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unethical
methods
to
obtain
business.
Unfair
trade
practices
include misrepresentation, false advertising, tied selling and other acts that are
declared unlawful by statute. It can also be referred to as deceptive trade
practices.
2. Restrictive Trade Practice
refers to any action by the producer that results in manipulation of price or conditions
of delivery of the goods or affects the flow of supplies in the market relating to goods
or services in such a manner so as to impose on the consumers any unjustified
costs.
3. Ethics in Finance
The financial crisis of 2008 stemmed, in large part, from unethical behavior and
acts by those in the financial industry.
Whether driven by greed or simple lack of knowledge and awareness of industry
ethical standards, the outcome was the same: the financial face of the country,
and the world, was changed forever.
As a result, many investors are paying more attention to their financial
professionals ethics, and doing more due diligence to ensure that the person
they entrust with their hard-earned cash is going to manage it within the
boundaries of the law and put the clients interests ahead of their own. Investors
are asking more questions nowand if they cannot find the answers they need
and want, they are walking away.
Therefore, as a financial professional, you have a responsibility to make sure that
the message youre sending to clients regarding your ethical standards is in line
with your actual behavior. Some professionals inadvertently drive clients away by
failing to answer questions or innocent behavior that could seem suspect, so you
need to know what your clients are looking for.
4. Ethics in Advertisement
Ethics means a set of moral principles which govern a persons behavior or how the activity is
conducted. And advertising means a mode of communication between a seller and a buyer.
Thus ethics in advertising means a set of well defined principles which govern the
ways of communication taking place between the seller and the buyer.
An ethical ad is the one which doesnt lie, doesnt make fake or false claims
and is in the limit of decency.
The main area of interest for advertisers is to increase their sales, gain more and more
customers, and increase the demand for the product by presenting a well decorated, puffed
and colorful ad. They claim that their product is the best, having unique qualities than the
competitors, more cost effective, and more beneficial. But most of these ads are found to be
false, misleading customers and unethical. The best example of these types of ads is the one
which shows evening snacks for the kids, they use coloring and gluing to make the product
look glossy and attractive to the consumers who are watching the ads on television and
convince them to buy the product without giving a second thought.
5. Ethics in salesmanship
Don't intentionally misrepresent anything
Fix any important misunderstandings that you can.
Work hard for your employer.
Always be willing to trade a short-term loss for the sake of a long-term gain.
Do what you say you are going to do.
Give liberally.
Recognize those who help you.
Continuously learn and improve.
Never give up.
Don't speak badly about anyone.
6. Unethical vs non ethical practices
morally principled and has a good conduct whereas unethical is the total opposite
of it.
An ethical principle in one society may be unethical in another society and these
differ from one society to another.
However, there are some universally accepted ethical behaviors as well.
Almost all the societies promote ethical conducts and demote the unethical
behaviors.
7. Value system vs ethics
8. Profit
9. Major issues in false adv
10. Ethical conduct in selection process
11. Does CSR contribute towards social development
12. Ethical models for decision making
silence, open posture) as well as verbal skills (how often one expresses
his/her opinion, concentration, verbal incentives such as voice modulation,
asking questions, and eliminating all the obstacles and barriers)
privacy protected. Corporations can determine who can access what information and what
they can do with it thanks to intellectual property rights.
Quality of Life
The increase in technology has created many advantages fro organizations; however, the
increase in technology and the size and power of businesses have led to issues that
jeopardize the quality of life for consumers. Many companies will do whatever it takes to
increase profits or productivity. With this aggressive nature companies can cause harm to
the community. Going back to the theory that there is no free lunch somebody is always
going to pay the price. The customer may be the person who gets the best result out of an
unethical situation but somebody else can be hurt.
Accountability and Liability
When corporations are faced with an ethical issue it is important that they understand the
consequences of their decisions. The corporation is responsible for the negative and
positive outcomes of a situation. Corporations can be found liable for producing faulty to
harmful goods to consumers. Liability and responsibility is pretty much the same thing.
Liability is the legal equivalent to what an individual or organization is responsible for.
Sometimes a firm might want to increase profits by cutting costs or employees that might
comprise the effectiveness and safety of their product.
Ethical Principles
Privacy is the claim of individuals to be left alone, free from surveillance or interference from
other individuals or organizations, including the state. Information technology and systems
threaten an individuals claim to privacy by making invasion cheap and effective.
17. Satyam
In January 2009, Indias own Enron unfolded in its backyard and shocked the
conscience of the nation, particularly the corporate world. This is now popularly
referred to as Satyam Scam. It is a saga of failed corporate governance and ethics in
corporate world of India, with ramifications extending to the US. Finally the company
(Satyam) has been sold out and acquired by Mahindra in an auction; its prestigious
global clients cancelled their contract (Merrill Lynch, State Farm Insurance etc.) with
Satyam; the Chairman and promoter B Ramalinga Raju, CFO Srinivas, the PwC
auditors comprising in all 5 persons were put behind bars.
Rajus concern was that poor performance would result in drop of market value of
the firm thereby making it open to acquisition. The promoters (Raju & family) who
held only a fraction of equity did not want to relinquish control. So in an alleged
collusion with PwC (auditors) they continued to fudge accounts over several years.
He overstated revenues and profits, overstated debtors, understated liabilities and
accrued interest was fictional, paid salaries to non-existent employees 53,000 in
place of actual 40,000. Once the scam broke, it was alleged that Raju & family had
indulged in insider trading by selling shares before bringing the fraud to light. Raju
rationalized his deeds by stating, It was like riding a tiger, not knowing how to get off
without being eaten.
Finally, to wipe out all evidence of his misdeeds, Raju tried to acquire Maytas
(opposite of Satyam, a company floated by the same promoter group) such that the
fictitious assets may be filled with real ones. The proposal of acquisition fell through
in the board. Rajus last straw to whitewash all dark misdeeds sank, leaving him with
no option but to come clean on manipulation of the books of account.
The consequences were serious for various stakeholders. Two days after his
confession, Ramalinga Raju was arrested. The company stock prices collapsed at
Bombay Stock Exchange and New York Stock Exchange. Both exchanges
suspended trading. SEC (Securities and Exchange Commission) charged Satyam of
committing fraud by overstating revenues by $1 billion and PW India (Subsidiary of
PwC) had poor quality systems which were incapable of detecting frauds while giving
clean chit to company accounts. Both the parties together have agreed to pay $ 17.5
million to settle the charges of fraud.
The episode raises several concerns regarding corporate governance and ethics.
Business organizations are organs of society. Their role is to create value for all
stakeholders in just and transparent manner and the laws of land are created to
ensure this alignment. Yet cases such as Satyam raise serious questions regarding
conflict of interest that arise when promoter families become executive directors;
when audit firms which are tasked to uncover any wrong doing, end up certifying
worthless accounts; when otherwise competent Independent Directors are unable to
live up to the expectations of those investors whose interest they are mandated to
represent.
Enron
Goldman Sachs
18. Demonetization
19. Information Selling
20. Ethical behaviour in HR people or marketing people