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Difference Between Law and Ethics: First Chapter Cont. Introduction To Business Ethics

Laws are rules that must be followed to maintain order, while ethics are principles that guide behavior but are not enforced. Ethics apply to situations not covered by laws, like relationships, and consider moral dimensions beyond what is legal. There are also areas where what is legal may not be ethical. Business ethics are important and address dilemmas in finance, human resources, marketing, and production.

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844 views8 pages

Difference Between Law and Ethics: First Chapter Cont. Introduction To Business Ethics

Laws are rules that must be followed to maintain order, while ethics are principles that guide behavior but are not enforced. Ethics apply to situations not covered by laws, like relationships, and consider moral dimensions beyond what is legal. There are also areas where what is legal may not be ethical. Business ethics are important and address dilemmas in finance, human resources, marketing, and production.

Uploaded by

Amrerta
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Download as DOCX, PDF, TXT or read online on Scribd
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First Chapter Cont.

Introduction to Business Ethics

Difference Between Law and Ethics


BASIS FOR
LAW ETHICS
COMPARISON

Meaning The law refers to a systematic Ethics is a branch of moral


body of rules that governs the philosophy that guides
whole society and the actions of people about the basic
its individual members. human conduct.

What is it? Set of rules and regulations Set of guidelines

Governed By Government Individual, Legal and


Professional norms

Expression Expressed and published in They are abstract.


writing.

Violation Violation of law is not There is no punishment for


permissible which may result in violation of ethics.
punishment like imprisonment or
fine or both.

Objective Law is created with an intent to Ethics are made to help


maintain social order and peace in people to decide what is
the society and provide protection right or wrong and how to
to all the citizens. act.

Binding Law has a legal binding. Ethics do not have a


binding nature.
Relationship between
ethics and the law
•
Business ethics can be said to
begin when the law ends
•
Not all ethical issues are covered
by the law — for example
there is no rule about cheating
on your boyfriend/girlfriend but
it is considered morally wrong.
•
Not all legal issues are ethical —
for example the law
prescribes whether we should
drive to the right or left side of
the road, but it is not an ethical
decision.
•
Not always a ‘right answer’: the
grey areas of business ethic
Relationship between
ethics and the law
•
Business ethics can be said to
begin when the law ends
•
Not all ethical issues are covered
by the law — for example
there is no rule about cheating
on your boyfriend/girlfriend but
it is considered morally wrong.
•
Not all legal issues are ethical —
for example the law
prescribes whether we should
drive to the right or left side of
the road, but it is not an ethical
decision.
•
Not always a ‘right answer’: the
grey areas of business ethic
Relationship between
ethics and the law
•
Business ethics can be said to
begin when the law ends
•
Not all ethical issues are covered
by the law — for example
there is no rule about cheating
on your boyfriend/girlfriend but
it is considered morally wrong.
•
Not all legal issues are ethical —
for example the law
prescribes whether we should
drive to the right or left side of
the road, but it is not an ethical
decision.
•
Not always a ‘right answer’: the
grey areas of business ethic
Role and Scope of Ethics in Business
Business ethics plays a very crucial role in various management
functions, which are given as follows:

i. Ethics in Finance:

It deals with various ethical dilemmas and violations in day-to-day


financial transactions. An example of ethical violations is data fudging
in which enterprises present a fabricated statement of accounts and other
records, which are open to investigation. Ethics in financial transactions
gained importance when due to their insufficiency nations suffered
massive economic meltdowns.
The following are the ethics in finance:
a. Following truthfulness and authenticity in business transactions
b. Seeking the fulfillment of mutual interests

ii. Ethics in Human Resource Management:

It deals with the enforcement of the rights of employees in an enterprise.


Such rights are as follows:
a. Having a right to work and be compensated for the same
b. Possessing a right for free association and participation
c. Enjoying a right for fair treatment in an enterprise
d. Holding a right to work in a hazard-free environment
e. Blowing whistle (an activity where an employee can raise voice
against any wrong practice of anyone in an enterprise)

iii. Ethics in Marketing:

Deals with a number of issues, which are as follows:


a. Misinforming the customers about the products or services
b. Deciding high prices for the products and services
c. Creating false impression on the customers/consumers about the
features of products
d. Promoting sexual attitudes through advertising; thus, affecting the
young generation and children.
iv. Ethics in Production:

It deals with the responsibility of an organization to make sure that


products and processes of production is not causing harm to the
environment.
It throws light on the following issues:
a. Avoiding rendering services or producing products that are hazardous
to health. For example, tobacco and alcohol
b. Maintaining ethical relations with the environment and avoiding
environmental pollution.

Relationship between
ethics and the law
•
Business ethics can be said to
begin when the law ends
•
Not all ethical issues are covered
by the law — for example
there is no rule about cheating
on your boyfriend/girlfriend but
it is considered morally wrong.
•
Not all legal issues are ethical —
for example the law
prescribes whether we should
drive to the right or left side of
the road, but it is not an ethical
decision.
•
Not always a ‘right answer’: the
grey areas of business ethic

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