BUS ETHICS M2

• Business


  An organization or economic system where goods and services are exchanged for one another or for money
• Business organization


  An entity formed for the purpose of carrying on commercial enterprise
• Basic Forms of Business Organizations

  • Sole Proprietorship
  • Partnership
  • Corporation
  • Cooperative
• Sole Proprietorship


  Owned by one person and operates for their benefit
• Partnership


  A business owned by two or more people
• Corporation


  Considered by law to be a unique entity, separate and apart from those who own it
• Cooperative


  A limited liability business that can organize for-profit or not-for-profit
• Basic Classifications of Businesses

  • Service Businesses
  • Merchandising Businesses
  • Manufacturing Businesses
  • Hybrid Businesses
• Service Businesses


  Provide an activity or the performance of a task with a commercial purpose
• Merchandising Businesses


  Sell goods, also known as merchandise
• Manufacturing Businesses


  Use components, parts or raw materials to make a finished good
• Hybrid Businesses


  Conduct operations by combining an internet retail outlet with a brick and mortar warehouse or an order completion service
• Purposes of Establishing a Business

  • To make money and have financial independence
  • To self-actualize or to fulfill one's interest and enjoyment
  • To have a second career
  • To have variety at work
  • To create opportunities for others and for the national (and/or global) economy
  • To take on a challenge
  • To come up with better ways of doing things (creativity and innovation)
  • To create customers
  • To exhibit high levels of effectiveness and efficiency
  • To set and meet own deadlines
  • To offer value
  • To move the society, change the world, and make it a better place
  • To build a better future
• Stakeholder


  In the business context, these are customers, shareholders, employees, suppliers, government agencies, communities, and many others who have a "stake" or claim in some aspect of a company's products, operations, markets, industry, and outcomes
• Types of Stakeholders


  • Primary stakeholders
  • Secondary stakeholders
• Stakeholder orientation


  The degree to which a firm understands and addresses stakeholder demands
• Social responsibility


  An organization's obligation to maximize its positive impact on stakeholders and minimize its negative impact to the society and environment in general
• Corporate citizenship


  The extent to which businesses strategically meet the economic, legal, ethical, and philanthropic responsibilities placed on them by various stakeholders
• Issues in Social Responsibility


  • Loss of privacy for marketing purposes
  • Consumer protection
  • Sustainability
  • Corporate governance
• Evidence suggests that caring about the well-being of stakeholders leads to increased profits
• The support that stakeholders have for companies they perceive to be socially responsible also serve to enhance the firm's profitability