Ethics and Sustainable Business
Domain focus
This section covers Ethics and Sustainable Business. The exam tests business ethics, corporate social responsibility, environmental responsibility, fair dealing and long-term sustainability.
Core rules and concepts
- Ethics means honesty, fairness, transparency, respect for stakeholders and compliance with law; ethics goes beyond legality.
- CSR is a contribution to society. In India, Section 135 of the Companies Act 2013 mandates CSR for certain large companies, but small firms still gain trust through ethical practice even when not mandated.
- Sustainability follows the triple bottom line-people, planet, profit-through reduce, reuse, recycle; efficient energy and water use; safe waste disposal; and fair labour.
- Greenwashing, or claiming to be green without practice, damages trust.
Worked example
A small dyeing unit installs wastewater treatment, switches part of its range to natural dyes, pays fair wages and publishes its prices. Reasoning: treatment meets environmental responsibility; natural dyes support a premium segment; fair wages reduce attrition; transparency builds trust. The higher cost is offset by lower rework and stronger brand loyalty.
Traps that cost marks
Do not treat ethics as only legal compliance. Do not reduce CSR to a one-time donation. Do not make green claims without practice. Do not ignore labour practices.