Business Ethics Concepts and
Professional Ethics
Business Ethics Concepts
• Business ethics refer to a set of professional
or applied ethics that review or study ethical
or moral principles and ethical or moral
problems that appear in any business
environment.
• Issues regarding business ethics arise when
there is a conflict between profit maximizing
and the concept of social and legal
responsibilities of the business.
Business Ethics Concepts
• The basic concepts of business ethics involve three
different types of moral or ethical issues.
• Some concepts focus on the issues covering the
function of business within the environment where the
business activates i.e. political, economic, legal and
other social factors.
• Other concepts focus on the corporate issues, i.e. the
issues pertaining to the functioning of a certain
business or company.
• While some other concepts focus on the individual
issues, i.e. the issues pertaining to the conduct or
behavior of individuals within a business or company.
C1. Businesses as a "Corporate Entity”
• Business corporations in most of the nations are considered
legally as entities or persons, i.e. the rights and liabilities
legally applicable to persons or citizens are also applicable
to business corporations.
• The eventual objective of individual ethics is developing a
set of ethical standards which can be held as acceptable
after considering everything carefully in a particular
situation.
• These individually accepted ethical standards can also be
applied to different situations such as personal, social and
even in a business.
• Most of the consumers agree that a business should follow
the same moral standard while interacting with an
individual customer as well as interacting with all
customers locally, nationally or globally.
C2. Business Ethics considered as
"Good":
• Business ethics considered as "Good" requires
containing and following a norm of moral
values keeping the expectations and rights of
people ahead of the profit maximization of
business.
• A business’s main goal is to make a profit but
peoples’ rights and expectations should not be
ignored.
C2. Business Ethics considered as
"Good":
• Good business ethics is beneficial for businesses
in the following three ways:
• It Discourages the breaking of laws in business
activities.
• It assists businesses to avoid steps for which the
company may come under costly civil lawsuits.
• It demotivates companies to engage in actions
which can damage the image of the company.
Good business ethics helps to improve businesses
profitability as following ethical values prevents
loss of revenue and company reputation.
C3. Unethical Business Practices:
• Many big companies have been fined a large amount
of money for following unethical business practices.
• Unethical business practices go far beyond functions
breaking the law. Many renowned companies are
engaged in unethical and questionable practices
without breaking any laws.
• They follow practices just to increase their profits
ignoring the rights of the consumers, such as, giving
less in quantity or quality, selling old or low-quality
products with free gifts, etc.
• Businesses are ethically responsible for their activities
as individuals are responsible for theirs.
C4. Moral Rights:
• Generally, a moral right refers to a person’s
claim to something.
• When a person is entitled to a right, he or she
is able to make a decision whether or not to
claim such right without anyone’s permission.
• The entitlement of moral or ethical rights
implies that others have particular duties
towards the person bearing the right.
C5. The Concept of Justice:
• The following beliefs are utilized to distribute the benefits and
burdens in a just or fair way to the people of the society.
• Egalitarianism states that all human beings are equal. According to
this belief, all the benefits and burdens of the society should be
circulated according to this principle:
• “Every person should be given exactly equal shares of a society’s or
a group’s benefits and burdens.”
• Utilitarianism states that a just society’s laws and institutions
promote the best overall or average welfare of its members.
According to this belief, the greatest benefits for all, and the society
should be organized in such a way that its wealth is allocated to
meet everyone’s basic needs.
• Libertarian justice states that the free market is naturally just, and
that redistributive taxation breaches the property rights of people.
Every business person should follow the
business ethics properly because studies
prove that ethically correct business becomes
profitable in the long run.
