanical and engineering
firms can assist in upgrading those
know ledges required for more efficient
upstream production. Sugar co-operatives
in Maharashtra constructed Kolhapur dams
that helped sugarcane production in the
region that made the ordinary farmer of the
region that much better off.
In fact, many villages in this area are
serviced by gobar gas plants
that were initially financed
by sugar co-operatives. This
allowed village children to
study longer hours, and
this raised the standards
of those who then came
to work for these sugar
factories. In the same
vein, the expectations that
Bill Gates has recently un-
leashed in raising computer
literacy will eventually help
the software. industry as
much as it fOr\\'ards technical expertise in
society at large. Without trying to legislate
in advance what companies should do in
terms of CSR, in each case they must reach
out from within the inner core of their
functioning if their efforts in this direction
are to be sustained.
When CSR is buoyed by this kind of
rationale it does not dep~nd on the will
power of charismatic, and sometimes
idiosyncratic, corporate leaders who take
on philanthropic projects that run the risk
of running out of steam. It now becomes
an essential aspect of an organisation's
functioning and indeed its future well-
being too depends significantly on it.
No longer is CSR just CEO-driven, nor
can it be seen as a mere add-on by others in
the organisation.
Finally, when CSR is confused with
obeying the law, it does not really add
anything to the concept. It might even make
it appear as though obeying the law is
optional. It is only when CSR is carefully
planned such as its outreach is linked
integrally to its basic organisational core
that it can raise industrial standards across
the board. CSR is, therefore, meant only
for those who have the stomach to take on
tough assignments.
J - - -'-
I .
For Big Mac, vegetableoil is sacredcow:
Sourish Bhattacharyya
New Delhi, May 4
HERE'S THE beef on french fries. Two
Seattle-based Indians ha.ve taken McDon-
ald's to court for lacing its french fries with
beef flavouring, a chemical compound that
mimics the taste of beef fat. You.can argue.
the merits of the case till the cows come
home, but here's why McDonald's fat is in
the fire.
For decades, as Eric Schlosser has
exposed in his just-published book, Fast
Food Nation: The Dark Side Of An All-
American Meal, Ronald McDonald cOuked
his famous french fries in a combination of
93 per cent beef tallow and 7 per cent cot-
tonseed oil. "The mix gave the fries their
unique flavour - and more saturated beef
fat per ounce than a McDonald's hamburg-
er," writes Schlosser.
The junk.food multinational, in fact, was
so particular aboUt its ftench fries that in
1957 it set up a research lab to perfect the
taste. But with consumer groups demanding
good health along \\1th their french fries, it
switched over to pure vegetable oil in 1990.
. .' -- . .'
AFP
McSMEAR:A BJPactivistat work in Mumbai
Subliminally, though, fast-food junkies
weren't accepting this switch, so McDonald's
got the New Jersey-based International
Flavours and Fragrances (which also manu-
factures the smell of six of the top ten Amer-
ican perfumes) to play around with chemi-
cals and create a compound that would arti-
ficially replicate the taste of beef fat.
It is this compound that goes under the
label of 'natural flavours' in the ingredients
rJf:\
.~~. [.7::.cv
list given in the McDonald's website -the om-'
cial position is that the flavouring is "some-
thing similar to beef broth". Potatoes, par-
tially hydrogenated soyabean oil,dextrose
and sodium acid pyrophosphate (a colour
preservative) are the other ingredients.
McDonald's India, however, insists that
"no beef or animal extracts of whatsoever
kind" are used in its french fries, although
they're imported in the form of blast-frozen ,.
partially fried strips from New Zealand.
Does the supplier use beef flavouring in the
french fries? "Weuse 100per cent vegetable
oil at every stage," maintains a company
spokesman.
India is the second-largest grower of pota-
toes, but Wedon't grow the 6-inch, extra long
variety that's best for french fries, which
explains why our consumption of the Amer-
ican stuff has quadrupled to 2,000tonnes in
two years and is likely to shoot up to 6,000
tonnes by 2002, according to US Potato
Board estimates.Now,India's future asa sig-
nificant consumer of french fries now
hinges on what's cooking in Seattle.
Did McDonald's let down US Hindus? page 13
ilON Saturday, May 5, 2001
Hindustan Times, New Delhi I 7

100% VEGETARIAN
FRENCHFRIES
IN McDONALD'STM
INDIA

Dear Customer,

McDonald's India would like to assure

you that French Fries in India is a
100 % vegetarian product and does not
contain any beef or animal extract of
whatsoever kind.

We confirm that right from the

processing stage until it is cooked and
served to you, we only use 100%
vegetable oil in India.

McDonald's India
I

L------
I

-.----
J
_.t,

It's time we took a stand and took measures to prevent

and counter sexual harassment of women at workplaces

The SUPREME COURT has pre~cribed certain GUIDELINES and NORMS for the employer
. Initiate appropriate action in accordance . Ensure that victims. or witnesses are not
with law (criminal proceedings) victimized or discriminated against while
. Create an adequate complaint mechanism dealing with complaints of sexual
including a Complaints Committee harassment.
headed by a woman (not less than half . The victims of sexual harassment should
of its members should be women). It should have the option to seek transfer of the
also involve a third party either a NGO or perpetrator or their own transfer.
any other body which is familiar with the . Appropriate disciplinary action should be
issue of sexual harassment. initiated against the guilty in accordance
with service rules.
. Ensure time-bound treatment of complaints.

