Maharaja Agrasen Institute of TechnologyFirst Internal Assignment

M.B.A

March 2014

CORPORATE

SOCIAL

RESPONSIBILITY

Subject: Corporate Social Submitted to :Ms. Anju Bharti

Resposibility

Submitted by : Garima

Enrollment No :10014803912

Semester : MBA 4th (B)

Relevance of ethics and values in Indian Business scenario.

Running a business requires adequate consideration to a number of issues outside the

traditional scope of making money, of which ethics is most certainly one. As our business

grows and becomes more significant, we impact on the lives and circumstances of people in

ways we can only imagine - through bringing jobs, creating wealth and inspiring others to

grow their businesses. An important part of engaging in this process is understanding

business ethics, which if not up to scratch can leave you with a bad reputation and can even

ruin business, not to mention alienating employees, suppliers and the local community.

India is a developing country where more and more business houses are emerging on daily

basis and this is the main reason to develop in a few years businesses are adopting unethical

practices. In India increasing number of scams are showing the lack of good business ethics

and values that cause the big wrong steps by the corporations and the employees who run it.

Ethics is something of a subjective topic, but it is nevertheless of immense importance across

all areas of business. From the way in which sales and marketing is handled through to

product development and customer service, and even to some extent finance, ethics has a

significant role to play in ensuring business success and ultimately living up to the corporate

social responsibility. Thus adopting a ethics-specific approach to doing business is critical

towards ensuring a legitimate business model with long term potential.

Ethics and values are no doubt an important business subject for any entrepreneur to study,

but they also have a wider application throughout organisations. One man's concept of what

is ethical and for the best may be completely different from another man's concept, and so it's

important to establish a collective set of ethics that represent the entire organisation rather

than just adopting a piecemeal approach. These can be installed through training, through

creating business policies and even through careful selection at the HR stage, although it's

important that there are also enforcement mechanisms within the business concerned, and

that ethics and values remain a forefront consideration in day-to-day trade to ensure a unified,

morally sound approach to doing business. The importance can be illustrated as under:

Stop Business Malpractices : Some unscrupulous businessmen do business malpractices by

indulging in unfair trade practices like black-marketing, artificial high pricing, adulteration,

cheating in weights and measures, selling of duplicate and harmful products, hoarding, etc.

For example Satyam case in India is an example of malpractice by the traders. These business

malpractices are harmful to the consumers. Business ethics and values help to stop these

business malpractices.

Improve Customers' Confidence : Business ethics are needed to improve the customers'

confidence about the quality, quantity, price, etc. of the products. The customers have more

trust and confidence in the businessmen who follow ethical rules and have good values. They

feel that such businessmen will not cheat them.

Survival of Business : Business ethics are mandatory for the survival of business. The

businessmen who do not follow it will have short-term success, but they will fail in the long

run. This is because they can cheat a consumer only once. After that, the consumer will not

buy goods from that businessman. He will also tell others not to buy from that businessman.

So this will defame his image and provoke a negative publicity. This will result in failure of

the business. Therefore, if the businessmen

does not follow ethical rules and do not cultivate good values in his organisation, he will fail

in the market. So, it is always better to follow appropriate code of conduct to survive in the

market.

Safeguarding Consumers' Rights: The consumer has many rights such as right to health

and safety, right to be informed, right to choose, right to be heard, right to redress, etc. But

many businessmen do not respect and protect these rights. Business ethics are must to

safeguard these rights of the consumers. Also if there is good value culture in the organisation

the employees will not harm the consumers in any way.

Protecting Employees and Shareholders: Business ethics are required to protect the interest

of employees, shareholders, competitors, dealers, suppliers, etc. It protects them from

exploitation through unfair trade practices.

Develops Good Relations: Business ethics and values are important to develop good and

friendly relations between business and society. This will result in a regular supply of good

quality goods and services at low prices to the society. It will also result in profits for the

businesses thereby resulting in growth of economy.

Creates Good Image: Business ethics and values create a good image for the business and

businessmen. If the businessmen follow all ethical rules and have proper value culture, then

they will be fully accepted and not criticised by the society. The society will always support

those businessmen who follow this necessary code of conduct. For example Tata and

Reliance are two business houses in India who are for their ethical business practices and

respected for the same.

Smooth Functioning: If the business follows all the business ethics and values, then the

employees, shareholders, consumers, dealers and suppliers will all be happy. So they will

give full cooperation to the business. This will result in smooth functioning of the business.

So, the business will grow, expand and diversify easily and quickly. It will have more sales

and more profits.

Consumer Movement: Business ethics are gaining importance because of the growth of the

consumer movement. Today, the consumers are aware of their rights. Now they are more

organised and hence cannot be cheated easily. They take actions against those businessmen

who indulge in bad business practices. They boycott poor quality, harmful, high-priced and

counterfeit (duplicate) goods. Therefore, the only way to survive in business is to be honest

and fair.

