Business Ethics

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Work program of the discipline psychology and ethics of business relations

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The work program of the discipline “ethics of business relations” is recommended for training direction 080400 “personnel management”

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UDC 65.01 (075.8)

BBK 65.290-2ya73

Reviewers:

Department of Personnel Management of the Academy of Labor and Social Relations;

First Deputy Director of the Institute of Labor of the Ministry of Labor and Social Development of the Russian Federation, Honored Economist of the Russian Federation, Doctor of Economics, Professor A.F. Zubkova.

Kibanov A.Ya., Zakharov D.K., Konovalova V.G.

K38 Ethics of business relations: Textbook / Ed. AND I. Kibanova. - M.: INFRA-M, 2002. - 368 p. - (Series “Higher Education”).

ISBN 5-16-001082-3

The textbook, prepared by scientists from the Department of Personnel Management of the State University of Management, outlines theoretical, methodological and practical issues of ethics in business relations: the nature of ethics in business relations; ethics of the organization and its leaders; the essence of verbal, non-verbal, remote communication, manipulations in communication, communication management; rules of business relations; etiquette of a business person and business relationships.

The book is intended for students, undergraduates, graduate students, as well as teachers of the discipline “Ethics of Business Relations”. It may be useful to management and personnel management specialists of organizations.

UDC 65.01(075.8)

BBK 65.290-2ya73

PREFACE

The purpose of this textbook is to equip the reader with scientific and applied knowledge in the field of ethics in business relations. The textbook covers a wide range of problems in the ethics of business relations, grouped into three sections: “Theoretical foundations of the ethics of business relations” (Chapters 1, 2, 3); “Communication as a tool for business ethics” (chap. 4, 5, 6, 7, 8); “Rules and etiquette of business relations” (chap. 9,10, 11).

Section 1. The first chapter reveals the nature, essence and basic principles of business ethics. It introduces the reader to the patterns of interpersonal relationships and priority problems in this area. The second chapter examines the impact of ethics and ethical standards on the social responsibility of an organization and improving the results of its activities. The third chapter is devoted to revealing the relationship between the ethical standards of the organization and the leader, introducing the reader to methods for managing the ethical standards of interpersonal relations in a team. It provides recommendations on the ethics of resolving controversial issues and conflict situations.

Section 2. The fourth chapter examines the essence of communication as a communicative tool of business ethics, and provides types and methods of managing business communication. The fifth chapter sets out the basics of business rhetoric, touches on the essence of speech culture, discussion and speech behavior, and gives recommendations on the use of expressive means of business speech. The sixth chapter introduces the reader to the basics, as well as kinesic and proxemic features of nonverbal communication, and reveals the essence of visual contact. Chapter seven examines telephone ethics and business writing culture. The eighth chapter describes manipulations in communication and the rules of neutralization. It also reveals techniques that stimulate communication that excludes manipulation.

Section 3. The ninth chapter sets out the rules for preparing a public speech, conducting a business conversation, an interview, an office meeting, negotiations with business partners, as well as the rules for constructive criticism. The tenth chapter reveals the essence of etiquette, the image of a business person, and the contents of a business card. Issues of greeting and introduction etiquette and the appearance of a business person are discussed here. The final chapter, the eleventh chapter of the textbook, characterizes the rules of behavior in public places, the etiquette of business receptions, the peculiarities of business communication with foreign partners, as well as the art of compliments and gift-giving.

Each chapter of the textbook ends with test questions and practical assignments. Test questions allow the reader to quickly check the degree of mastery of the material read, and practical tasks help consolidate this knowledge when performing specific tasks and tests.

