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COURSE CODE: COURSE CODE: COURSE CODE: COURSE CODE: MBA 4.3MBA 4.3MBA 4.3MBA 4.3

INDIAN ETHOS AND BUSINESS ETHICSINDIAN ETHOS AND BUSINESS ETHICSINDIAN ETHOS AND BUSINESS ETHICSINDIAN ETHOS AND BUSINESS ETHICS L E CTURE NOTE - 2 009

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S Y L L A B U S SYLLABUS Course objectives:Course objectives:Course objectives:Course objectives:

• To understand the importance of ethics in business, and ,

• To acquire knowledge and capability to develop ethical practices for effective management.

Module IModule IModule IModule I Ethics, culture and values: Importance of culture in organisations; Indian ethos and value systems; concepts of Dharma; Nishkama karma and Purusharthas; Model of management in the Indian socio political environment; Work ethos; Indian heritage in production and consumption. Module IIModule IIModule IIModule II Business ethics: Relevance of values in Management; Holistic approach for managers in decision-making; Secular vs spiritual values in Management; Ethical relativism; whistle blowing; Stress in corporate management; Module IIIModule IIIModule IIIModule III Ethics management: Role of organisational culture in ethics; structure of ethics management; Ethics Committee; Ethics Officers and the CFO; Communicating ethics; Ethical Audit; Corporate Governance; Transparency International and other Ethical bodies. Books:

1. Chakraborty, S.K.: Foundations of Managerial Work – Contributions from Indian Thought, Himalaya Publishing Hose, Delhi 1998.

2. Chakraborty, S.K.: Ethics in Management: Vedantic Perspectives, Oxford University Press, Delhi 1995.

3. Boatright, John R: Ethics and the Conduct of Business, Pearson Education, New Delhi 2005. 4. Kumar, S. and N.K.Uberoi: Managing Secularism in the New Millenium, Excel Books 2000. 5. Griffiths, B: The Marriage of East and West, Colling , London 1985. 6. Trevion and Nelson: Managing Business Ethics, John Wiley and Sons, 1995.

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M O D U L E I MODULE I

The terms 'values', 'ethics', 'integrity' and 'conduct' are often used interchangeably and uncertain language is one of the barriers to establishing a widely understood framework for ethics. For the purposes of this paper, the following definitions will apply:

• EthicsEthicsEthicsEthics - what ought to be; the ideals of what is just, good and proper; • ValuesValuesValuesValues - the commonly held beliefs that guide judgment about what is good

and proper, and from which ethical principles derive; • IntegrityIntegrityIntegrityIntegrity - normally one of the key ethical values; but also used in the current

Departmental Performance Assessment as synonymous with a departmental framework for ethics (see Part Five);

• Codes of cCodes of cCodes of cCodes of conductonductonductonduct - the rules that translate ideals and values into everyday practice; and

• ConductConductConductConduct - the actual behaviour and actions of public servants.

Normative ethics is largely about values and the accepted norms for 'right' conduct. Applied ethics is the practical application of values and standards, which sometimes involves choosing between values in a particular context. This paper is concerned with applied ethics, where values are translated into conduct.

CULTURE

The word "culture" is most commonly used in three basic senses:

• The set of shared attitudes, values, goals, and practices that characterizes an institution, organization or group.

• an integrated pattern of human knowledge, belief, and behavior that depends upon the capacity for symbolic thought and social learning

• excellence of taste in the fine arts and humanities, also known as high culture

When the concept first emerged in eighteenth- and nineteenth-century Europe, it connoted a process of cultivation or improvement, as in agriculture or horticulture. In the nineteenth century, it came to refer first to the betterment or refinement of the individual, especially through education, and then to the fulfillment of national

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aspirations or ideals. In the mid-nineteenth century, some scientists used the term "culture" to refer to a universal human capacity.

In the twentieth century, "culture" emerged as a concept central to anthropology, encompassing all human phenomena that are not purely results of human genetics. Specifically, the term "culture" in American anthropology had two meanings: (1) the evolved human capacity to classify and represent experiences with symbols, and to act imaginatively and creatively; and (2) the distinct ways that people living in different parts of the world classified and represented their experiences, and acted creatively. Following World War II, the term became important, albeit with different meanings, in other such as sociology, cultural studies, organizational psychology and management studies.

Organizational Organizational Organizational Organizational CCCCultureultureultureulture

One of the most important building blocks for a highly successful organization and an extraordinary workplace is "organizational culture." We define organizational culture as the set of shared beliefs, truths, assumptions, and values that operate in organizations. Organizational culture has been described as "...how people behave when no one is looking."

"...We believe that organizations will ultimately get only as far as their organizational cultures take them."

Why should you think about this in your organization? Because "behind the scenes" of what happens in the day-to-day life of organizations and employees... is culture. Culture is everywhere. It directly impacts what happens...or does not happen in organizations. At Dynamic Foundations, we place so much stock in organizational At Dynamic Foundations, we place so much stock in organizational At Dynamic Foundations, we place so much stock in organizational At Dynamic Foundations, we place so much stock in organizational culture that we believe organizations will ultimately get only as far as their culture that we believe organizations will ultimately get only as far as their culture that we believe organizations will ultimately get only as far as their culture that we believe organizations will ultimately get only as far as their organizational cultures take them.organizational cultures take them.organizational cultures take them.organizational cultures take them.

Furthermore, something is driving the development of your culture and sustaining it. Organizational culture is a result of that which precedes it. Why this is so important to understand and what does this mean for you in your organization? It means that if you want to address issues related to your culture, you must focus on the key elements that come together to create and sustain it.

Organizations are more than they appear to be on the surface. Behind products, policies, services, and rewards are the ingredients which determine the results in organization. We believe that organizational culture is a primary, if not the primary determinant of that which separates "champion" from "also-ran" organizations. We believe an organization can go only as far as its culture takes it. We help organizations get their "cultural bearings," get a clear sense of how far they are from where they wish to be, and what it will take to get "there." Then we help organizations move themselves forward.

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Organizational Cultural Transformation Organizational Cultural Transformation Organizational Cultural Transformation Organizational Cultural Transformation

Organizational cultural transformation is not for the faint of heart. In fact, many attempts at transforming an organization fail, for a variety of reasons:

• "Playing at it" or "dabbling" with it until it's no longer fun • Not applying the kind of leadership that would best meet the needs of the

situation • Intervening in the wrong places or at the wrong time • Not taking this work seriously enough • Not giving it enough time or attention • Senior leaders "delegating" this work (rather than committing and investing

their own time and energies) • Knowing what needs to be done but being unwilling to do it...to go all the way • Not having the people and tools available internally to get the job done • Inability to engage all the right people in the process

Elements of organizational culture may include:Elements of organizational culture may include:Elements of organizational culture may include:Elements of organizational culture may include:

• Stated and unstated values. • Overt and implicit expectations for member behavior. • Customs and rituals. • Stories and myths about the history of the group. • Shop talk—typical language used in and about the group. • Climate—the feelings evoked by the way members interact with each other,

with outsiders, and with their environment, including the physical space they occupy.

• Metaphors and symbols—may be unconscious but can be found embodied in other cultural elements.

IMPORTANCE OF CULTURE IN ORGANISATIONS (a) (a) (a) (a) Culture is an evolutionary concept. It is developed by individuals (managers) in an organization. A good organization is represented by its culture. Hence, culture is alive. (b) (b) (b) (b) Culture is certain set of `practices’ followed by individuals. Such practices are evolved through proper experimentations. A live organization has got values. Such values are inseparable and are a product of labour. (c) (c) (c) (c) Since an organization is represented by its practiced culture, it is `alive’ and has `values’. Image is nothing but an expression of `culture’ as is patronized by the `society’. It has a form and the same is imprinted in the minds and hearts of individuals. (d) (d) (d) (d) Culture is represented by each and every organisation in one way or the other and such practices forms part of organizational culture. It is through steady efforts and

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practices that such a culture is represented to the outside world, in the form of organizational culture. (e) (e) (e) (e) Culture is the backbone of each and every organization. It is based on this image that an organization is built and hence culture acts as a foundation based on which it is formed. (f) (f) (f) (f) The essential quality of culture is that it is unique for each and every organization. It is built based on steady and steadfast efforts as nourished by the individuals through hard core labour. (g) (g) (g) (g) When an organization absorbs another organization then a `wedding’ of different culture takes place. This is the principle of polygamy.

INDIAN ETHOS AND VALUE SYSTEMS

Every country has its own culture and character based on the social, political and economic environment in which it operates. From that culture springs forth the national ethos, which prescribes a code of conduct for its citizens and creates the context for business ethics and values in that society. Indian ethos and wisdom — a legacy and heritage from its hoary past — envisaged a socialistic pattern of society, with an accent on redistributionism. It has always been a champion of renunciation and rectitude, rather than accumulation and aggrandisement.

Mahatma Gandhiji once said that it was difficult, but not impossible, to be an honest businessman; but it was impossible to be honest, and also, amass wealth. He advocated a simple and self-sustaining lifestyle based on the dictum that while there was always adequate means to meet the needs of everyone, it was not enough to meet the greed of a few.

When one looks at the current commercial scenario, following questions arise for introspection. When financial scams and scandals are being reported by the media almost as a weekly feature, when even the world of sports is tainted with treachery and painted with perversion and political skulduggery, where does one look for relief and redemption?

Is it not a fact that a substantial portion of the GDP in this country is being systematically blocked and funnelled away into the black market and laundered back with guile and impunity towards moral uprightness? When will this nation be able to cultivate a critical mass of managers, who will measure up to their full height and call a halt to this caricature of character and corporate misdemeanour, where the ends always seem to vindicate the means?

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It is in this setting that the importance of instilling basic ethical norms in the process and progress of a professional career in commerce takes the driving seat. Perhaps, the curriculum of management education in India must be reoriented to reflect its national culture and character.

Ethics and values must find a place in the art and science of management. The ability to do the right thing and, what is more important, doing it every time (even when no one is watching) is the noblesse oblige in the managerial milieu. It must become the done thing, the insignia and talisman of a professional manager.

A word of caution, however, is necessary. In our zeal and zest to realise and rehabilitate the quintessence of Indian wisdom in the practice of modern management, there must be no room for anyone to take a tendentious advantage of the situation. Let there not be any let up triggered by some vested interests to make a political mileage out of this campaign.

Like, for instance, how the doctrine of hindutva is being brandished as the monopoly of a particular segment of the population. The secular character of this tenet has been tarnished to suit an ideolog; to create obscurantism as against enlightenment; and to develop an intolerance of dissent, instead of coexistence with plurality. Business ethos principles practiced by Indian Companies:Business ethos principles practiced by Indian Companies:Business ethos principles practiced by Indian Companies:Business ethos principles practiced by Indian Companies:---- Indian companies are guided by certain rules of conduct in the form of ethical and moral standards. Some of the business ethos principles, practiced by Indian companies are listed below: 1. Principle of `sacrifice’1. Principle of `sacrifice’1. Principle of `sacrifice’1. Principle of `sacrifice’ An individual is trained by the principle of `sacrifice’ through the process of `give and take’ policy. A person, who is willing to sacrifice part of his bread or effort, commands a superior place in the organization. 2. Principle of `harmony’2. Principle of `harmony’2. Principle of `harmony’2. Principle of `harmony’ An individual is trained in such a way that to avoid conflicts and friction one should be guided by certain set of moral conducts and principles. 3. Principle of `non3. Principle of `non3. Principle of `non3. Principle of `non----violence’violence’violence’violence’ This principle protects an organization from strikes and lockouts and unnecessary avoidable conflicts. 4. Principle of `reward’4. Principle of `reward’4. Principle of `reward’4. Principle of `reward’ The one who performs well are encouraged to do so. This implies that the activities of individuals need to be monitored and encouragement in the form of `rewards’ may cultivate the spirit of higher productivity among groups.