Consumer Satisfaction: Today, the consumer is the king of the market. Any business simply

cannot survive without the consumers. Therefore, the main aim or objective of business is

consumer satisfaction. If the consumer is not satisfied, then there will be no sales and thus no

profits too. Consumer will be satisfied only if the business follows all the business ethics and

values, and hence are highly needed.

Importance of Labour: Labour, i.e. employees or workers play a very crucial role in the

success of a business. Therefore, business must use business ethics while dealing with the

employees. The business must give them proper wages and salaries and provide them with

better working conditions. There must be good relations between employer and employees.

The employees must also be given

proper welfare facilities.

Healthy Competition: The business must use business ethics while dealing with the

competitors. They must have healthy competition with the competitors. They must not do

cut-throat competition. Similarly, they must give equal opportunities to small-scale business.

They must avoid monopoly.

This is because a monopoly is harmful to the consumers.

Ques- the environmental problems of developing countries are not side effects of excessive

industrialization but the inadequacy of development. Explain the paradox.

Ans- The environmental problems of developing countries are not side effects of excessive

industrialization but the inadequacy of development. The increasing numbers of cases of

environmental problems in developing countries are not the result of their developments but

the problem of not taking care of environment while developing in different sectors. The

countries are focusing more on development ignoring the environment part which is affected

by the developments. Environmental changes may be driven by many factors including

economic growth, population growth, urbanization, intensification of agriculture, rising

energy use and transportation.

Rapid and unplanned development and expansion is the main reason why environment

factors are not taken care while developing the other parts of the country, in many sectors. It

is the lack of development in these sectors that they are causing excessive pollution and

harming the earth. If the development is not planned it will cause harm in any other way to

the earth and ultimately the mankind. The unplanned development has widened the gap

between demand and supply of resources, thus depleting the precious environment resource

base of the cities. The result is the growing trend in deterioration of air and water quality,

generation of waste, the proliferation of slums and undesirable land use changes, all of which

contribute to urban poverty.

Transport activities have a wide variety of effects on the environment such as air pollution,

noise from road traffic and oil spills from marine shipping. Transport infrastructure in India

has expanded considerably in terms of network and services. Thus, road transport accounts

for a major share of air pollution load in cities such as Delhi. Port and harbor projects mainly

impact on sensitive coastal eco systems. Their construction affects hydrology, surface water

quality, fisheries, coral reefs and mangroves to varying degrees.

Direct impacts of agricultural development on the environment arise from farming activities

which contribute to soil erosion, land salination and loss of nutrients. The spread of green

revolution has been accompanied by over exploitation of land and water resources, and use of

fertilizers and pesticides have increased many fold. Shifting cultivation has also been an

important cause of land degradation. Leaching from extensive use of pesticides and fertilizers

is an important source of contamination of water bodies. Intensive agriculture and irrigation

contribute to land degradation particularly salination, alkalization and water logging.

In the economical factors the main cause of pollution is, to a large extent, environmental

degradation is the result of market failure, that is, the nonexistent or poorly functioning

markets for environmental goods and services. In this context, environmental degradation is a

particular case of consumption or production externalities reflected by divergence between

private and social costs (or benefits). Lack of well defined property rights may be one of the

reasons for such market failure. On the other hand, Market distortions created by price

controls and subsidies may aggravate the achievement of environmental objectives.

Despite of development in many sectors the development of environment is ignored by the

developers so it is the inadequacy of development not the lack of development.

Causes of unethical behaviour by individuals:

We work in stressful time and the work pressure force individuals to do unethical to

achieve the targets given by the employers.

In the highly competitive world everyone wants to succeed at a fast pace. That let

them follow unethical ways to achieve more in less time. A person acts unethically

because he or she believes it help him or her in career, an unethical act is used as a

means of impressing a superior the career of a competitor. For example, a person

sabotage a co worker’s project as a means of making him/herself look better in

comparison.

One of the main causes of unethical behaviour is greed. A person often chooses to act

immorally or unethically for personal financial gain. In business, there are a number

of opportunities for employees and employers to do the wrong thing. For example, an

employee who has contact with a client may be willing to give them a discount in

exchange for a kickback. An employer may have an opportunity to sell the company's

stock when he has inside information about a drop in profit.

Ignorance-Ethical conflicts or violations are not always transparent, and it's easy for

an employee to perform an unethical act without knowing it. For this reason, it is

important for companies to make employees aware both of the company's general

ethics policy, and specific examples of ethical and unethical behaviour.

Misguided loyalty is another reason for unethical conduct on the job. People

sometimes lie because they think in doing so they are being loyal to the

organization or to their bosses. Examples of this type of behaviour are not hard to

find. For example, managers at automobile companies who hide or falsify

information about defects that later cause accidents and kill people or managers at

pharmaceutical companies who hide information about dangerous side effects of

their drugs. No doubt these managers believed they were protecting their

employers. They may well have seen themselves as good, loyal employees.