Business Ethics and Social Responsibility

Code of Ethics in Business- Quarter 3 Week 3

Name: ___________________________________ Score: ____________

Year and Strand: ___________________________ Date: _____________
LEARNING ACTIVITY SHEET

Background Information for the Learners

The term Ethics is derived from the Greek word ethos which means
“characteristic way of thinking”. Ethics, as a science, does not only evaluate the morality of
our human conduct but also provides us with a common understanding of the universal,
objective, and irreversible moral principles that should govern our human behavior and guide
our moral decisions (Roa, 2011).
Ethics are moral principles that guide the conduct of the individual (Racelis, 2017).
These are rules of behavior based on ideas about what is morally good and bad
(MerriamWebster Dictionary).
Learning Competency: Formulate a “code of ethics” that reflect core principles derived from
analyses.. (ABM_ESR12-llla-d-1.6)

Why is ethics important in business?

Ethical conduct, whether at the corporate, professional, or personal level, is a direct

reflection of the principles and values which regulate the person and the institution he/she
represents. Organizations establish their own culture that is socially expressed as their ideals.
Such principles or ideals have an impact on the relationships within the company, efficiency,
prestige, performance and retention of employees, legalities, and the wider community they
work in.
As a result, most organizations generate a list of organizational values and codes of
conduct to be recognized and adhered by all workers. Motivating and enhancing constructive
actions, and at the same time building an atmosphere that prevents unethical behavior are
vital obligations on the part of both administrators and workers.
How to Apply Ethics

At the individual level, organizations ought to concentrate on improving and

encouraging every employee to respect and adhere to ethical principles. Certain aspects of
individual ethics have their roots in the individual. Achieving a strong sense of professionalism
and recognizing certain professional decisions' ethical implications are the key components of
education, individual reflection, and experience.

Examples of Ethical Issues in Business 1. Ethical Issues in Finance

Under the umbrella of finance and accounting, fairness in trading practices,
trading conditions, financial contracting, sales practices, consultancy services, tax
payments, internal audits, external audits, and executive compensation are included,
 whereas specific corporate ethical/legal abuse includes insider trading,
bribery/kickbacks, misleading financial analysis, and fraud on securities.

2. Ethical Issues in Human Resource (HR) Management

Human Resource Management 's tasks include hiring and orientation,
performance evaluation, training and development, labor relations, and health and
safety concerns. Among the ethical issues are discrimination by age (the young ones
are preferred over the older ones), gender preference, sexual orientation, race,
ethnicity, disability, and physical appearance are all ethical issues that the HR
oversees.

3. Ethical Issues in Sales and Marketing

Marketing ethics deals with the beliefs, standards and/or morals that
advertisers and marketing organizations will operate upon. Ethical marketing issues
include promotion of obsolete or harmful products/services; openness about
environmental threats; food ingredients (Genetically Modified Organisms); possible
health hazards or financial risks; protection for the privacy and autonomy of
consumers; truthfulness in advertising; and honesty in price and delivery. Some claim
that advertisements can affect the views of individuals and their relationships with
others, suggesting an ethical obligation to avoid distorting those expectations and
relationships.
Ethics in marketing includes practices in pricing, which involves unlawful acts
such as price manipulation and price skimming. According to Hayes (2020), price
skimming is a product pricing strategy by which a firm charges the highest initial price
that customers will pay and then lowers it over time. On the other hand, advertising
has raised concerns over offensive advertisements, objectification, and school
marketing.
4. Ethical Issues in Production
Business ethics typically deals with company's duties to ensure its goods and
industrial procedures do not inflict unnecessary harm. Many products and services can
be generated and used at zero risk and it can be difficult to assess the ethical path.
However, there are consumers who patronize products that damage them, for
example, tobacco products. Output can have adverse effects on the environment like
air pollution, destruction of habitats, and urban sprawl.

What is Code of Ethics?

Code of Ethics is a set of rules about good and bad behavior. It is a guide of principles
designed to help professionals conduct business honestly and with integrity. A code of ethics
document may outline the mission and values of the business or organization, how
professionals are supposed to approach problems, the ethical principles based on the
organization's core values, and the standards to which the professional is held.

