BUSINESS ETHICS REVIEWER Nonprofit Organizations

-​ Aims to advocate and implement

The Business Organization activities for which it normally raises
funds for.
Business Organization - is an entity that -​ Provides social assistance for the
aims to earn a profit by providing products betterment of society
to satisfy the needs of the market. -​ Formed to serve the public interest
-​ Sometimes referred to as part of civil
Products; society organizations
Tangible Products - Physical objects - thos NPO - non profit organizations
that can be perceived by touch (goods or NGO - non government organizations
commodities) such as foods, clothes, cars,
etc. Forms of Business Organizations

Intangible Products - Non Physical Sole/Single Proprietorship

Objects such as haircut, medical -​ Owned and operated by one
consultation, and legal advice. individual who makes all the
decisions related to the business.
Profit - refers to the amount of money -​ The Sole Proprietor (owner) owns
remaining after all costs relating to a all the assets of the business and
product or service have been deducted from the profits generated by it.\
the total sales or revenue. -​ Has total liability for any losses or
debts.
Classifications of business organizations -​ Does not need a big capital and is
often limited to the owner’s savings
For-profit organizations or loan from the bank.
-​ Aims to make profit to sustain the Examples of Sole Proprietorship
business -​ Sari-sari stores, beauty salons,
-​ Built to serve the business owner(s) computer shops, laundry shops, and
by directly or indirectly selling goods bakeries, online stores, food cart
or services. franchises, freelance works, and
-​ Can range from a sole proprietor etc.
running a bakery, to a team of
accountants who formed a Partnerships
partnership offering accountancy -​ Composed of two or more
services, to a corporation's individuals who pool their resources
manufacturing goods being sold in (money, property, skills)
supermarkets, and even to -​ Each owners is called partner
conglomerates. -​ There is no limit to the number of
Conglomerates - a business with interests partners, although approvals of the
in smaller business entities that operate other partners are needed,
separately. -​ Formed of the business value a
potential partner can bring into the
business
Examples of partnerships Cooperative - an autonomous and duly
-​ Professional services (law, registered association of persons, with a
accounting, medicine), delivery common bond of interest, who have
services, and merchandising voluntarily joined together to achieve their
businesses. social, economic, and cultural needs and
General Partner - has unlimited liability for aspirations by making equitable
the debts and obligations contributions to the capital
Limited Partner - has liability up to the required,patronizing their products and
extent of his or her capital contributions services and accepting a fair share of the
along with other general partners. risks and benefits of the undertaking in
accordance with universally accepted
Corporations cooperative principles.
-​ A type of organization formed legally
through its articles of incorporations Types of Cooperative
filed with the Securities and -​ Credit cooperative, Consumer
Exchange Commission (SEC). cooperative, and producer
-​ Formed by at least 5 but not more cooperative, among others.
than 15 persons
Revised Corporation Code in 2019 Classification of corporations
- one-person corporations with only
one stockholder can now be Close Corporation - shares of stock are
organized. not available on stock exchange or any
-​ Has its own legal personality, distinct public market; it cannot make any public
and separate front eh persona offering of its stocks.
forming the corporation Open Corporations - is listed in the
-​ Can have perpetual existence Philippine Stock Exchange and has gone
unless otherwise specified in its public in raising its capital. It makes an initial
articles of incorporation. public offering to get listed in the PSE where
its stocks are traded.
Types of Corporation
Advantages of a corporations as a form
Stock Corporation - is a for-profit of business organizations
organization that has capital stock that is
divided into shares and is authorized to Unlimited life. A corporation has unlimited
distribute to the shareholders dividend or life, as it may exist well beyond the life span
allotments of the surplus profits on the basis of the original owners.
of the shares held.
Nonstock Corporations - is one where no Credibility. Customers, suppliers, investors,
parts of its income is distributed as dividend and financial institutions may see a
to its members, trustees, or officers. Any business as more credible if it is a
profit that a nonstock corporation earns is corporation. A business that takes the effort
used to further promote the purpose of the and money to organize a corporation sends
organization. a signal that the company will be around for
a long time.
 Environmental Factors - Ecological factors
Ease of transferring ownership. A such as storms, floods, drought, wildfires,
corporation can easily transfer ownership volcanic eruptions, earthquakes, and
should the original owners decide to sell it pollution may affect the operations of the
by transferring the company's stock business.
certificate to another shareholder.
Demographic Factors - Businesses can
Protecting personal assets. Owners of a use demographics such as age group,
corporation are liable for business losses gender, income distribution, population size,
and debts up to the equivalent of their geographical location, race, and ethnicity to
investment in the corporation. identify target markets and to determine
product preferences and buying behaviors
Business Organizations and Their of consumers.
Environment
Regulatory Factors - The legal rules and
External Factors regulations ( monetary, and trade policies,
import and export restrictions, immigration
Political Factors - A stable political laws, etc) that govern businesses in the
leadership attracts business investors and country greatly affect business owners or
increases confidence in the country’s potential investors.
economy. Laws, tax policies, and incentives
that the government extends to the Economic Systems
business sector also impact existing and
potential investors. Economics - the study of how resources
used in the production of goods and
Economic Factors - inflation, price level of services are distributed for consumption
commodities, interest rates, demand and within a social system.
supply, and exchange rates, among others Factors of Production - natural, human,
affect businesses. Businesses need to and financial resources
monitor relevant economic indicators so that Economic System - describes how a
they can make appropriate business society distributes its resources to produce
decisions. goods and services.

Sociocultural Factors - People’s attitude,

behaviors, customs, cultural heritage,
traditions. beliefs , and lifestyle affect the
functioning of the business.

Technological Factors - Advances in

technology have made it possible to start a
business and do shopping and banking
without leaving the home, among other
things.
Different Economic Systems Business Ownerships. Businesses are
owned and operated by the government
Capitalists
Competitions. There is no competition
Definition. Individuals own and operate the
majority of businesses that provide goods Profits. Profits go to the government
and services. Also known as free
enterprise. Product Availability and Price. Prices of
Pure Capitalism - all economic decisions products are high with limited choices of
are made without government intervention. goods and services.
Modified Capitalism - The government
intervenes and regulates businesses to Employment Options. Most people work in
some extent. the government, with little option in
choosing a career.
Business Ownership. Operated and
owned by individuals and corporations Socialism

Competitions. Encouraged by market Definitions. The government owns and

forces and government regulations operates basic industries, but individuals
own most businesses. Its core is social
Profits. Individuals keep profits and decide equity.
on ho to use them
Competition. Major Industries are owned
Product Availability and Price. Prices of and operated by the government; small
products are determined by supply and businesses are owned by individuals
demand, and consumers enjoy a wide
selection of products Profits. Profits from the government goes to
the government and profits from small
Employment Options. There are business owners goes to them.
unlimited choices of careers for everyone.
Product Availability and Price - Prices of
Communism products are determined by supply and
demand, while consumers have some
Definitions. Communism is a society in choices of products.
which the people, without regard to class,
own all their nation’s resources. Everyone Employment Options. Many people work
contributes according to each person's in the government, with some options in
ability, and people receive goods and choosing a career.
services based on their needs. The
government determines the goods and
services needed by the citizens as well as
the mode of production and distribution of
goods and services.
Ethics and Business

Ethics - a branch of philosophy that

involves systematizing, defending, and
recommending concepts of right and wrong
conduct.