LEB 320F Ethics Quiz
money
o Morality is rooted in social relationships and thinking about money weakens those relationships and have an adverse effect on ethical decision making o When thinking about money its more about you, not the people around you; you are more willing to lie and act unethically o People must be wary that a having such a narrow focus on money does not cause them to act unethically
ethics
study of morality by systematically exploring moral values, moral standards and obligation, moral reasoning, and moral judgments system of beliefs that tells us what to do when there is not law that tells us - common sense what you do when there are no formal rules to govern behavior
false consensus effect
tendency to believe that other people think the same way we do o People are not good at detecting when they are being lied to but to the contrary believe they are astute judges of honesty - manifests self in large groups - if someone says something you disagreed with but you don't open your mouth you created false consensus
rationalization strategies: denial of injury
the actors are convinced that no one is harmed by their actions; hence the actions are not really corrupt
rationalization strategies: appeal to higher loyalties
the actors argue that their violation is due to their attempt to realize a higher-order value
rationalization strategies: social weighting
the actors assume 2 practices that moderate the salience of corrupt behaviors: 1. condemn the codemner, 2. selective social comparison
rationalization strategies: denial of victim
the actors counter any blame for their actions by arguing that the violated party deserved whatever happened
rationalization strategies: denial of responsibility
the actors engaged in corrupt behaviors perceive that they have no other choice than to participate in such activities
rationalization strategies: metaphor of the ledger
the actors rationalize that they are entitled to indulge in deviant behaviors because of their accrued credits (time and effort) in their jobs
morality
the appropriate treatment of our fellow human beings
analyzing ethical issue - consider:
the speaker the source the communication medium timing context
situational factors and ethical decision making
time pressure money conclusion
time pressure
Business people should monitor themselves because when they face extreme time pressure they are more likely to make ethical missteps than otherwise
role morality
Concept that people may adopt different moralities for different roles they play in society - change your ethics based on where you are or what you are doing ex. Jack abramoff - wearing different hats at home and at work
entertainment voting paradox
-you can sit on couch and cheer for something all you want but if don't get up and do something you have problem on your hands -people may verbalize one direction but actions don't prove it ex. CEO of cancer society
moral reasoning process
1. ID the issues (narrowly) 2. ID and apply rules/governing principals 3. analyze 4. weigh and prioritize 4b. consider "excusing conditions" 5. conclude
moral reasoning and decision making
1. Narrowly defined issues 2. Identify governing principles 3. Apply governing principles to facts and circumstances 4. Make defensible decisions
agents of capital view
agents of capital; agents of the shareholders who own the corporation and provide its capital • Only duty is to earn as much money as possible for the shareholders, within the limits of the law and customary ethical practices -only concerned about 1 thing and that is capital or money -ex. investment banking and hedge funds, Enron
obedience to authority
all of us tend to defer to authority Stanley Milgram experiments o When people make decisions they are often much more concerned about the acceptability of the decision to the people to whom they are accountable than they are about the content of the decision itself o Acceptability heuristic - people often judge whether their decision is right not in terms of content or philosophical ethicality but whether it will be acceptable to their superiors o People are much more likely to undertake an unethical action in the workplace when urged to do so by a superior than to choose that unethical course of their own volition - respect authorities - want to please boss so sweep ethics aside
illegitimate norms
are incompatible with hypernorms→values that infringe upon fundamental human rights
external control factors
are more contextual factors and tend to hold more weight
internal control factors
are skills, abilities, emotions, and compulsions
vitacraves gummy vitamins example
artificially flavored but picture of fruit on it - ethical failure on transparency and honesty front
simple root cause analysis
asking the question "why" over and over again until you get to the root of the cause
group dynamics
groups of employees often behave differently than any single employee would have behaved in isolation, because the dynamics of the group transcend individual reason and autonomy
priorities
have to weigh things out for yourself valued opinion vs. discounted opinions (ex. beard) prevalence of following rules vs. cutting corners
overconfidence