-. .~ ..~~ WiMA'%.__JII&.'%.m,%%Th_Wl:.",&W,*,*W,\.%.,%'W.;gflWI.!{.%.%.w.1iI,"i'i1."'iii1U'IIIh.%'%,"ih."'&%'%WMii'4.&J,"I.WiiM%l'1Wi'iIit&'%.W;$

GENDER EQUALITY INCLUDES PROTECTION FROM SEXUAL

HARASSMENT AND RIGHT TO WORK WITH DIGNITY, WHICH IS A
UNIVERSALL Y RECOGNIZED BASIC HUMAN RIGHT.
~w
~~-''''%''~11!1!@1ffi,._'%''R%'_1Ul!Kfl,%'W."",\__'%.'%,''%.'%.'''2}''%.-&",'W.fl%'1i~ffiW;%{,'1tWtYJit_1U'Kiiffi%*,,,*

CD

I
!e
Department of Women and Child Development, ~
0
N
Ministry of Human Resource Development,
-'"'" Government of India Towards a new dawn ~
't:I

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 2 : Business Ethics
(i)
'(i) When orders dropped in any manufacturing company, the I
supervisor is asked to terminate a few employees to save cost. The I
supervisor knows that some of them though loyal, hard working, they I
have to be terminated to save his skin. He knows it is unfCiir to
terminate the employees and still he is helpless. Even if he is given
two months termination time by the company. he will not reveal his
plans of termination to the employees to be terminated with a fear that
employees would quit while still needed or not work as hard as they
usually did after being told. The supervisor had to enforce all company
rules and policies. For him" the ethical dilemma relates to two'
dimensions:
. Personal
. Professional, Ethic
expressed
(11) In another case. a senior librarian who was very casual and {

negligent'in his' attitude. had to make one of his weak assistants a !

scapegoat at the end of the year when library inventory was checked j
1.4 D
and nearly 500 books were short. The senior librarian knew very well ! We v.
that his assistant is highly loyal. sincere and honest in his work and I dictionaric
such a thing would not have happened from him. However, the reason . }
of the books lost could not be found out by him and he had to put the
r
blame on his junior who is mentally weak and innocent. Othef"\Vise, he I ;

had to take the full blame. He took the decision of putting the blame on j
. I
his junior rather than on himself.
E
There would be many episodes like this, raising ethical questions l t
for a number of reasons. Sometimes society is harmed. At other times.'
the individual makes profit in an unfair way at the expense of others.
. I
We all know the story of the clever monkey that ate the curd rice and t
smeared it on to the face of the goat. The goat was punished severely \i
by his master who thought that it had eaten the same. d
a
A business firm suffers many a times with higher costs when money v I

is 'embezzled' or when the firm has to pay hidden costs for its supplies. II
(Embezzlement is fraudulent appropriation of another's property by the I
. 1
'
person to whom it was entrusted). Thus it can be noticed that 'money I

c
laundering' cloaks illegal activities and protects lawbreakers like the I

monkey-goat episode. ! 0
. 'I
1
1~
1.3 Meaning of Ethics \\
i ir
Ethics in Latin language is called 'Ethicus' and in Greek. it is j . E
called 'Ethicos'. In fact. this word has originated from 'ethos', meaning I
t1
character or manners. j
0
Ethics is thus said to be the source of morals; a treatise on this; i C
moral principles; recognised rules of conduct. I CI
The character of a man is expressed in terms of his conduct (ref. ! . E
Fig. 1.1). I b
el
I

I
 ,/

Introduction to Business Ethics: 3

~
1("
1e Leads to
Decided Taken
ey

H &11
~uu~~~-~~~~~~__n. ...

to together
~n ~~~wri by considered
as
lis
at
By which we
ey can Judge
rlY again
I/O

