Transcript ethicsnew_autosaved

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Ethics and Social
Responsibility
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Ethics
Standards of moral behaviour
that is accepted by society as
right versus wrong.
+ Ethics
and Legality
Are Two Different Things
How should
people treat
others?
Laws we have
written to
protect
ourselves from
fraud, theft &
violence
What
responsibility
should they
feel to others?
Ethics
Legality
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Complete an
Ethics
Questionnaire
Write 1 to 9 on a piece of
looseleaf and answer the
following questionnaire
+ Ethics Questionnaire
1.
2.
3.
Which is worse?
A.
Hurting someone’s feelings by telling the
truth.
B.
Telling a lie and protecting someone’s
feelings.
Which is the worst mistake?
A.
To make exceptions too freely.
B.
To apply rules too rigidly.
Which is worse to be?
A.
Unmerciful
B.
Unfair
+ Ethics Questionnaire
4.
5.
Which is worse?
A.
Stealing something valuable from
someone for no good reason.
B.
Breaking a promise to a friend for no
good reason.
Which is it better to be?
A.
Just and fair.
B.
Sympathetic and feeling.
+ Ethics Questionnaire
6.
7.
Which is worse?
A.
Not helping someone in trouble.
B.
Being unfair to someone by playing
favourites.
In making a decision you rely
more on
A.
Hard facts
B.
Personal feelings and intuition
+ Ethics Questionnaire
8.
9.
Your boss orders you to do something
that will hurt someone. If you carry out
the order, have you actually done
anything wrong?
A.
Yes
B.
No
Which is more important in determining
whether an action is right or wrong?
A.
Whether anyone actually gets hurt.
B.
Whether a rule, law, commandment, or
moral principal is broken.
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How to Score


The answers fall in
one of two
categories, J or C.
Count your number
of J and C answers
using this key.
1.
A=C
B=J
2.
A=J
B=C
3.
A=C
B=J
4.
A=J
B=C
5.
A=J
B=C
6.
A=C
B=J
7.
A=J
B=C
8.
A=C
B=J
9.
A=C
B=J
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Meaning of Your Score

The higher your J score,
the more you rely on an ethic of justice.

The higher your C score, the more you prefer an
ethic of care.

Neither style is better than the other, but they are
different.

The styles are complementary.
Your score probably shows you rely on each style.

The more you appreciate both approaches, the
better you’ll be able to resolve ethical dilemmas
and to understand and communicate with
people who prefer the other style.
+ Ethics
is More Than Legality
 It
is not uncommon to hear of instances where
business people are involved in unethical behaviour.
 After
two years of denying accusations, WestJet
Airlines admitted to spying on Air Canada.

WestJet was accessing a confidential Air Canada website
designated for reservations.
 As
part of the settlement WestJet will pay Air
Canada’s investigation and litigation costs of $5.5
million and make a $10 million donation in the name
of both airlines to children’s charities across Canada.
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What can be done
to restore trust in
business and business
leaders?
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Laws don’t make
people honest,
reliable or truthful.
If laws were a big
deterrent, there
would be much
less crime.
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Ethical Standards Are
Fundamental
Moral Values - Right
Integrity
Honesty
Respect for
Human Life
Self-control
Courage
Selfsacrifice
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Ethical Standards Are
Fundamental
Moral Values - Wrong
Cheating
Cowardice
Cruelty
+ Undercover Boss
Lush Cosmetics
Full episode on YouTube.com
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Ethical Campaigns

We are, and always have
been, a campaigning
company.

We believe in standing up
for animal rights, protecting
the environment and
supporting humanitarian
causes.
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With over 150 stores in North
America, we have a unique
platform to create positive
change in our world, and
we put our ethics into
practice through activism
and charitable giving.
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Charitable Giving

Charitable giving is at the
heart of our business, and we
believe it's our responsibility to
advocate for the
environment, animals and
people in need.

In 2007, we invented a
beautiful hand and body
lotion called Charity Pot.

