Professional Ethics(PE)
GTU # 3150709
Unit-2
Business Ethics
Computer Engineering Department
Darshan Institute of Engineering & Technology, Rajkot
[Link]@[Link]
9558045778
Looping
Outline
• Principles of personal ethics
• Professional ethics
• Principles of professional ethics
• Evolution of ethics over the years
• Honesty, integrity and transparency are the touchstones of business ethics
• Distinction between values and ethics
• Roots of unethical behavior
• Ethical decision – making process
• PLUS ethical decision-making model
Principles of Personal Ethics
As with beliefs and values, personal ethics can differ widely from person to person.
As mentioned already, beliefs and values often motivate a person by defining what they see as
being important.
In turn, they influence a person’s attitudes, and how they behave.
Ethical expectations often take the form of principles such as:
concern for the well-being of others
respect for others
trustworthiness and honesty
compliance with the law
preventing harm to others
Prof. Vijay M Shekhat #3150709 (PE) Unit 2 – Business Ethics 3
Professional Ethics
In life our behavior is governed by different norm systems.
The word NORM comes from Latin “NORMA”= yardstick. Norms dictate what we “ought” or
“ought not” to do.
The norm systems governing the behavior of a professional are:
Individual morality
Refers to individual values of a specific person and what they believe to be right.
Individual morality is influenced by how a person was raised.
It is their personal value system.
The sanction for disobeying one’s individual morality is a guilty conscience.
Positive morality
This set of norms represents what is considered “right” in society at a particular time.
The sanction for failure to obey positive morality is social sanction.
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Professional Ethics (Cont…)
Law (Legal Norms)
Laws protect society and prevent anarchy by regulating behavior.
Public Law – also referred to as criminal law: between the state and individual.
Private Law – also referred to as contractual law and focuses on the relationship between persons.
Formal Law and Common Law find expression in the reported judgments of courts.
Professional Ethics
Professionals are a group of people who earn a living by undertaking a common activity and who regulate most of
this themselves.
Firstly they must form a constitution, e.g. SAIMechE, and secondly they must publish a professional code of rules or
an ethical code of conduct.
This code must be in line with the law and is often more restrictive than the law.
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Principles of Professional Ethics
Most of profession have common fundamental principles which boil down to four universal
fundamental principles:
1. Respect for People’s Dignity and Rights
Respect the client’s personal integrity (privacy, confidentiality)
Be non-judgmental of the intrinsic value of the client irrespective of age, behavior, culture, gender, race or religion
If you are not competent to undertake a project/task refer to another professionals
Respect the knowledge skills and experience of your colleagues and other professionals
2. Responsible Practice
The critical focus of this principle is to limit your practice to your field of expertise and competence
You must have the appropriate knowledge and skill before undertaking an activity
Undergo relevant training and adhere to best practice
Keep abreast of new developments in your field
Use a new technique under supervision of a competent and experienced professionals
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Principles of Professional Ethics (Cont…)
3. Integrity in Relationships
The power relationship is unbalanced between the client and the professionals as most power rests with the
professionals (having the knowledge and skill) which leaves the client vulnerable
Professional codes expect professionals to act with integrity
For professionals to be accepted in society and successful in their profession they need to be trusted.
In such a relationship good conscience requires one to act at all times for the sole benefit and interests of another,
with loyalty to those interests
4. Responsibility
Clients are clearly the professionals first responsibility but professionals also have a responsibility to society
Examples of responsible social actions are to:
• disperse information that can advance the profession
• protect the public trust in the profession by “blowing the whistle” on non-professional conduct
• assisting in some instances where worthy causes cannot afford professional services
• protect society from dangerous practices
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Evolution of Ethics over the Years
The notion of ethics in business can be traced back to the earliest forms of bartering, based on
the principle of equal exchange.
Countless philosophers and economists have examined the topic, from Aristotle and his
concept of justice to Karl Marx's attack on capitalism.
But the modern concept of business ethics dates back to the rise of anti-big business protest
groups in the United States in the 1970s.
The subject gradually became an academic field in its own right, with both philosophical and
empirical branches.
Then, thanks to government legislation, ethics have been incorporated into businesses,
reflected today in corporate social responsibility strategies and codes of conduct.
Business ethics is now not only a firmly established academic field, it is something companies
realize they need to manage and internalize.
The history of “business ethics” depends on how one defines it.
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Evolution of Ethics over the Years (Cont…)
Although the term is used in several senses and varies somewhat for different countries, its
current use originated in the United States and became widespread in the 1970s.
The history of business ethics in the United States can be viewed as the intersection of three
intertwined strands.
Each of these in turn can be divided into at least two related branches.
The first strand, which I shall call the ethics-in-business strand, is the long tradition of applying
ethical norms to business, just as it has been applied to other areas of social and personal life.
This strand can be divided further into the secular and the religious branches.
The second strand is the development of an academic field, which has been called business
ethics.
It also has two main branches, one being the philosophical business-ethics branch, which is
normative and critical, and the other the social-scientific branch, which is primarily descriptive
and empirical.
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Evolution of Ethics over the Years (Cont…)
The third strand is the adoption of ethics or at least the trappings of ethics in businesses.
This again subdivides into the integration of ethics into business and business practices on the
one hand and the commitment to corporate social responsibility on the other.
Business ethics was introduced into Europe and Japan in the 1980s although the term did not
translate easily, and the development in each country varied from that in the United States
because of socio-political-economic differences.