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 Saucer and Sims (2013) offer recommendations for developing Code of Ethics in business
organizations:

1. Adopt code of ethics (use the Code of Ethics of other companies as a reference and
modify according to the needs of the company).
2. Offer training on ethics (for management and employees).
3. Hire and foster individuals with ethical value.
4. Deal with immoral activities. Employees must know the implications and effects of
making unethical actions, and should be ready to accept consequences.
5. Take constructive measures. For example, give rewards to employees who admit their
mistakes. If the company is conscientious and smart, it can encourage warehouse
workers to take responsibility for their mistakes and even praise them for coming
forward, apologizing and ensuring that a faulty product is not purchased by the
customer. At first it seems counter-intuitive to reward an employee for a mistake, but
in the end, it provides everyone with the best result.
6. Carry out a social audit. Conduct survey to employees once in a while.
7. Cover all whistleblowers. These people detect illegal activities within organizations and
disclose the actions to the authority or managers. A whistleblower who works sincerely,
correctly reporting an issue, should be praised for his/her courage and integrity, as
opposed to being disciplined and ostracized. If an individual blasts the whistle, it is
possible that the company itself has failed internally to motivate and improve fair and
ethical conversations.
8. Empower the defenders of integrity. Support those who work with honesty and integrity.
9. Ensure executive commitment. The anonymity of those who report the problems
should be practiced.
10. Communicate the principles of conduct within the company and across the industry.
11. Assign an officer who is clearly responsible for the enforcement of ethical standards.
He/she can be consulted for advice.
12. Establish a procedure for violations of ethical standards, and fully review any offenses
reported.
13. Ensure high perseverance by the company's board of trustees.
14. Lead by example, above everything else.

It should be remembered that when faced with an ethical situation, the outcome of the
decision-making process should be considered. One way to tackle ethical situations is by
using the four-way test to evaluate decisions.

This four-way test consists of asking four questions:

1. Is my decision truthful?
2. Is my decision fair to all who are affected by it?
3. Will this build the organization's goodwill?
4. Will the decision benefit all parties with vested interest in the outcome?

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 Code of Ethics contains the following:
1. Vision means something that you imagine; a picture that you see in your mind
(Merriam-Webster Dictionary). The vision statement helps to ensure the alignment
of the decisions to the company goals.
Example: To make innovations that everyone could access and adapt depending on their
needs

2. Values (value means something thought of as important or useful) Values in

business help to ensure that all of the employees work towards the company goals.
Example: We commit ourselves to serve our customers with quality service and
utmost respect.

3. Mission- a specific task with which a person or a group is charged

(MerriamWebster Dictionary). The mission statement clearly and effectively guides
the business or the organization in its decisionmaking. Example: To inspire all the
young athletes of the country… tell them to dream and go for it!

4. Principles- moral rules or beliefs that help you know what is right and wrong and
that influence your actions (Merriam-Webster Dictionary).
Examples:
Customers have to be respected.
Make sure to deliver quality product.

Simplified Sample of Code of Ethics: XYZ Company

Our Core Values

Our Vision: To lead the car industry by giving our customers quality cars worthy of
their money and unmatched customer services Our Values:
We act with the highest standards of integrity.
We respect individuals and treat them fairly. Our Mission: To work efficiently and
enthusiastically to make XYZ Company the country’s top car dealer while serving our
customers punctually and courteously

Our Principles:
1st: XYZ Company shall adopt a zero-tolerance policy towards bribery and
corruption in whatever form;
nd
2 : All company officers and employees shall conduct business in accordance with
Philippine laws and regulations; and
3rd: We shall act in good faith and observe sense of professionalism at all
times.

For actual/specific example of Code of Ethics, please visit:

http://www.ayala.com.ph/governance/page/business-conduct-and-ethics

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 Code of Ethics aims to lessen conflicting issues as it explains to what degree such
conflicts can be avoided and what parties can do if these conflicts happened. Professionals
therefore cannot say that they were ignorant of the immoral nature of their improper behavior.
Often relevant is the possibility of disciplinary action (e.g. disbarment of a lawyer) which helps
minimize unnecessary disagreements or offensive behavior where a confrontation is imminent
or is likely to happen.

Activity 1.
I. Directions: Classify each phrase below to the corresponding column of ethical issues
where it belongs. Write your answers on a separate sheet of paper.

