Business Ethics and Social Responsibility
Business Ethics and Social Responsibility
Unit 1, Chapter 3
Ethics – are the rules that help us tell the difference
between right and wrong and encourage us to do the right
Ethical Behaviour – is behaviour that conforms to ethics –
individual beliefs and social standards about what is right
Values – tell us what we think is important and this, in
turn, helps us make decisions about right and wrong.
Morals – are the rules we use to decide what’s good and
A code of ethics – is a document that explains
specifically how employees should respond in different
Watch the DVD – Raging Bull
Class discussion to follow.
A dilemma is a situation where there is a difficult choice
between two or more options. They have good points and
bad points on both sides. But not all dilemmas are rightversus-wrong scenarios.
An ethical dilemma is a moral problem with potential
right or wrong answers. It occurs in business when a
business has a decision to make that weighs values and
morals against profitability and competitiveness.
Whistle-blowing is the decision of an employee to inform
officials or the public about a legal or ethical violation. The
employee discovers unethical, immoral, or illegal actions at
the workplace and has to make a decision about what to do.
Fraud – is the crime of lying or pretending. Some
businesses mislead consumers and try to trick them
into buying something in order to maximize their
An accounting scandal is a publicly exposed crime
involving accountants or senior executives who alter
accounting records for personal benefit. They
typically take place in large corporations.
A forensic accountant is an accountant who investigates legal
and financial documents, looking for evidence of tampering.
Embezzlement is a type of accounting fraud in which an
accountant or senior executive invents phony accounts and
redirects company money into them for personal gain.
Assets are items that a business owns, such as buildings, land,
equipment, cash, and receivables.
Liabilities are debts that a business owes.
Auditors are outside accountants who check the financial
records of companies.
Insider trading – buying or selling shares in a company based
on confidential information. This type of illegal trading is dealt
with by the Provincial Securities Commission.
Corporate Social Responsibility (CSR) – where a
business exhibits their values, their ethics, and the
contributions that they make to their communities.
1. Providing a safe and healthy work environment.
2. Adopting fair labour policies.
3. Protecting the environment.
4. Being truthful in advertising.
5. Avoiding price discrimination.
6. Donating to charity,
Should a business develop and follow their own business ethics, or should they
simply follow the laws that apply to the business?
Duty to report – means that businesses must disclose all important
information to shareholders, business partners, lenders, insurers, communities
, regulators, consumers, employees, and investors.
Laws that Govern Corporate Ethics
1. Workplace Safety – In Ontario, the Occupational Health and Safety Act
(OHSA) was instituted to ensure workplace safety and health. This act defines
the rights and responsibilities of workers.
2. Antidiscrimination Issues –
Glass ceiling – describes the invisible barriers to senior leadership positions.
Page 95 Ethical, Moral, and Legal Considerations.
Harassment – refers to those behaviours that are
found to be threatening or disturbing, and these
behaviours are not acceptable in society.
Accessibility Issues – employers have a duty to
accommodate an employee, regardless of ability or
disability. (Canadian Human Rights Act)
-Environmental Protection Act
-Business and the Environment
In Ontario, the Employment Standards Act sets out
certain mandatory minimum conditions of
Fair trade is the practice of helping producers in
developing countries bypass expensive middlemen so
they can sell their goods in other countries for a fair
Grassroots movement is one that develops from the
up, not the top down.
TransFair Canada is one non-profit organization that
assures consumers that the goods are certified and that
the purchases are benefiting the producers and