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5. Principle of `justice’5. Principle of `justice’5. Principle of `justice’5. Principle of `justice’ The one who works hard is `rewarded’ and the one who fails to do so is `punished’. This is essence the principle of Justice. 6. Principle of `taxation’6. Principle of `taxation’6. Principle of `taxation’6. Principle of `taxation’ The one who is taxed more is encouraged to stay fit for a longer period by proper appreciation and encouragement. This principle applies to individuals who are hardworking and productive. 7. Principle of `Integrity’7. Principle of `Integrity’7. Principle of `Integrity’7. Principle of `Integrity’ An integrated mind is more productive. Groups are encouraged to stay united in order to reap the benefits of division of labour. 8. Principle of `Polygamy’8. Principle of `Polygamy’8. Principle of `Polygamy’8. Principle of `Polygamy’ This is nothing but the wedding of two different cultures by absorption or takeover. How How How How valuesvaluesvaluesvalues areareareare formedformedformedformed Values are formed through the process of efforts. Such efforts never go invain. The following point throws valuable insights on formation of values, from an organizational perspective. 1) Efforts and values.1) Efforts and values.1) Efforts and values.1) Efforts and values. Efforts undertaken in order to enrich productivity among labourers by the process of experimentation, never go in vain. Efforts are milestones and the frequency with which one labours the more, the value in an organization grows, in the same proportion. 2) Vision and values2) Vision and values2) Vision and values2) Vision and values The vision of the entrepreneur generally tallies with the organizational goals. Vision acts as a foundation stone and pillar for enriching values in each and every organization. 3) Dedication and values3) Dedication and values3) Dedication and values3) Dedication and values A dedicated mind is God’s workshop. Values are formed through dedicated efforts. 4) Morality and values4) Morality and values4) Morality and values4) Morality and values The more an organization concentrates on morality or ethics, the more it brings fertility to the ‘tree’ called values. 5) Culture and values5) Culture and values5) Culture and values5) Culture and values A well developed culture evolves positive values. 6) Ethics and values6) Ethics and values6) Ethics and values6) Ethics and values Ethics are guided by certain moral principles. An ethical organization has got values and hence it thrives for a longer period. Such organizations generally have an infinite existence.

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CONCEPTS OF DHARMA The term dharma' (Sanskrit: dhárma, Pāḷi dhamma), is an Indian spiritual and religious term, that means one's righteous duty or any virtuous path in the common sense of the term. In the text of the Rigveda, the word appears as an n-stem, dhárman-, with a range of meanings encompassing "something established or firm" (in the literal sense of prods or poles), figuratively "sustainer, supporter" (of deities), and semantically similar to the Greek ethos ("fixed decree, statute, law"). It is used in most or all philosophies and religions of Indian origin—sometimes summarized under the umbrella term of Dharmic faiths—including Hinduism, Buddhism, Jainism, and Sikhism. It is difficult to provide a single concise definition for dharma, as the word has a long and varied history and straddles a complex set of meanings and interpretations.

The concept of dharma often found in many Hindu works such as “Sibi,” “The Yoga of Knowledge,” and “Numskull and the Rabbit”; is the duties and obligations of each caste in the Hindu religion. If a person’s dharma is not achieved, when the person dies they are reborn into the same caste they were in their previous life or they are born into a lower one. On the other hand, if a person does achieve his or her dharma, when they die they may be reborn into a higher caste and eventually achieve nirvana; nirvana is when the Atman, the soul, is finally set free from the cycle of rebirth and can finally become one with God. In the story “Sibi” there is a King who has just enjoyed a feast with his people and soon after he sits down under a tree, an injured dove falls into his lap seeking asylum from its pursuer, a hawk. The hawk insists that King Sibi give him his rightful meal of the dove but Sibi, being the thinker that he is tries to persuade the hawk towards a different meal but it does not work. So Sibi, knowing that it was his dharma to protect this dove since it took asylum in his lap, offers to give his own flesh and blood for the same weight of the dove instead of the dove itself. The hawk agrees and so Sibi cuts his flesh from his lower legs and finds it still is not enough to equal the weight of the dove, so Sibi sits on the scale, since he now is almost dead from loss of blood, to equal the weight. Then with a flash of light the dove and the hawk reveal themselves as the God of Fire, the dove, and Indra, the hawk. They revealed to Sibi that they were testing his dharma and give back to him his life. The concept of dharma in “Sibi” was that Sibi, being a King, was to protect his people, his family, and any other who sought asylum from him. Therefore, the dove, which sought asylum with Sibi, was therefore protected by the dharma of the King. In conclusion, Sibi achieved his dharma, though it was not easy to do, and once he dies he may be able to break the chains that keeps him locked into the cycle of rebirth. Unlike Sibi whose dharma was clear to him, Arjuna in “The Yoga of Knowledge” unfortunately had a dilemma between following the dharma of what he thought was right or following the dharma of a soldier. In the story, Arjuna is a soldier in a war

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where the opposite army includes his brothers and uncle; which means he would have to kill them which goes against his dharma of doing the right thing, but not killing them is going against his dharma as a soldier. Sri Krishna, a God disguised as Arjuna’s charioteer, tries to tell him to fight but Arjuna still will not fight so Sri Krishna has to bluntly tell him that he must fight for the shame he will receive if he were to go against his dharma as a soldier would be far worse than killing a few of his relatives in war. In the end of the story the reader does not truly find out whether Arjuna fought or not so whether he fulfilled his dharma is unknown but either way, Arjuna had to choose between what he thought was right and what was “right.” Sibi’s decision to save the dove was part of his dharma; this was easily seen to him. Arjuna had a conflict within himself about which dharma he must choose. In “Numskull and the Rabbit” the rabbit knows that his dharma is to get to the lion, Numskull, on time or the entire forest will be eaten but instead he decides to go slowly and be late. Once he arrives there he tells Numskull that another lion was claiming to be the king and had eaten the other five rabbits that had come with him. Numskull, thinking that he was the only lion allowed to call himself king, instantly jumped at the opportunity to kill this so called king and then get back to his meal of the day. So the rabbit leads Numskull to this hole, a well, where this other lion is said to live. The lion roars into the darkness of the hole and when he hears the roar echoed back at him jumps into the well thinking that the other lion was challenging him and dies being fooled by a mere rabbit. The rabbit’s dharma in the story was to go to the lion and be eaten so the rest of the forest could live, but the rabbit decided to go against that dharma and go with the dharma that told him that saving his own family and friends as well as the other animals of the forest was right so he took it upon himself to get rid of the problem of the forest. One way to see it, is that he achieved his dharma but also lessened his chances of moving up in the cycle of rebirth because he went against part of his other dharma. Over all, the rabbit’s dharma is unknown but what he did was the right thing to do to save his family and friends. When the dharma of a person or animal, as illustrated many times in stories, is not achieved the person or animal takes the chance of moving down or not moving at all in the caste system after rebirth. On the other hand, if the dharma is achieved then the person or animal has a greater chance to move up in the caste system after rebirth. The concept of dharma is easily found in the Hindu stories “Sibi,” “The Yoga of Knowledge,” and “Numskull and the Rabbit.” In all three stories dharma is clearly marked though the right choice is not always easily seen. The concept of dharma is more of a belief of what each individual believes is right, rather than was is “right.

The Purpose of DharmaThe Purpose of DharmaThe Purpose of DharmaThe Purpose of Dharma

The purpose of dharma is not only to attain a union of the soul with the supreme reality, it also suggests a code of conduct that is intended to secure both worldly joys and supreme happiness. Rishi Kanda has defined dharma in Vaisesika as "that confers worldly joys and leads to supreme happiness". Hinduism is the religion that suggests methods for the attainment of the highest ideal and eternal bliss here and now on earth and not somewhere in heaven. For example, it endorses the idea that it

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is one's dharma to marry, raise a family and provide for that family in whatever way is necessary. The practice of dharma gives an experience of peace, joy, strength and tranquillity within one's self and makes life disciplined.

PURUSHARTHAS

Purusharthas are the canonical four ends or aims of human life. These goals are, from lowest to highest: Purusha means human being and Artha means object or objective. Purusharthas means objectives of man. According to Hindu way of life, a man should strive to achieve four chief objectives (Purusharthas) in his life. They are:

1. dharma (righteousness),

2. artha (material wealth),

3. kama (desire) and

4. moksha (salvation).

Every individual in a society is expected to achieve these four objectives and seek fulfillment in his life before departing from here. The concept of Purusharthas clearly establishes the fact that Hinduism does not advocate a life of self negation and hardship, but a life of balance, achievement and fulfillment.

DharmaDharmaDharmaDharma (righteousness)(righteousness)(righteousness)(righteousness) Dharma describes as the natural universal laws whose observance enables humans to be contented and happy, and to save himself from degradation and suffering. Dharma is the moral law combined with spiritual discipline that guides one's life. It means "that which holds" the people of this world and the whole creation. Dharma is the "law of being" without which things cannot exist.

Anything that helps human being to reach god is dharma and anything that hinders human being from reaching god is adharma. According to the Bhagavat Purana, righteous living or life on a dharmic path has four aspects: austerity (tap), purity (shauch), compassion (daya) and truthfulness (satya); and adharmic or unrighteous life has three vices: pride (ahankar), contact (sangh), and intoxication (madya). The essence of dharma lies in possessing a certain ability, power and spiritual strength. The strength of being dharmic also lies in the unique combination of spiritual brilliance and physical prowess.

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Manusmriti written by the ancient sage Manu prescribes 10 essential rules for the observance of dharma:

1. Patience (dhriti), 2. forgiveness (kshama), 3. piety or self control (dama), 4. honesty (asteya), 5. sanctity (shauch), 6. control of senses (indraiya-nigrah), 7. reason (dhi), 8. knowledge or learning (vidya), 9. truthfulness (satya) and 10. absence of anger (krodha).

Manu further writes, "Non-violence, truth, non-coveting, purity of body and mind, control of senses are the essence of dharma". Therefore dharmic laws govern not only the individual but all in society.

Artha (material wealth)Artha (material wealth)Artha (material wealth)Artha (material wealth)

Artha means material wealth. Hinduism recognizes the importance of material wealth for the overall happiness and well being of an individual. A house holder requires wealth, because he has to perform many duties to uphold dharma and ensure the welfare and progress of his family and society. A person may have the intention to uphold the dharma, but if he has no money he would not be able to perform his duties and fulfill his dharma. Hinduism therefore rightly places material wealth as the second most important objective in human life. Lord Vishnu is the best example for any householder who wants to lead a life of luxury and still be on the side of God doing his duties. As the preserver of the universe, Lord Vishnu lives in Vaikunth amid pomp and glory, with the goddess of wealth herself by his side and yet helps the poor and the needy, protects the weak, upholds the dharma and sometimes leaving everything aside rushes to the earth as an incarnation to uphold dharma.

Hinduism advocates austerity, simplicity and detachment, but does not glorify poverty. Hinduism also emphasizes the need to observe dharma while amassing the wealth. Poverty has become a grotesque reality in present day Hindu society. Hindus have become so poverty conscious that if a saint or a sage leads a comfortable life, they scoff at him, saying that he is not a true yogi. They have to remind themselves of the simple fact that none of the Hindu gods and goddesses are really poor.

Hinduism believes that both spiritualism and materialism are important for the salvation of human beings. It is unfortunate that Hinduism came to be associated more with spiritualism, probably because of the influence of Buddhism, where as in truth Hinduism does not exclude either of them. As Swami Vivekananda rightly said religion is not for the empty stomachs. Religion is not for those whose main concern

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from morning till evening is how to make both ends meet. Poverty crushes the spirit of man and renders him an easy prey to wicked forces.

In ancient India Artha shastras (scriptures on wealth) provided necessary guidance to people on the finer aspects of managing their wealth. Kautilya's Artha Shastra, which is probably a compilation of many independent works, gives us a glimpse of how money matters were handled in ancient India.

Kama (desire)Kama (desire)Kama (desire)Kama (desire)

Kama in a wider sense means desire and in a narrow sense, sexual desire. Hinduism prescribes fulfillment of sexual passions for the householders and abstinence from it for the students and ascetics who are engaged in the study of the scriptures and in the pursuit of Brahman.

The Bhagavad-Gita informs us that desire is an aspect of delusion and one has to be wary of its various movements and manifestations. The best way to deal with desires is to develop detachment and perform desireless actions without seeking the fruit of ones actions and making an offering of all the actions to God. This way our actions would not bind us to the cycle of births and deaths.

Hinduism permits sexual freedom so long as it is not in conflict with the first aim, i.e. dharma. Hindu scriptures emphasize that the purpose of sex is procreation and perpetuation of family and society, while the purpose of dharma is to ensure order in the institution of family and society. A householder has the permission to indulge in sex, but also has the responsibility to pursue it in accordance with the laws of dharma. Marriage is a recognized social institution and marriage with wife for the purpose of producing children is legitimate and in line with the aims of dharma. Sex in any other form, including sex with wife for pleasure is adharma. (Here we are explaining the logic of the Purusharthas. We are not advocating an opinion.) One of the important sects of Hinduism is Tantricism. It recognizes the importance of sexual freedom in the liberation of soul. The Tantrics accept sex as an important means to experience the blissful nature of God and the best way to experience God in physical form. They also refer to the concept of Purusharthas to justify their doctrines. They believe that sexual energy is divine energy and it can be transformed into spiritual energy through controlled expression of sex.Just as the dharmashastras were written for the sake of dharma, and artha shastras for artha, Kama shastras were composed in ancient India for providing guidance in matters of sex. We have lost many of them because of the extreme secrecy and social disapproval associated with the subject. What we have today is Vatsayana's Kamasutra, which like the Arthashastra seems to be a compilation of various independent works rather the work of a single individual.

