1. Business Ethics Clean business is great business"Prepared by:- Arun Khedwal, Bhanu Bhatnagar Prashant Panhale

2. Agenda Quotes Definition Why business ethics? 4Ps Case Study-1 (Fraud) Case Study-2 (Non Ethical Governance) Case Study-3 (Good Ethics) Promote Good Ethics Our Responsibility Conclusion 3. Definition Business Economic system in which goods and services are exchanged for one another or money, on the basis of their perceived worth Ethics Derived from the Greece word ethos, meaning character and manners. Ethics is the study and philosophy of human conduct, with an emphasis on determining right from wrong In Other words Ethics are moral guidelines which govern good behaviour 4. Why Business Ethics? Attract customers to the firm's products, thereby boosting sales and profits Attract more employees wanting to work for the business, reduce recruitment costs and enable the company to get the most talented employees Attract investors and keep the company's share price high, thereby protecting the business from takeover Ethics contribute to profit 5. Profit Maximization It is understandable that a company's ultimate goal is to increase profit. While some companys go to the extreme & maximize profits unethically by slashing employee expenses, lowering product quality or impacting the environment negatively. 6. Ethical Issues 4 Ps Promotion False & misleading advertising Bribery Promotional allowances Unethical sales tacticsProduct Product quality & safety Fare packing & labelling Product warranties Damage to the EnvironmentalEthical Issues Price Price fixing Price negotiation Price increase Price discriminationPlace Dumping Unfair competition Government policy 7. Advertising Vs. Reality 8. Case Study-I :: Satyam Scandalam 9. About Satyam Satyam computer services limited was founded in 1987 by Mr. Ramalinga Raju Satyam computers started with only 20 employees The company offers consulting and information technology services to various sectors Satyam computers converted into public ltd co. Listed in Bombay stock exchange in 1991 Listed in New York stock exchange in 2001 Listed in EURONEXT Amsterdam stock exchange in 2008 There were 52,000 employees working in Satyam in September 2008 10. The Scam Accounting fraud of over 7,800 crores rupees Past 7 years accounting books were cooked:- Profits were inflated - Understated liability and overstated debts - Accrued interest (which was non-existent) -The gap in the balance had risen due to inflated profits Planned to buy the Maytas to fill the gap in the balance sheet 11. Impact of Scam Jobs of over 50,000 were at risk India`s global image was suffered Indian stock market fell dramatically Biggest single day fall of 175 Rs. On Jan 6th 2009 of Satyam share SEBI said that, if Saytam found guilty, its license to work in India may be revoked The New York Stock Exchange halted trading in Satyam stock India's National Stock Exchange announced removal of Satyam from S&P CNX & Nifty 50 The GDP fell by 0.4% I.T sector suffered a downturn 12. SATYAM-MAYTAS 13. Case Study-II :: Vodafone Tax Case 14. Case Study-II :: Vodafone Tax Case Acquisition of Hutch-Essar Ltd for 11 billion USD Taxability over Capital Gains on overseas transaction Withholding Tax obligations of the Non Resident buyer 2 Billion USD / 12,000 Crore Rupees Tax I-T claims that the sale involved India based assets and hence should be taxed 5 year long legal battle Bombay High Court ruling in favour of Revenue Dept. Supreme Court ruling in favour of Vodafone International Holdings Review petition by Finance Ministry Pranab Mukherjee brings in GAAR 15. Case Study-III :: TATAs Business Ethics 16. TATAs Business Ethics & Principles National Interest:Committed to benefit the economic development of the countries in which it operates.Equal opportunities employer:Provide equal opportunities to all its employees and all qualified applicants for employmentFinancial reporting and records:Prepare and maintain its accounts fairly and accurately and in accordance with the accounting and financial of the country .Gifts and donations:Its employees shall neither receive nor offer or make, directly or indirectly, any illegal payments, remuneration, gifts, do nations or comparable benefitsCompetition :Fully support the development and operation of competitive open markets.Government agencies:Employees shall not, unless mandated under applicable laws, offer or give any company funds or property as donation to any government agency or its representative. 17. TATAs Social Reforms Tata GroupEnforced by law/ Legal Measures 1912- Eight-hour day 1948- Factories Act 1915- Free medical aid 1948- Employees State Insurance Act 1920-Leave with Pay 1920- Workers Provident Fund Scheme 1937- Retiring gratuity 1948- Factories Act 1952-Employee Provident Fund Act 1972- Payment of Gratuity Act 18. Our Responsibility Minimal- What we shouldnt do Dont steal, dont kill & dont lie Better: What we should do Be fair, Be honest, Fulfil duties & work hard Best: What we could do to make things excellent for all of us Incentive & recognitions for outstanding ethical behaviours, raise awareness & educate youth 19. Conclusion Ethics should & must play an important role in todays organization's. It is vital in determining the long term success for any organization. Ethical business is GoodBusiness Choose for yourself today