100% of the purchase
price goes towards
supporting humanitarian,
environmental and
animal rights causes
locally and around the
world.
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Ethics Begins with
Each of Us
We cannot expect society to become
more moral and ethical unless we as
individuals commit to becoming more
moral and ethical ourselves.
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Ethics Begins with
Each of Us
 Ethical
behaviour should be exhibited in our
daily lives, not just in a business
environment.
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 How
do we do this?
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Handouts
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What is an
Ethical
Dilemma?
There is no desirable
alternative.
You must choose between
equally unsatisfactory
alternatives.
+ Ethical
Dilemma Questions
1.
Is it legal?
2.
Is it balanced?
3.
How will it make
you feel about
yourself?
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Ethical Dilemma Questions
1.
Is it legal?
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Am I violating any law or company policy?

Whether you are thinking about:

having a drink and then driving home
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gathering marketing intelligence or
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hiring or firing employees
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It is necessary to think about the legal
implications of what you do.

This question is the most basic one in
behaving ethically in business.
+ Ethical
2.
Dilemma Questions
Is it balanced?

Am I acting fairly?

Would I want to be treated this way?
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Will I win everything at the expense of another party?

Win-lose situations often end up as lose-lose situations.
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
There is nothing like a major loss to generate retaliation
from the loser. For example many companies that were
merely suspected of wrong doing have seen their stock
drop dramatically.

Not every situation can be completely balanced, but it is
important to the health of our relationships that we avoid
major imbalances over time.
An ethical business person has a win-win attitude
trying to benefit all parties involved.
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Ethical Dilemma Questions
3.
How will it make me feel about myself?
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Would I feel proud if my family or friends learned of my
decision?

Would I be able to discuss the proposed situation or
action with my immediate supervisor? The company’s
clients?

How would I feel if my decision were announced on the
news?

Will I have to hide my actions?

Am I feeling unusually nervous?

Decisions that go against our sense of right and wrong make
us feel bad – they corrode our self-esteem.

An ethical business person does what is proper as well as
what is profitable.
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Progress Assessment
1.
What is ethics?
2.
How does ethics differ from legality?
3.
When faced with ethical dilemmas,
what questions can you ask yourself
that might help you make ethical
decisions?
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Managing
Businesses Ethically
& Responsibly
People learn their standards
and values from observing
what others do, not from what
they say.
+ Managing Businesses
Ethically & Responsibly
A
business should be managed ethically for
many reasons to:
Maintain a good reputation
Attract and keep customers
Avoid lawsuits
Reduce employee turnover
Avoid government intervention
Please customers, employees and society and
Do the right thing
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Setting Corporate Ethical
Standards
Although ethics codes vary greatly, they can be
classified into two major categories:
Compliance-based Ethics

Ethical standards that
emphasize preventing
unlawful behaviour by
increasing control and by
penalizing wrongdoers.
Integrity-based Ethics
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Ethical standards that
define the organization’s
guiding values, create an
environment that
supports ethically sound
behaviour, and stress a
shared accountability
among employees.
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Which one is better?
+ GM
Recall : The Switch
From Hell
 It
was a deadly defect in an ignition switch that
led to the recall of millions of GM cars like the
Cobalt and the Ion and the confirmed deaths
of almost 30 drivers, with close to 200 more
being investigated.
 https://www.youtube.com/watch?v=Pwt1Dc2X
D6Q
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Handout & video
 What
are the accusations being made by
Chinese environmental groups?
 http://www.youtube.com/watch?v=7QPUf9DsTL
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As of Feb. 13, 2012
 Apple's
largest supplier, the FoxConn
Technology group, has announced Friday it will
raise wages by 16 to 25 per cent after criticism
over its labour practices.
 The
factory's workers have seen three separate
wage increases since 2010, and under the new
agreement will now make 1,800 yuan ($290 US)
a month, up from 900 yuan two years ago.
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Sample EF English teacher
monthly budget

