ethics
The rules or standards governing the conduct of a person or group
the principles and standards of moral behavior that are accepted by society as right versus wrong. Practicing good business ethics involves, at a minimum, competing fairly and honestly, communicating truthfully, being transparent, and not causing harm to others.
ethical dilemma
A situation in which more than one side of an issue can be supported with valid arguments
However, you will encounter situations in which choices are not so clear. An ethical dilemma is a situation in which you must choose between conflicting but arguably valid options, or even situations in which all your options are unpleasant.
ethical lapse
A situation in which an individual or a group makes a decision that is morally wrong, illegal, or unethical
When the question of what is right and what is wrong is clear, ethical decisions are easy to make: you simply choose to do the right thing. If you choose the wrong course, such as cheating on your taxes or stealing from your employer, you commit an ethical lapse. The choices were clear, and you made the wrong one.
conflict of interest
A situation in which competing loyalties can lead to ethical lapses, such as when a business decision may be influenced by the potential for personal gain
Watch out for conflicts of interest, situations in which competing loyalties can lead to ethical lapses. For instance, if you are in charge of selecting an advertising agency to handle your company's next campaign, you would have an obvious conflict of interest if your husband or wife worked for one of the agencies under consideration
corporate social responsibility
The idea that business has obligations to society beyond the pursuit of profits
There is a widespread assumption these days that CSR is both a moral imperative for business and is a good thing for society, but the issues aren't quite as clear as they might seem at first glance.
corporate philanthropy
The
donation of money, time, goods, or services to charitable, humanitarian, or educational institutions
from corporations
consumerism
A movement that pressures businesses to consider consumer needs and interests
The 1960s activism that awakened business to its environmental responsibilities also gave rise to consumerism, a movement that put pressure on businesses to consider consumer needs and interests.
transparency
The degree to which affected parties can observe relevant aspects of transactions or decisions
Business communication ethics often involve the question of transparency, which can be defined as "the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders."
Identify the minimum expectations for the ethical behavior of a business
Competing fairly and honestly
Communicating truthfully
Being transparent
Not causing harm to others
Identify the factors that influence ethical behavior
Cultural differences
Knowledge
Organizational behavior
Explain the difference between an ethical dilemma and an ethical lapse*
...
Explain how ethical dilemmas can be resolved
Make sure you frame the situation accurately, taking into account all relevant issues and questions.
Identify all parties who might be affected by your decision.
Be as objective as possible.
Don't assume that other people think the way you do.
Watch out for conflicts of interest.
Exhibit
15.?
Justice
Utilitarianism
Individual Rights
Individual Responsibilities
The Common Good
Virtue
Explain how businesses can improve their ethical climates
...
Explain the difference between Corporate Philanthropy and Strategic Corporate Social Responsibility?
Philanthropy
The donation of money, time,
goods, or services to charitable, humanitarian, or educational institutions
Strategic CSR
Social contributions that are directly aligned with a company's overall business strategy
Companies that engage in CSR activities can choose between two courses of action: general philanthropy or strategic CSR. Philanthropy involves donating money, employee time, or other resources to various causes without regard for any direct business benefits for the company.
In contrast to generic philanthropy, strategic CSR involves social contributions that are directly aligned with a company's overall business strategy. In other words, the company helps itself and society at the same time. This approach can be followed in a variety of ways. A company can help develop the workforce by supporting job training efforts or use volunteering programs to help train employees.
Explain the 4 approaches to Corporate Social Responsibility (CSR)
Minimalist CSR - companies do not have social responsibilities beyond earning money and obeying the law
Defensive CSR - companies engage in CSR only after being shamed or forced into it*
Cynical CSR - companies use CSR as a marketing ploy to distract attention from their self-centered behavior*
Proactive CSR - companies have a responsibility to help society beyond simply paying taxes and obeying the law**
*giving money to causes unrelated to
the company's lines of business
** not only the above but also investing in areas that are aligned with the company's business mission
Insider trading*
The use of unpublicized information that an individual gains from the course of his or her job to benefit from fluctuations in the stock market
All businesses have the capacity to cause harm to employees, customers, other companies, their communities, and investors. For example, insider trading, in which company insiders use confidential information to gain an advantage in stock market trading, harms other investors. (Insider trading is illegal, in addition to being unethical.)
What is Ethical Behavior?
-Competing fairly and honestly
-Communicating truthfully
-Being transparent
-Not causing harm to others
Businesses are expected to compete fairly and honestly and to not knowingly deceive, intimidate, or misrepresent themselves to customers, competitors, clients, employees, the media, or government officials.
