This is a Key Note Presentation entitle "STATISTICS & MANAGERIAL ETHICS : OVERVIEW OF PROBLEMS AND TOTAL SOLUTIONS" was presented at The 1st ISM International Statistical Conference (ISM-1)”, Johor Baharu, Malaysia, 4-6 September 2012, which was held at Persada International Convention Centre, Johor Baharu, Malaysia. I have revised the presentation to include Maqasid Al Shariah as a solution to problems Managerial Ethics in Statistics. I have redefined statistics as follows: "Statistics is a scientific method of collecting, organizing, presenting, analysing and interpreting numerical information, developed from mathematical theory of probability, within the ethical values of Maqasid al-Shariah”

1. STATISTICS & MANAGERIAL ETHICS :
OVERVIEW OF PROBLEMS AND TOTAL SOLUTIONS
by
Prof. Shaya’a Othman
Group Chief Executive Officer
CAPRICE GROUP, TURKIYE
The 1st ISM International Statistical Conference (ISM1)”, Johor Baharu, Malaysia, 4-6 September 2012
Persada International Convention Centre,
Johor Baharu, Malaysia
Note: I have revised my presentation to include Redefinition of Statistics &
Managerial Ethics to include Ethical Values according to Maqasid Al Shariah
Shaya’a Othman (1435/ 2014)

2. STATISTICS & MANAGERIAL ETHICS :
OVERVIEW OF PROBLEMS AND TOTAL SOLUTIONS
Shaya’a Othman

4. Propose Definition of Statistics
“Statistics is a scientific method of collecting, organizing, presenting,
analysing and interpreting numerical information, developed from
mathematical theory of probability.”
Definition by Shaya'a Othman, KUIS [2008]

6. OK

7. Increasing Explicit Unethical Behaviours
of Organisations
“The
main reason why ethics in economy and finance are
increasingly brought to the agenda not only in scientific
researches but also in public discussions is the
increasing explicit unethical behaviours of
organisations especially in developed countries and
increasing negative impact of such
behaviours. Examples such as the cases of Enron, Worldcom and Bernard Madoff in the USA, the scandals of
Parmalat in Italy, Siemens in Germany should be
regarded as incidents arising mainly from unethical
practices of the companies and their management”
Mehmet Akif ÇKE [2011],Global Financial Crisis from an Ethical Perspective
Research Journal of Internatıonal Studıes - Issue 19 (June., 2011), University
of Istanbul..

8. CRITICAL POINTS OF ABUSE

9. COMMON ERRORS
UNINTENTIONALLY AND INTENTIONALLY
[UNETHICALS]
CRITICAL POINTS 1 and 2
CRITICAL
POINT 1
CRITICAL
POINT 2

10. Data Collection Design
[CRITICAL POINT 1]

11. Errors in Sampling Design
[ CRITICAL PONT 2]

13. I
!!
No not
am ing
ask AT
WH ula,
m
for HOW
t
bu u do
yo t?
i
Example : Using Simple
Regression Line to forecast the
future
Analysis of Data
[Critical Point 3]

14. Do ethics really matter?
Do they have any practical use?”
At its core, ethics is about making conscious choices in line with an explicit framework
of values and principles. It is this reflective engagement with the world that stops
individuals, organisations and institutions from stumbling, blindly, into ethical ‘death
traps “
There is no longer a need to offer even a marginally
sophisticated answer.
All that one has to do is point to the billions of dollars of
wealth destroyed, at the millions of lives adversely affected
by loss of homes, opportunities; savings … the list goes on.
Dr Simon Longstaff is Executive Director of St James Ethics Centre. This article was
first published in Living Ethics, issue 74, summer 2008
http://www.ethics.org.au/living-ethics-overviews/living-ethics-issue-87-autumn-2012

15. Unitized System vs. Stick System
In
Curtain Wall Systems
Comparison between Stick and
Unitized in Curtain Wall Systems
“There are two types of curtain wall systems; "stick" and "unitized".
Although the stick system is cheaper, the unitized system has the
advantage of more flexibility relative to allowable deflection of the
supporting structure”
Curtain wall Primer for Design Professionals, Matthew Stuart, P.E., S.E., F.ASCE
http://www.pdhonline.org/courses/s119/s119.htm

17. CURRENT SITUATION

18. FAILURE TO PROMOTE A HIGHER CAUSE
by Jay Lorsch and Rakesh Khurana, Harvard Business School
“…….what
our role has
been in fostering a
culture that allows
executives to walk off
with millions of
dollars while their
firms lay in tatters
and society is left
with the bill”
Source:
http://roguemedia.org/tag/finance/
Executives Walk off with millions, while the society struggling to
keep alive

19. Financial Crisis: Blame Business-Schools
Business schools are largely responsible for the U.S. financial
crisis
MBA
BA
Statistical Diploma/Degrees
Research Methodology
Module
?
Subject
on
Ethics

