Chapter 9 of Ethics

Benefits of Ethics Audits

-Detect ethical misconduct before it becomes a major problem -Better account for their actions -Learn about the ethical culture for the organization -Improved relationship with stakeholders -Prepare for ethical disasters

Social Audit

Assessing and reporting a business's performance in fulfilling the four dimensions - economical, legal, ethical, and philanthropic responsibilities of stakeholders

Stage 3 of Ethics Auditing Process

Define the scope of the audit process

Stage 2 of Ethics Auditing Process

Establish a committee to oversee the ethics audit

Stage 7 of Ethics Auditing Process

Report your findings

Risks of Ethics Audits

-The process of conducting an ethics audit may foster stakeholder dissatisfaction -Auditing a firm's ethics programs is no guarantee that it will avoid challenges related to its efforts -It may find that one or more of its stakeholders criticisms cannot be dismissed or easily addressed -May uncover a serious ethical problem that it would prefer not to disclose until it can remedy the situation -Imposes burdens and costs form firms to undertake it -Few commons standards to judge disclosure and effectiveness or to make comparisons

Ethics Audit

A systematic evaluation of an organization's ethics program and performance as compared to the firms desired ethical standards to determine what's effective. Can be a precursor to setting up an ethics program

Triple Bottom Line

Captures values and criteria for measuring organizational success - economic, societal, and environmental

Stage 5 of Ethics Auditing Process

Collect and analyze relevant information

Balanced Scorecard

Focuses on all the elements that contribute to organizational performance and success - financial, customer, market, and internal processes

Output Controls

Involves setting standards against actual behavior, such as an ethics audit

Stage 1 of Ethics Auditing Process

Make sure upper management is on board - top managers and board of directors

Six Sigma

Manage process variations that cause defects and systematically works toward managing variation to eliminate those defects

Process Controls

Management commitment to the program and evaluation methods

Stage 4 of Ethics Auditing Process

Review organizational mission, values, goals, and policies that define ethical commitment

Stage 6 of Ethics Auditing Process

Verify the results

Formal Controls

any of the inputs you put into the company. Tools and resources - employees, ethics training, and communication systems