Bus. Eth. 1

Sustainability

Relates specifically to the environment

Corporate social responsibility

Actions associated by firms with various stakeholder interests as a priority.

Shareholders are

those who have partial ownership of a company because they have bought stock in it.

Ethics Contributes to Profits

-Better business performance. -Part of strategic planning toward obtaining the outcome of higher profitability. -Business ethics is becoming more than just a function of compliance; It's becoming an integral part of management's efforts to achieve competitive advantage.

Bottom Line for Bus. Eth.

-Firm survival -Profitability, revenues, sales -Stakeholders: customers, employees, channel members (manufacturers, wholesalers, retailers) -Contribute to societal goals: community, country, world

Ethics Contributes to Customer Satisfaction

-High levels of perceived corporate misconduct decreases customer trust. -Companies viewed as socially responsible increase customer trust and satisfaction. -Consumer respondents stated they would pay more for products from companies that give back to society in a socially responsible and sustainable manner.

Values

Enduring beliefs and ideals that are socially enforced

The Benefits of Business Ethics

Ethics Contributes to Employee Commitment, Investor Loyalty, Customer Satisfaction, Profits

Ethical culture

Organizational principles, values, and norms that are adhered to by the company and its personnel.

Business ethics

Organizational principles, values, and norms that may originate from individuals, organizational statements, or from the legal system that primarily guide individual and group behavior in business.

Morals

Personal philosophies that define right and wrong.

Value dilemma

Two or more beliefs/ideals in conflict with one another.

A stakeholder is

anyone who is impacted by a company or organization's decisions, regardless of whether they have ownership in that company.

Moral dilemma

Two or more morals in conflict with one another.

Ethics Contributes to Investor Loyalty

-Provides a foundation for efficiency, productivity, and profits. -Negative publicity, lawsuits, and fines can lower stock prices, diminish customer loyalty, and threaten a company's long-term viability. -Demand for socially responsible investing is increasing.

Ethics Contributes to Employee Commitment

-Willingness to sacrifice for the organization. -Increases group creativity and job satisfaction; decreases turnover. -Less pressure to compromise ethical standards, -Greater absence of misconduct. -Strong community involvement increases loyalty and positive self identity.

The Process of Legal to Unethical to Illegal Business Practice

1. A major event occurs that negatively sensitizes the public to a business practice. 2. The public uses social media to increase awareness. 3. Legislators (local, state, and federal) become sensitized to the negative business practices. 4. Bills, laws, and local, state or federal agencies are introduced to make specific items illegal or regulated.

Principles

Specific boundaries for behavior that often become the basis for rules