how you perceive your own behavior and ability to succeed. You think you are the best at something and therefore you will succeed - most common type of behavior seen with business execs who engage in poor ethical/legal decisions - it's about me and context doesn't matter - inflated ego syndrome and about how good you think you are not about the rest of world conforming to you
fundamental attribution error
human tendency to underestimate how situational factors affect other's decisions and actions and to overestimate how those same factors impact your decisions and actions creating error when don't take in circumstances and who person is on inside
groupthink
impairment of individual decision making causes collections of people to make much different decisions than the same people would make individually -leader of group sets forth idea and group decides to follow idea -everyone thinks exactly the same way because verbal leader says something
3 important qualities in hiring ethical people
integrity, intelligences, and energy
sustainable development
is development that meets the needs of the present without compromising the ability of future generation to meet its needs
role readiness
is making sure employees are prepared to do the job that is expected of them
conclusion: Fundamental attribution error
is people's tendency to underestimate how situational factors affect other' decisions and to overestimate how much they affect their own o We tend to assume that other people do bad things because they are bad people, but believe that we do bad things because we had to o Social and organizational factors, cognitive heuristics and biases, and situational factors affect everyone's ethical decision making o These factors are an explanation for bad decision making, not an excuse for it
moral disengagement
is the process of making detrimental conduct personally acceptable by persuading oneself that the questionable behavior is actually morally permissible
ethics on the global stage
is thinking whatever works for the foreign nation works for us
moral spillover
is when attitude about one instance spills over and effects someone's behavior
ethical fading
is when the ethical dimension of decisions you face can fade into the background and you may miss them altogether
logal and moral standards
legal standards have a different source than moral ones, consequences of violating either are different, legal and ethical standards clearly influence one another but not the same
most professionals have fooled themselves into believing they are ethical because:
(legality does not equal ethics) (rationalization) age money experience education network title
teflonic identity maneuvering
- high level professionals dissociating from their actions ex. Tom brady - no one cares he cheats - Teflon tom - things flying off his back
auction fever
- jealousy/envy - wants things when someone else wants it - increased desirability of sought after items/people - built up into something more because other people wanted it too
constanza fire syndrome
- there are people in world that when there is danger they will push elderly and small children in way - so selfish that at any cost they will push anyone out of the way because something bad has happened - at any cost will save themselves - runs and leaves you standing there
4 categories of business problems
1. ethical and legal 2. unethical and illegal 3. legal and unethical 4. illegal but ethical
moral minimum from class
1. honesty 2. transparency 3. keeping your commitments 4. doing no harm
conformity bias
AKA social proof bias towards conforming to the actions and standards we perceive to be acceptable by our peers - people more likely to undertake unethical actions in workplace and elsewhere if peers are engaging in similar behavior - acting/projecting same way as everyone else around you is behaving
pre-scripting
It makes sense for people who wish to act ethically during their professional careers to spend time envisioning ethical problems that they may confront in their careers and to anticipate how they will react when faced with such dilemmas
moral minimum: keeping commitments
Social and commercial relationships among people are quite difficult maintain without accepting the notion that we should keep the promises we make to each other
jack abramoff and framing
blind to own frames often adopt frame without realizing it dealt with it later blind to ethical issues framed so ethical issues were not in the picture at all
agents of society view
business is when it wants to give back to the society, and cares about the health and welfare of the society • Those who argue that it's both appropriate and morally obligatory for corporations to contribute to the correction of problems they did not cause -just being this is bad thing for business because won't have business for very long -cares about environment -ex. Austin pets alive
self-awareness
can't be afraid to turn lens on self recognize that you have done something wrong too
Three prominent methods of accomplishing continued corruption of newcomers being socialized into their corrupt environment:
co-optation compromise incrementalism
slippery slope of business problems
common sense --> PR or HR --> ethics --> legal problems start out small but grow over time if ignored and if you try to cover it up the slippery slope happens
aristotelian virtue ethics approach
