Corporate Governance: Business Ethics and Social Responsibility

Abstract

‘Business’ is a social organ; it shall not conduct itself in a way detrimental to the interest of the society and the business sectors. ‘Ethics’ on the same line follows the guiding principle of Dharma on one’s life. ‘Codes’ are developed to define organizational purpose, establish a uniform ethical climate within the organization and provide for consistent decision making. Hence, Ethics runs parallel to laws and shows consideration to others rights and interest in civilized society. These key aspects adjudicate whether the company is acting as a good steward of the company’s assets. Thus, the corporate sector should accord utmost importance to moral and ethical values and function with social responsibility. In this work, the endeavor is to find out the actual correlation of ethics and corporate governance, the requirements of an ethical base of business, the emerging trends in corporate governance, related developments and their relevance. This paper discusses the controversial question about the compatibility, inimitability and interface flanked by business ethics and social responsibility. The rationale for choosing the two principles together is to provide a base for comparison and to present the ethical standards based on this information. The research dwells upon good governance as key to economic and social transformation and social responsibility which is the prime duty to set standards of quality and integrity to protect the environment and safeguard the interests of customers, employees, suppliers and the community rather than concentrating on maximization of profits. The paper is an attempt in the direction of appreciating the concept of social accounting in monetary terms, its impact of objectives, policies and procedure.