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Moksha (salvation)Moksha (salvation)Moksha (salvation)Moksha (salvation)

If dharma guides the life of a human being from below acting as the earth, showing him the way from above like a star studded mysterious sky is Moksha. Dharma constitutes the legs of a Purusha that walk upon the earth; both artha and Kama constitute his two limbs active in the middle region; while Moksha constitutes the head that rests in the heaven.

Human life is very precious because of all the beings in all the worlds, only human beings have the best opportunity to realize the higher self. It is also precious because it is attained after many hundreds and thousands of lives. Rightly, salvation should be its ultimate aim.

Moksha actually means absence of moha or delusion. Delusion is caused by the inter play of the triple gunas. When a person overcomes these gunas, he attains liberation. The gunas can be overcome by detachment, self control, surrender to god and offering ones actions to God

If dharma is the center of the wheel of human life, artha and Kama are the two spokes and Moksha is its circumference. If dharma is at the center of human life, beyond Moksha there is no human life, but only a life divine.

The four Purusharthas are also like the four wheels of a chariot called human life. They collectively uphold it and lead it. Each influences the movement of the other three, and in the absence of any one of them, the chariot comes to a halt.

NISHKAM KARMA

Nishkam Karma, or self-less or desireless action is an action performed without any expectation of fruits or results, and the central tenet of Karma Yoga path to Liberation, which has now found place not just in business management, management studies but also in promoting better Business ethics as well. Its modern advocates press upon achieving success following the principles of Yoga, and stepping beyond personal goals and agendas while pursuing any action over greater good, which is also the key message of the Bhagavad Gita.

In Indian philosophy, action or Karma has been divided into three categories, according to their intrinsic qualities or gunas. Here Nishkam Karma belongs to the first category, the Satvik (pure) or actions which add to calmness; the Sakam Karma (Self-centred action) comes in the second rājasika (aggression) and Akarma (in-action) comes under the third, tāmasika which correlates to darkness or inertia.

The opposite of Sakam Karma (Attached Involvement) or actions done with results in mind, Nishkam Karma has been variously explained as 'Duty for duty's sake' and as 'Detached Involvement', which is neither negative attitude or indifference; and has today found many advocates in the modern business area where the emphasis has

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shifted to ethical business practices adhering to intrinsic human values and reducing stress at the workplace.

Another aspect that differentiates it from Sakam or selfish action, is that while the former is guided by inspiration, the latter is all about motivation, and that makes the central difference in its results, for example Sakam Karma might lead to excessive work pressure and workaholism as it aims at success, and hence creates more chances of physical and psychological burn outs. On the other hand Nishkam Karma, means more balanced approach to work, and as work has been turned into a pursuit of personal excellence, which results in greater personal satisfaction, which one would have otherwise sought in job satisfaction coming from external rewards. One important fallout of the entire shift is that where one is essentially an ethical practice inside-out leading to the adage, ‘Work is worship’ show itself literally at workplace, leading to greater work commitment, the other since it is so much result oriented can lead to unethical business and professional ethics, as seen so often at modern work place

Since the central tenet of practicing Nishkam Karma is Mindfulness in the present moment. Over time, this practice leads to not only equanimity of mind as it allows the practitioner to stay detached from results, and hence from ups and downs of business that are inevitable in any business arena, while maintaining constant work commitment since work as now been turned into a personal act of worship.. Further in the long run it leads to cleansing of the heart but also spiritual growth and holistic development.

Nishkam Karma in Bhagavad GitaNishkam Karma in Bhagavad GitaNishkam Karma in Bhagavad GitaNishkam Karma in Bhagavad Gita

Nishkam Karma, gets an important place in the Bhagavad Gita, the central text of Mahabharata, where Krishna advocates 'Nishkam Karma Yoga' (the Yoga of Selfless Action) as the ideal path to realize the Truth. Allocated work done without expectations, motives, or thinking about its outcomes tends to purify one's mind and gradually makes an individual fit to see the value of reason and the benefits of renouncing the work itself. These concepts are vividly described in the following verses:

“karman �y evādhikāras te

mā phales �u kadācana mā karma-phala-hetur bhūr

mā te sańgo 'stv akarman �i”. “You have a right to perform your prescribed duty, but you are not entitled to the fruits of action. Never consider yourself the cause of the results of your activities, and never be attached to not doing your duty”.

- Chapter 2, Verse 47.

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WORK ETHICS Work Ethic is a set of values based on the moral qualities of hard work and attentiveness. It is also a belief in moral benefit of work and its ability to enhance character. An example would be the Protestant work ethic or Chinese work ethic. A work ethic may include being reliable, having initiative or maintaining social skills. Workers exhibiting a good work ethic in theory (and ideally in practice) should be selected for better positions, more responsibility and ultimately promotion. Workers who fail to exhibit a good work ethic may be regarded as failing to provide fair value for the wage the employer is paying them and should not be promoted or placed in positions of greater responsibility. The so-called work ethic is generally construed to be a good and impressive thing. It fancies itself a high quality, but like most double-edged swords, it must be handled with care. An ethic, by definition, is a set of moral principles. The word derives from the Greek ethos -- which in turn is “the characteristic spirit or attitudes of a community, people, or system.” Applying work as a modifier, suggests that the work ethic is a characteristic attitude of a group toward what constitutes the morality of work. This can, unfortunately, be taken to boundaries.

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M O D U L E I I

MODULE I I

BUSINESS ETHICS

Definitions of Business ethics

Business ethics is the branch of ethics that examines ethical rules and principles within a commercial context; the various moral or ethical problems that can arise in a business setting; and any special duties or obligations that apply to persons who are engaged in commerce. Those who are interested in business ethics examine various kinds of business activities and ask, "Is the conduct ethically right or wrong?"

Business ethics is a form of the art of applied ethics that examines ethical rules and principles within a commercial context, the various moral or ethical problems that can arise in a business setting and any special duties or obligations that apply to persons who are engaged in commerce.

In the increasingly conscience-focused marketplaces of the 21st century, the demand for more ethical business processes and actions (known as ethicism) is increasing. Simultaneously, pressure is applied on industry to improve business ethics through new public initiatives and laws (e.g. higher UK road tax for higher-emission vehicles).

Business ethics can be both a normative and a descriptive discipline. As a corporate practice and a career specialization, the field is primarily normative. In academia descriptive approaches are also taken. The range and quantity of business ethical issues reflects the degree to which business is perceived to be at odds with non-economic social values. Historically, interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia. For example, today most major corporate websites lay emphasis on commitment to promoting non-economic social values under a variety of headings (e.g. ethics codes, social responsibility charters). In some cases, corporations have redefined their core values in the light of business ethical considerations (e.g. BP's "beyond petroleum" environmental tilt).

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Overview of issues in business ethics

General business ethics

• This part of business ethics overlaps with the philosophy of business, one of the aims of which is to determine the fundamental purposes of a company. If a company's main purpose is to maximize the returns to its shareholders, then it could be seen as unethical for a company to consider the interests and rights of anyone else.

• Corporate social responsibility or CSR: an umbrella term under which the ethical rights and duties existing between companies and society is debated.

• Issues regarding the moral rights and duties between a company and its shareholders: fiduciary responsibility, stakeholder concept v. shareholder concept.

• Ethical issues concerning relations between different companies: e.g. hostile take-over, industrial espionage.

• Leadership issues: corporate governance. • Political contributions made by corporations. • Law reform, such as the ethical debate over introducing a crime of

corporate manslaughter. • The misuse of corporate ethics policies as marketing instruments.

Professional ethics

Professional ethics covers the myriad of practical ethical problems and phenomena which arise out of specific functional areas of companies or in relation to recognized business professions.

Ethics of accounting information

• Creative accounting, earnings management, misleading financial analysis. • Insider trading, securities fraud, bucket shop, forex scams: concerns

(criminal) manipulation of the financial markets. • Executive compensation: concerns excessive payments made to corporate

CEO's. • Bribery, kickbacks, and facilitation payments: while these may be in the

(short-term) interests of the company and its shareholders, these practices may be anti-competitive or offend against the values of society.

Ethics of human resource management

The ethics of human resource management (HRM) covers those ethical issues arising around the employer-employee relationship, such as the rights and duties owed between employer and employee.

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• Discrimination issues include discrimination on the bases of age (ageism), gender, race, religion, disabilities, weight and attractiveness. See also: affirmative action, sexual harassment.

• Issues surrounding the representation of employees and the democratization of the workplace: union busting, strike breaking.

• Issues affecting the privacy of the employee: workplace surveillance, drug testing. See also: privacy.

• Issues affecting the privacy of the employer: whistle-blowing. • Issues relating to the fairness of the employment contract and the balance

of power between employer and employee: slavery, indentured servitude, employment law.

• Occupational safety and health.

Ethics of sales and marketing

Marketing which goes beyond the mere provision of information about (and access to) a product may seek to manipulate our values and behavior. To some extent society regards this as acceptable, but where is the ethical line to be drawn? Marketing ethics overlaps strongly with media ethics, because marketing makes heavy use of media. However, media ethics is a much larger topic and extends outside business ethics.

Pricing: price fixing, price discrimination, price skimming.

Anti-competitive practices: these include but go beyond pricing tactics to cover issues such as manipulation of loyalty and supply chains. See: anti-competitive practices, antitrust law.

Specific marketing strategies: green wash, bait and switch, shill, viral marketing, spam (electronic), pyramid scheme, planned obsolescence.

Content of advertisements: attack ads, subliminal messages, sex in advertising, products regarded as immoral or harmful

Children and marketing: marketing in schools.

Black markets, grey markets.

Ethics of production

This area of business ethics deals with the duties of a company to ensure that products and production processes do not cause harm. Some of the more acute dilemmas in this area arise out of the fact that there is usually a degree of danger in any product or production process and it is difficult to define a degree of permissibility, or the degree of permissibility may depend on the changing state of preventative technologies or changing social perceptions of acceptable risk.

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• Defective, addictive and inherently dangerous products and services (e.g. tobacco, alcohol, weapons, motor vehicles, chemical manufacturing, bungee jumping).

• Ethical relations between the company and the environment: pollution, environmental ethics, carbon emissions trading

• Ethical problems arising out of new technologies: genetically modified food, mobile phone radiation and health.

• Product testing ethics: animal rights and animal testing, use of economically disadvantaged groups (such as students) as test objects.

• The permissibility of international commerce with pariah states.

HOLISTIC MANAGEMENT

The idea of Holistic Management began in the 1960’s when Allan Savory, then a young wildlife biologist in his native Southern Rhodesia, wished to solve the riddle of desertification. After successive careers as a farmer, game rancher, management consultant, a member of Parliament and leader of the opposition party in the midst of a civil war, Savory concluded that the spread of deserts, the loss of wildlife, and the human impoverishment that always resulted were related to the way people made decisions, whether or not those people lived or worked on the land.

Exiled as a result of his opposition to the ruling Rhodesian party, Savory immigrated to the United States where he co-founded Holistic Management International with his wife, Jody Butterfield, in 1984. HMI, a 501(c)3 nonprofit organization headquartered in Albuquerque, New Mexico, works with people around the world to heal damaged land and increase the productivity of working lands by applying the Holistic Management principles.

Holisticgoal concept for guide decision making

At its core, the Holistic Management Framework uses a concept known as a holisticgoal to guide decision making. The holisticgoal ties people's desired way of life, based on what they value most deeply (materially and spiritually), to the ecosystems and resources that that support their vision. All actions and decisions are tested to determine whether or not they will help reach the established holisticgoal. Testing and management guidelines, planning procedures and a feedback loop assure constant monitoring of the success of decisions.

The Holistic Management Framework also considers the key role that animals play in renewing the land, and recognizes the nature and importance of four basic

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ecosystem processes: the water cycle, the mineral cycle, energy flow, and community dynamics (the relationship between organisms in an ecosystem). The Framework identifies eight tools for managing these ecosystem processes: human creativity, technology, rest, fire, grazing, animal impact, living organisms, and money and labor.