To give you an idea of how an average EF English teacher in China
spends his or her salary, here is a sample monthly budget:

Gross Income (Salary) : 12,350 RMB

Rent : 3500 RMB
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Utilities (electricity, gas, water) : 250 RMB
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Phone & Internet : 300 RMB
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Food : 1500 RMB

Insurance : 295 RMB

Remaining Disposable Income : 6,505 RMB
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The Renminbi (RMB) is the official currency of the People's
Republic of China (PRC).
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Made in Bangladesh
 https://www.youtube.com/watch?v=onD5UOP5
z_c
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 Price

fixing
Is a practice in which the prices for goods and services
are manipulated in a way which is designed to benefit
specific companies or individuals.
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Don’t write this
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If two companies happen to sell competing
products at the same price, it is only considered
price fixing if collusion can be proved.

In other words, if two supermarkets both sell packs of
a dozen eggs at the same cost, this would not be
illegal.

If, however, someone could prove that the owners
of the supermarkets held a secret meeting in which
they decided to sell their eggs at the same price, it
would be considered price fixing.
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Irving example
 http://www.cbc.ca/news/canada/new-
brunswick/story/2012/09/28/nb-irving-oil-pricefix-quebec-charge.html
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Questions for video
 Who
does it hurt?
 Should
it really be illegal? Why?
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Corporate Social
Responsibility
(CSR)
A business’s concern for
the welfare of society as
a whole.
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Corporate Responsibility in the
Twenty-first Century
There are different views of coroporate
responsibility to stakeholders:
1.
The strategic
approach requires
that management’s
primary orientation be
toward the economic
interests of
shareholders.
The pluralist approach
recognizes the special
responsibility of
management to raise
profits, but not at the
expense of employees,
suppliers, and members
of the community.
2.

This view says that
corporations can make a
profit only when they fulfill
their moral responsibilities to
society as a whole.
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Responsibility to Customers

Customers prefer to do business with companies they trust
and, even more important, do not want to do business
with companies they don’t trust.

One responsibility of business is to satisfy customers by
offering them goods and services of value.

One of the surest ways of failing to please customers is not
being totally honest with them.

The payoff of socially conscious behaviour could result in
new business as customers switch from rival companies
simply because they admire the company’s social efforts
– a powerful competitive edge.
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Responsibility to Investors
 Ethical
behaviour is good for shareholder
wealth.
 Unethical
behaviour may seem to work for the
short term, but it guarantees eventual failure.
 In
the 2005 Canada’s Most Respected
Corporations survey, 89% of Canadian CEOs
agreed with the statement that “companies
that are more respected by the public enjoy a
premium in their share price”.
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Insider Trading
 An
unethical activity in which insiders use
private company information to further
their own fortunes or those of their family
and friends.
 Martha
Walters:

Stewart’s Interview with Barbara
Part 1 and Part 2
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Responsibility of Employees
 Once
a company creates, jobs, it has an
obligation to ensure that hard work and talent
are fairly rewarded.
 Part
of treating employees well is ensuring that
employers of all sizes provide a safe work
environment.

The Canadian Labour Congress (CLC) believes that
there are well over 1,000 workers who die annually from
workplace causes and there are more than one million
who suffer workplace injuries.
 When
employees feel they’ve been treated
unfairly, they often strike back.

How do you think employees would strike back against
the company?
+ Responsibility
to Society
 Businesses
need to develop long-term
profitable relationships with their
customers by establishing repeat
business.

Repeat business is based on buying safe and
value-laden products, at reasonable prices.
 Many
companies believe business has a
role in building a community that goes
well beyond giving back.

Their social contributions include cleaning up the
environment, building community toilets, providing
computer lessons, caring for the elderly, and
supporting children from low-income families.
+ Responsibility to the
Environment
 Businesses
are often criticized for their role in
destroying the environment.

The Sydney Tar Ponds are North America’s largest
hazardous waste site.

More than 80 years of discharges from the steelproducing coke ovens near the harbour have filled
Muggah Creek with contaminated sediments.