1. destruction of habitats
2. encountered misleading financial reports
3. overweight applicants are not allowed
4. hiring limited to religious affiliations
5. honesty in prices
6. truthfulness in advertising
7. fraud on securities
8. harm to environment
9. manipulation in prices
10. exaggerated advertisements

Ethical Issues:

in Human
Resource
Management in Sales and
in Finance Marketing in Production

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II. Directions: What would you do under the following situations below. Write your
answers on a separate sheet of paper.

1. Being an advertising artist, you were instructed by the manager to make two layouts,
but you will only receive the price for one.

2. Your company would have to donate P 1,000,000 to charity, but you witnessed that
the accountant only gave P 700,000 instead of P 1,000,000.

3. Being one of the food processors in a manufacturing company, you know that the
ingredients listed on the label of your product are not completely true.

Activity 2.
I. Directions: Read each sentence below and classify each according to the ethical issue
where it belongs. Write the letter of your answers on a separate sheet of paper.

A. Ethical Issues in Finance

B. Ethical Issues in Human Resource Management
C. Ethical Issues in Marketing
D. Ethical Issues in Production
1. XYZ Company does not accept members of LGBTQIA+ community.
2. Diggie’s hotdogs are made under strict processing standards.
3. The company accountant orders office supplies from her husband’s store.
4. Strawberry, a new brand of computer, launched its new laptops at an overpriced
amount.
5. Lobo Enterprise rejects all differently abled persons.
6. Super Milk does not put on the can’s label the ingredients they used.
7. The food products of XYZ Corporation are well-sealed.
8. The manager joins the contract bidding of their proposed new building.
9. Lotlot, the accountant, bribed the personnel to reduce their company’s tax payable.
10. Robot Beverages hired a famous commercial model for its product promotion.
11. Chocolatey Much Manufacturing Corporation delivers its products on time.
12. RB Corporation’s employable age limit is 55 years old.

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 II. Directions: Fill in the blanks with the appropriate word/s to make each sentence correct.
Write your answers on a separate sheet of paper.

13-14 The term ethics is derived from the Greek word _______ which means characteristic
way of __________.

15. Ethics are rules of _______ based on ideas about what is morally good and bad.
Activity 3
I. Directions: Read each sentence below and write the words thumbs up if it is true or thumbs
down if it is not. Write your answers on a separate sheet of paper.

1. The company’s Board of Trustees should show perseverance.

2. It does not matter whether the decision is fair to all or not.
3. Social surveys should be carried out by the company.
4. The company may not fully review the offenses reported.
5. Each member of the organization should be fully aware of the company’s principles.
6. The owner’s decision should be based on truth.
7. Do not mind immoral activities in the company.
8. The management should protect the whistleblowers. 9. The decision should build
goodwill of the organization.
10. Ethics are social principles that guide the conduct of the individuals.

Directions: Complete each statement by filling the appropriate word in the blank. Write your
answers on a separate sheet of paper.

11-12 Code of Ethics is a set of rules about _____ and _____ behavior.
13. The possibility of giving _____ action often minimize doing offensive behavior.
14. The people who detect illegal activities and report the same to proper authorities are called
_____.
15. It is highly suggested that administrators should lead by _____.

II. Directions: Write a short script that shows how a General Manager should respond to an
employeewhistleblower who had witnessed a bribing incident of a big client to the new
Sales Manager. Write your answers on a separate sheet of paper.

Rubrics:

Content 4 pts. Mechanics 3 pts.

Ethical implication of decision 3 pts.
10 pts.

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Prepared by:

LEINEL M. MALAZZAB
SHST II
APARRI WEST NATIONAL HIGH SCHOOL

Checked and Approved:

