Business Ethics ch1

8/9/2019 Business Ethics ch1

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BA 362

BUSINESS ETHICS

MANOLETE GONZALEZ


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Introductions

Na!

Ma"or

#ro$id! an !%a&'! o( a situation )ou *a$! !ncount!r!d t*atco!s c'os!+ in )our o&inion+ to an un!t*ica' d!cision or

action,


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ocus. G!n!ra' Mana/!!nt o(

an or/ani0ation

An or/ani0ation is a s)st! o( conscious')

coordinat!d acti$iti!s or (orc!s o( to or or!

&!rsons4


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Busin!ss Et*ics Cours!.

L!arnin/ O"!cti$!s Sensitivity: To insur! t*at )ou ar! aar! o(7s!nsiti$! to !t*ica' issu!s in a''

as&!cts o( t*! usin!ss !n$iron!nt and &ro(!ssiona' !%c*an/!s

Skill-Building: To &ro$id! )ou it* r!asonin/ and d!cision-a8in/ too's to

*!'& )ou t*in8 t*rou/* !t*ica' issu!s and to r!s&ond s!nsi') *!n (ac!d it*

suc* issu!s Integration: To !na'! )ou to !((!cti$!') int!/rat! )our &!rsona' $a'u!s and

r!asonin/ s8i''s into a'' o( *at )ou do and stand (or

Practice: To /i$! )ou o&&ortuniti!s to 9&ractic!9 $a'u!s int!/ration and !t*ica'

r!asonin/ &roc!ss!s in cas! !%&!ri!nc!s

Understanding: To o((!r )ou a d!!&!r und!rstandin/ o( t*! ro'! )ou &'a) in

(orin/ or/ani0ationa' cu'tur! and t*! !ans ) *ic* )ou can i&act it in a

&ositi$! ann!r

Reinforcement: To r!in(orc! t*! r!sourc!s a$ai'a'! to )ou i( con(ront!d it*

!t*ica' situations


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;!


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;!


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Hous! ;u'!s

!!& distractions to a iniu+ r!s&!ct )our &!!rs S*ut o(( c!'' &*on!s or &'ac! t*! in si'!nt od! >not! an unatt!nd!d

$iratin/ c!'' &*on! is distractin/?

Usin/ 'a&to&s ar! o8 (or not! ta8in/ or r!(!r!nc! to not!s Co! to c'ass on ti! i( )ou do arri$! 'at!+ tr) to !nt!r unotrusi$!')+

!/ tr) not to a'8 in (ront o( t*! instructor *!n c'ass is in s!ssion

A$oid sid! discussions it* )our n!i/*or I( )ou *a$! to '!a$! !ar')+ '!t t*! instructor 8no and sit *!r! )ou can

'!a$! unotrusi$!') Mu'ti-tas8in/ acti$iti!s ar! not a&&r!ciat!d+ (or !%a&'! r!adin/ t*!

n!s&a&!r+ or8in/ on anot*!r cours! durin/ c'ass+ sur(in/ t*! int!rn!t+s'!!&in/+ !tc


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Hous! ;u'!s

;!s&!ct !ac* ot*!r. to'!rat! di((!r!nc!s o( o&inion and ann!r o(&artici&atin/

I( )ou *a$! stron/ o&inions+ $oic! it and ! *!ard+ 'ist!n to r!s&ons!s+

!n/a/! in an !%c*an/! o( o&inions+ and t*!n a''o t*! c'ass to o$! on Huor+ in(ora'+ o8 But do r!!!r *) ! ar! in c'ass Ot*!r su//!stions,


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Et*ics Busin!ss

McGraw-Hill/Irwin

Business Ethics: Decision-Making for PersonalIntegrity& Social es!onsi"ility# Copyright 2008 The McGraw-Hill Companies, Inc. All rights resere!.

$ha!ter1


11/461-111-11

A &!rson it* outard coura/!

dar!s to di!

A &!rson it* inard coura/!dar!s to 'i$!

- Lao T0u

Ethics is tougher than you

think . . .


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C*a&t!r O"!cti$!s

A(t!r !%&'orin/ t*is c*a&t!r+ )ou i'' ! a'! to.