It then spread in a variety of ways to other parts of the world, each time with a different local
emphasis and history.
On the world-wide level it became associated with the UN Global Compact, initiated by the then
UN Secretary-General Kofi Annan in an address to The World Economic Forum on January 31,
1999, and officially launched in July, 2000.
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Honesty, Integrity & Transparency are the Touchstones of Business Ethics
Ethical corporate behavior is nothing but a reiteration of the ancient wisdom that ‘honesty is
the best policy’.
The dramatic collapse of some of the Fortune 500 companies such as Enron and WorldCom or
the well-known auditing firm Andersen showed that even successful companies could
ultimately come to grief, if their managers did not practice the basic principles of integrity.
For every profession we would think of a code of conduct or a set of values, which has a moral
content and that would be the essence of ethics for that profession.
There should be transparency in operations leading to accountability, which should ensure
safety and protect the interest of all stakeholders.
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Distinction between Values and Ethics
Ethics are the set of rules that govern the behavior of a person, established by a group or
culture.
Values refer to the beliefs for which a person has an enduring preference.
Ethics and values are important in every aspect of life, when we have to make a choice between
two things, wherein ethics determine what is right, values determine what is important.
ETHICS VALUES
Meaning Ethics refers to the guidelines for conduct, that Value is defined as the principles and ideals, which
address question about morality. helps them in making judgment of what is more
important.
What are they? System of moral principles. Stimuli for thinking.
Consistency Uniform Differs from person to person
Tells What is morally correct or incorrect, in the given What we want to do or achieve?
situation?
Determines Extent of rightness or wrongness of our options. Level of importance.
What it does? Constrains Motivates
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Roots of Unethical Behavior
Unethical behavior in the workplace doesn’t have to be widespread or wasteful to be costly.
Corporate scandals that finish with the arrests of immoral executives may gather the
headlines.
But the cumulative damages caused by the apparently small indiscretions that employees and
managers commit every day are just as bad.
Almost half of the 120 million workers in the United States have acknowledged witnessing
ethical misconduct.
Whether it’s a common infraction like misusing company time, mistreating others, lying,
stealing or violating company internet policies, unethical behavior in the workplace is
widespread.
These are the root causes of unethical behavior:
No Code of Ethics
Employees are more likely to do wrong if they don’t know what’s right.
Without a code of ethics, they may be unfair.
A code of ethics is a proactive approach to addressing unethical behavior.
It establishes an organization’s values#3150709
Prof. Vijay M Shekhat
and sets boundaries for adhering to those values. Everyone is accountable.
(PE) Unit 2 – Business Ethics 13
Roots of Unethical Behavior (Cont…)
Fear of Reprisal
When explaining why they don’t report ethical misconduct that they witness, people often say it is because they worry
about the implications.
They don’t want to damage their career or incur the anger of the offender.
Or, sometimes, they let the infraction go because they don’t know how to report it or they feel that their report may be
ignored.
Impact of Peer Influence
If everyone is doing it, it must be right. Or is it? What’s to stop someone from padding their expense report when their
co-workers do it but don’t get caught?
Too often people lapse into the bad behavior of others.
People behave unethically because they tend to perceive questionable behaviors exhibited by people who are similar
to them — like their co-workers — to be more acceptable than those exhibited by people who they perceive as
dissimilar, researchers say.
Going Down a Slippery Slope
Misconduct starts small, such as the exaggeration of a mileage report.
But the longer it goes unchecked, the worse the offenses become.
The few extra dollars that came from the mileage report may eventually be dwarfed by larger falsified expenses or
perhaps even outright misuse.
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Roots of Unethical Behavior (Cont…)
Setting a Bad Example
Ethical behavior starts at the top.
Employees emulate their leaders, and the most significant factor in ethical leadership is personal character.
Corporate leaders who employees view as demonstrating personal character are more likely to be perceived as
setting a strong tone, researchers say.
If employees see the boss knocking off early every day, they may do likewise.
Ignoring the small stuff will not necessarily lead to the type of scandals that make the news.
But ethical misconduct could prove costly if it is not stopped.
Identifying these causes of unethical behavior in the workplace could prevent problems and
minimize damages.
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Ethical Decision – Making Process
Take Time to Define the Problem
Consult Resources and Seek Assistance
Think About the Lasting Effects
Consider Regulations in Other Industries
Decide on a Decision
Implement and Evaluate
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PLUS Ethical Decision-Making Model
PLUS Ethical Decision-Making Model is one of the most used and widely cited ethical models.
To create a clear and cohesive approach to implementing a solution to an ethical problem, the
model is set in a way that it gives the leader “ethical filters” to make decisions.
The letters in PLUS each stand for a filter that leaders can use for decision-making:
P – Policies and Procedures:
Is the decision in line with the policies laid out by the company?
L – Legal:
Will this violate any legal parameters or regulations?
U – Universal:
How does this relate to the values and principles established for the organization to operate? Is it in tune with core
values and the company culture?
S – Self:
Does it meet my standards of fairness and justice?
These filters can even be applied to the process, so leaders have a clear ethical framework all
along the way.
Prof. Vijay M Shekhat #3150709 (PE) Unit 2 – Business Ethics 17
Professional Ethics(PE)
GTU # 3150709
Thank
You
Computer Engineering Department
Darshan Institute of Engineering & Technology, Rajkot
[Link]@[Link]
9558045778