Transcript CH3

Chapter 3
Ethics and
Social Responsibility
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1
Learning Objectives
• State the importance of ethics for individual
employees and organizations.
• Describe four forces that influence the ethical
behavior of individuals and organizations.
• Describe three approaches that people use
when making ethical judgments.
• Explain stakeholder social responsibility and
how it influences managers’ ethical decisions.
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2
Shaping Ethical Conduct
(adapted from Figure 6.1)
Cultural Forces
Fundamental American personal values include:
 honesty
 integrity
 trustworthiness
 respect for other people
 self-respect
 family
 achievement
 reliability
 fairness
 loyalty
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3
Shaping Ethical Conduct
(adapted from Figure 6.1)
Cultural Forces
Legal and Regulatory Forces
Laws are society’s values and standards that
are enforceable in the courts.
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Examples of Lawful and Unlawful Reasons
for Dismissing Employees
(adapted from Table 6.1)
Some Permissible Reasons
Some Unacceptable Reasons
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Incompetence in performance that
does not respond to training or to
accommodation
Gross or repeated insubordination
Civil rights violations such as
engaging in harassment
Illegal behavior such as theft or
physical violence
Repeated lateness or unexcused
absences
Drug activity or drunkenness on the
job
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•
•
•
•
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Blowing the whistle about illegal
conduct by the employer
Reporting OSHA violations
Filing discrimination charges with
the EEOC or a state or municipal fair
employment agency
Filing unfair labor practice charges
with the NLRB or a state agency
Engaging in union activities,
provided there is no violence or
unlawful behavior
Complaining or testifying about
violations of equal pay, wage, or
hour law
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Shaping Ethical Conduct
(adapted from Figure 6.1)
Cultural Forces
Legal and Regulatory Forces
Organizational Forces
A code of ethics states the principles that
employees are expected to follow when
acting on behalf of the organization.
Some recommended actions include
 Create a formal ethics system
 Communicate ethical expectations
 Include ethical conduct as a measure of
performance evaluations
 Make it acceptable to talk about ethics
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Shaping Ethical Conduct
(adapted from Figure 6.1)
Cultural Forces
Legal and Regulatory Forces
Organizational Forces
Individual Forces
 Moral Development
 Whistle Blowing
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Whistle-Blowing
• Anyone considering whistle-blowing should
consider the following
–
–
–
–
Is this the only way?
Do I have the evidence?
Why am I doing this?
Am I ready?
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Shaping Ethical Conduct
(adapted from Figure 6.1)
Cultural Forces
Legal and Regulatory Forces
Organizational Forces
Individual Forces
Ethical Conduct
• Individual
• Organization
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Making Ethical Judgments
• The utilitarian approach focuses on behaviors
and their results, not on the motives for such
actions.
– Achieving organizational goals
– Efficiency
– Conflicts of interest
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Making Ethical Judgments
• The moral rights approach holds that decisions
should be consistent with fundamental rights
and privileges.
–
–
–
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Life and safety
Truthfulness
Privacy
Freedom of conscience and speech
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Making Ethical Judgments
• The justice approach involves evaluating
decisions and behavior with regard to how
equitably they distribute the benefits and costs
among individuals and groups.
– Distributive Justice Principle
– Fairness Principle
– Natural Duty Principle
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Stakeholder Social Responsibility
• Stakeholder social responsibility holds that
managers and other employees have
obligations to identifiable groups that are
affected by, or can affect the achievement of
an organizations goals.
• Stakeholders are individuals or groups that
have interests, rights, or ownership in an
organization and its activities.
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Common Stakeholders of Organizations
(adapted from Figure 6.2)
Media
Secondary Stakeholders
Governments
(Regulatory Agencies)
Primary Stakeholders
Customers
Political
Action
Groups/
Activists
Suppliers
The
Organization
Employees
Unions
Shareholders
Nongovernmental
Organizations
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Examples of Types of Pressures from Primary
Stakeholders
(adapted from Table 6.3)
• Employees
–
–
–
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Pay and benefits
Safety and health
Rights at work/global labor standards
Fair/ethical treatment in hiring, reviews, promotion, and related
areas
• Shareholders
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–
–
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Demands for efficiency/profitability
Viability (sustainability)
Growth of investment
Ethical disclosure of financial information
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Examples of Types of Pressures from Primary
Stakeholders (cont.)
(adapted from Table 6.3)
• Customers
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Competitive prices
Quality and safe products
Respect for customers’ privacy
Concern for environment
Truthful/ethical advertising and sales practices
• Suppliers
– Meet commitments
– Repeat business
– Fair trade practices/ethical treatment
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Evaluating Social Performance
• Proactive Responsibility
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Broad performance criteria
Ethical norms
Operation strategy
Response to social pressures
Legislative and political activities
• Social Audits
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