SECULAR Vs SPIRITUAL VALUES IN MANAGEMENT

1) By secular view on values in management, it refers to the worldly thoughts and philosophies as reproduced by management Gurus or experts. By spiritual values in management, it refers to the insights thrown on management by Vedas and Upanishads (or) by spiritual Gurus.

2) Secularists thoughts and views on management finds its way from Maslows need hierarchy and culminate till the most modern thoughts on management. Spiritual values in management find its base from the age old Vedas and Upanishads with special reference to Bhagavat Gita.

3) Secularists treat management values, as a science rather than ordaining it as a philosophy. Spiritualists treat management values as a philosophy rather than by ordaining it as a science.

4) Secularists treat management values as an evolutionary concept. Spiritualists believe sources like Bhagavat Gita, as a ready reckoner on value based management.

5) Secularists views on values in management are not generally ethical by nature.

Spiritualists find their reference one value based management as ethical or moral, in its true sense.

6) The contribution of Indian thoughts towards secular values on management as reproduced by management science is comparatively poor, with reference to spiritual values on management. The contribution of Indian thoughts towards spiritual values on management has magnificent theories, when compared to secular values on management.

7) The secular views on management as propounded by management experts lack any ideals. The Indian spiritual values in management have divinity as the ideal to be portrayed.

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ETHICAL RELATIVISM

Ethical relativism is the position that there are no moral absolutes, no moral right and wrongs. Instead, right and wrong are based on social norms. Some have heard of the term situational ethics which is a category of ethical relativism. At any rate, ethical relativism would mean that our morals have evolved, that they have changed over time, and that they are not absolute.

Ethical relativism is the theory that holds that morality is relative to the norms of one's culture. That is, whether an action is right or wrong depends on the moral norms of the society in which it is practiced. The same action may be morally right in one society but be morally wrong in another. For the ethical relativist, there are no universal moral standards -- standards that can be universally applied to all peoples at all times. The only moral standards against which a society's practices can be judged are its own. If ethical relativism is correct, there can be no common framework for resolving moral disputes or for reaching agreement on ethical matters among members of different societies.

Advantage of ethical relativism is that it allows for a wide variety of cultures and practices. It also allows people to adapt ethically as the culture, knowledge, and technology change in society. This is good and a valid form of relativism.

The disadvantage of ethical relativism is that truth, right and wrong, and justice is all relative. Just because the group of people thinks that something is right does not make so. Slavery is a good example of this. Two hundred years ago in America, slavery was the norm and morally acceptable. Now it is not.

Within ethical relativism, right and wrong are not absolute and must be determined in society by a combination of observation, logic, social preferences and patterns, experience, emotions, and "rules" that seem to bring the most benefit. Of course, it goes without saying that a society involved in constant moral conflict would not be able to survive for very long. Morality is the glue that holds a society together. There must be a consensus of right and wrong for a society to function well. Ethical relativism undermines that glue.

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WHISTLE BLOWING

A whistleblowerwhistleblowerwhistleblowerwhistleblower is a person who alleges misconduct. More complex definitions may be used, but the issue is that the whistleblower usually faces reprisal. The misconduct may be classified in many ways; for example, a violation of a law, rule, regulation and/or a direct threat to public interest, such as fraud, health/safety violations, and corruption.

One famous whistleblower is Jeffrey Wigand, who exposed the Big Tobacco scandal, revealing that executives of the companies knew that cigarettes were addictive and approved the addition of carcinogenic ingredients to the cigarettes. Wigand's story was the basis for the 1999 movie The Insider. Another example is Dr. Frederic Whitehurst, who exposed irregularities at the USA's Federal Bureau of Investigation's Crime Lab. In Europe, Paul van Buitenen exposed irregularities in the European Commission.

Origins of term "whistleblower"Origins of term "whistleblower"Origins of term "whistleblower"Origins of term "whistleblower"

The term whistleblower derives from the practice of English Bobbies, who would blow their whistles when they noticed the commission of a crime. The whistle would alert both law enforcement officers and the general public of danger.

DefiDefiDefiDefinition of a whistleblowernition of a whistleblowernition of a whistleblowernition of a whistleblower

Most whistleblowers are internal whistleblowers, who report misconduct to a fellow employee or superior within their company. One of the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behavior or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behavior, within an organization, if there are complaint systems that offer not just options dictated by the organization, but a choice of options for individuals, including an option that offers near absolute confidentiality.

External whistleblowers, however, report misconduct to outside persons or entities. In these cases, depending on the information's severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, state, or federal agencies.

Under most U.S. federal whistleblower statutes, in order to be considered a whistleblower, the federal employee must have reason to believe his or her employer has violated some law, rule or regulation; testify or commence a legal proceeding on the legally protected matter; or refuse to violate the law. If disclosure is specifically prohibited by law or executive order, disclosure may be considered treason. However, no whistleblowers have been tried for treason in the United States, and it is not officially treasonous to report illegal conduct by government officials there.

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Some try to limit the impact of whistle blowing by arguing that "role-prescribed" whistleblowers (e.g. quality control personnel or internal auditors) are not whistleblowers in the traditional sense because they are employed in order to blow whistles. In cases where whistle blowing on a specified topic is protected by statute, U.S. courts have generally held that such whistleblowers are protected from retaliation. However, a closely divided U.S. Supreme Court decision, Garcetti v. Ceballos (2006). held that the First Amendment free speech guarantees for government employees do not protect disclosures made within the scope of the employees' duties.

Many U.S. federal courts do not distinguish between internal and external whistle blowing. For example, in the field of federal environmental whistle blowing, federal courts have protected only internal whistle blowing as a matter of public policy, holding that whistleblower statutes encourage the free flow of information, and that internal whistle blowing helps resolve problems as soon as possible.

Common reactions to Common reactions to Common reactions to Common reactions to whistle blowingwhistle blowingwhistle blowingwhistle blowing

Ideas about whistle blowing vary widely. Whistleblowers are commonly seen as selfless martyrs for public interest and organizational accountability; others view them as a 'tattle tale' or "snitches" (slang), solely pursuing personal glory and fame.

It is probable that many people do not even consider blowing the whistle, not only because of fear of retaliation, but also because of fear of losing their relationships at work and outside work.

Because the majority of cases are very low-profile and receive little or no media attention and because whistleblowers who do report significant misconduct are usually put in some form of danger or persecution, the idea of seeking fame and glory may be less commonly believed.

Persecution of whistleblowers has become a serious issue in many parts of the world. Although whistleblowers are often protected under law from employer retaliation, there have been many cases where punishment for whistle blowing has occurred, such as termination, suspension, demotion, wage garnishment, and/or harsh mistreatment by other employees. For example, in the United States, most whistleblower protection laws provide for limited "make whole" remedies or damages for employment losses if whistleblower retaliation is proven. However, many whistleblowers report there exists a widespread "shoot the messenger" mentality by corporations or government agencies accused of misconduct and in some cases whistleblowers have been subjected to criminal prosecution in reprisal for reporting wrongdoing.

As a reaction to this many private organizations have formed whistleblower legal defense funds or support groups to assist whistleblowers; one such example in the

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UK is Public Concern at Work. Depending on the circumstances, it is not uncommon for whistleblowers to be ostracized by their co-workers, discriminated against by future potential employers, or even fired from their organization. This campaign directed at whistleblowers with the goal of eliminating them from the organization is referred to as mobbing. It is an extreme form of workplace bullying wherein the group is set against the targeted individual. The fiction novel Year of The Rhinoceros by Michael B. Neff, recently published, accurately and dramatically depicts these types of retaliatory behaviors.

LegalLegalLegalLegal protection for whistleblowersprotection for whistleblowersprotection for whistleblowersprotection for whistleblowers

Legal protection for whistle blowing varies from country to country. In the United Kingdom, the Public Interest Disclosure Act 1998 provides a framework of legal protection for individuals who disclose information so as to expose malpractice and matters of similar concern. In the vernacular, it protects whistleblowers from victimization and dismissal.

In the United States, legal protections vary according to the subject matter of the whistle blowing, and sometimes the state in which the case arises. In passing the 2002 Sarbanes-Oxley Act, the Senate Judiciary Committee found that whistleblower protections were dependent on the "patchwork and vagaries" of varying state statutes. Still, a wide variety of federal and state laws protect employees who call attention to violations, help with enforcement proceedings, or refuse to obey unlawful directions.

The first U.S. law adopted specifically to protect whistleblowers was the Lloyd-La Follette Act of 1912. It guaranteed the right of federal employees to furnish information to the United States Congress. The first U.S. environmental law to include an employee protection was the Water Pollution Control Act of 1972, also called the Clean Water Act. Similar protections were included in subsequent federal environmental laws including the Safe Drinking Water Act (1974), Resource Conservation and Recovery Act (also called the Solid Waste Disposal Act) (1976), Toxic Substances Control Act (1976), Energy Reorganization Act of 1974 (through 1978 amendment to protect nuclear whistleblowers), Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, or the Superfund Law) (1980), and the Clean Air Act (1990). Similar employee protections enforced through OSHA are included in the Surface Transportation Assistance Act (1982) to protect truck drivers, the Pipeline Safety Improvement Act (PSIA) of 2002, the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century ("AIR 21"), and the Sarbanes-Oxley Act, enacted on July 30, 2002 (for corporate fraud whistleblowers).

The patchwork of laws means that victims of retaliation need to be alert to the laws at issue to determine the deadlines and means for making proper complaints. Some deadlines are as short as 10 days (for Arizona State Employees to file a "Prohibited Personnel Practice" Complaint before the Arizona State Personnel Board; and Ohio public employees to file appeals with the State Personnel Board of Review). It is 30 days for environmental whistleblowers to make a written complaint to the

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Occupational Safety and Health Administration [OSHA]. Federal employees complaining of discrimination, retaliation or other violations of the civil rights laws have 45 days to make a written complaint to their agency's equal employment opportunity (EEO) officer. Airline workers and corporate fraud whistleblowers have 90 days to make their complaint to OSHA. Nuclear whistleblowers and truck drivers have 180 days to make complaints to OSHA. Victims of retaliation against union organizing and other concerted activities to improve working conditions have 180 days to make complaints to the National Labor Relations Board (NLRB). Private sector employees have either 180 or 300 days to make complaints to the federal Equal Employment Opportunity Commission (EEOC) (depending on whether their state has a "deferral" agency) for discrimination claims on the basis of race, gender, age, national origin or religion (but here an example of retaliation can be seen, as these anti-discrimination agencies change their areas of discrimination to suit their needs. An area of discrimination in California was if a complaining party had a civil servant relative. The state Department of Fair Employment and Housing quickly called an end to this practice. The state's RALPH Act has also proven to be non-functional.) Those who face retaliation for seeking minimum wages or overtime have either two or three years to file a civil lawsuit, depending on whether the court finds the violation was "willful."

Those who report a false claim against the federal government, and suffer adverse employment actions as a result, may have up to six years (depending on state law) to file a civil suit for remedies under the U.S. False Claims Act (FCA). Under a qui tam provision, the "original source" for the report may be entitled to a percentage of what the government recovers from the offenders. However, the "original source" must also be the first to file a federal civil complaint for recovery of the federal funds fraudulently obtained, and must avoid publicizing the claim of fraud until the U.S. Justice Department decides whether to prosecute the claim itself. Such qui tam lawsuits must be filed under seal, using special procedures to keep the claim from becoming public until the federal government makes its decision on direct prosecution.

Federal employees could benefit from the Whistleblower Protection Act, and the No FEAR Act (which made individual agencies directly responsible for the economic sanctions of unlawful retaliation). Federal protections are enhanced in those few cases were the Office of Special Counsel will uphold the whistleblower's case.

The Military Whistleblower Protection Act protects the right of members of the armed services to communicate with any member of Congress (even if copies of the communication are sent to others).

The HOPE Scholarship in Georgia is the only incentive to report corporate, government, or religious crimes. This scholarship provides four years of free tuition to a tech school or University in Georgia for children of whistleblowers or those researching corporate crime.

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Whistleblower Protection Act of 2007Whistleblower Protection Act of 2007Whistleblower Protection Act of 2007Whistleblower Protection Act of 2007

The U.S. Supreme Court dealt a major blow to government whistleblowers when, in the case of Garcetti v. Ceballos, 04-5, it ruled that government employees did not have protection from retaliation by their employers under the First Amendment of the Constitution.

