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Business Ethics and Legal Issues
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Intellectual Property Rights
Refers to the legal protection of creations of the mind, such as inventions, literary and artistic works, symbols, names, and images. Examples include patents, copyrights, and trademarks.
Privacy Laws
These laws govern the handling of personal data and protect against its unauthorized use. In business, customer and employee data must be handled responsibly. Examples include the General Data Protection Regulation (GDPR) in the EU and the California Consumer Privacy Act (CCPA).
Insider Trading
An unethical and often illegal practice where individuals use non-public information gained from their position within a company to benefit from stock trading. Example: An executive buys stocks knowing their company is about to be acquired.
Discrimination and Equal Opportunity
The ethical principle of providing equal opportunity and avoiding discrimination against employees or job applicants based on race, gender, age, religion, or other protected characteristics. Examples include Title VII of the Civil Rights Act and the Americans with Disabilities Act.
Environmental Law Compliance
Businesses must adhere to laws governing the impact of their operations on the environment. Examples include regulations on waste disposal, emissions, and resource conservation such as the Clean Air Act.
Bribery and Corruption
Offering, giving, receiving, or soliciting anything of value to influence the actions of an official or other person in charge of a public or legal duty. Examples include violations of the Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act.
Consumer Protection Laws
These laws are designed to ensure fair competition and the free flow of truthful information in the marketplace. Examples include the Federal Trade Commission Act and the Consumer Protection Safety Act.
Accounting Fraud
Manipulation or falsification of a company's financial statements to present a more favorable picture than is actually the case. Prominent examples include the Enron and WorldCom scandals.
Employment Law
Regulates the relationship between employers and employees, covering issues such as wages, workplace safety, and wrongful termination. Examples include the Fair Labor Standards Act and Occupational Safety and Health Act (OSHA).
Conflict of Interest
A situation where a person's or entity's vested interests may compromise their decision-making. In business, it might involve an employee having a financial stake in a supplier or competing company. Disclosure and avoidance are crucial to manage it.
Advertising and Marketing Laws
Regulations that govern how companies promote their products to avoid false or misleading representations. Examples include the Lanham Act and the Truth in Advertising laws.
Product Liability
The legal liability a manufacturer or trader incurs for producing or selling a faulty product. Example: A customer sues a toy company for harm caused by a defective toy.
Whistleblower Protection
Laws that exist to protect individuals who report illegal or unethical practices within an organization. Examples include the Sarbanes-Oxley Act and the Dodd-Frank Act which provide certain protections for whistleblowers.
Corporate Social Responsibility
A business approach that contributes to sustainable development by delivering economic, social, and environmental benefits for all stakeholders. Examples include Fair Trade practices and corporate volunteerism programs.
Fair Competition Laws
These laws prevent businesses from engaging in unfair practices that limit or prevent competition. Examples include antitrust laws like the Sherman Act and the Clayton Act.
Tax Evasion
The illegal non-payment or underpayment of tax. Examples include undeclared income or the use of offshore tax havens to hide profits.
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