EVELYN P. RAPACON
School Principal I

References
"5 Marketing Practices for Your Service-Based Business". Medium.
https://medium.com/the-mission/5marketing-practices-for-your-servicebased-business-c3f9a024f34d.
"Business Ethics | Boundless Business". Courses.Lumenlearning.Com.
Retrieved from
https://courses.lumenlearning.com/boundlessbusiness/chapter/businesse
thics/. "Business Ethics |
Boundless Business".
Courses.Lumenlearning.Com.
https://courses.lumenlearning.com/boundlessbusiness/chapter/businessethics/.
"Examples of Company Policies & Procedures". Small Business - Chron.Com.
https://smallbusiness.chron.com/examples-company-policies-procedures10995.html. "How
Codes of Ethics Work". Investopedia. https://www.investopedia.com/terms/c/code-ofethics.asp.
AICPA Insights. https://blog.aicpa.org/2014/07/5-scenarios-whereproperworkplace-decorum-is-e s
https://blog.hubspot.com/marketing/inspiringcompanymissionstatementssential.html#sthash.8
gz0ruoq.dpbs.
DepEd. 2016. DepEd’s Curriculum Guide for Business Ethics and Social Responsibility, s. 2016
DepEd. 2020. DepEd’s Most Essential Learning Competencies (MELC) for Business Ethics and Social
Responsibility, s. 2020
Hayes, Adam. "What Everyone Should Know About Price Skimming". Investopedia, 2020.
https://www.investopedia.com/terms/p/priceskimming.asp.
Hayes, Adam. 2020. How Codes of Ethics Work". Investopedia. Retrieved from
https://www.investopedia.com/terms/c/codeof-ethics.asp.
Jordan, Brent. 2020. Brown Wooden Blocks on White Table [Image]. Retrieved from
https://www.pexels.com/photo/brownwooden-blocks-on-whitetable6037812/. Jordan, Brent.
Brown Wooden Blocks on White Table. 2020. Retrieved from
https://www.pexels.com/photo/brown-woodenblocks-on-whitetable6064131/.
King, Stephen. "Top 12 Bookkeeping Best Practices for Achieving Business Success".
Growthforce.Com. https://www.growthforce.com/blog/top-12bookkeepingbest-practices-for-
achievingbusiness-success. Merriam-Webster Dictionary

Racelis, Aliza. 2017. Business Ethics and Social Responsibility. Manila: Rex Book Store, Inc.

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 Business Ethics and Social Responsibility
Philosophies Influencing Our Business Practices- Quarter 3 Week 4

Name: _____________________________________ Score: ______________

Year and Strand: _____________________________ Date: _______________
LEARNING ACTIVITY SHEET

Background Information for the Learners

The fast growing economy of the Philippines opportunities for entrepreneurs.

Companies can learn from the techniques used by Greek philosophers to achieve
success in business. As you go through this module, you will learn about the classical
philosophies for business practices.

Learning Competency: Illustrate how these philosophies are reflected into

business practices. (ABM_ESR12-llle-h-2.1)

The Classical Philosophers and Philosophies and their Implications on Business

1. Socrates (469-399 BCE)- “The Gad-fly at the Marketplace” is one of the few
individuals whom one could say have shaped the cultural and intellectual
development of the world for without him, history would be profoundly different.
This is Socrates’s philosophical idea:

“The unexamined life is not worth living.” Socrates pointed out that human
choice was motivated by the desire for happiness.

Socrates thought of the Entrepreneurs. The Socratic Method is a way of

thinking that allows individuals to define their own purpose of learning and exploring
its purpose through openminded questioning of what they hold to be true. Socrates
insisted on a right to think of ourselves by introducing the philosophical concept,
“Dare to Disagree”.

2. Plato – “The Philosopher-King” is one of the world’s best known and most
widely read and studied philosophers. He was the student of Socrates and the
teacher of Aristotle. He wrote in the middle of the 4th Century BCE in ancient
Greece. This is Plato’s philosophical idea:

“Good people do not need laws to tell them to act responsibly, while bad
people will find a way around the laws.”

Plato maintains a virtue-based eudemonistic conception of ethics. That is to

say, happiness or well-being (eudaimonia) is the highest aim of moral thought and
conduct, and the virtues (aretê: excellence) are the requisite skills and dispositions
needed to attain it.
3. Aristotle – “All or Nothing” (384-322 BCE) is a towering figure in ancient Greek
philosophy, contributing to logic, metaphysics, mathematics, physics, biology,
ethics, politics, agriculture, medicine, dance, and theater. These are some of
Aristotle’s philosophical ideas:

“Happiness is the meaning and the purpose of life, the whole aim, and end of
human existence.”
“Let people seek fulfillment.” The word happiness
in ethics is a translation of the Greek term “eudaimonia” which connotes success
and fulfillment. For Aristotle, this happiness is our highest goal. In relation to
business, Aristotle concludes that the role of the leader is to create an environment
in which all members of an organization can realize their potential.

