CMA Intermediate · Business Laws and Ethics · Business Ethics and Emotional Intelligence
Which of the following best describes business ethics?
Business ethics is the set of moral principles and standards that guide how individuals and organisations behave in business dealings. It goes beyond legal compliance to cover fairness, honesty and responsibility, so a description limited to statutes, accounting rules or profit rules is incomplete.
- AThe set of moral principles and standards that guide the conduct of people and organisations in business dealingsCorrect
- BThe collection of statutes that a company must comply with while carrying on trade
- CThe accounting standards applied while preparing financial statements
- DThe internal rules fixed by management to maximise profit
Explanation
Business ethics deals with moral principles and standards of right and wrong applied to business conduct. Laws are only one source of rules and are narrower than ethics, so the statute-based option is wrong. Accounting standards and profit rules do not capture the moral dimension.
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