The following people took part in writing the textbook: Doctor of Economics, Prof. A.Ya. Kibanov (Preface, 2.1, 2.2, 3.1, 3.2, 3.5, 4.4, 5.1, 5.2, 6.2, 7.2, 9.3, 9.5; practical tasks: 1.2, 2, 3.1, 3.4, 3.5, 3.6, 4.1, 4.2 , 5D, 5.2, 7.1, 7.2, 7.3, 8.2, 9.1; Appendices 2, 3); Ph.D., Associate Professor D.K. Zakharov (1.1, 1.3, 3.3, 3.4, 5.3, 5.4, 7.1, 9.1, 9.2, 9.4, 9.6, 10.3, 10.4); Ph.D., Assoc. V.G. Konovalova (1.2, 1.4, 2.3, 4.1, 4.2, 4.3, 5.5, 6.1, 6.3, 6.4, 8, 10.1, 10.2, 10.5, I; practical tasks: 1.1, 3.2, 3.3,4-3, 4.4,.6, 8.1,9.2, 9.3, 10,11; Appendix 1).

SECTION I.

THEORETICAL FOUNDATIONS OF BUSINESS ETHICS

Chapter 1

HIGHER EDUCATION

series founded in 1996

Ministry of Education of the Russian Federation

State University of Management

AND I. KIBANOV

D.K.ZAKHAROV

V.G. KONOVALOV

Business ethics textbook

Approved by the Ministry of Education of the Russian Federation as a textbook for students of higher educational institutions studying in the specialty “Personnel Management”

Reviewers:

Department of Personnel Management of the Academy of Labor and Social Relations;

First Deputy Director of the Institute of Labor of the Ministry of Labor and Social Development of the Russian Federation, Honored Economist of the Russian Federation, Doctor of Economics, Professor A.F. Zubkova.

Kibanov A.Ya., Zakharov D.K., Konovalova V.G.

Ethics of business relations: Textbook / Ed. AND I. Kibanova. - M.: INFRA-M, 2003. - 368 p. - (Series “Higher Education”).

The textbook, prepared by scientists from the Department of Personnel Management at the State University of Management, outlines theoretical, methodological and practical issues of ethics in business relations: the nature of ethics in business relations; ethics of the organization and its leaders; the essence of verbal, non-verbal, remote communication, manipulations in communication, communication management; rules of business relations; etiquette of a business person and business relationships.

The book is intended for students, undergraduates, graduate students, as well as teachers of the discipline “Ethics of Business Relations”. It may be useful to management and personnel management specialists of organizations.

PREFACE

Purpose of this tutorial - equip the reader with scientific and applied knowledge in the field of ethics in business relations. The textbook covers a wide range of problems in the ethics of business relations, grouped into three sections: “Theoretical foundations of the ethics of business relations” (Chapters 1, 2, 3); “Communication as a tool for business ethics” (chap. 4, 5, 6, 7, 8); “Rules and etiquette of business relations” (chap. 9,10, 11).

Section 1. The first chapter reveals the nature, essence and basic principles of business ethics. It introduces the reader to the patterns of interpersonal relationships and priority problems in this area. The second chapter examines the impact of ethics and ethical standards on the social responsibility of an organization and improving the results of its activities. The third chapter is devoted to revealing the relationship between the ethical standards of the organization and the leader, introducing the reader to methods for managing the ethical standards of interpersonal relations in a team. It provides recommendations on the ethics of resolving controversial issues and conflict situations.

Section 2. The fourth chapter examines the essence of communication as a communicative tool of business ethics, and provides types and methods of managing business communication. The fifth chapter sets out the basics of business rhetoric, touches on the essence of speech culture, discussion and speech behavior, and gives recommendations on the use of expressive means of business speech. The sixth chapter introduces the reader to the basics, as well as kinesic and proxemic features of nonverbal communication, and reveals the essence of visual contact. Chapter seven examines telephone ethics and business writing culture. The eighth chapter describes manipulations in communication and the rules of neutralization. It also reveals techniques that stimulate communication that excludes manipulation.

