business ethics from me

8/14/2019 Business Ethics From Me

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Business ethics

Chapter no :12Ethical management

system


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Group members:

Murk Afzal Gujjar

Mahrunnisa

Bharti Kewalramani

Samer Hussain

Nawal Saeed Parsa Rafique


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ETHICAL MANAGEMENT SYSTEM A system that basically helps minimizing the unethical acts in an

organization.

BetterCorporate Governanceensures a good EthicalManagement System.

Better Corporate Governance ??


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CORPORATE GOVERNANCE

Corporate governance is the set ofprocesses, customs, policies, laws and

institutions affecting the way a corporation

is directed, administered or controlled


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CORPORATE GOVERNANCE

Structure vary from country tocountry

Standardized on American

patterns

Globalized CapitalismSelf Governance

Substituting Governmentalregulation of market


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IMPORTANCE

McKinsey & Co. investor Survey, 2002

85% investors consider corporategovernance to be equally or more important

than financial issues, in deciding whichcompany to invest in


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CORPORATE GOVERNANCE SHOULD

Ensure that managers effectively execute

the strategy laid down

by the B.O.Ds

Avoid fraud, deception, malpractices

within the corporation.

Provide opportunities to share holders toexamine the functioning and true

performance of the corporation


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Principles of CorporateGovernance

Fairness-stake holders interest should also be

considered.

Accountability

Responsibility

Transparency-especially of financial performance.


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Moral Responsibilities

Maximization of long run profits

Diligent and competent in performing the

duties

Recognize that directors are agents of the

shareholders


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Minimizing Corporate Risk

A major objective of corporate strategy

Types of Risk: Business

Financial

Operational

Political


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How to Minimize Risk?

A key element of the ethical management system isa mechanism for identifying and minimizing ethical

risk. Risk is minimized mainly by an ethics committee. The risk of unethical behavior within the corporation

is determined by the firms culture , policies andoperational procedures .

Stakeholders perceptions should be consideredboth for evaluating the corporations ethicalperformance and for identifying stakeholdersexpectations.


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Triple bottom line

Approach to achieve cost savings and

improve environmental performance. Benefits of TBL:

Enhanced reputation Benchmarked performance Improved operations and management

Improved risk management Increased confidence from investor,insurers

and I financial organizations Improved communication with

stakeholders.


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Contd

Improved Communication with stakeholders

Increased confidence from investors andfinancial organizations

Corporations should show that their actionswill have beneficial consequences on

selected stakeholders


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ETHICAL MANAGEMENT AND

REPORTING

For minimizing risk, corporations should take

Ethical Management and Reporting seriously

Ethical Risks is identified by Ethics

Committee


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BETTER RISK MANAGEMENT

Identify stakeholders whose ethical

perspective matter

Prioritization of stakeholders interest in terms

of legal, technological, social, political and

financial power of different stakeholdergroups

Planning

Formulation


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CODE OF ETHICS

A statement which explicates morallyacceptable behavior within a corporation

Raises Ethical awareness & expectations

Provide guidance for ethical decision making


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Contd

External code of ethics target

stakeholders specially customers

Codes may be imposed by management

on employees

Likely to be effective when they are

genuinely negotiated


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ASPIRATIONAL OR

DIRECTIONAL CODES

Aspirational Code is relatively short

statement of expected ethical norms

Directional codes provide guidelines about

employee behavior in differentcircumstances


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DIRECTIONAL CODES

A statement of the rationale for the code

Expected ethical standards of behavior

Guidelines for conduct in specified situations

Sanctions for violating of guidelines


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