concentrates more on the actor attempting to become virtuous person in all aspects rather than on the resolution of specific ethical issues each person should focus on developing and practicing important virtues if a person embodies these virtues, the decisions they make will likely be good ones
moral sense
confers an evolutionary advantage by enabling humans to enjoy the many benefits of living in groups
rationalization strategies:
denial of responsibility denial of injury denial of victim social weighting appeal to higher loyalties metaphor of the ledger
utilitarianism
ethical theory that is committed solely to the purpose of promoting the greatest good for the greatest number consequentialist theory - concentrates on the consequences of moral choices to attempt to calculate which course of action will lead to the best result for the most people
reasonable persona standard (RPS)
everyone has their own truth have to step outside self and recognize we can all be unreasonable instructs you to be a reasonable person
moral relativism
focuses on differences of moral constructs morals relative to world around you
moral pluralism
focuses on what is same across different systems of morality
moral codes tend to contain
negative appraisals of certain acts of harming others, values pertaining to reciprocity and fairness, requirements concerning behaving in a manner benefitting one's status in the social hierarchy, regulations clustering around bodily matters
incrementalism
newcomers are gradually introduced to corrupt acts; likely to slide down a slippery slope; more likely to do something they would have originally said no to
ethical actors
o Active knowing wrongdoers who know that they are doing wrong and are active proponents of the fraud o Passive but knowing wrongdoers who realize at some level they are involved in the wrongdoing but persist often because of pressures from superior or peers (don start but don't try to stop) o People who are important to the fraud but are unaware of the wrongdoing involved in
Most valued traits of potential employees among a list of 12 were
o Communication and interpersonal skills o Team skills o Ethics
the tangible and the abstract
o Decision making is naturally impacted more by vivid, tangible, contemporaneous factors than by factors that are removed in time and space o People are more concerned about family and friends close to them, than starving people abroad o More about short-term than long-term o Moral distance is the idea that the farther a person is located from the impact of the consequences of his or her actions, the easier it is to act immorally - in-groups vs. outgroups - we care more about things that hit closer to home - if things happen to us or people close to us we care about it but if it happens to people far away from us we don't care ex. Apple workers far away
jack abramoff and overconfidence bias
o Didn't think he was being unethical o Tend to think more ethical than neighbors or coworkers and if overly confident we just assume we are being ethical than not o If off course and thinks ok then that person cant come back or notice what they're doing - jack poster child for that o 92% think more ethical than others o stopped caring o didn't lack in confidence o Read torah everyday o Susceptible to this o Became arrogant - had a lot of success - won everything - arrogance in not listening to things he didn't want to hear
sunk costs
o Escalation of commitment o People will attend a play that they have decided they don't really want to see just because they have already bought the tickets o Sunk costs can lead to an escalating commitment where people throw good money after bad in a deteriorating situation -the more we invest in something the more we stick with it until the bitter end - once we start allocating resources to something/investing ourselves in something it gets harder and harder to stop
jack abramoff and self-serving bias
o Every client he took weren't ideologically problematic for him o Bias that is devilish - we have filters and so the way we gather and process and remember info is affected by our own self interest o People underestimate how much incentives matter or own bias matters o People who are conservative watch Fox and more liberal watch MSNBC - don't want to believe another way o Believed in causes he fought for o Represented casinos - sometimes tried to get them open for clients and other times tried to close some down because it competed against his clients - thought his side was always right o People selectively remember stuff that makes them look good o Mind has tricked them into believing this o Reverse unfortunate trend
jack abramoff and rationalizations
o Excuses we give ourselves for not living up to own ethical standards o Elaborate scheme of rationalizations that prevented him from seeing things he was doing was wrong o Most people tell a little lie to get benefits
jack abramoff and moral equilibrium
o Passionate in helping people o Responded to people's needs by giving them money o When have running scoreboard in head we try to keep track if we are living up to own self image and we try to compensate and find good deeds to do o Giving away 80% of money to good causes o Helping people and helped him to feel good about what he was doing o Moral licensing - if we do something good we often give ourself license not to live up to standards o Giving away money - good feeling - helped decrease capacity to analyze what he was doing - say he was a saint o Give himself license not to live up to moral standards b/c doing good in other ways so what he was doing was fine or he didn't see it as bad