Section 3. The ninth chapter sets out the rules for preparing a public speech, conducting a business conversation, an interview, an office meeting, negotiations with business partners, as well as the rules for constructive criticism. The tenth chapter reveals the essence of etiquette, the image of a business person, and the contents of a business card. Issues of greeting and introduction etiquette and the appearance of a business person are discussed here. The final chapter, the eleventh chapter of the textbook, characterizes the rules of behavior in public places, the etiquette of business receptions, the peculiarities of business communication with foreign partners, as well as the art of compliments and gift-giving.

Each chapter of the textbook ends with test questions and practical assignments. Test questions allow the reader to quickly check the degree of mastery of the material read, and practical tasks help consolidate this knowledge when performing specific tasks and tests.

The following people took part in writing the textbook: Doctor of Economics, Prof. AND I. Kibanov (Preface, 2.1, 2.2, 3.1, 3.2, 3.5,4.4, 5.1, 5.2, 6.2, 7.2, 9.3, 9.5; practical tasks: 1.2, 2, 3.1, 3.4, 3.5, 3.6, 4.1, 4.2, 5.1, 5.2 , 7.1, 7.2, 7.3, 8.2, 9.1; Appendices 2, 3); Ph.D., Associate Professor D.K. Zakharov (1.1, 1.3, 3.3, 3.4, 5.3, 5.4, 7.1, 9.1, 9.2, 9.4, 9.6, 10.3, 10.4); Ph.D., Associate Professor V.G. Konovalova (1.2, 1.4, 2.3, 4.1, 4.2, 4.3, 5.5, 6.1, 6.3, 6.4, 8, 10.1, 10.2, 10.5, 11; practical tasks: 1.1, 3.2, 3.3, 4.3, 4.4, 6, 8.1, 9.2 , 9.3, 10, 11; Appendix 1).

A. Ya. Kibanov, D. K. Zakharov, V. G. Konovalova

Personnel management: theory and practice

Business Ethics

Educational and practical manual

Edited by Doctor of Economic Sciences, Professor A. Ya. Kibanov

1. ETHICS AND SOCIAL RESPONSIBILITY OF THE ORGANIZATION AND MANAGER

An organization is, on the one hand, an economic system that is obliged to take care of the efficient use of its resources. By doing so, the organization fulfills the economic function of producing products or providing services needed by society while providing jobs for citizens and maximum profits for shareholders. On the other hand, an organization is more than an economic system. A modern organization is a complex part of its environment, which includes many components on which the very existence of the organization depends. These include customers, suppliers, the media, unions or associations, as well as employees and shareholders. This multi-layered social environment can greatly influence the organization's achievement of its goals, so the organization must balance purely economic goals with the economic and social interests of these components of the environment.

The public expects from modern organizations not only to demonstrate high economic results, but also significant achievements in terms of the social goals of society. An organization is socially responsible when it makes a profit without violating laws and government regulations. From this position, the organization pursues economic goals.

The leading association of US corporations engaged in the development and promotion of the concept of corporate social responsibility, Business for Social Responsibility defines social responsibility as follows: “Achieving business success in ways that are based on ethical standards and respect for people, communities, and the environment” (Business for Social Responsibility. Overview of Corporate Social Responsibility. 2003). green paper The European Union defines corporate responsibility as “a concept in which companies voluntarily integrate social and environmental policies into business operations and their relationships with the entire range of organizations and people associated with the company.” This approach has been adopted by most countries of the European Union.

Corporate social responsibility is the responsibility of a company to all people and organizations it encounters in the course of its activities, and to society as a whole. All business associations and researchers include here: the company’s responsibility in relationships with partners; consumer responsibility; responsible employee policy; environmental responsibility; the company's responsibility to society as a whole.

In Russia, the concept of corporate social responsibility (CSR), which contains all five of the above elements, is also beginning to be introduced, although for now special attention is paid in Russian companies to relations with employees and interaction with society.