4. Immanuel Kant (1724–1804). “Duty based Ethics”. He is one of the most

influential philosophers in the history of Western Philosophy. He was not
concerned with the consequences of one’s actions or the harm caused to one’s
individual interests. Instead, he is focused on motives and the willingness of
individuals to act for the good of others, even if the action might result to personal
loss. Doing something for the right reason was more important to Kant than any
particular outcome.

For example, business ethics is littered with cases of companies that have
suffered damaging crises due to their leaders’ lack of commitment to act based on
goodwill and about what benefits others.

5. Jeremy Bentham and John Stuart Mill- “Utilitarianism” revolves around the
concept of “the end justifies the means”. It believes that outcomes, as a result of
an action have a greater value compared to the latter.

Utilitarianism is a philosophy or belief suggesting that an action is morally

right when the majority of people benefit from it. Also, the doctrine that an action is
right as it promotes happiness, and that the greatest happiness of the greatest
number should be the guiding principle of conduct. Utilitarianism is a moral theory
that advocates actions that promote overall happiness or pleasure and reject actions
that cause unhappiness or harm. A utilitarian philosophy, when directed to making
social, economic, or political decisions, aims for the betterment of society.
Activity 1. Directions: Write the business philosophies of each philosopher in the
table below. The first one is done for you. Write your answers on a separate sheet
of paper.

Philosophers Business Philosophies

The unexamined life is not worth living.

Socrates

Plato

Aristotle

Immanuel Kant

Jeremy Bentham and John Stuart Mill

Activity 2
I. Directions: Complete the sentences below and write your answers on a separate
sheet of paper.

I have learned that Aristotle’s philosophy influences business practices in

__________________________________________________________________
__________________________________________________________________
__________________________________________________________________

I have learned that Plato’s philosophy influences business practices in

__________________________________________________________________
__________________________________________________________________
__________________________________________________________________

I have learned that Socrates’ philosophy influences business practices in

__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
I have learned that Immanuel Kant’s philosophy influences business practices in
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________

I have learned that Jeremy Bentham and John Stuart Mill’s philosophies influence
business practices in
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________

Rubrics:
Correctness of answer 4 points
Clarity of explanation 4 points
Mechanics 2 points
10 points

II. Directions: Give a situation that shows the implication of each philosophy in
business. Write your answers on a separate sheet of paper.

1. Aristotle’s philosophy
2. Plato’s philosophy
3. Socrates’ philosophy
4. Immanuel Kant’s philosophy

5. Jeremy Bentham and John Stuart Mill’s philosophy

Rubrics:
Correctness of answer 4 points
Clarity of explanation 4 points
Mechanics 2 points
10 points

Activity 3
A. Directions: Fill-in the given graphic organizer about the famous philosophers
and their philosophies you have learned (10pts). Write your answers on a separate
sheet of paper.
B. Directions: Identify whose philosophy is described in each number. Choose
your answers from the box. Write the letter of your answers on a separate sheet of
paper.

a. Aristotle b. Plato c. Socrates

d. Immanuel Kant e. Jeremy Bentham and John Stuart Mill

____11. Motives and the willingness of individuals to act for the good of others, even
though that action might result to personal loss.
____12. The role of the leader is to create an environment in which all members of
an organization can realize their own potential.
____13. Happiness or well-being is the highest aim of moral thought and conduct.
____14. Utilitarianism is a moral theory that advocates actions that promote
overall happiness or pleasure and rejects actions that cause unhappiness or harm.
____15. We have the right to think of ourselves.
Prepared by:

LEINEL M. MALAZZAB
SHST II
APARRI WEST NATIONAL HIGH SCHOOL

Checked and Approved:

EVELYN P. RAPACON
School Principal I

References:
Coggle. n.d. "Foundation of The Principles Their Implication On Business". Coggle.
Retrieved from https://coggle.it/diagram/WiDxGe2npwAB1zf2/t/foundation-
oftheprinciples-their-implication-onbusiness.
Driver,Julia.2014.The History of
Utilitarianism.Retrieved from
https://plato.stanford.edu/entries/utilitarianism-history/
Duignan,Brian.2020.Utilitarianism.Retrievedhttps://www.britannica.com/topic/utilitar
ianism-philosophy.
McCartney, Steve & Parent, Rick. 2015. Ethics in Law Enforcement. BCCampus.
Retrieved from
https://opentextbc.ca/businessethicsopenstax/chapter/deontology-ethicsas-duty