1business Ethics the Changing Environemnt and Stakeholder Management (1)

7/28/2019 1business Ethics the Changing Environemnt and Stakeholder Management (1)

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Business Ethics, TheChanging Environment,

And StakeholderManagement


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Chapter Topics

1. Business ethics and the changingenvironment

2. What is business ethics? Why does it

matter?

3. Levels of business ethics

4. Five myths about business ethics

5. Why use ethical reasoning in business?

6. Can business ethics be taught and trained?

7. Plan of the book


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Business Ethics and theChanging Environment

Businesses & governments operate in changingtechnological, legal, economic, social & politicalenvironmentswith competing stakeholders & power claims.

Stakeholders are individuals, companies, groups &nations(investors, employees, customers, supplierscreditors,

directors, government (and itsagencies), owners (shareholders),unions, and the community from which the businessdraws itsresourcesetc)that cause and respond to external issues,opportunities, and threats.

The rate of change and uncertainty in which stakeholders& society must make & manage business & moral decisions

have accelerated due to the impact of: Internet and information technologies

Globalization

Deregulation

Mergers

Wars
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Environmental Forces and

Stakeholders Local, national, and international

environments are increasingly movingtoward and into a global system of

dynamically interrelated interactions amonglocal, national, and regional politics,economies, regulations, technologies,demographics, and international law. Economic environment

Technological Political

Governmental and regulatory

Legal

Demographic


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Stakeholder Management

Approach The stakeholder management approachis a way ofunderstanding the effects of environmental forces andgroups on specific issues that affect real-timestakeholders and their welfare.

This approach attempts to enable individuals andgroups to articulate collaborative win-win strategies:based on:

Identifying and prioritizing issues, threats, or opportunities

Mapping who the stakeholders are

Identifying their stakes, interests, and power sources

Showing who the members of coalitions are or may become Showing what each stakeholders ethics are and should be

Developing collaborative strategies and dialogue from a higherground perspective to move plans and interactions to thedesired closure for all parties


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What is Business Ethics?

Why Does It Matter? Ethical solutions to business and organizational problems

may have more than one right alternative and sometimes,no right solution may seem available.

Laura Nash has defined business ethics as the study of how

personal moral norms apply to the activities and goals ofcommercial enterprise,as dealing with three basic areas ofmanagerial decision making:

Choices about what the laws should be and whether tofollow them

Choices about economic and social issues outside thedomain of law

Choices about the priority ofself-interest over thecompanys interests


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What Are Unethical

Business Practices? Surveys have identified the following recurring

themes to prominent everyday ethical issuesfacing businesses and their stakeholders:

Managers lying to employees

Office nepotism and favoritism

Taking credit for others work

Receiving/offering kickbacks

Stealing from the company

Firing an employee for whistle-blowing(wrongdoing in or by an organisation)

Padding expense accounts

Divulging confidential information or trade secrets

Terminating employment without sufficient notice

Using company property/materials for personal use


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What Are Unethical

Business Practices? The most unethical behavior, as per one

survey, happens in the following areas:

Government

Sales Law

Media

Finance

Medicine Banking

Manufacturing


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Why Does Ethics Matter In

Business? Doing the right thing matters to employers,

employees, stakeholders, and the public.

For companies, it means saving billions of dollarseach year in lawsuits, settlements, and theft

Tobacco industry

Costs to businesses include:

Deterioration of relationships

Damage to reputation

Declining employee productivity, creativity, andloyalty

Ineffective information flow throughout theorganization

Absenteeism


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Levels of Business Ethics Because ethical problems are not only an

individual or personal matter, it is helpfulto see the different levels at which issues

originate and how they move to otherlevels.

Five levels are: Individual

Organizational Association

Societal

International


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Can Business Ethics Be

Taught And Trained? Ethic courses should not:

Advocate a set of rules from a single

perspective Not offer only one best solution to

specific ethical problems

Not promise superior or absolute ways

of thinking and behaving in situations


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Taught And Trained? Ethic courses and training can do the

following: Provide people with rationales, ideas, and vocabulary

Help people make sense of their environments

Provide intellectual weapons

Enable employees to act as alarm systems for companypractices

Enhance conscientiousness(vigilance) and sensitivity

Enhance moral reflectiveness and strengthen moralcourage

Improve the firms moral climate


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Taught And Trained? Other scholars argue that ethical

training can add value to the moralenvironment of a firm and torelationships in the workplace by:

Finding a match between employersand employees values

Managing the push-back point Handling an unethical directive

Coping with a performance system thatencourages unethical means

Documents

1business Ethics the Changing Environemnt and Stakeholder Management (1)