There is a difference between legal and social responsibility. Legal responsibility refers to adherence to specific laws and government regulations that define what an organization can and cannot do. For example, how to protect the environment, how to recruit, what are the minimum product safety requirements, etc. An organization that is subject to all these laws and regulations is behaving in a legally responsible manner, but cannot be considered socially responsible if does not fulfill relevant obligations to society. Social responsibility is considered as a voluntary response of an organization to the social problems of its employees, residents of its city, region, country, and world.

In our country, significant material resources were and are now mainly concentrated in organizations, and not in the hands of individuals. Traditionally, they were used to solve socio-economic problems of a region, a city, and, above all, cities specially created for those working in one large organization. These traditions, in our opinion, can continue in the new economic conditions. In the meantime, it is mainly large national companies and divisions of international companies that are thinking seriously about the policy of social responsibility and the strategy of participation in society. Medium-sized businesses, with rare exceptions, operate “the old fashioned way,” conducting business as necessary and engaging in one-time charity work.

A socially responsible strategy for an organization can be extremely beneficial to it. Traditionally called the following advantages that organizations receive for themselves by following a policy of social responsibility: a more attractive image of the organization in society is formed; trust in the organization increases; turnover, number of clients, etc. increase due to improved attitude towards the organization; there is an opportunity to get more profitable orders; thanks to its increased authority, the organization can pursue a more active, effective policy in society, expanding its activities, in particular its sales markets; it becomes possible to achieve a reduction in local taxes, etc. The prerequisites for such a policy are objective conditions, which first of all include the availability of resources in the organization - material, financial, human.

Why does business need social responsibility? 1

1. Globalization. Today, transnational companies (TNCs) produce about 25% of the world's product. Socially significant issues have long been in the spotlight of public attention, so companies are trying to the best of their ability to “behave well” without stepping on public opinion’s sore spots. Levi Strauss & Co in 1995 was forced to terminate contracts with Burma (now Myanmar) due to human rights violations in this country. Russian TNCs are actively entering world markets and for this reason they are forced to play by the rules of civilized business. LUKOIL announced the introduction of international environmental certification standards ISO and OHSAS, and soon after acquired the Getty Petrolium company in the USA and its network of gas stations. Wimm Bill Dann received an international certificate of conformity from the British Retailer Consortium, after which it began to actively promote its brand abroad.

2. Capitalization. It is known that the intangible assets of most foreign companies are several times higher than the tangible ones. According to Interbrand, the ratio of tangible and intangible assets for IBM is 17:69, for Coca-Cola - 4:96. It is also known that a significant part of intangible assets is the value of the brand itself (or rather, the “megabrand”). This value is not least determined by the reputation, which is formed, among other things, on the basis of the company’s socially responsible behavior. 50% of British shoppers are willing to switch to another brand if it is offered by a socially responsible company (Mintel, 1998). In the US, this figure is even higher: two out of three Americans are ready to change their purchasing preferences towards “corporate citizens”.

3. Reputation. Research conducted by Walker Information has revealed a direct link between a company's social value (the cumulative effect of its positive impact on society), its reputation and the brand loyalty of its consumers. For retailers, the results are stunning. An increase in a company's social value by one point leads to a 0.55 point improvement in reputation, while an increase in economic value by the same point increases reputation by only 0.32 points. Thus, social indicators, compared to economic indicators, have twice the impact on a company’s reputation.

4. Financial indicators. A study of 469 American companies in various industries conducted by the Conference Board (The Link Between Corporate Citizenship and Financial Performance, 1999) showed that there is a very significant positive correlation between return on assets (ROA) and social activity of the company; a significant positive correlation between Return On Sales (ROS) and the company’s social activity; a positive correlation between return on capital and return on shares (Return On Capital, ROC; Return on Equity, ROE) and the company’s social activity. Total shareholder returns for companies with strong financial and social performance have increased by 43% over the past 15 years. During the same time, this figure for “merely” financially successful companies increased by only 19% (Schmidt, 2000). Social engagement pays dividends. Socially active companies have 3% higher return on sales, 4% higher return on assets, and 10% higher return on equity and shares than non-socially active companies (KLD, 2002).