1 E%&'ain *) !t*ics is i&ortant in t*! usin!ss !n$iron!nt

2 E%&'ain t*! natur! o( usin!ss !t*ics as an acad!ic disci&'in!

3 Fistin/uis* t*! !t*ics o( &!rsona' int!/rit) (ro t*! !t*ics o( socia'r!s&onsii'it)

5 Fistin/uis* !t*ica' nors and $a'u!s (ro ot*!r usin!ss-r!'at!d

nors and $a'u!s

: Fistin/uis* '!/a' r!s&onsii'iti!s (ro !t*ica' r!s&onsii'iti!s

6 E%&'ain *) !t*ica' r!s&onsii'iti!s /o !)ond '!/a' co&'ianc!

@ Fistin/uis* !t*ica' d!cision-a8in/ (ro ot*!r &ractica' d!cision

situations


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O&!nin/ F!cision #oint.

Aaron Feuerstein We ill discuss this !"ening #ecision Point at the $eginning

of the ne%t class.


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Busin!ss !t*ics is a &roc!ss o(

r!s&onsi'! d!cision-a8in/

T*! scanda's and ruin !%&!ri!nc!d sinc! t*! Enron co''a&s!

!r! rou/*t aout ) !t*ica' (ai'ur!s

! i'' discuss a d!cision-a8in/ od!' t*at can *!'&indi$idua's to und!rstand suc* (ai'ur!s and a$oid (utur!

usin!ss and &!rsona' tra/!di!s

Why explore ethics in business?Because

Ethics Failures = Business Failures


15/461-1:1-1:

An Et*ica' Cor&orat! C'iat!

&'is either develo"ing or deteriorating(

enriching itself or im"overishing itself.

It needs constant care and attention.)

Study $y the Woodstock *enter

+eorgeton University( #.*.


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,he conseuences of unethical$ehavior and unethical $usiness

institutions are too serious for

too many "eo"le to $e ignored.

ulti"ly these harms $y the do/ens of other

com"anies im"licated in similar scandals and

one gets an idea of hy ethics is no longer

dismissed as irrelevant.


18/461-11-1

Sta8!*o'd!rs4

T*is discussion o( t*! ran/! o( &!o&'! i&act!d ) t*! Enron co''a&s!

!$id!nc!s *o on! cas! can draatica'') a((!ct t*! 'i$!s o( t*ousands o(

&!o&'!. !&'o)!!s+ stoc8*o'd!rs+ ana/!!nt+ su&&'i!rs+ custo!rs+ and

surroundin/ couniti!s

or !tt!r or (or ors!+ t*! d!cisions ad! it*in a usin!ss (ir i''

a((!ct an) or! &!o&'! t*an on') t*! indi$idua' *!rs!'(

Et*ica'') r!s&onsi'! usin!ss d!cision-a8in/ t*!r!(or! ust o$!

!)ond a narro conc!rn it* stoc8*o'd!rs+ and consid!r t*! i&act t*atd!cisions i'' *a$! on a id! ran/! o( sta8!*o'd!rs

In a /!n!ra' s!ns!+ a usin!ssstakeholder i'' ! an)on! a((!ct!d+ (or

!tt!r or ors!+ ) d!cisions ad! it*in t*! (ir


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Sta8!*o'd!r T*!or)

Sta8!*o'd!r t*!or) is a od!' o( cor&orat! socia' r!s&onsii'it) t*at

*o'ds t*at usin!ss ana/!rs *a$! !t*ica' r!s&onsii'iti!s to t*is or!

road ran/! o( sta8!*o'd!rs+ as o&&os!d to a or! narro $i! t*at t*!

&riar) r!s&onsii'it) o( ana/!rs is 'iit!d to stoc8*o'd!rs


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Sta8!*o'd!rs. Cor&orationsSta8!*o'd!rs. Cor&orations

Custo!rs7C'i!nts

Stoc8*o'd!rs

E&'o)!!s

Consu!r ad$ocat!s

;!/u'ators

M!dia

Go$!rn!nt

Trad! Associations

Co&!titors

Loca' Counit)

Ot*!rs,,,,,


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*) car! aout !t*ics,

Un!t*ica' !*a$ior cr!at!s (inancia' and ar8!tin/ ris8s

A co&an) can /o out o( usin!ss+ and its !&'o)!!s can /o to "ai'+ i( no

on! is &a)in/ att!ntion to t*! !t*ica' standards o( t*! (ir

A (irs !t*ica' r!&utation can &ro$id! a co&!titi$! ad$anta/!+ ordisad$anta/!