Communicating truthfully is a simple enough concept: tell the truth, the whole truth, and nothing but the truth.
Code of ethics*
A written statement that sets forth the principles that guide an organization's decisions
Companies with strong ethical practices create cultures that reward good behavior—and don't intentionally or unintentionally reward bad behavior. To help avoid ethical breaches, many companies develop programs to improve ethical conduct, typically combining training, communication, and a code of ethics that defines the values and principles that should be used to guide decisions.
Whistle-blowing*
The disclosure of information by a company insider that exposes illegal or unethical behavior by others within the organization
Employees who observe unethical or illegal behavior within their companies and are unable to resolve the problems through normal channels may have no choice but to resort to whistle-blowing—expressing their concerns internally through formal reporting mechanisms or externally to the news media or government regulators. However, the decision to "blow the whistle" on one's own employer is rarely easy or without consequences.
The Relationship between Business and Society*
Consumers in contemporary societies enjoy and expect a wide range of benefits, from education and healthcare to credit and products that are safe to use.
Profit-seeking companies are the economic engine that powers modern society; they generate the vast majority of the money in a nation's economy.
Much of what we
consider when assessing a society's standard of living involves goods and services created by profit-seeking companies.
Companies cannot hope to operate profitably without the many benefits provided by a stable, functioning society.
Philanthropy*
The donation of money, time, goods, or services to charitable, humanitarian, or educational institutions
Companies that engage in CSR activities can choose between two courses of action: general philanthropy or strategic CSR. Philanthropy involves donating money, employee time, or other resources to various causes without regard for any direct business benefits for the company.
Nongovernmental organizations (NGOs)*
Nonprofit groups that provide charitable services or promote social and environmental causes
CSR: The Natural Environment*
First, the creation, delivery, use, and disposal of products that society values virtually always generate pollution and consume natural resources.
Second, "environmental" causes are often as much about human health and safety as they are about forests, rivers, and wildlife.
Third, many of these issues often require tough trade-offs, occasional sacrifice, disruptive change, and decision making in the face of
uncertainty.
Cap and trade*
A type of environmental policy that gives companies some freedom in addressing the environmental impact of specified pollutants, by either reducing emissions to meet a designated cap or buying allowances to offset excess emissions
In addition to technological solutions to reduce pollution and resource consumption, businesses, governments, and NGOs are pursuing a variety of political and economic solutions. For example, cap and trade programs try to balance free-market economics with government intervention. Lawmakers first establish a maximum allowable amount of a particular pollutant that a designated group of companies or industries is allowed to emit (the "cap") and then distribute individual emission allowances to all the companies in that group. If a company lowers its emissions enough to stay under its prescribed limit, it can sell, trade, or save leftover allowances (the "trade").
Sustainable development*
Operating business in a manner that minimizes pollution and resource depletion, ensuring that future generations will have vital resources
Efforts to minimize resource depletion and pollution are part of a broader effort known as sustainability, or sustainable development, which the United Nations has defined as development that "meets the needs of the present without compromising the ability of future generations to meet their own needs."
Identity theft*
A crime in which thieves steal personal information and use it to take out loans and commit other types of fraud
Product safety concerns range from safe toys, food, and automobiles to less-tangible worries such as online privacy and identity theft, in which criminals steal personal information and use it to take out loans, request government documents, get expensive medical procedures, and commit other types of fraud. According to Federal Trade Commission estimates, some 9 million Americans are victims of identity theft every year.
CSR: Consumers
The right to buy safe products - and to buy them safely
The right to be informed
The right to choose which products to buy
The right to be heard
CSR: Employees
Discrimination
Affirmative action
Discrimination*
In a social and economic sense, denial of opportunities to individuals on the basis of some characteristic that has no bearing on their ability to perform in a job
The United States has always stood for economic freedom and the individual's right to pursue opportunity. Unfortunately, in the past many people were targets of economic discrimination, being relegated to low-paying, menial jobs and prevented from taking advantage of many opportunities solely on the basis of their race, gender, disability, or religion.
Affirmative action*
Activities undertaken by businesses to recruit and promote members of groups whose economic progress has been hindered through either legal barriers or established practices
In the 1960s, affirmative action programs were developed to encourage organizations to recruit and promote members of groups whose past economic progress has been hindered through legal barriers or established practices. Affirmative action programs address a variety of situations, from college admissions to hiring to conducting business with government agencies. Note that although affirmative action programs address a variety of population segments, from military veterans with disabilities to specific ethnic groups, in popular usage, "affirmative action" usually refers to programs based on race.