Ethics and Social Responsibility in Business: Principles and Practices

1. Chapter 3 Ethics and Social Responsibility

2. Philosophical Principles Underlying Business Ethics • Focus on consequences and pragmatism (So who is hurt?) • Focus on rights of individuals (deontology emphasizes principles) • Focus on integrity (virtue ethics focuses on character of person)

3. Values and Ethics • Ethics converts values into action. • The right values can lead to competitive advantage. • Ethically-centered management focuses on quality of product rather than completion date.

4. Contributing Factors to Ethical Problems • Greed, gluttony, and self-gain • Unethical organizational culture • Moral laxity (“Forget ethics for now.”) • Self-interest (“I’ll take care of me first.”) • Unconscious bias (“A man is best for the job of CEO.”) • Rationalization (“Everybody else cheats on taxes.”)

5. Ethical Temptations and Violations • Stealing from employers and customers • Illegally copying software • Treating people unfairly • Sexual harassment • Conflict of interest (lose objectivity) • Accepting kickbacks and bribes

6. Ethical Temptations and Violations, continued • Divulging confidential information • Misuse of corporate resources (“Let’s take the corporate jet to Cancun.”) • Corporate espionage (e.g., dumpster diving for dirt on the competition) • Poor cyberethics (e.g., stealing identities from résumés posted online)

7. A Guide to Ethical Decision Making • Is it right? • Is it fair? • Who gets hurt? • Would you be comfortable if your decision were widely circulated? • Would you tell your child to do it? • How does it smell?

8. Background Concepts of Social Responsibility • Corporate social responsibility—obligations to society beyond profits • Stockholder viewpoint—only responsibility is to owners/stockholders • Stakeholder viewpoint—firm is responsible to all affected groups • Iron law—lose power if irresponsible • Corporate social performance—good citizen in the community

9. Social Responsibility Initiatives • Environmental protection • Work-life programs (such as flexible work schedules) • Community redevelopment projects • Acceptance of whistle blowers • Compassionate downsizing (such as outplacement services and emotional support)

10. Ethical and Socially Responsible Workplace • Formal mechanisms for monitoring ethics (e.g., ethics committee, ethics hotline) • Written organizational codes of conduct • Communication about ethics and social responsibility • Leadership by example and ethical role models • Confrontation about ethical deviations • Training in ethics and social responsibility