Chapter4:Management Ethics and Social Responsibility
justice approach
holds that moral decisions must be based on standards of equity, fairness, and impartiality
preconventional level
individuals are concerned with external rewards and punishments and obey authority to avoid detrimental personal consequences.
postconventional
individuals are guided by an internal set of values based on universal principles of justice and right and will even disobey rules or laws that violate these principles.
chief ethics officer
a company's executive who oversees all aspects of ethics and legal compliance
principle based statements
are designed to affect corporate culture; they define fundamental values and contain general language about company responsibilities, quality of products, and treatment of employees
compensatory justice
argues that individuals should be compensated for the cost of their injuries by the party responsible
ethical dilemma
arises in a situation concerning right or wrong when values are in conflict, alternative choices or behaviors have potentially negative consequences, right or wrong cannot be clearly distinguished.
moral-rights approach
asserts that human being have fundamental rights and liberties that cannot be take away by an individual's decision
ethical responsibility
be ethical. do what is right. avoid harm.
triple bottom line
companies that embrace sustainability measure performance in terms of financial performance, social performance, and environmental performance
individualism approach
contends that acts are moral if they promote the individual's best long-term interests.
examples of Free Choice
deciding where to buy a new suit, or choosing which of two well-qualified candidates to hire for an open position
profit-maximizing view
economic responsibility carried to the extreme, this view argues that the corporation should be operated on a profit-oriented basis, with its sole mission to increase its profits so long as it stays within the rules of the game
whistle-blowling
employee disclosure of illegal, unethical, or illegitimate practices on the employer's part
unethical towards suppliers
-accepting favors or kickbacks -violating contract terms -paying without accurate records or invoices
human behavior falls into 3 categories
-codified law -domain of Ethics -domain of Free Choice
unethical towards employees
-discriminating against employees -creating a hostile work environment -violating health and safety rules
unethical towards customers
-false or deceptive sales practices -submitting misleading invoices -fabricating product quality data
unethical towards financiers
-falsifying financial reports -breaching database controls -using confidential information
unethical towards society
-violating environmental standards -exposing public to safety risks -violating international human rights
corporate credos
general statements of principle
percentage of adults to reach postconventional
20%
policy-based statements
generally outline the procedures to be used in specific ethical situations. these situations include marketing practices, conflicts of interest, observance of laws, proprietary information, political gifts, and equal opportunities.
Codified Law
which values and standards are written in the legal system and enforceable in the courts.
code of ethics
is a formal statement of the company's values concerning ethics and social issues; it communicates to employees what the company stands for.
ethics committee
is a group of executives appointed to oversee company ethics
green movement
is a special interest group of particular importance today
stakeholder
is any group or person within or outside he organization that has some type of investment or interest in the organization's performance and is affected by the organization's actions.
discretionary responsibility
is purely voluntary and is guided by the organization's desire to make social contribution not mandate by economics, laws, or ethics
Ethics
is the code of moral principles and values that governs the behaviors of a person or group with respect to what is right or wrong.
examples of Codified Law
licenses for cars, paying corporate taxes, or following other local, state, national laws
legal responsibility
obey the law
conventional level
people learn to conform to the expectations of good behavior as defined by colleagues, family, friends, and society.
Domain of Free Choice
pertains to behavior about which the law has no say and for which an individual or organization enjoys complete freedom.
stakeholder mapping
provides a systematic way to identify the expectations, needs, importance, and relative power of various stakeholders, which may change over times.
sustainability
refers to the economic development that generates wealth and meets the needs of the current generation while preserving the environment and society so future generations can meet their needs as well
distributive justice
requires that different treatment of people not to be based on arbitrary characteristics. i.e. men and women should not receive different salary if they have the same qualifications for a job
procedural justice
requires that rules be administered fairly. rules should be clearly stated and consistently and impartially enforced.
practical approach
sidesteps debates about what is right,good, or just, and bases decisions on prevailing standards of the profession and the larger society, taking the interests of all stakeholders into account.
economic responsibility
the first criterion of social responsibility, the business institution is, above all, the basic economic unit of society. its responsibility is to produce the goods and services that society wants and to maximize profits for its owners and shareholders.
moral agent
the individual who must make an ethical choice in an organization
utilitarian approach
the moral behavior produces the greatest good for the greatest number
Domain of Ethics
this domain has no specific laws, yet it does have standards of conduct based on shared principles and values about moral conduct that guide an individual or company.