The free speech protections of the First Amendment have long been used to shield whistleblowers from retaliation by whistleblower attorneys. In response to the Supreme Court decision, the House of Representatives passed H.R. 985, the Whistleblower Protection Act of 2007. President George W. Bush, citing national security concerns, promised to veto the bill should it be enacted into law by Congress. The Senate's version of the Whistleblower Protection Act (S. 274), which has significant bipartisan support, was approved by the Senate Committee on Homeland Security and Governmental Affairs on June 13, 2007. However, it has yet to reach a vote by Senate as a hold has been placed on the bill by Senator Tom Coburn (R-OK). According to the National Whistleblower Center, Coburn's hold on S. 274 has been done to further President Bush's agenda.

California False Claims ActCalifornia False Claims ActCalifornia False Claims ActCalifornia False Claims Act

The California False Claims Act protects whistleblowers from retaliation from their employer under a section entitled: "Section 12653. Employer interference with employee disclosures." Under this section, employers may not make rules that prevent an employee from disclosing information to the government in furtherance of a false claims action, an employer may not discharge, demote, suspend, threaten, harass, deny promotion to, or in any other manner discriminate against, an employee in the terms and conditions of employment because he or she has disclosed information to the government.

Conscientious Employee Protection Act (CEPA)Conscientious Employee Protection Act (CEPA)Conscientious Employee Protection Act (CEPA)Conscientious Employee Protection Act (CEPA)

CEPA, New Jersey's whistleblower law, prohibits an employer from taking any retaliatory action against an employee because the employee does any of the following:

• Discloses, or threatens to disclose, to a supervisor or to a public body an activity, policy, or practice of the employer or another employer, with whom there is a business relationship, that the employee reasonably believes is in violation of a law, or a rule or regulation issued under the law, or, in the case of an employee who is a licensed or certified health care professional, reasonably believes constitutes improper quality of patient care;

• Provides information to, or testifies before, any public body conducting an investigation, hearing or inquiry into any violation of law, or a rule or regulation issued under the law by the employer or another employer, with whom there is a business relationship, or, in the case of an employee who is a licensed or

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certified health care professional, provides information to, or testifies before, any public body conducting an investigation, hearing or inquiry into quality of patient care; or

• Objects to, or refuses to participate in, any activity, policy or practice which the employee reasonably believes: is in violation of a law, or a rule or regulation issued under the law, or, if the employee is a licensed or certified health care professional, constitutes improper quality of patient care; is fraudulent or criminal; or is incompatible with a clear mandate of public policy concerning the public health, safety or welfare or protection of the environment.

Whistleblower Week in Washington (WWW)Whistleblower Week in Washington (WWW)Whistleblower Week in Washington (WWW)Whistleblower Week in Washington (WWW)

The week of May 13-19 2007, whistleblowers from all over the country gathered in Washington, D.C., to convince the United States Congress to pass stronger whistleblower protections for both government and private sector workers. Dr. Marsha Coleman-Adebayo, founder of the No FEAR Coalition and No FEAR Institute, served as Chair of the first-ever Whistleblower Week in Washington. The event was coordinated around the fifth anniversary of the May 15, 2002 enactment of the Notification and Federal Employee Antidiscrimination and Retaliation Act of 2002, which is now known as the No FEAR Act. One purpose of the Act is to "require that Federal agencies be accountable for violations of antidiscrimination and whistleblower protection laws." Public Law 107-174. The law came to fruition after Dr. Coleman-Adebayo provided congressional testimony about American companies exposing African miners and their families to vanadium, a deadly substance.

During WWW dozens of nonprofit organizations, whistleblower groups and individual whistleblowers participated in a broad range of activities that included discussion panels, testimony, award ceremonies, a film night and book signing, and workshops in advocacy, stress management, whistleblower law, and mentoring. Doctors from the "Semmelweis Society International" played a leading role in organizing the event, along with the Civil rights whistleblower advocates, the No FEAR Institute. Prominent organizations included the Government Accountability Project (GAP), the National Whistleblower Center, the VA Whistleblower Coalition, the National Security Whistleblowers Coalition, the ACLU, Public Citizen, the Liberty Coalition, and the Association of American Physicians and Surgeons (AAPS). Betsy Combier represented the E-Accountability Foundation. Linda Lewis, chair of Whistleblowers USA, played a special role and noted that "too many very brave whistleblowers were present to adequately honor their accomplishments and their contributions to the conference." Senator Charles Grassley saluted the group, and called on the White House to hold a rose garden ceremony to honor whistleblowers. The group plans to make this an annual event.

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M O D U L E I I I MODULE I I I

ETHICS MANAGEMENT Ethics management is a new science in the field of management. With the rapid evolution in the field of management, the role of ethics has been recognized, by and large, by the management experts. By ethics, it refers to the principles of conduct governing an individual or group in a society is known as ethics management.

ROLE OF ORGANIZATIONAL CULTURE IN ETHICS By culture, it refers to the ideas, customs, skills, arts etc. of a people or group, which are transferred, communicated or passed along, as in or to succeeding generations. The organization that manages such ideas, customs etc. of a particular people or group in a particular period evolves a distinct culture as drastically different from that of other similar organizations in the field. This is known as organizational culture. With the involvement of management in ethical related issues in an undertaking, the roles of organizational culture in ethics need to be recognized. The rapid involvement of the organization towards upbringing an emerging culture or nourishing a new culture enforces rigid constraints on the working style on group or individuals by emphasising on a set of code of conduct, in terms of morality.

ETHICS COMMITTEE

Definitions of Definitions of Definitions of Definitions of Ethics Committee:Ethics Committee:Ethics Committee:Ethics Committee:

• An independent group of medical and non-medical people who verify the integrity of a study and ensure the safety, integrity, and human rights of the study participants.

• A mandated committee of an institution (hence institutional ethics committee, or IEC, or human research ethics committee, or HREC) that conducts medical research.

• A consultative committee in a hospital or other institution whose role is to analyze ethical dilemmas and to advise and educate health care providers, patients, and families regarding difficult treatment decisions.

• This is an independent group of people that includes doctors, nurses, medical staff, members of the public and sometimes lawyers. This committee

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considers and decides if proposed clinical trials are ethical. The details of the proposed trial are considered and that it is looking at an important question that cannot be answered through existing information.

• A committee appointed to consider ethical issues

Main functions of the Committee:Main functions of the Committee:Main functions of the Committee:Main functions of the Committee:

The Committee on Ethics was first constituted on March 4, 1997 to oversee the moral and ethical conduct of Members and to examine the cases referred to it with reference to ethical and other misconduct of Members. In respect of procedure and other matters, the rules applicable to Committee on Privileges were to apply to the Committee with such variations and modifications as the Chairman.

ETHICS OFFICERS

Ethics officers (sometimes called "compliance" or "business conduct officers") have been appointed formally by organizations since the mid-1980s. One of the catalysts for the creation of this new role was a series of fraud, corruption and abuse scandals that afflicted the U.S. defense industry at that time. This led to the creation of the Defense Industry Initiative (DII), a pan-industry initiative to promote and ensure ethical business practices.

Another critical factor in the decisions of companies to appoint ethics/compliance officers was the passing of the Federal Sentencing Guidelines for Organizations in 1991, which set standards that organizations (large or small, commercial and non-commercial) had to follow to obtain a reduction in sentence if they should be convicted of a federal offense. Although intended to assist judges with sentencing, the influence in helping to establish best practices has been far-reaching.

In the wake of numerous corporate scandals between 2001-04 (affecting large corporations like Enron, WorldCom and Tyco), even small and medium-sized companies have begun to appoint ethics officers. They often report to the Chief Executive Officer and are responsible for assessing the ethical implications of the company's activities, making recommendations regarding the company's ethical policies, and disseminating information to employees. They are particularly interested in uncovering or preventing unethical and illegal actions.

The effectiveness of ethics officers in the marketplace is not clear. If the appointment is made primarily as a reaction to legislative requirements, one might expect the efficacy to be minimal, at least, over the short term. In part, this is because ethical business practices result from a corporate culture that consistently places value on ethical behavior, a culture and climate that usually emanates from the top of the organization. The mere establishment of a position to oversee ethics will most likely be insufficient to inculcate ethical behavior: a more systemic programme with consistent support from general management will be necessary.

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CHIEF FINANCIAL OFFICER

The Chief Financial OfficerChief Financial OfficerChief Financial OfficerChief Financial Officer (CFOCFOCFOCFO) of a company or public agency is the corporate officer primarily responsible for managing the financial risks of the business or agency. This officer is also responsible for financial planning and record-keeping, as well as financial reporting to higher management. (In recent years, however, the role has expanded to encompass communicating financial performance and forecasts to the analyst community.) The title is equivalent to finance directorfinance directorfinance directorfinance director, commonly seen in the United Kingdom. The CFO typically reports to the Chief Executive Officer, and is frequently a member of the board of directors.

COMMUNICATING ETHICS Meaning and significance of Meaning and significance of Meaning and significance of Meaning and significance of communicating ethics:communicating ethics:communicating ethics:communicating ethics: A company is communicating all the time - with insiders to instruct or guide them, and shape their values; with outsiders to let them know what the company is thinking and doing. Ethics in communication involves the application of ethical principles in communicating with stakeholders of all categories - clients, employees, investors, government departments, etc. Honesty, accuracy and transparency in communication are very important to companies. Significance of communication ethicsSignificance of communication ethicsSignificance of communication ethicsSignificance of communication ethics

• Truth and fairness in communication are necessary for individual’s liberty and proper transactions. Exaggeration, untrue statements, rough language and remarks which spread hatred are to be avoided.

• In all communication, courtesy begets courtesy. The golden rule of ethics is, do unto others as you would like others to do unto you.

• A company with a reputation for ethical communication enjoys high value for its shares. High calibre people work for it; it also enjoys a better market for its products and services, and public support in times of controversy.

• In all communication, ethical consideration is inescapable. It is the result of responsible thinking, decision-making and developing healthy relations with all with whom the company deals.

• Ethical communication adds to your dignity by promoting truthfulness, responsibility, and respect for yourself and others. Unethical communication threatens and poisons a company's name and reputation.

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Characteristics of ethical communicationCharacteristics of ethical communicationCharacteristics of ethical communicationCharacteristics of ethical communication An ethical communication is -

• Complete in all respects

• Is truthful and not deceptive

• Avoids jugglery of language

• Does not hide unhappy news under sweet coating

• Does not state opinions as facts Ethical communicators, in other words, have a well-developed sense of all-round responsibility. One plays one's part duly and faithfully in all transactions with all kind of stakeholders. One is not biased or tilted towards any party. The demand for ethical communication is high, and yet it is sometimes very difficult to be entirely ethical. All the same, it is a goal which must be kept before one's eyes in all business transactions. Ethical organizations are created by persons of high integrity, a Culture of truth, and by following one’ conscience - that small voice within which tells us what is right. Factors influencing ethiFactors influencing ethiFactors influencing ethiFactors influencing ethical communicationcal communicationcal communicationcal communication Every act of communication has three possibilities - to speak, to listen, or to be silent. Whatever you do, you send across a signal to the other party. And then there are other factors like body language, tone etc. You cannot escape the responsibility to communicate by remaining silent; a proverb says that silence is half consent. The propriety of your speech or writing depends on these: are you telling the plain truth but being too blunt at the same time? A Sanskrit saying says, speak the truth and make it pleasant to hear. A proper, ethical communication must satisfy following criteria’s

• To whom are you talking. It should be to the right audience. And it should be to nobody else.

• The communication must be where it is due. What you say must dutifully belong to the audience. Your trade secrets have to be guarded while communicating.

• The timing of the message is all important. Time is of essence in business decisions and honouring the time commitment can make the big difference.

• Where you speck should be the right environment for your message. You may not scold an employee in the presence of others. You may not discuss important trade matters where they may be overheads.

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Attributes of ethical communicationAttributes of ethical communicationAttributes of ethical communicationAttributes of ethical communication

• It is true and fair.

• It honours the freedom of expression of all parties concerned.

• You must have tolerance for difference of opinion.

• The human rights should be upheld in the act of communication. :

• All information should be presented without the gloss of falsehood or pretensions.

• The language should be courteous.

• You should accept -the consequences of what you say and do.

• At the same time, you must oppose unethical communication with all your might.