20. Financial Crisis: Blame Business-Schools
Business schools are largely responsible for the U.S. financial
crisis
“The current crisis highlights the growing complexity of the financial system and
underscores the sea change in business education from the generic to the specific,
from the old boys’ network to the global financial network, and from boardroom
tactics to risk analytics. By training tomorrow’s leaders to manage the risks of the
financial system effectively and ethically, we’ll have a fighting chance of
surviving even the largest crises. This is what business schools do, and we need to
do more of it, not less.
CON: BUSINESS EDUCATION—WE NEED MORE, NOT LESS
by Andrew W. Lo, MIT Sloan School of Management
Financial Crisis: Blame B-schools
Business schools are largely responsible for the U.S. financial crisis.
http://www.businessweek.com/debateroom/archives/2008/11/us_financial_
cr.html

21. FINANCIAL CRISIS : BLAME BUSINESS SCHOOLS
“In the run up to the crisis, many business executives
were so self-interested they failed to consider
themselves as custodians of their own institutions. All
of us involved in business education need to ask what
our role has been in fostering a culture that allows
executives to walk off with millions of dollars while
their firms lay in tatters and society is left with the bill”
FAILURE TO PROMOTE A HIGHER CAUSE
by Jay Lorsch and Rakesh Khurana, Harvard Business School

22. THE NEED TO SHIFT THE MIND SET OF OUR
STUDENTS & MANAGERS
WHAT?
HOW?
This is normally we
teach our students
We should teach our
students HOW
“What is Weighted
Average?”
How Weighted Average
works?

23. OK
OK

24. Social Responsibility and
Managerial Ethics
Organizational Business Mangement by SHAYAA OTHMAN
24

25. What is Social Responsibility
Classical View : Organizations should concern only on financial returns –advocated
by economists Milton Friedman. Organizational resources for any “social good” are
adding to the costs and should be passed to consumers through higher price.
Socioeconomic View : Goes beyond making profits to include protecting and
improving society’s welfare. Corporation not only responsible exclusively to
stakeholders but also to the large society who supported them through buying their
products PETRONAS in Sudan, Turkmenistan, etc. JOHORCORP – Wakaf Medical Clinics,
etc. Syed Mokhtar – Islamic Art Center KL, Education Foundations, etc
25

26. 26

27. Social Responsibility and Economic Performance
Positive Relationship between Social Responsibility and Economic Performance.
Corporate Social Performance positively associated to financial performance [prior &
future] – concluded by many researches .
Social Screening : Applying social criteria [screen] to investment decisions. Mutual
stocks Fund will not invest in liquor, gambling, tobacco, nuclear power, weapons, price
fixing, or fraud. Good Examples Islamic Funds, Islamic Banks.
“ THERE IS LITTLE EVIDENCE THAT A COMPANY SOCIALLY RESPONSIBLE
ACTIONS SIGNIFICALLY HURTS ITS LONG-TERMS ECONOMIC PERFORMANCE”
27

28. Valued-Based Management
Valued-Based Management : An approach to managing in which managers
establish , promote, and practice an organization’s shared values. An Organization’s
values reflect what it stands for and what it believes in. Examples Patagonia US
[Maker of Outdoor sports strong environmental commitment. - from products design
to shipping – gives 10% profit to environmental causes & actively educate customers
on environmental issues. KUIS as Islamic Organizations – Islamic Principles all the way
from up to down.
Shared Values: share the corporate values From Managers’ Decision & Actions to
Employee Behaviors , and products and services. KUIS, etc??
Organizational Business Mangement by SHAYAA OTHMAN
28

29. SHARED
ORGANIZATIONAL
VALUES
Organizational Business Mangement by SHAYAA OTHMAN
29

30. Greening of Management
Global Environmental Problems ;
Serious Situations : Natural Resources Depletions [Oils, Menials, etc] ; global
warming; pollution [air, water, and soil]; industrial accidents, and toxic wastes.
How to Green
Protect & Preserver Natural Environment : Example 3M Corporation
Program 3 Ps Program = Pollution Prevention Pays
Organizational Business Mangement by SHAYAA OTHMAN
30

31. Managerial Ethics
WESTERN VIEWS – 4 VIEWS
1.Unitarian Views of Ethics; Ethical decisions are made solely on the basis of their
outcomes or consequences. Using Quantitative Method of Making Decision.
2.Rights Views of Ethics: Respecting & protecting individual liberties and
privileges –right to privacy, freedom of conscience, free speech, life and safety.
3.Justice View Ethics: Managers impose and enforce rules fairly and impartially
and do by following all legal rules and regulation
4.Integrative social contracts : ethical decisions should be based on empirical
[what is] and normative [what should be] factors. Integration of two “contract” general
social contract of business to operate with acceptable rules and among members of
communities – wage levels – norms of industry -
31

32. Managerial Ethics
Universal Islamic Ethics
32

33. Ultimate Objectives [Maqasid al-Sharia]
Muslims Scholars include al-Gazali [505HA/1111AC],
hold the opinion that the Ultimate Objectives [Maqasid
al-Sharia] necessary [al-daruiriyyah] for mankind’s
peaceful co-existence according to al-Quran and alSunaah, include 5 main areas :
1.Protection
2.Protection
3.Protection
4.Protection
5.Protection
of
of
of
of
of
al-Din Islam
Life
Intellect or Faculty of Reason
Progeny or Offspring
Material Wealth
Eidin Atta (2010}

34. . Source : Othman, Shaya’a, (2011) Islamic Management, Maqasid Al-Shariah in
Islamic Finance, Alor Setar, Kolej Universiti Insaniah.