overoptimism
o People tend to think that good things are more likely to happen to them than to others and that bad things are less likely to be inflicted upon them than upon others o Evolutionarily beneficial but can lead to systematic errors in decisions making and in some circumstances it can induce conduct that appears unethical - contextual - we want to believe the best will happen even if its irrational - better situation gets the more unrealistically optimist we get - don't want to think bad things will ever happen to me - more about how the world will revolve around you
People who strive primarily for achievement and wealth are less happy on average than those whose strivings focus on 3 other categories:
o Relationships and intimacy o Religion and spirituality o Generativity (leaving a legacy and contributing something to society)
self-serving bias
o The tendency we have to gather information, process information, and even remember information in such a manner as to advance our self-interest and support our pre-existing views o Even when people try their hardest to be fair and impartial, their judgments are inevitably shaded by it o Confirmation bias o Even affects how people remember information - people are more likely to recall evidence that supports their point of view than evidence that opposes it - people involved in negotiations tend to remember information that supports their bargaining position more than information that undermines it o Causal attribution theory - people have a tendency to attribute to themselves more than average credit for their company's or team's successes and less than average responsibility for its failures o People have need to see themselves as "good and reasonable" - let's in all good stuff about you and keeps out all the bad stuff about you - covering up mistakes instead of accepting them
jack abramoff and role morality
o Thought he was great and moral - approached clients they wont lose o Give clients what they paid for o Tendency that people have when in job that my personal ethical standards don't apply here b/c I am playing a diff role o Conflicts of interest part of o Bribing legislators to get results during day
cognitive dissonance
o To avoid uncomfortable psychological inconsistency, once people have made decisions of taken positions they will cognitively screen information and tend to reject that which undermines their decisions or contradicts their positions - makes it difficult for the person to process accurately new, contradictory information - selective filter that screens information about the world - accept info that fits your view of world and reject everything else - don't believe something is true so you reject it ex. Aziz Ansari sexual assault and lovable comedian
time-delay traps
o When an action has both short-term and long-term consequences, the former are much easier for people to consider o People who prefer immediate gratification over delayed gratification o In the short-run people often face temptations that are difficult to resist; tendency to become increasingly impatient - short-term consequences easier for people to consider than long-term consequences - when you consider short-term consequences but ignore long-term consequences ex. Enron; tequila shots
whistleblowers
o Whistleblowers can be misinformed, make mistakes in judgment, overreact, vindictive, and delusional, but they can also serve of the conscience of the firm o The good whistleblowers can do outweighs the bad o IT requires the audit committee of public corporations to set up a mechanism for whistleblowers to communicate to the board o The Dodd-Frank Act of 2010 added further protections for whistleblowers
social and organizational pressures and ethical decision making
obedience to authority conformity bias (social proof) groupthink false consensus effect
rules based approach
one's behavior is morally defensible only if everyone else could do the same thing without interfering with optimal functioning of an organized society deontological approach - may focus on act of and not consequences (to treat individuals as ends in themselves and avoid lying, cheating, stealing, other wrong behaviors) treat others the way you wish to be treated 10 commandments sort of analysis
trust
our perception of another's ethics
cognitive heuristics and biases and ethical decision making
overoptimism overconfidence self-serving bias framing role morality cognitive dissonance sunk costs tangible and the abstract time-delay traps loss aversion
loss aversion
people hate losing more than they like winning and will go to greater lengths to avoid losing than to win o Endowment effect is the notion that we easily attach ourselves to things and then value them much more than we valued them before we identified with them oPeople detest losses more than they enjoy gains, about twice as much -related to sentimental value - emotional value we assign to real world products - often goes with sunk costs -psychological fear of losing and that fear is greater than the joy of winning - economically irrational ex. first car
consistent norms