The advantages of ethical communicationThe advantages of ethical communicationThe advantages of ethical communicationThe advantages of ethical communication Who is there who does not want ethical communications directed to him/her? Obviously no one. It means ethics in communication is a trick to being popular. If a company realizes that it has erred in actions or speech, it looks heroic when it comes forward with as a correction. Here are the advantages of ethical communication: 1. It helps in longIt helps in longIt helps in longIt helps in long----term business interests:term business interests:term business interests:term business interests: As a company acquires a reputation for honest and upright actions and statements, its stocks goes up. The company is liked by all the stakeholders. It is a truism that honesty is the best policy. 2. It attracts high calibre people.2. It attracts high calibre people.2. It attracts high calibre people.2. It attracts high calibre people. People who are honest have a moral right and a tendency to look for honesty in others. If your company runs on ethical lines, you will get people who also do the same. Chances are that you will enjoy it better working with them. 3. It gives you a good image face to face with the law3. It gives you a good image face to face with the law3. It gives you a good image face to face with the law3. It gives you a good image face to face with the law: If you have been speaking truth then your image unconsciously gets built for honesty. It does not matter whether your turnover is small as long as you give your customers the right kind of deal. 4. It helps in effective strategic management:4. It helps in effective strategic management:4. It helps in effective strategic management:4. It helps in effective strategic management: Corporate communication is at the heart of corporate management. Your company's identity depends on its public communication and dialogue with the people. Your company's planning and control depend on its communications, in good times and bad. If your company's name is involved in unhappy news, mass communication becomes all important. For instance, suppose your brand ambassador is involved in a legal tangle or if he performs poorly in the game which earned him brand ambassadorship. You have to issue-a delicate, discreet communiqué. 5. It helps to earn the trust of government bodies:5. It helps to earn the trust of government bodies:5. It helps to earn the trust of government bodies:5. It helps to earn the trust of government bodies: Ethical communication gives the company a wholesome image. In cases of doubt, its statements are believed. The dealing with government bodies becomes hassle-free. Unethical communication may be helpful in the short run, but in the long run, ethical communication alone helps.

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ETHICAL AUDIT

Ethical audit is a new technology which is being developed at the European Institute for Business Ethics (EIBE). There is nothing new about ethical behaviour in business, nor about programmes designed to improve and perhaps formalise an ethical approach to decision making within companies. In recent years many companies have appointed a senior manager with dedicated responsibility for promoting ethical behaviour throughout the company.

Ethical auditing is a process which measures the internal and external consistency of an organization’s values base. The key points are that it is value-linked, and that it incorporates a stakeholder approach.

Its objectives are two-fold: It is intended for accountability and transparency towards stakeholders and it is intended for internal control, to meet the ethical objectives of the organization.

The value of the ethical audit is that it enables the company to see itself through a variety of lenses: it captures the company's ethical profile. Companies recognize the importance of their financial profile for their investors, of their service profile for their customers, and of their profile as an employer for their current and potential employees. An ethical profile brings together all of the factors which affect a company's reputation, by examining the way in which it does business. By taking a picture of the value system at a given point in time, it can:

� Clarify the actual values to which the company operates

� Provide a baseline by which to measure future improvement

� Learn how to meet any societal expectations which are not currently

being met

� Give stakeholders the opportunity to clarify their expectations of the

company's behavior

� Identify specific problem areas within the company

� Learn about the issues which motivate employees

� Identify general areas of vulnerability, particularly related to lack of

openness

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CORPORATE GOVERNANCE

Corporate governanceCorporate governanceCorporate governanceCorporate governance is the set of processes, customs, policies, laws, and institutions affecting the way a corporation (or company) is directed, administered or controlled. Corporate governance also includes the relationships among the many stakeholders involved and the goals for which the corporation is governed. The principal stakeholders are the shareholders/members, management, and the board of directors. Other stakeholders include labor (employees), customers, creditors (e.g., banks, bond holders), suppliers, regulators, and the community at large. For Not-For-Profit Corporations or other membership Organizations the "shareholders" means "members" in the text below (if applicable).

Corporate governance is a multi-faceted subject. An important theme of corporate governance is to ensure the accountability of certain individuals in an organization through mechanisms that try to reduce or eliminate the principal-agent problem. A related but separate thread of discussions focuses on the impact of a corporate governance system in economic efficiency, with a strong emphasis shareholders' welfare. There are yet other aspects to the corporate governance subject, such as the stakeholder view and the corporate governance models around the world (see section 9 below).

There has been renewed interest in the corporate governance practices of modern corporations since 2001, particularly due to the high-profile collapses of a number of large U.S. firms such as Enron Corporation and MCI Inc. (formerly WorldCom). In 2002, the U.S. federal government passed the Sarbanes-Oxley Act, intending to restore public confidence in corporate governance.

DefinitionDefinitionDefinitionDefinition

In A Board Culture of Corporate GovernanceA Board Culture of Corporate GovernanceA Board Culture of Corporate GovernanceA Board Culture of Corporate Governance, business author Gabrielle O'Donovan defines corporate governance as 'an internal system encompassing policies, processes and people, which serves the needs of shareholders and other stakeholders, by directing and controlling management activities with good business savvy, objectivity, accountability and integrity. Sound corporate governance is reliant on external marketplace commitment and legislation, plus a healthy board culture which safeguards policies and processes'.

O'Donovan goes on to say that 'the perceived quality of a company's corporate governance can influence its share price as well as the cost of raising capital. Quality is determined by the financial markets, legislation and other external market forces plus how policies and processes are implemented and how people are led. External forces are, to a large extent, outside the circle of control of any board. The internal environment is quite a different matter, and offers companies the opportunity to differentiate from competitors through their board culture. To date, too much of corporate governance debate has centered on legislative policy, to deter fraudulent

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activities and transparency policy which misleads executives to treat the symptoms and not the cause.

It is a system of structuring, operating and controlling a company with a view to achieve long term strategic goals to satisfy shareholders, creditors, employees, customers and suppliers, and complying with the legal and regulatory requirements, apart from meeting environmental and local community needs.

Report of SEBI committee (India) on Corporate Governance defines corporate governance as the acceptance by management of the inalienable rights of shareholders as the true owners of the corporation and of their own role as trustees on behalf of the shareholders. It is about commitment to values, about ethical business conduct and about making a distinction between personal & corporate funds in the management of a company.” The definition is drawn from the Gandhian principle of trusteeship and the Directive Principles of the Indian Constitution. Corporate Governance is viewed as ethics and a moral duty.

HistoryHistoryHistoryHistory

In the 19th century, state corporation laws enhanced the rights of corporate boards to govern without unanimous consent of shareholders in exchange for statutory benefits like appraisal rights, to make corporate governance more efficient. Since that time, and because most large publicly traded corporations in the US are incorporated under corporate administration friendly Delaware law, and because the US's wealth has been increasingly securitized into various corporate entities and institutions, the rights of individual owners and shareholders have become increasingly derivative and dissipated. The concerns of shareholders over administration pay and stock losses periodically has led to more frequent calls for corporate governance reforms.

In the 20th century in the immediate aftermath of the Wall Street Crash of 1929 legal scholars such as Adolf Augustus Berle, Edwin Dodd, and Gardiner C. Means pondered on the changing role of the modern corporation in society. Berle and Means' monograph "The Modern Corporation and Private Property" (1932, Macmillan) continues to have a profound influence on the conception of corporate governance in scholarly debates today.

From the Chicago school of economics, Ronald Coase's "The Nature of the Firm" (1937) introduced the notion of transaction costs into the understanding of why firms are founded and how they continue to behave. Fifty years later, Eugene Fama and Michael Jensen's "The Separation of Ownership and Control" (1983, Journal of Law and Economics) firmly established agency theory as a way of understanding corporate governance: the firm is seen as a series of contracts. Agency theory's dominance was highlighted in a 1989 article by Kathleen Eisenhardt ("Agency theory: an assessement and review", Academy of Management Review).

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US expansion after World War II through the emergence of multinational corporations saw the establishment of the managerial class. Accordingly, the following Harvard Business School management professors published influential monographs studying their prominence: Myles Mace (entrepreneurship), Alfred D. Chandler, Jr. (business history), Jay Lorsch (organizational behavior) and Elizabeth MacIver (organizational behavior). According to Lorsch and MacIver "many large corporations have dominant control over business affairs without sufficient accountability or monitoring by their board of directors."

Since the late 1970’s, corporate governance has been the subject of significant debate in the U.S. and around the globe. Bold, broad efforts to reform corporate governance have been driven, in part, by the needs and desires of shareowners to exercise their rights of corporate ownership and to increase the value of their shares and, therefore, wealth. Over the past three decades, corporate directors’ duties have expanded greatly beyond their traditional legal responsibility of duty of loyalty to the corporation and its shareowners.

In the first half of the 1990s, the issue of corporate governance in the U.S. received considerable press attention due to the wave of CEO dismissals (e.g.: IBM, Kodak, Honeywell) by their boards. The California Public Employees' Retirement System (CalPERS) led a wave of institutional shareholder activism (something only very rarely seen before), as a way of ensuring that corporate value would not be destroyed by the now traditionally cozy relationships between the CEO and the board of directors (e.g., by the unrestrained issuance of stock options, not infrequently back dated).

In 1997, the East Asian Financial Crisis saw the economies of Thailand, Indonesia, South Korea, Malaysia and The Philippines severely affected by the exit of foreign capital after property assets collapsed. The lack of corporate governance mechanisms in these countries highlighted the weaknesses of the institutions in their economies.

In the early 2000s, the massive bankruptcies (and criminal malfeasance) of Enron and Worldcom, as well as lesser corporate debacles, such as Adelphia Communications, AOL, Arthur Andersen, Global Crossing, Tyco, led to increased shareholder and governmental interest in corporate governance. This is reflected in the passage of the Sarbanes-Oxley Act of 2002.

Impact of Corporate GovernanceImpact of Corporate GovernanceImpact of Corporate GovernanceImpact of Corporate Governance

The positive effect of corporate governance on different stakeholders ultimately is a strengthened economy, and hence good corporate governance is a tool for socio-economic development.

Role of Institutional InvestorsRole of Institutional InvestorsRole of Institutional InvestorsRole of Institutional Investors

Many years ago, worldwide, buyers and sellers of corporation stocks were individual investors, such as wealthy businessmen or families, who often had a vested,

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personal and emotional interest in the corporations whose shares they owned. Over time, markets have become largely institutionalized: buyers and sellers are largely institutions (e.g., pension funds, mutual funds, hedge funds, exchange-traded funds, other investor groups; insurance companies, banks, brokers, and other financial institutions).

The rise of the institutional investor has brought with it some increase of professional diligence which has tended to improve regulation of the stock market (but not necessarily in the interest of the small investor or even of the naïve institutions, of which there are many). Note that this process occurred simultaneously with the direct growth of individuals investing indirectly in the market (for example individuals have twice as much money in mutual funds as they do in bank accounts). However this growth occurred primarily by way of individuals turning over their funds to 'professionals' to manage, such as in mutual funds. In this way, the majority of investment now is described as "institutional investment" even though the vast majority of the funds are for the benefit of individual investors.

Program trading, the hallmark of institutional trading, averaged over 80% of NYSE trades in some months of 2007. (Moreover, these statistics do not reveal the full extent of the practice, because of so-called 'iceberg' orders. See Quantity and display instructions under last reference.)

Unfortunately, there has been a concurrent lapse in the oversight of large corporations, which are now almost all owned by large institutions. The Board of Directors of large corporations used to be chosen by the principal shareholders, who usually had an emotional as well as monetary investment in the company (think Ford), and the Board diligently kept an eye on the company and its principal executives (they usually hired and fired the President, or Chief Executive Officer— CEO).

A recent study by Credit Suisse found that companies in which "founding families retain a stake of more than 10% of the company's capital enjoyed a superior performance over their respective sectorial peers." Since 1996, this superior performance amounts to 8% per year. Forget the celebrity CEO. "Look beyond Six Sigma and the latest technology fad. One of the biggest strategic advantages a company can have, [BusinessWeek has found], is blood lines." In that last study, "BW identified five key ingredients that contribute to superior performance. Not all are qualities unique to enterprises with retained family interests. But they do go far to explain why it helps to have someone at the helm— or active behind the scenes— who has more than a mere paycheck and the prospect of a cozy retirement at stake." See also, "Revolt in the Boardroom," by Alan Murray.

Nowadays, if the owning institutions don't like what the President/CEO is doing and they feel that firing them will likely be costly (think "golden handshake") and/or time consuming, they will simply sell out their interest. The Board is now mostly chosen by the President/CEO, and may be made up primarily of their friends and associates, such as officers of the corporation or business colleagues. Since the (institutional)

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shareholders rarely object, the President/CEO generally takes the Chair of the Board position for his/herself (which makes it much more difficult for the institutional owners to "fire" him/her). Occasionally, but rarely, institutional investors support shareholder resolutions on such matters as executive pay and anti-takeover, aka, "poison pill" measures.

Finally, the largest pools of invested money (such as the mutual fund 'Vanguard 500', or the largest investment management firm for corporations, State Street Corp.) are designed simply to invest in a very large number of different companies with sufficient liquidity, based on the idea that this strategy will largely eliminate individual company financial or other risk and, therefore, these investors have even less interest in a particular company's governance.