36. . Source : Othman, Shaya’a, (2011) Islamic Management, Maqasid Al-Shariah in
Islamic Finance, Alor Setar, Kolej Universiti Insaniah.

38. OK
OK

39. Fighting fraudulent
online reviews with
math
Online reviews can make or break a
business. Unfortunately, unscrupulous
individuals frequently cheat by
submitting fraudulent online reviews
that either increase or lessen a
business’ reputation, regardless of
whether the individuals have actually
used the product or service or have an
opinion. These reviews are sometimes
quite hard to catch and weed out, but
researchers at State University of New
York, Stony Brook, have found that
there’s a way to catch these reviews
by using mathematics
Catching fraudulent online reviews is no miracle –
it's math. (Photo Credit: CC BY/mad
LOLscientist/Flickr)
http://personalmoneynetwork.com/moneyblog/2012/06/19/fighting-fraudulent-online-reviews/

40. TOTAL APPROACH OF ADDRESSING PROBLEMS OF ETHICS
ETHICS

41. Development of Organizational Ethical Index
1. Corporate Responsibility Index (CRI)
The Australian government has funded the St James Ethics Centre to provide a
website,www.thehub.ethics.org.au, to build communities of responsible business practice in
Australia. This CRI is 0ne of its best known benchmarks , which addresses business practices as
environmental, social/community, workplace practices, marketplace and business conduct and
ethical governance
2. Global Reporting Initiative (GRI),
About 80% of the global Fortune 250 companies now disclose their sustainability performance with
about 60% of these using the sustainability reporting framework of GRI, an independent
internationally networked organisation. The framework measures economic, environmental and
social performance
3. Global Compact [GC] of UN
United Nations launched its Global Compact, in 2000, a voluntary corporate citizenship initiative,
which asks a commitment from business and others to advance 10 universal principles in the areas of
human rights, labour standards, environment and anti-corruption

42. Definition of Ethics
“a set of moral principles, especially ones relating to or
affirming a specified group, field, or form of conduct”
"Business Ethics"
can be defined as the
critical, structured examination of how people &
institutions should behave in the world of
commerce. In particular, it involves examining
appropriate constraints on the pursuit of selfinterest, or (for firms) profits, when the actions of
individuals or firms affects others
http://www.businessethics.ca/definitions/business-ethics.html

43. ETHICS
Source: Shaya’a Othman (2012). 1st ISM International Statistical
Conference, Johor Baharu , Malaysia

44. MANAGERIAL
ETHICS
MANAGEMENT
•PERSONAL
•FAMILY
•COMMUNITY
•ORGANIZATION
•NATION

48. Maqasid al Shariah as a Administrative Foundation of
managing the Nation should be mentioned here
The principles and work ethics upheld by the Prime Minister’s Office include the following:
Trust
to perform duties with full responsibility
Integrity
to practise values of honesty, sincerity and integrity in all matters
Responsibility
to possess high accountability and responsibility in performing duties, without abusing power
and position for self-gain or the benefit of other interested parties
Excellence
to constantly endeavour to improve knowledge, creativity and innovation as well as team spirit
Loyalty
to have undivided loyalty to the department and nation at all times so as to safeguard image
and sovereignty
Commitment
to carry out work with full responsibility at all times and not disregard public responsibilities
because of personal interest
Dedication
to be prepared to take on responsibilities at any time with no expectations of reward but for the
good of the department and the government
Discipline
to be constantly on good behaviour, observe the laws and regulations and punctuality
Diligence
to carry out duties efficiently, effectively and productively at all times in order to produce
excellent service
Professionalism
to constantly improve knowledge and skills to provide efficient, prompt and meticulous
services as well as to possess characteristics of creativity, innovation, motivation,
competitiveness and accountability

51. Success of Applying
Managerial Ethic in
Accordance to
Islamic Principles

53. “Statistics is a scientific method of collecting, organizing,
presenting, analysing and interpreting numerical information,
developed from mathematical theory of probability.”
Definition by Shaya'a Othman, KUIS [2008]
“Statistics is a scientific method with ethical values, of collecting,
organizing, presenting, analysing and interpreting numerical
information, developed from mathematical theory of probability.”
Definition by Shaya'a Othman, INSANIAH[2011]
“Statistics is a scientific method of collecting, organizing,
presenting, analysing and interpreting numerical information,
developed from mathematical theory of probability, within the
ethical values of Maqasid al-Sharia”
Definition by Shaya'a Othman, INSANIAH, [2012]
REDIFINATION
OF STATISTICS
TO INCLUDE
ETIHICAL
VALUES
ACCORDING TO
SHARIAH

54. OK
OK
OK

55. SUMMARY OF TOTAL SOLUTION

56. Effective, Efficient, Ethical
Adherence to Islamic Values
THANK YOU FROM
Prof. SHAYA’A OTHMAN