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COURSE:BGB2033 CORPORATE SOCIAL POLICY
FACULTY: FACULTY OF BUSINESS ADMINISTRATION
© UNIRAZAK 2011 Page 1 of 11
BGB2033: CORPORATE SOCIAL POLICY
Course Leader: Shaharudin Yunus
COURSE NOTES
TOPIC 1: Fundamentals of Values, Ethics and Morality
LEARNING OBJECTIVES
At the end of this chapter, you will be able to:
• Define values
• List the sources of value
• Identify the roles of values in decision-making
• Identify the definition of ethics
• Identify the nature of ethical reasoning
• Identify the concept of ethical standards and judgement
• Define morality
• Identify the various phases of Kohlberg's theory of moral development
• Identify the differences between ethics and morality
• Identify the similarities between ethics and morality
• Identify the basic unification of ethics, values and morality
1.1 NATURE OF VALUES
1.1.1 Definition
A small company has just employed Rizal as a marketing executive. As a fresh graduate, Rizal
feels enthusiastic about the job and is determined to be a good worker. On the first day of work,
new employees were briefed on how work is done. At that point, Rizal realized that some of the
company's marketing strategies somewhat deceived the customers. This is just one example of
ethical issues in business that we will look at in this course.
Values, ethics, and morality are three concepts used in discussing 'Business Ethics and Values'.
We will see how they should be applied in businesses. However, in this section, we will discuss
values first.
Values are defined as fundamental principles or enduring beliefs about the most desirable
conditions and purposes of human life. Values determine our actions and behavior, and they
enable us to understand why people act the way they do. In simpler terms, values are normally
what we want to have or to be associated with in life.
However, values are actually hard to define in specific terms because they rely highly upon one's
interests, culture, societal norms and upbringing. In other words, what may be positive values to a
person may not be so good to the next person.
For example, in secular societies, even the wearing of scarves is considered undesirable or of
negative value because it is associated with religious restraint.
Values mold the personality of individuals and influence their actions. Values differ from one
person to another depending on beliefs, interests and the environment in which the person is
brought up.
COURSE:BGB2033 CORPORATE SOCIAL POLICY
FACULTY: FACULTY OF BUSINESS ADMINISTRATION
© UNIRAZAK 2011 Page 2 of 11
1.1.2 Sources
We have learned that different people have different values. Still, there are some values that are
agreed by most, if not all, people. This is due to the fact that those values come from the same
sources. Values may come from:
• upbringing
• religion
• social norms
• experiences.
Upbringing
Most parents set rules for their children. Although the rules may not be written, family members
are expected to obey them. Usually, the check and balance for these rules are done through
punishment and reward. For instance, if you are caught lying, you will probably be scolded,
spanked, grounded and you may not even get your pocket money. Contrarily, you will be
rewarded by telling the truth, either with praises, hugs or gifts. Gradually, all these rules become
norms in your lives regardless of the presence of your parents.
Religion
Religion is also a source of values. All religions have moral instructions and promote values to
their believers. Muslims, for example, believe in life after death and the Day of Judgement, where
each individual is accountable for his or her actions in this world. As such the value of truthfulness
is one among the moral values that will be evaluated in terms of the salvation of the Muslims.
It is very important to note that religion is not only about formal system of individual worship but it
also teaches social relationships. A good example is the mandate that says "What you do not
want done to yourself, do not do to others" by Confucianism. This saying also exists in other
religions but phrased in slightly different wordings.
Social Norms
The environment in which we live also influences our values. For instance, due to the increasing
role of private property, individual rights and the impersonal nature of the market economy,
Westerners have become an open community, where they practice free speech and defend
individual rights to express ideas, practice their creed, and at the same time, be tolerant of the
rights of others.
On the contrary, Easterners are more reserved in their communication and attitude, and have a
comparatively more conservative lifestyle; sometimes to the point of being intolerant of diversity.
Experiences
Experiences are yet another important source of values. As we grow older, we meet more people
and we learn new things, and therefore, we enhance and widen our understanding of life.
Knowledge gained through reading and other modes also molds our values. Thus, we will and
should continue to obtain as much exposure as we can such that the experiences enable a
critical look at the values we are used to, whether local or foreign.