Since the marked rise in the use of Internet transactions from the 1990s, both individual and professional stock investors around the world have emerged as a potential new kind of major (short term) force in the direct or indirect ownership of corporations and in the markets: the casual participant. Even as the purchase of individual shares in any one corporation by individual investors diminishes, the sale of derivatives (e.g., exchange-traded funds (ETFs), Stock market index options, etc.) has soared. So, the interests of most investors are now increasingly rarely tied to the fortunes of individual corporations.

But, the ownership of stocks in markets around the world varies; for example, the majority of the shares in the Japanese market are held by financial companies and industrial corporations (there is a large and deliberate amount of cross-holding among Japanese keiretsu corporations and within S. Korean chaebol 'groups'), whereas stock in the USA or the UK and Europe are much more broadly owned, often still by large individual investors.

Parties to corporate governanceParties to corporate governanceParties to corporate governanceParties to corporate governance

Parties involved in corporate governance include the regulatory body (e.g. the Chief Executive Officer, the board of directors, management and shareholders). Other stakeholders who take part include suppliers, employees, creditors, customers and the community at large.

In corporations, the shareholder delegates decision rights to the manager to act in the principal's best interests. This separation of ownership from control implies a loss of effective control by shareholders over managerial decisions. Partly as a result of this separation between the two parties, a system of corporate governance controls is implemented to assist in aligning the incentives of managers with those of shareholders. With the significant increase in equity holdings of investors, there has been an opportunity for a reversal of the separation of ownership and control problems because ownership is not so diffuse.

A board of directors often plays a key role in corporate governance. It is their responsibility to endorse the organisation's strategy, develop directional policy,

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appoint, supervise and remunerate senior executives and to ensure accountability of the organisation to its owners and authorities.

The Company Secretary, known as a Corporate Secretary in the US and often referred to as a Chartered Secretary if qualified by the Institute of Chartered Secretaries and Administrators (ICSA), is a high ranking professional who is trained to uphold the highest standards of corporate governance, effective operations, compliance and administration.

All parties to corporate governance have an interest, whether direct or indirect, in the effective performance of the organisation. Directors, workers and management receive salaries, benefits and reputation, while shareholders receive capital return. Customers receive goods and services; suppliers receive compensation for their goods or services. In return these individuals provide value in the form of natural, human, social and other forms of capital.

A key factor is an individual's decision to participate in an organisation e.g. through providing financial capital and trust that they will receive a fair share of the organisational returns. If some parties are receiving more than their fair return then participants may choose to not continue participating leading to organizational collapse.

PrinPrinPrinPrinciplesciplesciplesciples

Key elements of good corporate governance principles include honesty, trust and integrity, openness, performance orientation, responsibility and accountability, mutual respect, and commitment to the organization.

Of importance is how directors and management develop a model of governance that aligns the values of the corporate participants and then evaluate this model periodically for its effectiveness. In particular, senior executives should conduct themselves honestly and ethically, especially concerning actual or apparent conflicts of interest, and disclosure in financial reports.

Commonly accepted principles of corporate governance include:

• Rights and equitRights and equitRights and equitRights and equitable treatment of shareholdersable treatment of shareholdersable treatment of shareholdersable treatment of shareholders: Organizations should respect the rights of shareholders and help shareholders to exercise those rights. They can help shareholders exercise their rights by effectively communicating information that is understandable and accessible and encouraging shareholders to participate in general meetings.

• Interests of other stakeholdersInterests of other stakeholdersInterests of other stakeholdersInterests of other stakeholders: Organizations should recognize that they have legal and other obligations to all legitimate stakeholders.

• Role and responsibilities of the boardRole and responsibilities of the boardRole and responsibilities of the boardRole and responsibilities of the board: The board needs a range of skills and understanding to be able to deal with various business issues and have the ability to review and challenge management performance. It needs to be of sufficient size and have an appropriate level of commitment to fulfill its

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responsibilities and duties. There are issues about the appropriate mix of executive and non-executive directors.

• Integrity and ethical behaviourIntegrity and ethical behaviourIntegrity and ethical behaviourIntegrity and ethical behaviour: Ethical and responsible decision making is not only important for public relations, but it is also a necessary element in risk management and avoiding lawsuits. Organizations should develop a code of conduct for their directors and executives that promotes ethical and responsible decision making. It is important to understand, though, that reliance by a company on the integrity and ethics of individuals is bound to eventual failure. Because of this, many organizations establish Compliance and Ethics Programs to minimize the risk that the firm steps outside of ethical and legal boundaries.

• Disclosure and transparencyDisclosure and transparencyDisclosure and transparencyDisclosure and transparency: Organizations should clarify and make publicly known the roles and responsibilities of board and management to provide shareholders with a level of accountability. They should also implement procedures to independently verify and safeguard the integrity of the company's financial reporting. Disclosure of material matters concerning the organization should be timely and balanced to ensure that all investors have access to clear, factual information.

Issues involving corporate governance principles include:Issues involving corporate governance principles include:Issues involving corporate governance principles include:Issues involving corporate governance principles include:

• internal controls and internal auditors • the independence of the entity's external auditors and the quality of their

audits • oversight and management of risk • oversight of the preparation of the entity's financial statements • review of the compensation arrangements for the chief executive officer and

other senior executives • the resources made available to directors in carrying out their duties • the way in which individuals are nominated for positions on the board

• dividend policy

Nevertheless "corporate governance," despite some feeble attempts from various quarters, remains an ambiguous and often misunderstood phrase. For quite some time it was confined only to corporate management. That is not so. It is something much broader, for it must include a fair, efficient and transparent administration and strive to meet certain well defined, written objectives. Corporate governance must go well beyond law. The quantity, quality and frequency of financial and managerial disclosure, the degree and extent to which the board of Director (BOD) exercise their trustee responsibilities (largely an ethical commitment), and the commitment to run a transparent organization- these should be constantly evolving due to interplay of many factors and the roles played by the more progressive/responsible elements within the corporate sector. In India, a strident demand for evolving a code of good practices by the corporation, written by each corporation management, is emerging.

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Mechanisms and controlsMechanisms and controlsMechanisms and controlsMechanisms and controls

Corporate governance mechanisms and controls are designed to reduce the inefficiencies that arise from moral hazard and adverse selection. For example, to monitor managers' behaviour, an independent third party (the external auditor) attests the accuracy of information provided by management to investors. An ideal control system should regulate both motivation and ability.

(a)(a)(a)(a) Internal corporate governance controlsInternal corporate governance controlsInternal corporate governance controlsInternal corporate governance controls

Internal corporate governance controls monitor activities and then take corrective action to accomplish organisational goals. Examples include:

• Monitoring by the board of directorsMonitoring by the board of directorsMonitoring by the board of directorsMonitoring by the board of directors: The board of directors, with its legal authority to hire, fire and compensate top management, safeguards invested capital. Regular board meetings allow potential problems to be identified, discussed and avoided. Whilst non-executive directors are thought to be more independent, they may not always result in more effective corporate governance and may not increase performance. Different board structures are optimal for different firms. Moreover, the ability of the board to monitor the firm's executives is a function of its access to information. Executive directors possess superior knowledge of the decision-making process and therefore evaluate top management on the basis of the quality of its decisions that lead to financial performance outcomes, ex ante. It could be argued, therefore, that executive directors look beyond the financial criteria.

• Internal control procedures and internal auditorsInternal control procedures and internal auditorsInternal control procedures and internal auditorsInternal control procedures and internal auditors: Internal control procedures are policies implemented by an entity's board of directors, audit committee, management, and other personnel to provide reasonable assurance of the entity achieving its objectives related to reliable financial reporting, operating efficiency, and compliance with laws and regulations. Internal auditors are personnel within an organization who test the design and implementation of the entity's internal control procedures and the reliability of its financial reporting.

• Balance of powerBalance of powerBalance of powerBalance of power: The simplest balance of power is very common; require that the President be a different person from the Treasurer. This application of separation of power is further developed in companies where separate divisions check and balance each other's actions. One group may propose company-wide administrative changes, another group review and can veto the changes, and a third group check that the interests of people (customers, shareholders, employees) outside the three groups are being met.

• RemunerationRemunerationRemunerationRemuneration: Performance-based remuneration is designed to relate some proportion of salary to individual performance. It may be in the form of cash or non-cash payments such as shares and share options, superannuation or other benefits. Such incentive schemes, however, are reactive in the sense that they provide no mechanism for preventing mistakes or opportunistic behaviour, and can elicit myopic behaviour.

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External corporate governanceExternal corporate governanceExternal corporate governanceExternal corporate governance controlscontrolscontrolscontrols

External corporate governance controls encompass the controls external stakeholders exercise over the organisation. Examples include:

• competition • debt covenants • demand for and assessment of performance information (especially financial

statements) • government regulations • managerial labour market • media pressure • takeovers

Systemic problems of corporate governanceSystemic problems of corporate governanceSystemic problems of corporate governanceSystemic problems of corporate governance

• Demand for information: A barrier to shareholders using good information is the cost of processing it, especially to a small shareholder. The traditional answer to this problem is the efficient market hypothesis (in finance, the efficient market hypothesis (EMH) asserts that financial markets are efficient), which suggests that the small shareholder will free ride on the judgements of larger professional investors.

• Monitoring costs: In order to influence the directors, the shareholders must combine with others to form a significant voting group which can pose a real threat of carrying resolutions or appointing directors at a general meeting.

• Supply of accounting information: Financial accounts form a crucial link in enabling providers of finance to monitor directors. Imperfections in the financial reporting process will cause imperfections in the effectiveness of corporate governance. This should, ideally, be corrected by the working of the external auditing process.

Role of the accountantRole of the accountantRole of the accountantRole of the accountant

Financial reporting is a crucial element necessary for the corporate governance system to function effectively. Accountants and auditors are the primary providers of information to capital market participants. The directors of the company should be entitled to expect that management prepare the financial information in compliance with statutory and ethical obligations, and rely on auditors' competence.

Current accounting practice allows a degree of choice of method in determining the method of measurement, criteria for recognition, and even the definition of the accounting entity. The exercise of this choice to improve apparent performance (popularly known as creative accounting) imposes extra information costs on users. In the extreme, it can involve non-disclosure of information.

One area of concern is whether the accounting firm acts as both the independent auditor and management consultant to the firm they are auditing. This may result in

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a conflict of interest which places the integrity of financial reports in doubt due to client pressure to appease management. The power of the corporate client to initiate and terminate management consulting services and, more fundamentally, to select and dismiss accounting firms contradicts the concept of an independent auditor. Changes enacted in the United States in the form of the Sarbanes-Oxley Act (in response to the Enron situation as noted below) prohibit accounting firms from providing both auditing and management consulting services. Similar provisions are in place under clause 49 of SEBI Act in India.

The Enron collapse is an example of misleading financial reporting. Enron concealed huge losses by creating illusions that a third party was contractually obliged to pay the amount of any losses. However, the third party was an entity in which Enron had a substantial economic stake. In discussions of accounting practices with Arthur Andersen, the partner in charge of auditing, views inevitably led to the client prevailing.

However, good financial reporting is not a sufficient condition for the effectiveness of corporate governance if users don't process it, or if the informed user is unable to exercise a monitoring role due to high costs (see Systemic problems of corporate governance above).

Rules versus principlesRules versus principlesRules versus principlesRules versus principles

Rules are typically thought to be simpler to follow than principles, demarcating a clear line between acceptable and unacceptable behaviour. Rules also reduce discretion on the part of individual managers or auditors.

In practice rules can be more complex than principles. They may be ill-equipped to deal with new types of transactions not covered by the code. Moreover, even if clear rules are followed, one can still find a way to circumvent their underlying purpose - this is harder to achieve if one is bound by a broader principle.

Principles on the other hand is a form of self regulation. It allows the sector to determine what standards are acceptable or unacceptable. It also pre-empts over zealous legislations that might not be practical.

EnforcementEnforcementEnforcementEnforcement

Enforcement can affect the overall credibility of a regulatory system. They both deter bad actors and level the competitive playing field. Nevertheless, greater enforcement is not always better, for taken too far it can dampen valuable risk-taking. In practice, however, this is largely a theoretical, as opposed to a real, risk.

Action Beyond ObligationAction Beyond ObligationAction Beyond ObligationAction Beyond Obligation

Enlightened boards regard their mission as helping management lead the company. They are more likely to be supportive of the senior management team. Because

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enlightened directors strongly believe that it is their duty to involve themselves in an intellectual analysis of how the company should move forward into the future, most of the time, the enlightened board is aligned on the critically important issues facing the company.