represent values that are less universal and more culturally specific than hypernorms→"we exist to serve to customer" or :our goal is to advance the health of individuals"→most companies operating around the word should follow these consistent norms
hypernorms
represent values that would be fully accepted in almost all culture and organizations→fundamental human rights→things that should be observed no matter where in the world they are operating
co-optation
rewards are used like compensation to convince people what they are doing is not unethical
Donaldson and Dunfee's Integrated Social Contract Theory (ISCT)
says that domestic ethical values cannot be absolute, some account must be taken of local cultural standards (legitimate and illegitimate norms on outside, hyper norms in middle, consistent norms, moral free space)
moral minimum (textbook)
set of general standards that constitute the ethical minimum necessary for the functioning of civilization 1. honesty 2. loyalty 3. keeping commitments 4. doing no harm
big ethical problem or not? starbucks vs. hostess examples
starbucks sued for too much ice - no hostess cakes recalled due to undeclared peanut reside - yes - life or death situation
philosophical approaches to ethical reasoning
utilitarianism (consequentialist theory) rules based approach (deontological approach) aristotelian virtue ethics approach
framing
we make decisions based on context o People's risk preferences change dramatically depending on whether an option is framed in terms of a potential loss or potential gain - ex. whole milk and fat, la croix
moral free space
when companies find norms that are inconsistent with at least some other legitimate norms existing in other economic cultures, and may even be in mild tension with hypernorms→they express unique, but strongly held, cultural beliefs→require creativity to accommodate
compromise
where individuals essentially back into corruption in an attempt to resolve a pressing problem
early lessons in business
you won't get paid people are lazy and selfish people are immature if you aren't bleeding it's not a problem
moral minimum: loyalty
• A moral duty of loyalty is based on 2 facts: • By virtue of relationship we have created in the other person a legitimate expectation that we will further his or her interests • Relationship has placed us in a position where we have the ability to cause serious harm if we do not act in that person's interests • When we enter relationships we take on affirmative obligation to: • Fully disclose to the other person all material information that is relevant to our dealings • Keep confidential any information that the other party reasonably expects us to protect • Avoid undisclosed conflicts of interest • Generally act in the best interests of the other party even if such action is not entirely our own best interests
In order for a code of ethics to actually make an impact companies should consider:
• Employee engagement in writing and revising the code = buy in • Word the code clearly • Reward employees who follow it • Utilizing the code to resolve ethically issues • Remember that strengthening the structure, process, and values that reinforce ethical behavior is a never-ending process
suggestions for changing peoples mind
• Help other see the "big picture" through a long-term lens • Don't be a "goody two-shoes"→be able to offer alternative strategies; constructive criticism • Be pragmatic→generate and forcefully present alternatives that make it feasible and reasonable for others to select the ethical course of action (even if they may do so reluctantly)
group dynamics factors
• Individuals may not view their conduct as really their own • A member of a group may feel that there is safety in numbers • Formal lines of authority and accountability within organization may be fuzzy, thus increasing the chances that no single person feels responsible • Communication among individuals within the decision-making group may be less than perfect, and thus different individuals or subgroups may be acting on the basis of somewhat different facts and assumptions
moral minimum: doing no harm
• Negative effects are those that damage some legitimate interest of another person • Narrower legal counterparts for the obligation of doing no harm are found
self model
• People not only decide what is the "right" way to act in a given situation by making a moral judgment, but they also make a decision regarding their own responsibility for acting on the judgment • The criteria for making these judgments arises from a person's moral identity, which reflects the degree to which being moral is an essential characteristic of the person's sense of self • The model emphasizes the human tendency to strive for self-consistency
moral minimum: honesty
• Rational person does not have to justify telling the truth • Without reasonable expectations of honesty, we cannot maintain the personal and business relationships that create and economic wellbeing • Principles in the legal domain that are intended to encourage
rationalizations are:
• Self serving explanations • That assist in making behavior appear more acceptable to both self and others • Involve a degree of self deception • Often occur outside the realm of the conscious mind • Can reduce feelings of responsibility and/ore anxiety for the negative aspects of behavior • Can neutralize the impact of legal or ethical issues involved in a decision
