Business ethics

Ethics-The term ethics is emerged from Latin word ‘Ethicus’ or Greek word ‘Ethicos’. Both these
words have in turn originated from the word ‘Ethos’ which means character. The word ethics can
be defined in many ways-
1) As per Oxford dictionary it is ‘a system of moral principles, rules and conduct’.
2) It is a science of morals.
3) It describes what is right, what is fair, and what is proper.
4) The study of what is good and right to the people. The basic question ethics asks are how a man
should act, especially when the action have direct and indirect effect on others.
The issue of ethics becomes a complex issue as the terms good, bad, right or wrong are relative
terms and are issues of moral judgment. The problem has one more side that who is making the
judgment. From different sides the problems are seen in different light. The distinctions are made in
‘us’ and ‘others’ and in ‘benefits’ and ‘obligations’.

Business Ethics-
What is right, proper and just these questions are going to be more imp. in future as our society is
going to be more crowded, economy more competitive, and technology more complex.
During the initial period of industrial revolution, it was considered that business and ethics do not
go together. It was believed that if it is business then it is not ethical. In early 1950’s it was believed
in India that a company that is making profit is unethical; profit making is dirty. Today profit is
considered to be must for any organization. The concept of business ethics started revolving around
1960.The social awareness movement gave birth to business ethics. The business houses had the
financial assistance to help in solving social problems and commercial organizations started having
their own set of ethical standards. Since then the business ethic shave developed an increase in
awareness and popularity.
The term business ethics is given different meaning by different people. Business ethics simply
means applying ethics in business. It can be defines as ‘the application of ethical principals and
methods of business analysis. Carter McNamara defines business ethics as,’ coming to know what
is right and what is wrong in the work place and doing what is right- with regards to effects of
products/ services and in relationship with stakeholders.’
According to Wheeler, ‘Business ethics is an art or science of maintaining harmonious relationship
with the society, its various groups and institutions as well a s reorganizing the moral responsibility
for the rightness or wrongness of a business conduct.’
In short, the industry and commerce has to balance economic interests of the organization and
social responsibility.

Feature/characteristics of business ethics-

1-It refers to a code of conduct- Business ethics involves a code of conduct which speaks about the
moral duties and obligations the businessman should follow while carrying on his normal business
activities.
2- Business ethics is base don social and moral values like self control, consumer protection,
service to society, fair treatment to social groups and not to harm or exploit others.
3- Business ethics provides protection to various social groups, like share holders, employees, and
consumers.
4- Business ethics provide basic framework within which the business has to be conducted. It
suggests the legal, cultural, social, economic limits of the business.
5- Business ethics can not be imposed by law or force. It must be accepted as self discipline by the
businessman.
6-Bucinessmen should be given proper education and guidance to follow ethical practices. Trade
associations and chamber of commerce have to play positive role in this regard.

Importance and need for business ethics-

Today it is realized that the organizations which act legally and ethically not only save lot of money
but also gain public support and reputation in whatever new venture the organization takes. It lasts
for a longer time.
The importance of ethics in business is many folds as follows-
1) Part of society-Business is a part of society. Whatever ethical principals apply to the
society apply to the business. Business should give priority to social good. Such ethical
approach gives higher status to business