Transcript Slide 1

Chapter 1-REVIEW
An Introduction to the
Fundamentals of Dynamic
Business Law and Business
Ethics
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Business Law
Definition: Enforceable rules of
conduct that govern commercial
relationships
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Functional Areas of Business
Affected By Business Law
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Corporate Management
Production and Transportation
Marketing
Research and Development
Accounting and Finance
Human Resource Management
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Purposes of the Law
• Providing order
• Serving as an alternative to
altercation
• Facilitating a sense that change is
possible
• Encouraging social justice
• Guaranteeing personal freedoms
• Serving as a moral guide
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Classification of Law
• Private Law: Involves
disputes between
private individuals or
groups
• Public Law: Involves
disputes between
private individuals or
groups and their
government
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Classification of Law
• Civil Law: Involves
the rights and
responsibilities
involved in
relationships between
persons and between
persons and their
government
• Criminal Law:
Involves incidents in
which someone
commits an act
against the public as
a whole
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Sources of Business Law
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Constitutions
Statutes
Cases
Administrative Law
Treaties
Executive Orders
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Major Federal Administrative
Agencies (Independent)
• Commodity Futures Trading Commission
• Consumer Product Safety Commission
• Equal Employment Opportunity
Commission
• Federal Trade Commission
• Federal Communications Commission
• Interstate Commerce Commission
• National Labor Relations Board
• National Transportation Safety Board
• Nuclear Regulatory Commission
• Securities and Exchange Commission
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Major Federal Administrative Agencies
(Executive)
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Federal Deposit Insurance Corporation
Occupational Safety and Health Administration
General Services Administration
National Aeronautics and Space Administration
Small Business Administration
International Development Cooperative Agency
National Science Foundation
Veterans Administration
Office of Personnel Management
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Business Ethics and Social
Responsibility
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Business Ethics and Social Responsibility
• Ethics: The study and practice of decisions
about what is good or right
• Business Ethics: The application of ethics
to the problems and opportunities
experienced by businesspeople
• Ethical Dilemma: A problem about what a
firm should do for which no clear, right
decision is available
• Social Responsibility of Business:
Expectations that the community imposes
on firms doing business inside its borders
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The “WPH” Process of Ethical
Decision Making: W—WHO
(Stakeholders)
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Consumers
Owners or Investors
Management
Employees
Community
Future Generations
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The “WPH” Process of Ethical
Decision Making: P—PURPOSE
(Values)
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Freedom
Security
Justice
Efficiency
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Primary Values and Business
Ethics: Freedom
• To act without restriction from
rules imposed by others
• To possess the capacity or
resources to act as one wishes
• To escape the cares and
demands of this world entirely
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Primary Values and Business
Ethics: Security
• To possess a large enough supply of
goods and services to meet basic
needs
• To be safe from those wishing to
interfere with your property rights
• To achieve the psychological
condition of self-confidence such that
risks are welcome
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Primary Values and Business Ethics:
Justice
• To receive the products of your labor
• To treat all humans identically,
regardless of race, class, gender,
age, and sexual preference
• To provide resources in proportion to
need
• To possess anything that someone
else was willing to grant you
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Primary Values and Business Ethics:
Efficiency
• To maximize the amount of
wealth in society
• To get the most from a particular
output
• To minimize costs
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The “WPH” Process of Ethical
Decision Making: H—HOW
(Guidelines)
• The Golden Rule
• Public Disclosure Test
• Universalization Test
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Six Ways To Interpret “The Golden Rule”
• Do to others as you want them to gratify you
• Be considerate of others’ feelings as you want
them to be considerate of yours
• Treat others as persons of rational dignity like you
• Extend brotherly or sisterly love to others, as you
would want them to do to you
• Treat others according to moral insight, as you
would have others treat you
• Do to others as God wants you to do to them
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