Kayla Humphries
Chapter 6 – Ethics, Professionalism & Social Responsibility
CODE OF ETHICS: SET OF GUIDELINES AND RULES THAT WILL ENHANCE
BUSINESS HONESTY AND INTEGRITY
The relevance of professional codes
• Aim to regulate behavior of people in profession.
• Profession = occupation/job requiring tertiary education.
• If someone registered with professional body = abide by professional code of
organization. If code is contravened = fined/suspended/disbarred.
• Eg. Law, education, medicine etc.
Good business practice
• Refers to standard of professionalism, ethics, accountability etc. conducted.
• Professional behavior guided by professional codes = stipulate predetermined
consequences for professionals that don’t act in the right way.
• Doesn’t belong to organization = not clear what’s regarded as unethical.
• Complications
o Unethical not necessarily illegal.
o BUT all illegal = unethical.
• Ethical theories:
o Principle-based theory – Persons principles, values, morals will
determine if person sees unethical or not.
o Consequence-based theory – The outcome determines ethical or not.
o Utilitarian theory – Based on what is best for the most people.
Ethical behaviour in practice
CONFLICT OF INTEREST
o Eg. Somebody awarding tender knowing the person who might get it.
o Recruitment panel, knowing someone applying = friend/family.
o If person serves on Board of Directors approached by supplier to be part of
board – what is the ethical thing to do?
, Kayla Humphries
BRIBES AND CORRUPTION
o Bribe if someone offered reward to give unfair advantage to someone, not
always money. If money = smoothing/facilitation payment.
o Corruption = someone in position of power abuses power for personal gain.
Eg. Misappropriating funds.
UNAUTHORISED USE OF FUNDS
o Using business funds that aren’t authorized = same as theft.
o People in offices have more opportunities to get involved in white collar
crimes than manufacturing department.
o Eg. Manager having expense account to take wife for lunch and claiming as
business expense.
o Spending money not intended for that specific purpose.
INNAPROPRIATE GIFTS
o Most businesses make employees declare gifts received.
o Could be interpreted as form of bribery, or strings attached?
SEXUAL HARRASSMENT
o Criminal offence (Labour Relations Act – Section 2)
o Eg. Unwanted physical contact, whistling, sex life?, jokes, sexual gestures,
exposure, unwanted explicit photos, offer of reward in return for sexual
favours.
o Employees may not engage in any of above with anyone related to business.
o Businesses should have clearly defined poly on sexual harassment, including
policies to follow, and penalties if guilty.
UNFAIR ADVERTISING
EMPLOYMENT/LABOUR ISSUES
o Employees abusing sick leave.
o Abuse of internet/email (porn sites, exposure of confidential info, spreading of
rumours, being on social media, personal emails, taking stationery home,
verbal abuse).
Chapter 6 – Ethics, Professionalism & Social Responsibility
CODE OF ETHICS: SET OF GUIDELINES AND RULES THAT WILL ENHANCE
BUSINESS HONESTY AND INTEGRITY
The relevance of professional codes
• Aim to regulate behavior of people in profession.
• Profession = occupation/job requiring tertiary education.
• If someone registered with professional body = abide by professional code of
organization. If code is contravened = fined/suspended/disbarred.
• Eg. Law, education, medicine etc.
Good business practice
• Refers to standard of professionalism, ethics, accountability etc. conducted.
• Professional behavior guided by professional codes = stipulate predetermined
consequences for professionals that don’t act in the right way.
• Doesn’t belong to organization = not clear what’s regarded as unethical.
• Complications
o Unethical not necessarily illegal.
o BUT all illegal = unethical.
• Ethical theories:
o Principle-based theory – Persons principles, values, morals will
determine if person sees unethical or not.
o Consequence-based theory – The outcome determines ethical or not.
o Utilitarian theory – Based on what is best for the most people.
Ethical behaviour in practice
CONFLICT OF INTEREST
o Eg. Somebody awarding tender knowing the person who might get it.
o Recruitment panel, knowing someone applying = friend/family.
o If person serves on Board of Directors approached by supplier to be part of
board – what is the ethical thing to do?
, Kayla Humphries
BRIBES AND CORRUPTION
o Bribe if someone offered reward to give unfair advantage to someone, not
always money. If money = smoothing/facilitation payment.
o Corruption = someone in position of power abuses power for personal gain.
Eg. Misappropriating funds.
UNAUTHORISED USE OF FUNDS
o Using business funds that aren’t authorized = same as theft.
o People in offices have more opportunities to get involved in white collar
crimes than manufacturing department.
o Eg. Manager having expense account to take wife for lunch and claiming as
business expense.
o Spending money not intended for that specific purpose.
INNAPROPRIATE GIFTS
o Most businesses make employees declare gifts received.
o Could be interpreted as form of bribery, or strings attached?
SEXUAL HARRASSMENT
o Criminal offence (Labour Relations Act – Section 2)
o Eg. Unwanted physical contact, whistling, sex life?, jokes, sexual gestures,
exposure, unwanted explicit photos, offer of reward in return for sexual
favours.
o Employees may not engage in any of above with anyone related to business.
o Businesses should have clearly defined poly on sexual harassment, including
policies to follow, and penalties if guilty.
UNFAIR ADVERTISING
EMPLOYMENT/LABOUR ISSUES
o Employees abusing sick leave.
o Abuse of internet/email (porn sites, exposure of confidential info, spreading of
rumours, being on social media, personal emails, taking stationery home,
verbal abuse).
