Business and Society - Chapter 7

5 Levels:

1. The level of the individual (the personal level) 2. The level of the organization 3. The level of the industry or profession 4. The societal level 5. The global or international level

When a decision is made about what is ethical (right, just, fair) using the conventional approach, there is room for variability on several counts: What are three key elements that compose such a decision?

1. We observe the decision, action, or practice that has taken place in the workplace setting. 2. We compare the practice with prevailing norms of acceptability - that is, society's or some other standard of what is acceptable or unacceptable. 3. We must recognize that value judgments are being made by someone as to what really occurred (the actual behavior) and what the prevailing norms of acceptability really are. This means: two different people could look at the same behavior or practice, compare it with their beliefs of what the prevailing norms are, and reach different conclusions as to whether the behavior was ethical or not.

What are ethical determinants?

1. What is the true nature of the practice, behavior, or decision that occurred? 2. What are society's (or business's) prevailing norms of acceptability? 3. What value judgments are being made by someone about the practice or behavior, and what are teat person's perceptions of applicable norms?

What are four important ethics questions? These four questions capture the core of what ethics is all about.

1. What is? 2. What ought to be? 3. How do we get from what is to what ought to be? 4. What is our motivation in all this?

What two questions has research focused on about law?

1. Why do firms behave illegally or what leads them to engage in illegal activities? 2. What are the consequences of behaving illegally?

Carl Anderson

A leader in commissioning the survey, was reported to have said: "Today, America faces a serious problem with a financial crisis caused in no small part by greed-the public lacks confidence in our financial system and in much of corporate America.

National Business Ethics Survey (NBES)

A survey to determine what is going on within companies. Things they found while doing the survey: Ethical misconduct (wrong doing being reported) down slightly Whistle blowing head increased (when more employees have reported misconduct) Ethical cultures seem stronger (treating different cultures all the same) Pressure to cut corners was down (doing short cuts) Retaliation against those reported increased (people bullied people who were telling on them)

Ethical Egoism

An ethical principle based on the idea that the individual should seek to maximize his or her own self-interest as a legitimate factor, and this belief is widely held in society.

What is the Conventional Approach?

Based on how common society today views business ethics. The conventional approach is based on ordinary, common sense. We compare a decision, practice, or policy with prevailing norms of acceptability in society.

What is the Ethical Tests Approach?

Based on short, practical questions or "test" to guide ethical decision making, behavior and practices.

What is the Principles Approach?

Based on the use of ethics principles or guidelines to justify and direct behavior, actions, and policies.

What is a field of study that is of interest to the public, academics, students, and managers?

Business Ethics

What are the three major approaches to business ethics?

Conventional Approach Principles Approach Ethical Tests Approach

What compares and contrasts different moral codes, systems, practices, beliefs and values?

Descriptive Ethics

What are the two key branches of moral philosophy or ethics?

Descriptive Ethics and Normative Ethics

"What Is?" Question

Descriptive Question Forces us to identify the reality of what is actually going on in an ethcial sense in business or in a specific decision or practice.

What is Normative Ethics concerned with?

Establishing norms or standards by which business practices might be guided or judged.

What two words are so similar to one another that we may use the term interchangeably to refer to the study of fairness, justice, and moral behavior in business:

Ethics and Morality

What are the central variables that must be considered and balanced against each other in the quest to make wise decisions?

Ethics, Economics, and Law

Micro Level

Individual companies, managers, and employees still face the continuing onslaught of ethics challenges that occur on an everyday basis

Business Ethics

Is Concerned with morality and fairness in behavior, actions, and practices that take place within a business context. Also, the study of business practices in organizations and a request to determine whether these practices are acceptable or not.

Morality

Is a doctrine or system of moral conduct. Do the right thing Also refers to principles of right, wrong, and fairness in behavior.

What is the major challenge of the Conventional Approach?

Is answering the questions "Whose norms do we use?" in making the ethical judgment, and "What norms are prevailing?"

Ethics

Is the discipline that deals with moral duty and obligation. Also known as a set of moral principles or values.

Title VII of the Civil Rights Act

It does not take much sexual innuendo to constitute a "hostile work environment" and a sex discrimination charge under this.

What was unique about the Enron Era?

It included chief-level executives as the poster children for bad corporate ethics

Why is it important to have normative ethics instead of just descriptive ethics?

Just because many are participating in this questionable activity doesn't make it an appropriate practice.

Explain Law:

May be seen as a reflection of what society thinks are minimal standards of conduct and behavior.

What is Normative business ethics based on?

Moral common sense (being fair, honest truthful) or it might require critical thinking and the pursuit of different types of ethical analysis (interest based, rights based, duty based, virtue based)

Which ethics would insist that a practice be justified on the basis of some ethical principle, argument, or rationale before being considered acceptable.

Normative Ethics

Marist College Institute for Public Opinion in 2009

Not surprisingly, the survey found that Americans were more likely than business executives to express a negative opinion on the course and practices of Corporate America.

Gallup Poll

November 2009 The latest available, revealed that 38 percent of the public thought that business executives had low or very low ethics. Only 12 percent thought their ethics were very high or high, and 48 percent thought their ethics were average

What is the focus of Descriptive Ethics?

On learning what is occurring in the realm of behavior, actions, decision, policies, and practices of business firms, managers or, perhaps, specific industries. It also focuses on, "what is" the prevailing set of ethical standards in the business community, specific organizations, or on the part of specific mangers.

Michael Blumenthal

One time the US secretary of the treasury and the chief executive officer (CEO) of the brendix corporation, he thought that society was changing.

What does the Conventional Approach rely on?

Our use of common sense and a widely held sense of what is ethical.w

What is the primary way many companies display their CSR in the community - through good and charitable works?

Philanthropic Initiatives

Is it that Society is actually changing?

Some of the illegal activities that businesses were committing have come to light (they've been proven guilty) and businesses are adjusting to the changes caused by the guilty parties.

What is a real danger in limiting our attention to descriptive ethics?

That some people may adopt the view that "if everyone is doing it," it must be acceptable.

Macro Level

The entire business system has been called into question

Broad Level

The general perception of business ethics by the public Outside looking in

What does not address all realms in which ethical questions might be raised?

The law

Narrow Level

The specific perceptions as to what is going on inside of the organization. Inside looking out

Are the media reporting business ethics more vigorously?

There is no doubt that the media are reporting ethical problems more frequently and fervently. The media had found business ethics to be subjects of growing interest (meaning people want to hear about it more)

Talk about how law and ethics go hand in hand

They go together but the law may not always be ethical. If we break the law we are being unethical but sometimes we have to do what we believe is ethical.

What does Normative Ethics seek to do?

Uncover, develop, and justify basic moral principles that are intended to guide behavior, actions, and decisions. Also, seeks to propose some principle or principles for distinguishing what is ethical from what is unethical in the business practices.

Wallstreet Financial Scandals

We are not yet behind it

Enron

We witnessed the birth and accelerated maturation of the "ethics industry"

Practical Question

What is and what ought to be, (and what is our motivation for doing all this)

Normative Ethics

What ought to be By contrast, is concerned with supplying and justifying a coherent moral system of thinking and judging.

Descriptive Ethics

What really is Is concerned with describing, characterizing, and studying the morality of a people, and organization, a culture, or a society.

Ethical Relativism

Where we pick and choose which source of norms we wish to use on the basis of what will justify our current actions or maximize our freedom.

The spirit of the law often

extends beyond the letter of the law

The law embodies:

notions of ethics

Ken Lay

of Enron was convicted but died efore he could serve his prison sentence