Business Ethics and Governance Lecture Notes

Comprehensive vocabulary flashcards covering the core concepts, ethical frameworks, legal standards, and professional governance topics from BU6016 Business Ethics lecture notes.

Business Activity

All the processes and operations involved in creating, distributing, and selling goods or services to meet customer needs and generate profit.

Marketing and Sales

The business function responsible for identifying customer needs, promoting products or services, and generating revenue through sales, thereby bridging the gap between product and customer.

Operations/Production

The business function focused on transforming inputs (raw materials, labor, capital) into outputs (finished goods or services) efficiently and effectively to create what the customer needs.

Human Resources (HR)

The organizational function responsible for managing people by ensuring the right talent is acquired, developed, and retained to meet business goals.

Finance and Accounting

The business function responsible for managing financial resources, recording transactions, and reporting performance to ensure financial stability and compliance.

Research and Development (R&D) / Innovation

The business function focused on developing new products, services, or processes to maintain competitiveness, solve problems, and drive future growth.

Business Ethics

The examination of the responsibilities that people and organizations owe to themselves and to each other within a business context.

Practical Reasoning

A form of reasoning that involves deliberating about what one ought to do.

Theoretical Reasoning

A form of reasoning aimed at establishing truth and determining what one should believe.

Personal Integrity Ethics

An ethical approach focusing on an individual's moral principles, internal consistency between beliefs and actions, honesty, and 'doing the right thing even when no one is watching.'

Social Responsibility Ethics

An ethical approach focusing on the obligations that individuals and organizations have toward society as a whole, advocating for decisions that benefit collective well-being.

Norms

Standards of appropriate and proper (or 'normal') behavior that establish guidelines for what we should do, how we should act, and what type of person we should be.

Values

Beliefs that incline individuals or institutions to act or choose one course of action rather than another.

Ethical Values

Properties of life that serve well-being in impartial rather than personal or selfish ways, contributing to human well-being and a life well lived.

Stakeholder

An individual, institution, or community that has a stake in the operations of an organization and in how it does business.

Risk Assessment

A process to identify potential events that may affect an entity and manage risk to remain within its risk appetite, providing reasonable assurance regarding the achievement of objectives.

Moral Imagination

The ability to envision various alternative choices, consequences, resolutions, benefits, and harms when facing an ethical decision.

Satisficing

A decision-making failure characterized by selecting the alternative that merely satisfies minimum decision criteria rather than finding the best possible solution.

Whistleblowing

The reporting of misconduct—such as illegal acts, fraud, health and safety violations, or corruption—by an employee or member with privileged access to authorities or the public.

Utilitarianism

A consequentialist ethical framework holding that the morally correct action or policy is the one that produces the greatest good for the greatest number.

Market Utilitarianism

Adam Smith's perspective asserting that free and competitive markets serve as the best means to maximize overall societal well-being.

Administrative Utilitarianism

An approach to utilitarianism where policy experts analyze society to determine and implement the specific policies that maximize overall good.

Egoism

A consequentialist ethical theory that evaluates actions based solely on how they maximize the individual's happiness rather than overall societal good.

Deontology

A principle-based approach to ethics (from the Greek deon for duty) asserting that actions are right or wrong based on duties and rules, regardless of the consequences.

Virtue Ethics

A character-centered ethical approach that studies how character traits (virtues) are formed and encourages becoming a good person who lives a meaningful, worthwhile, and satisfying life.

Human Rights

Basic rights and freedoms entitled to every individual simply because they are human, characterized as universal, inalienable, and interdependent.

Legal Rights

Rights created, written, and protected by governments, statutes, and constitutions, which are context-specific and enforced through courts and law enforcement.

Contractual Rights

Rights created by specific mutual agreements, such as employment contracts, that are legally enforceable under contract law.

Duty of Care

An employer's fundamental responsibility to protect employees' physical and psychological safety, including providing a hazard-free workplace and mental health support.