In a nutshell, values come from various sources and some of our values may change while others
are reinforced as we grow older, and as we gain more knowledge through our experiences and
exposure to other social norms. But moral values remain moral values as long as we are aware of
their role in achieving the ultimate goals or telos of our existence. Only the manifestation of the
norms representing the values may be altered.
COURSE:BGB2033 CORPORATE SOCIAL POLICY
FACULTY: FACULTY OF BUSINESS ADMINISTRATION
© UNIRAZAK 2011 Page 3 of 11
1.1.3 Roles
"Life is all about choices. It's your choice how you live your life."
Everyday we have to make choices. We choose how to react to situations and how to deal with
people around us. In so doing, we need values to guide us in making decisions.
For each individual, consciously or otherwise:
• values are the principles of life
• values determine his or her interests
• values influence and restrict his or her
• attitude and behavior
• values determine his or her needs
• choices and expectations in life
• values guide his or her judgment of right and wrong.
People get personal satisfaction or fulfillment when they act or perform activities that are in line
with their values. For example, those whose values include caring for others tend to have
meaningful lives, when they are able to do good deeds and contribute to helping the poor.
Take another simple example. A company has two candidates for promotion. The first person
really wants the post so he or she goes bad-mouthing the other candidate to ensure the post is
his or hers. This person succeeds due to unfair means and even if he or she doesn't subscribe to
the values of fairness, he or she will not be willing to be treated unfairly by others. Invariably, the
person will feel the pang of conscience and perhaps will not be at ease for the rest of his or her
life because he or she has done something that is unethical and of negative value.
In any organization or community, people have become more conscious of the values in decision-
making processes. Commonly, in successful organizations, the leaders are known to have
initiated the inculcation of shared values and inspire the followers towards the virtue of excellence
through their unwavering belief in the organization's core values or core purpose. Core values are
values that define who we are and what is meaningful to our existence. Core purpose is our
reason for being or the mission of our existence that will make the journey worthwhile. Implicit in
these values and purposes is the concept of human well functioning and happiness.
Leadership that is ethical is associated with morally upright character. A person with integrity
usually qualifies as good leaders as the moral values are so ingrained in him or her that he or she
lives in accordance with the values even when he or she has to strategize worldly affairs. The
effectiveness in leading others is strengthened by the role model that is presented to others in
terms of acceptable and unacceptable values. Rewards and punishments and the codes of
conduct are well discussed and accepted under such leadership. As such, it is important to all in
the organization that they correctly determine who become leaders as leaders are not only
accountable for ensuring that work is done properly and timely but they also have to be guided by
ethical values and a keen sense of purpose.
Values guide people in justifying the rights and wrongs. Successful organizations are
organizations that are driven by values and that can make ethical decisions by honoring
commonly shared values of the society they are in while not harming people in the process of
playing their role towards promoting well being and prosperity.
COURSE:BGB2033 CORPORATE SOCIAL POLICY
FACULTY: FACULTY OF BUSINESS ADMINISTRATION
1.2 NATURE OF ETHICS
1.2.1 Definition
Nowadays, people from all walks of life and professionals in all types of disciplines including
business, politics, education, and medicine allude to the role of ethics in achieving excellence.
Ethics has become the central issue in human activities. In this topic, we will look at the definition
of ethics.
Originally, ethics came from the Greek word ethos, which means customs or the fabric of values
that makes a society what it is. It also means the distinguishing character, moral nature, or the
beliefs that guide a person, group, or institution. According to Solomon (1984), ethics means
"distinguishing disposition, character or attitude of a specific people, culture or group."
De George (1999) provides another definition of ethics, which is ethics as "a systematic attempt
to make sense of our individual and social moral experience in such a way as to determine the
rules that ought to govern human conduct, the values worth pursuing and the character traits
deserving development in life".
So, ethics is actually the study of the moral content of people's behavior against moral principles.
In addition to reflecting on the nature of right and wrong or good and bad, ethics as a discipline
also helps explain the reasons behind each judgment we make, and in the process, makes us
aware of the principles and standards that give meaning to our lives. In other words, one of the
objectives of ethical awareness is to be constantly in touch with our values and also make logical
decisions that conform to our strongly held values. Engaging in ethical discourse can also expose
students to the viewpoints and values of those we have to deal with in our capacity as social
beings.