Unlike traditional boards, enlightened boards do not feel hampered by the rules and regulations of the Sarbanes-Oxley Act. Unlike standard boards that aim to comply with regulations, enlightened boards regard compliance with regulations as merely a baseline for board performance. Enlightened directors go far beyond merely meeting the requirements on a checklist. They do not need Sarbanes-Oxley to mandate that they protect values and ethics or monitor CEO performance.

At the same time, enlightened directors recognize that it is not their role to be involved in the day-to-day operations of the corporation. They lead by example. Overall, what most distinguishes enlightened directors from traditional and standard directors is the passionate obligation they feel to engage in the day-to-day challenges and strategizing of the company. Enlightened boards can be found in very large, complex companies, as well as smaller companies.

Corporate governance models around the worldCorporate governance models around the worldCorporate governance models around the worldCorporate governance models around the world

Although the US model of corporate governance is the most notorious, there is a considerable variation in corporate governance models around the world. The intricated shareholding structures of keiretsus in Japan, the heavy presence of banks in the equity of German firms, the chaebols in South Korea and many others are examples of arrangements which try to respond to the same corporate governance challenges as in the US.

AngloAngloAngloAnglo----American ModelAmerican ModelAmerican ModelAmerican Model

There are many different models of corporate governance around the world. These differ according to the variety of capitalism in which they are embedded. The liberal model that is common in Anglo-American countries tends to give priority to the interests of shareholders. The coordinated model that one finds in Continental Europe and Japan also recognizes the interests of workers, managers, suppliers, customers, and the community. Each model has its own distinct competitive advantage. The liberal model of corporate governance encourages radical innovation and cost competition, whereas the coordinated model of corporate governance facilitates incremental innovation and quality competition. However, there are important differences between the U.S. recent approach to governance issues and what has happened in the UK. In the United States, a corporation is governed by a board of directors, which has the power to choose an executive officer, usually known as the chief executive officer. The CEO has broad power to manage the corporation on a daily basis, but needs to get board approval for certain major actions, such as hiring his/her immediate subordinates, raising money, acquiring another company, major capital expansions, or other expensive projects. Other duties of the board may

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include policy setting, decision making, monitoring management's performance, or corporate control.

The board of directors is nominally selected by and responsible to the shareholders, but the bylaws of many companies make it difficult for all but the largest shareholders to have any influence over the makeup of the board; normally, individual shareholders are not offered a choice of board nominees among which to choose, but are merely asked to rubberstamp the nominees of the sitting board. Perverse incentives have pervaded many corporate boards in the developed world, with board members beholden to the chief executive whose actions they are intended to oversee. Frequently, members of the boards of directors are CEOs of other corporations, which some see as a conflict of interest. sons to deviate from the sound rule, they should be able to convincingly explain those to their shareholders.

Codes and guidelinesCodes and guidelinesCodes and guidelinesCodes and guidelines

Corporate governance principles and codes have been developed in different countries and issued from stock exchanges, corporations, institutional investors, or associations (institutes) of directors and managers with the support of governments and international organizations. As a rule, compliance with these governance recommendations is not mandated by law, although the codes linked to stock exchange listing requirements may have a coercive effect.

For example, companies quoted on the London and Toronto Stock Exchanges formally need not follow the recommendations of their respective national codes. However, they must disclose whether they follow the recommendations in those documents and, where not, they should provide explanations concerning divergent practices. Such disclosure requirements exert a significant pressure on listed companies for compliance.

In the United States, companies are primarily regulated by the state in which they incorporate though they are also regulated by the federal government and, if they are public, by their stock exchange. The highest number of companies are incorporated in Delaware, including more than half of the Fortune 500. This is due to Delaware's generally business-friendly corporate legal environment and the existence of a state court dedicated solely to business issues (Delaware Court of Chancery).

Most states' corporate law generally follow the American Bar Association's Model Business Corporation Act. While Delaware does not follow the Act, it still considers its provisions and several prominent Delaware justices, including former Delaware Supreme Court Chief Justice E. Norman Veasey, participate on ABA committees.

One issue that has been raised since the Disney decision in 2005 is the degree to which companies manage their governance responsibilities; in other words, do they merely try to supersede the legal threshold, or should they create governance guidelines that ascend to the level of best practice. For example, the guidelines issued by associations of directors (see Section 3 above), corporate managers and

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individual companies tend to be wholly voluntary. For example, The GM Board Guidelines reflect the company’s efforts to improve its own governance capacity. Such documents, however, may have a wider multiplying effect prompting other companies to adopt similar documents and standards of best practice.

One of the most influential guidelines has been the 1999 OECD Principles of Corporate Governance. This was revised in 2004. The OECD remains a proponent of corporate governance principles throughout the world.

Building on the work of the OECD, other international organisations, private sector associations and more than 20 national corporate governance codes, the United Nations Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR) has produced voluntary Guidance on Good Practices in Corporate Governance Disclosure. This internationally agreed benchmark consists of more than fifty distinct disclosure items across five broad categories:

• Auditing • Board and management structure and process • Corporate responsibility and compliance • Financial transparency and information disclosure • Ownership structure and exercise of control rights

The World Business Council for Sustainable Development WBCSD has done work on corporate governance, particularly on accountability and reporting, and in 2004 created an Issue Management Tool: Strategic challenges for business in the use of corporate responsibility codes, standards, and frameworks.This document aims to provide general information, a "snap-shot" of the landscape and a perspective from a think-tank/professional association on a few key codes, standards and frameworks relevant to the sustainability agenda.

Ownership structuresOwnership structuresOwnership structuresOwnership structures

Ownership structures refers to the various patterns in which shareholders seem to set up with respect to a certain group of firms. It is a tool frequently employed by policy-makers and researchers in their analyses of corporate governance within a country or business group.

Generally, ownership structures are identified by using some observable measures of ownership concentration (i.e. concentration ratios) and then making a sketch showing its visual representation. The idea behind the concept of ownership structures is to be able to understand the way in which shareholders interact with firms and, whenever possible, to locate the ultimate owner of a particular group of firms. Some examples of ownership structures include pyramids, cross-share holdings, rings, and webs.

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Corporate governance and firm performanceCorporate governance and firm performanceCorporate governance and firm performanceCorporate governance and firm performance

In its 'Global Investor Opinion Survey' of over 200 institutional investors first undertaken in 2000 and updated in 2002, McKinsey found that 80% of the respondents would pay a premium for well-governed companies. They defined a well-governed company as one that had mostly out-side directors, who had no management ties, undertook formal evaluation of its directors, and was responsive to investors' requests for information on governance issues. The size of the premium varied by market, from 11% for Canadian companies to around 40% for companies where the regulatory backdrop was least certain (those in Morocco, Egypt and Russia).

Other studies have linked broad perceptions of the quality of companies to superior share price performance. In a study of five year cumulative returns of Fortune Magazine's survey of 'most admired firms', Antunovich et al. found that those "most admired" had an average return of 125%, whilst the 'least admired' firms returned 80%. In a separate study Business Week enlisted institutional investors and 'experts' to assist in differentiating between boards with good and bad governance and found that companies with the highest rankings had the highest financial returns.

On the other hand, research into the relationship between specific corporate governance controls and firm performance has been mixed and often weak. The following examples are illustrative.

Board compositionBoard compositionBoard compositionBoard composition

Some researchers have found support for the relationship between frequency of meetings and profitability. Others have found a negative relationship between the proportion of external directors and firm performance, while others found no relationship between external board membership and performance. In a recent paper Bhagat and Black found that companies with more independent boards do not perform better than other companies. It is unlikely that board composition has a direct impact on firm performance.

Remuneration/CompensationRemuneration/CompensationRemuneration/CompensationRemuneration/Compensation

The results of previous research on the relationship between firm performance and executive compensation have failed to find consistent and significant relationships between executives' remuneration and firm performance. Low average levels of pay-performance alignment do not necessarily imply that this form of governance control is inefficient. Not all firms experience the same levels of agency conflict, and external and internal monitoring devices may be more effective for some than for others.

Some researchers have found that the largest CEO performance incentives came from ownership of the firm's shares, while other researchers found that the relationship between share ownership and firm performance was dependent on the level of ownership. The results suggest that increases in ownership above 20% cause

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management to become more entrenched, and less interested in the welfare of their shareholders.

Some argue that firm performance is positively associated with share option plans and that these plans direct managers' energies and extend their decision horizons toward the long-term, rather than the short-term, performance of the company. However, that point of view came under substantial criticism circa in the wake of various security scandals including mutual fund timing episodes and, in particular, the backdating of option grants as documented by University of Iowa academic Erik Lie and reported by James Blander and Charles Forelle of the Wall Street Journal.

Even before the negative influence on public opinion caused by the 2006 backdating scandal, use of options faced various criticisms. A particularly forceful and long running argument concerned the interaction of executive options with corporate stock repurchase programs. Numerous authorities (including U.S. Federal Reserve Board economist Weisbenner) determined options may be employed in concert with stock buybacks in a manner contrary to shareholder interests. These authors argued that, in part, corporate stock buybacks for U.S. Standard & Poors 500 companies surged to a $500 billion annual rate in late 2006 because of the impact of options. A compendium of academic works on the option/buyback issue is included in the study Scandalby author M. Gumport issued in 2006.

A combination of accounting changes and governance issues led options to become a less popular means of remuneration as 2006 progressed, and various alternative implementations of buybacks surfaced to challenge the dominance of "open market" cash buybacks as the preferred means of implementing a share repurchase plan.

TRANSPARENCY INTERNATIONAL

Transparency InternationalTransparency InternationalTransparency InternationalTransparency International (TITITITI) is an international non-governmental organization addressing corruption. This includes, but is not limited to, political corruption. It is widely known for producing its annual Corruptions Perceptions Index (see below), a comparative listing of corruption worldwide. The international headquarters is located in Berlin, Germany. The founder of the organisation is Peter Eigen.

Organization and roleOrganization and roleOrganization and roleOrganization and role

TI is organised as a group of some 100 national chapters, with an international secretariat in Berlin, Germany. Originally founded in Germany in May 1993 as a not-for-profit organisation, TI is now an international non-governmental organisation, and claims to be moving towards a completely democratic organisational structure. TI says of itself:

"Transparency International is the global civil society organisation leading the fight against corruption. It brings people together in a powerful worldwide coalition to end

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the devastating impact of corruption on men, women and children around the world. TI's mission is to create change towards a world free of corruption."

It rejects any idea of "northern superiority" regarding corruption and is committed to exposing corruption worldwide.

Since 1995, TI has issued an annual Corruption Perceptions Index (CPI); it also publishes an annual Global Corruption Report, a Global Corruption Barometer and a Bribe Payers Index.

TI does not undertake investigations on single cases of corruption or expose individual cases. It develops tools for fighting corruption and works with other civil society organisations, companies and governments to implement them. The goal of TI is to be non-partisan and to build coalitions against corruption.

TI's biggest success has been to put the topic of corruption on the world's agenda. International Institutions such as the World Bank and the International Monetary Fund now view corruption as one of the main obstacles for development, whereas prior to the 1990s this topic was not broadly discussed. TI furthermore played a vital role in the introduction of the United Nations Convention against Corruption and the OECD Anti-Bribery Convention.

However the TI USA Chapter has never commented within its publications on any corruption case within the USA, and has taken money from the Boeing Corporation, whose executive Darleen A. Druyun was imprisoned for corrupt activities, leading to the resignation of Boeing CEO Phil Condit.

Corruption Perceptions IndexCorruption Perceptions IndexCorruption Perceptions IndexCorruption Perceptions Index

The CPI—besides the World Bank corruption index—is the most commonly used measure for corruption in countries worldwide. Based on many different studies, it is known for its accuracy. To form this index, TI compiles surveys that ask businessmen and analysts, both in and outside the countries they are analyzing, their perceptions of how corrupt a country is. Relying on the number of actual corruption cases would not work since laws and enforcement of laws differ significantly from country to country.

The CPI is criticised for two main reasons. The first is a danger of a self-fulfilling prophecy. Country analysts might be influenced by past corruption indices and therefore not realise changes. Secondly, the use of the index values in time-series statistics is problematic due to the way it is calculated.

Competitiveness and corruptionCompetitiveness and corruptionCompetitiveness and corruptionCompetitiveness and corruption

A review of the linkages between countries' competitiveness and the incidence of corruption was initiated at a TI workshop in the International Anti-Corruption Conference in Prague, November 1998.

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