Due Process

An employee right ensuring a fair and impartial hearing before any disciplinary action or punishment is administered.

Employment at Will (EAW)

A legal principle stating that either the employer or the employee can terminate the employment relationship at any time, for almost any reason, and without a fixed contract term.

Downsizing

The planned elimination of jobs to improve an organization's efficiency or effectiveness, often triggered by economic downturns, technological changes, or shifts in business strategy.

Data Ethics

A branch of ethics dealing with moral obligations and responsibilities concerning the collection, protection, use, and dissemination of data amid increasing digitalization.

Personal Data

Any confidential information about an individual, such as personal identity numbers, contact information, or medical records, that identifies or relates to them.

Commercially Sensitive Information

Proprietary business data—including trade secrets, intellectual property, and client lists—that could harm the employer's business if leaked.

General Data Protection Regulation (GDPR)

A European Union regulation widely viewed as a global benchmark for privacy law, requiring transparency, user consent, and the right to access personal data.

Personal Data Protection Law (PDPL)

Bahrain's data protection regulation, enforced by the Ministry of Justice, Islamic Affairs and Waqf as the Personal Data Protection Authority (PDPA) under Royal Decree No. 78 of 2019.

Workplace Privacy

The protection of an employee's personal information, communications, and activities from unauthorized access or excessive monitoring by an employer.

Personally Identifiable Information (PII)

Specific protected data items such as national identity numbers, home addresses, and bank records used to uniquely identify an individual.

Business Use Exception

A legal principle permitting employer monitoring when conducted for a legitimate business purpose, such as quality control.

Consent Exception

A legal principle permitting workplace monitoring when the employee has explicitly provided consent, often via an employee handbook or policy.

Principle of Proportionality

A global standard central to privacy laws like GDPR requiring that workplace monitoring must be necessary for a legitimate business goal and use the least intrusive method available.

Trust (in Ethics)

An ethically warranted reliance on another party, which forms an essential basis in social, professional, and market relationships.

Corporate Governance

The system and structure by which corporations are managed, directed, and controlled toward the objectives of fairness, accountability, and transparency.

Joint Stock Company

A business structure that raises capital by selling transferable shares to multiple investors who benefit from limited liability.

Accountability

Being responsible for actions and decisions and being able to explain, justify, and answer for them to relevant stakeholders.

Transparency

Openness and clarity in communication and information disclosure, ensuring stakeholders have access to accurate, relevant, and understandable information.

Public Interest

The collective well-being of the community and broader society, which professional accountants and auditors protect by ensuring financial accuracy and integrity.

Business Trust

The confidence that stakeholders (investors, customers, employees, and the public) place in a business to act ethically, transparently, and responsibly.

Professional Skepticism

An auditor's attitude that includes a questioning mind, alertness to conditions indicating possible misstatement due to error or fraud, and critical assessment of audit evidence.

Professional Judgement

The application of cumulative training, knowledge, and experience within the context of accounting and ethical standards to make informed decisions during an audit engagement.

Conflict of Interest (COI)

A situation where a person's private interests—financial, familial, or social—clash with professional duties, threatening or appearing to threaten objectivity and decision-making.

Self-Interest Threat

An ethical threat where a professional's personal financial or private interests inappropriately influence their professional judgment.

Self-Review Threat

An ethical threat occurring when a professional is required to evaluate their own previous work or work done by someone from their firm, compromising objectivity.

Advocacy Threat

An ethical threat that arises when a professional promotes an employer's or client's position to the point that their professional objectivity is compromised.

Familiarity Threat

An ethical threat where a close or long-standing relationship makes a professional overly sympathetic or uncritical toward a client or employer.

Intimidation Threat

An ethical threat occurring when a professional is deterred from acting objectively due to actual or perceived pressures, such as threats of dismissal or replacement.

Safeguards

Specific controls, procedures, or policies established by legislation, the profession, or employing organizations to eliminate or reduce ethical threats to acceptable levels.