BROADER ETHICAL ISSUES IN SOCIETY-CORRUPTION & BRIBERY

Presented By:

Ajesh Raj 1261

Sijo Johnson 1272

Suyash Kotian 1287

Jyoti Surywamshi 1311

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.

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;

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

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

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.

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

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

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

Cont’d…

• Losses• Discouragement of Shareholders and Investors• Damaged Business Image• Business Inefficiency

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

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.

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.