Consu!r o)cotts /i$! !$!n t*! ost s8!&tica' usin!ss '!ad!r r!ason

to &a) att!ntion to !t*ics

Mana/in/ !t*ica'') can a'so &a) si/ni(icant di$id!nds in or/ani0ationa'structur! and !((ici!nc)

Trust+ 'o)a't)+ coit!nt+ cr!ati$it)+ and initiati$! ar! "ust so! o( t*!

or/ani0ationa' !n!(its t*at ar! or! 'i8!') to ('ouris* it*in !t*ica'')

sta'! and cr!di'! or/ani0ations


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REALITY CHECK

Why $e good0T*! Institut! (or Busin!ss+ T!c*no'o/) and Et*icssu//!sts t*! (o''oin/ Nin! Good ;!asons4 to run a

usin!ss !t*ica'').

1 Liti/ation7indict!nt a$oidanc!2 ;!/u'ator) (r!!do3 #u'ic acc!&tanc!5 In$!stor con(id!nc!: Su&&'i!r7&artn!r trust

6 Custo!r 'o)a't)@ E&'o)!! &!r(oranc! #!rsona' &rid!J Its ri/*t


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But+ do!s ri/*t4 or int!/rit)4 *a$!

r!ards,

9*i'! t*! *!ad'in!s ar! /oin/ to a'' t*! /u)s *o ar! doin/

it ron/+ t*!r! is a $!r) stron/ cor&s o( &!o&'! *o ar! r!a'')

coitt!d to doin/ it ri/*t #art o( doin/ it ri/*t is )ouKr! notdoin/ it to /!t *!ad'in!s ouKr! doin/ it to r!a'') a8! a

di((!r!nc! in t*! 'i$!s o( &!o&'!

-- G!or/!ton Co''!/! #r!sid!nt Bi'' Crouc*+ s&!a8in/ at a usin!ss !t*ics con(!r!nc!s&onsor!d ) t*! Et*ica' L!ad!rs*i& Institut! >

9Stron/ Et*ics H!'& Busin!ss!s Succ!!d+ Con(!r!nc! S&!a8!rs Sa)+9A#+ Mar 2:?
http://www.dfw.com/mld/dfw/business/8269585.htmhttp://www.dfw.com/mld/dfw/business/8269585.htm


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O&!nin/ F!cision #oint.

Aaron Feuerstein Should 1aron 2euerstein re$uild in alden and "ay his

em"loyees in the meantime0 *at (acts ou'd ! *!'&(u' as )ou a8! )our "ud/!nts aout

!u!rst!in,

Ho an) di((!r!nt !t*ica' $a'u!s ar! in$o'$!d in t*is situation, *at8ind o( an is !u!rst!in, Ho ou'd )ou d!scri! *is actions a(t!r t*!(ir!, Can )ou d!scri! t*! an and *is actions it*out usin/ !t*ica' or!$a'uati$! ords,

*os! int!r!sts s*ou'd !u!rst!in consid!r in a8in/ t*is d!cision, Ho

an) di((!r!nt &!o&'! !r! a((!ct!d ) t*! (ir! and t*! d!cision, *at ot*!r o&tions !r! a$ai'a'! (or !u!rst!in, Ho ou'd t*!s!a't!rnati$!s *a$! a((!ct!d t*! ot*!r &!o&'! in$o'$!d,

!r! !u!rst!ins actions c*arita'!+ or as t*is so!t*in/ *! *ad a dut)or o'i/ation to do, *at is t*! di((!r!nc! !t!!n acts o( c*arit) ando'i/ator) acts,


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Busin!ss Et*ics as Et*ica'

F!cision-Ma8in/ (insert obj. 2)

F!cisions *ic* (o''o (ro a &roc!ss o( t*ou/*t(u' and

consci!ntious r!asonin/ i'' ! or! r!s&onsi'! and !t*ica'

d!cisions ;!s&onsi'! d!cision-a8in/ and d!'i!ration i''

r!su't in or! r!s&onsi'! !*a$ior T*! &oint o( a usin!ss !t*ics cours!,

To '!arn aout t*! /r!at !t*icists o( *istor) suc* as Aristot'!+ o*n

Stuart Mi''+ and Ianu!' ant >t*!informationalcontento( t*!

c'ass?