Fig. 1.1 Meaning of Ethics

Ethics thus can be considered as the source of character of a person
nd expressed as right or wrong conduct or action.
la
ed 1.4 Definition of Ethic. and Buslne.s Ethics
ell
We will examine different definitions given for ethics in the
1d dictionaries as well as in books.
0n
he . According to Concise Oxford Dictionary, 'ethics' is relating to
he morals; treating of moral questions: morally correct:
In honourable.
. It is the study of morals and moral choices. It focuses on
1S standards, rules and codes of conduct that govern. the
'S, behaviour of individuals and groups.
"s. . In the simplest terms, business ethics are moral principles
1d that define right and wrong behaviour in the world of business.
'ly What constitutes right and wrong behaviour in business is
determined by the public interest groups, and business
ey organisations, as well as an individual's personal morals and
~S. values.
he . The other dictionary meaning of 'ethics' is that it is the
ey 'science of morals'; it is that branch of philosophy, which is
he concerned with human character and conduct. It is a treatise
on morals (capable of knowing right and wrong).
. 'Ethics' refer to the code of conduct that guides an individual
while dealing in a situation. It relates to the sodal rules that
influence people to be honest in dealing with the other people.
is .
1.1g Ethics are the principles of behaviour that distinguish between
the right from the wrong. Business ethics is the eVfll~ation
of business activities and behaviour as right or wrong. Ethical
S; conduct conforms with what a group or society, as a whole
considers right behaviour.
~f. . Ethics can be defined as the study of what makes up good and
bad conduct inclusive of related actions and values. Business
ethics, which is a subject of the study of Ethics and is defined
 4 : Business Ethics @
,
as the study of what makes up good and bad conduct as related r
to business activities and values (Business is defined as any c
individual or organisation, a corporation, a partnership, joint . E
ventures or a franchise whose primary goal is to provide goods a
a,nd services in order to 'obtain a return on investment). Il
. Ethics are the rules we play by, They are the standards of d
behaviour generally accepted by a society. Ethics are standards p
of moral conduct. Marketing ethics relate to a moral b
evaluation of decisions based on commonly accepted principles . E
of behaviour. This evaluation results in action being Judged tc
right or wrong. Ethics pertain to more than what is legal. . A
. According to R.Wayne Mondy, 'Ethics is the discipline dealing r1
with what is good and bad, or right and wrong, or with moral 'W
duty and obligation.' a
. Ethics Is that branch of philosophy, which Is concerned with a
the ,rightness or wrongness, goodness or badnes's of human . B
conduct. Ethics provides the basis for deciding that,a particular t(
action ,is morally good or bad. s]
. Ethics describes what is 'right' and what is 'wrong' in human e1
behaviour, and what 'ought to be'. Business ethics are the II
desired norms of behaviour exclusively daling with tl
commercial transactions. Ethics is a description of 'observed' tr
as well as 'desirable behaviour' and 'conduct' that attempts to . 'B
articulate moral values. bl
. Ethics concern the rightness or wrongness of human conduct. et
. is
According to Johl1 Donaldson, Business ethics. in short can
hi
be described as the systematic study of moral (ethical) matters
pertaining to business, industry or related activities, . Bl
institutions, or practices and beliefs. It can also refer to the pr
actual standards, values or practices or beliefs (An example of I to
the latter use is seen in the title of Max Weber's book. 'The
Protestant Ethic and the Spirit of Capitalism'). Business Ethics 1.5 Int
is the systematic handling of values in business and industry.
. The word 'ethics' is derived from the Greek word 'ethos' which Ethics
behaviour c
refers specifically to the "character" and "sentiment of the
community. " may even 01
. of two famil
Shea. in 1988 defines ethics as the principles of conduct Business e1
governing an individual or a profession and "standards of medical eth
behaviour."
.
policies. or :
Ethics are the 'rules or standards that govern behaviours.' As affairs. In b
per Brian Harvey. ethics stands for a practice as well as a . Lo
reflection on that practice. As a practice, it can be described bu
as the conscfous appeal to norms and values. to which. on . Cr:
reasonable grounds, we hold ourselves obliged. as. reciprocally,
we hold others obliged to the same norms and values. As a
 Introduction to Business Ethics: tJ ~
reflection, ethics is the methodical and systematic elaboration
of the norms and values, we appeal to in our dairly,activities.
. Ethics are about norms and values of a certain seriousness,
about standards and ideals, Le., ones that people cannot easily
neglect without harming others, or without being looked at
,~
:'"" disdainfully by significant others. It is about keeping your
promises, respecting sentiment of beings, and distributing
benefits and burdens in a fair and equitable way.
. Business ethics are the application of general ethical rules
to business behaviour.
. According to Keith Davis and associates, ethics are a set of
rules that define right and wrong conduct. These rules tell us
when our behaviour is acceptable and when it is disapproved
and considered to be wrong. Business ethics are the
application of general ethical rules to business behaviour.
. Business ethics concentrate on moral standards as they.apply
to business policies, institutions and behaviour. It is a
special1sed study of moral right or wrong, It Is a form of applied
ethics. It includes not only the analysis of moral norms and
moral values, but also attempts to apply the conclusions of
the analysis to that assortment of institutions, technologies,
transactions, activities and pursuits that we call business.
. Business ethics are nothing but the application of ethics in
business. It proves that businesses can be, and have been
ethical and still make profits. Today, more and more interest
is being given to the application of ethical practices in
business dealings and the ethical implications of business.
. Business ethics are rules of business conduct, by which the
proprietary of business activities may be judged. It also relates
to the behaviour of managers.

1.5 Introduction to Business Ethics

Ethics is commonly defined as a set of principles prescribing a
behaviour code, explains what is good and "right, or bad and wrong. It
may even outline moral duties and obligations. There is a combination
oftwo familiar words, namely business and ethics in 'Business ethics'.
Business ethics are concerned with moral issues in business just as
medical ethics are concerned with morality of medical practices and.
policies, or political ethics are concerned with the morality of political
affairs. In business ethics, we arrive at two things: '

. Looking at the problems which raises moral issues in

business.
. Critically examining the various problems for solving them.
,
\