2.

Sources of ethics and Myths about

business ethics
Sources of Ethics
Religion
Culture
Legal System
Corporate Ethics and the Concept of CSR

2.1 Sources of Ethics
Business
Ethics
Legal
System
Culture
Religion
2.1.1: Religion
One of the oldest sources of ethical inspiration
Despite doctrinal differences, religions believe
that ethics is an expression of divine will
All great religions agree on fundamental
principles secular ethical doctrine and the
principle of reciprocity, preach the necessity
for an orderly social system, emphasize social
responsibility for general welfare
2.1.2: Cultural Experience
A source of ethics because
Culture is a set of values, rules and
standards
transmitted among generations from
hunting and gathering stage, to
agricultural stage, to industrial stage, and
acted upon to produce behaviors that fall
within acceptable limits

2.1.3: The Legal System
Laws are rules of conduct, approved by
legislatures that
Guide human behavior in any society
Codify ethical expectations
Are reactive i.e., keep changing as new evils
emerge; and
Are expected to be adhered to by businesses
2.2. Myths about Business Ethics
5 Myths
Ethics is personal
Business and ethics do not mix
Business ethics is relative
Good business means good ethics
Information is neutral and amoral
2.2.1: Ethics is Personal, Confined to Self
Every citizen has/should have the constitutional right to
decide what is right and what is wrong
But individuals choice of right and wrong cannot be
absolute
It is constrained by public interest abuse and also the
demands of the organization (its norms, culture and
standards)
Organizational ethics are the summation of moral
beliefs of individual employees; organizations do not
commit crimes, individuals do.

2.2.2: Business and Ethics do not go Together
The notion now-a-days: Honesty is the best
policy but not in business
Businesses operate in a free market and strive
hard to earn profit
Management of a business is based on
scientific not ethical principles
But the argument is not acceptable:
Business cannot operate in vacuum, it is an
integral part of the society, which has
principles, norms and values and cannot allow
businesses to act amorally and create chaos
2.2.3: Ethics in Business is Relative
What is right or wrong is determined by what the
society says is right or wrong: something right
(ethical) in one place or context is wrong (unethical)
in another place or context.
But the relativist ethos is not acceptable in
international business: relativism may be carried to
any logical extreme and create complications in
interactions, communications, transactions and
negotiations; let each persons values remain valid
for him or her, businesses must try to create a
synergy of the value systems.

2.2.4: Good Business Means Good Ethics
Executives and organizations that maintain a good
corporate image, practice equitable dealings with
customs and employees and earn profits by
legitimate, legal means are de facto ethical
However,
Organizations pursuing profit making cannot be
expected to display moral characteristics like
honesty, considerations and sympathy and usually,
there is no correlation between goodness and
material success
2.2.5 Information is Neutral and Amoral
Information and computing are considered amoral
as forms of control, power and manipulation and
open access to information results in questionable
use of data bases, violation of privacy, targeting of
consumers for fraudulent advertising, pirating of
intellectual property, exposure of children to
pornography and the like.
But information and computing have productive and
positive dimensions, too: Exposure to information
can help empowerment and enlightenment and
increased efficiency