Business Ethics &
Corporate Governance
MODULE 2
Rohan Patwardhan,
Advocate
[Link], LLM (V.U. Pune) LLM (K.C.L., U.K.)
Founding & Managing Partner, LexRobe Legal®
Founder, The Juris Chronicles
MODULE 2
Business Ethics- An overview-Concept, nature.
• Business ethics refers to implementing appropriate business policies and
practices with regard to arguably controversial subjects.
• Some issues that come up in a discussion of ethics include corporate governance,
insider trading, bribery, discrimination, social responsibility, and fiduciary
responsibilities.
• The law usually sets the tone for business ethics, though doing the bare minimum
is generally frowned upon.
• Developing ethical models and practices can boost a company's revenues, profits,
and share price.
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Evolvling Values & Ethics
• Accountability
• Fairness
• Integrity
• Corporate Social Responsibility
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• Ethics in Business – Myth & Reality:
• Leaders may face challenges in the workplace due to different interpretations of what is
ethical. Situations often require navigating "gray areas" where it's unclear what is right
and wrong.
• For example, the theory of ethical relativism holds that morality is relative to the norms of
one's culture. This means that the same action may be morally right in one society but be
morally wrong in another.
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• Models of ethical decision making- Stages, :
• Ethical decision-making models typically include steps for identifying problems,
gathering information, and evaluating options. Here are some examples of ethical
decision-making models:
• StudySmarter
• This model has six steps:
• Problem identification: Recognizing that an ethical problem exists
• Collecting information: Gathering all relevant information to understand the problem
• Identifying options: Exploring all possible solutions to the ethical issue
• Evaluating options: Evaluating each option against ethical principles
• Making a decision: Making an ethical decision after careful evaluation
• Implementing the decision: Acting on the decision and evaluating its impacts
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Ethical concerns in the Indian business scene:
• Privacy
• Environmental sustainability
• Corporate social responsibility
• Discrimination
• Occupational safety and health
• Employees have a right to a safe working environment and conditions.
.
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• Liberalization, Privatization and Globalization (LPG) & global trends in
business ethics :
• Liberalization, Privatization, and Globalization (LPG) is a model of economic reforms
that was announced by the Indian government in 1991. The goal of the reforms was to
make the Indian economy more market-oriented and competitive with the world economy,
and to increase economic growth and foreign exchange reserves. The three terms in LPG
stand for:
• Liberalization: Less government control over the economy, allowing for more freedom
• Privatization: Private sector participation in state-owned enterprises
• Globalization: An open economy with more economic freedom and global economic
integration
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Suggestive Reading:
1. Course Material by Prof Joanna Mankad for the entire course to be the main
reference point.
2. Ref Reading Chapter 1, 3 Ethics in Business and Corporate Governance by S K
Mandal
3. Case Study HBS : The Fall of Enron
4. Case Studies: The Satyam Scam, Harshad Mehta Scam