To !%&'or! !t*ica' behavior, to consid!r *o *uan !in/s

&ro&!r') s*ou'd 'i$! t*!ir 'i$!s


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Busin!ss Et*ics as Et*ica'

F!cision-Ma8in/

An !t*ics c'ass stri$!s to &roduc! or! !t*ica' !*a$ior

aon/ t*! stud!nts *o !nro'' But t*! on') acad!ica'')

and !t*ica'') '!/itiat! a) to do t*is is t*rou/* careful(

and reasoned decision-making

A &roc!ss o( rationa' d!cision-a8in/+ a &roc!ss t*at in$o'$!s

car!(u' t*ou/*t and d!'i!ration+ can and i'' r!su't in

!*a$ior t*at is ot* or! r!asona'! and or! !t*ica'


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So+ *at do ! !an

)Ethics?


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Ethics is not this:


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*at is !t*ics,4

At its ost asic '!$!'+ !t*ics is

conc!rn!d it* *o ! act and *o

! 'i$! our 'i$!s


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*at is !t*ics,4

Et*ics in$o'$!s *at is &!r*a&s t*! ost onu!nta'


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*at is !t*ics,4

T*is (unda!nta'


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#!rsona' ;!s&onsii'it) $s

Socia' ;!s&onsii'it), >insert obj. !)

T*!r! i'' ! an) ti!s it*in a usin!ss s!ttin/ *!r!

an indi$idua' i'' n!!d to st!& ac8 and as8.

In t*! s!cond s!ns!+ Ho s*ou'd ! 'i$!,4 r!(!rs to *o !

'i$! to/!t*!r in a counit) In t*is s!ns!+ usin!ss !t*ics is conc!rn!d it* *o usin!ss

institutions ou/*t to ! structur!d+ aout cor&orat! socia'

r!s&onsii'it)+ aout a8in/ d!cisions t*at i'' i&act an)

&!o&'! ot*!r t*an t*! indi$idua' d!cision-a8!r

What should I do? How should I act?


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#!rsona' ;!s&onsii'it) $s

Socia' ;!s&onsii'it),

T*is as&!ct o( usin!ss !t*ics as8s us to !%ain!

usin!ss institutions (ro a social rat*!r t*an an

individual&!rs&!cti$!

! r!(!r to t*is road!r socia' as&!ct o( !t*ics as

d!cision-a8in/ (or social res"onsi$ility


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Et*ica' Nors and a'u!s(insert obj. ")

A co&an)s cor! $a'u!s+ (or !%a&'!+ ar! t*os! !'i!(s and

&rinci&'!s t*at &ro$id! t*! u'tiat! /uid! in its d!cision-a8in/

Indi$idua's can *a$! t*!ir on &!rsona' $a'u!s and+ i&ortant')+

institutions a'so *a$! $a'u!s

Values =

Those beliefs that incline us to act or to choose in

one way rather than another


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Fistin/uis*in/ Nors

On! a) to distin/uis* t*!s! $arious t)&!s o( $a'u!s is in

t!rs o( t*! !nds t*at t*!) s!r$! inancia' $a'u!s s!r$! on!tar) !nds+ r!'i/ious $a'u!s s!r$!

s&iritua' !nds+ a!st*!tic $a'u!s s!r$! t*! !nd o( !aut)+ '!/a'$a'u!s s!r$! 'a+ ord!r+ and "ustic!+ and so (ort*

Fi((!r!nt t)&!s o( $a'u!s ar! distin/uis*!d ) t*! $arious !nds

s!r$!d ) t*os! acts and c*oic!s

So+ *o ar! !t*ica' $a'u!s to ! distin/uis*!d (ro t*!s!ot*!r t)&!s o( $a'u!s, *at !nds ar! s!r$!d ) !t*ics,


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L!/a' ;!s&onsii'iti!s $s

Et*ica' ;!s&onsii'iti!s (insert obj.# $ %)

T*! 'a &ro$id!s a $!r) i&ortant /uid! to !t*ica' d!cision-

a8in/+ ut '!/a' nors and !t*ica' nors ar! not id!ntica'

nor do t*!) a'a)s a/r!!

O$!r t*! 'ast d!cad!+ an) cor&orations *a$! !sta'is*!d

!t*ics &ro/ras and *ir!d !t*ics o((ic!rs *o ar! c*ar/!d

it* ana/in/ cor&orat! !t*ics &ro/ras

Muc* /ood or8 /!ts don! ) !t*ics o((ic!rs+ ut it is (air tosa) t*at uc* o( t*is (ocus!s on co&'ianc! issu!s T*!

Saran!s-O%'!) Act cr!at!d a draatic and $ast n! 'a)!r o(

'!/a' co&'ianc! issu!s


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Cant t*! 'a ans!r t*! n!/ati$!? aout t*is a&&roac*,


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Reality Check

Ethics goes Mainstream!

A 2DD3 &o'' ) F!'oitt! o( :+DDD dir!ctors o( t*! to& 5+DDD

&u'ic') trad!d co&ani!s r!&ort!d t*at J &!rc!nt !'i!$!d

t*at an !t*ics and co&'ianc! &ro/ra as an !ss!ntia' &art

o( cor&orat! /o$!rnanc! O$!r D &!rc!nt *ad d!$!'o&!d (ora' cod!s o( !t*ics !)ond

t*os! r!


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Ho is !t*ica' d!cision-a8in/

di((!r!nt (ro ot*!r d!cision-

a8in/, (insert obj. *)

Et*ics is a &art o(ractical reason+ r!asonin/ aout

*at ! s*ou'd do+ as o&&os!d to theoretical reason+*ic* is r!asonin/ aout *at ! s*ou'd !'i!$!

T*!or!tica' r!ason is t*! &ursuit o( trut*+ *ic* is t*!

*i/*!st standard (or *at ! s*ou'd !'i!$!


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Fiscussion o( O&!nin/

F!cision #oint.

Aaron Feuerstein On t*! sur(ac!+ Ma'd!n Mi''s &ro$id!s a c'!ar+ i( !%tr!!+

!%a&'! o( a usin!ss '!ad!r *o as i''in/ to a8!

si/ni(icant (inancia' sacri(ic!s (or t*! !''-!in/ o( *is!&'o)!!s and counit)

Aaron !u!rst!in cou'd *a$! ad! an) ot*!r d!cisions t*at

ou'd *a$! !!n (inancia'') !n!(icia'+ a't*ou/* at a /r!at

costs to !&'o)!!s and t*! surroundin/ tons To an) &!o&'!+ *! as a tru! *!ro


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Fiscussion o( O&!nin/

F!cision #oint !t+ t*! cas! !$!ntua'') !ca! or! co&'!% On! i&ortant (act is t*at Ma'd!n Mi''s as &ri$at!') on!d Had !u!rst!in !!n CEO o( a &u'ic') trad!d cor&oration+

*is r!s&onsii'iti!s ou'd *a$! !!n si/ni(icant') di((!r!nt B!caus! o( t*is (act+ so! os!r$!rs d!scri! !u!rst!ins

d!cisions as a si&'! cas! o( &!rsona' /!n!rosit)+ ut not a*!'&(u' od!' (or ot*!r cor&orat! !%!cuti$!s

As it as+ Ma'd!n Mi''s as una'! to r!co$!r (inancia'')(ro t*! 'oss!s associat!d !it*!r t*! (ir! and it* !u!rst!insd!cisions and !$!ntua'') !nt!r!d an8ru&tc)

Critics c'ai t*at t*is (act d!onstrat!s t*! r!a' costs o( suc*

/!n!rosit)


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C*a&t!r On! ocau'ar) T!rs

A(t!r !%ainin/ t*is C*a&t!r+ )ou s*ou'd *a$! a c'!ar

und!rstandin/ o( t*! (o''oin/ !) T!rs and )ou i'' (ind

t*! d!(in!d in t*! G'ossar). Et*ics

Mora'it)7Socia' ustic!

a'u!s

Norati$! !t*ics7F!scri&ti$! !t*ics

Sta8!*o'd!rs

Sta8!*o'd!r T*!or)

#ractica' ;!asonin/

Documents

Business Ethics ch1