Two decades later, there have been several attempts
and more than $100 million spent to clean up this
toxic site.

In May 2004, the governments of Canada and Nova
Scotia committed $400 million to the cleanup. It is
expected that this cleanup will take ten years.
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Earl Jones
 http://www.cbc.ca/fifth/episodes/2009-
2010/earl-jones-in-trust
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 Give
your opinion
+ Codes
of Ethics-Don’t write
this, use this for last question
Trait
Compliancebased
Purpose
To conform to internallydetermined standards, as
To obey laws and regulations
well as obey laws and
regulations
Aim
Leader
Strategy
Integrity-based
To avoid criminal conduct
To enable responsible
employee conduct (which
includes adhering to the law)
Lawyers
Managers within the business
(with the help of legal
counsel)
Education, controls,
penalties, less employee
discretion
Education, controls,
penalties, decision
processes likely to involve
employees, leadership,
accountability
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Handout
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Ethics web quest project
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What is Whistleblowing

whistleblowing occurs when an employee or worker
provides certain types of information, usually to the
employer or a regulator, which has come to their
attention through work.

The disclosure may be about the alleged wrongful
conduct of the employer, or about the conduct of a
fellow employee, client, or any third party. The
whistleblower is usually not directly, personally
affected by the danger or illegality, although they
may be.
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The Sarbanes-Oxley Act (SOX) of
the United States
 SOX
requires all public corporations to provide a
system that allows employees to submit
concerns regarding accounting and auditing
issues both confidentially and anonymously.
+ Whistle-blowing
Legislation in Canada
 Bill
 It
C-11 was passed in November 2005.
provides for significant powers to
investigate wrongdoing; it contains clear
legal prohibition of reprisal against those
who make good-faith allegations of
wrongdoing; and it proposes measures to
protect the identity of persons making
disclosures.
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Public Servants Disclosure Protection
Act (PSDPA) which defines
wrongdoing as:

Violating any federal or provincial law or regulations;

Misusing public funds or assets;

Gross mismanagement in the public sector;

Doing something or failing to do something that creates a
significant and specific danger to the health, safety or life
of persons or to the environment;

Seriously breaching the Values and Ethics Code for the
Public Sector and/or Canada Post’s Code of Conduct;
and

Knowingly directing or counselling a person to commit a
serious wrongdoing
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Progress Assessment
1.
How are compliance-based ethics
codes different from integrity-based
ethics codes?
2.
What protection is being offered to
whistle-blowers in the public sector?
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 Is
Whistle- blowing ethical or not?
 Explain
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Whistleblowing Project
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International Ethics and
Social Responsibility
 Prime
Minister Stephen
Harper introduced
legislation to make the
government more
honest and transparent
through the Federal
Accountability Act.

This Act promises to end
undue influence on
government by big
business, unions, and
industry lobbyists.
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International Ethics and
Social Responsibility

Many businesses are demanding socially responsible
behaviour from their international suppliers by
ensuring that suppliers do not violate domestic
human rights and environmental standards.

In contrast to companies that demand their
suppliers demonstrate socially responsible behaviour
are those that have been criticized for exploiting
workers in less developed countries.

Nike, has been accused by human rights and labour
groups of treating its workers poorly while lavishing millions
of dollars on star athletes to endorse its products.

Nike is working to improve its reputation, in part by joining
forces companies and six leading anti-sweatshop groups
to create a single set of labour standards with a common
factory-inspection system.
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International Ethics and Social
Responsibility

The justness of requiring international suppliers to adhere
to domestic ethical standards is not as clear-cut as you
might think.

Is it always ethical for companies to demand compliance with
the standards of their own countries?

What about countries in which child labour is an accepted
part of the society and families depend on the children’s
salaries for survival?

What about foreign companies doing business in Canada –
should these companies comply with Canadian ethical
standards? What about multinational corporations?
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International Ethics and
Social Responsibility
 The
International Standards Organization (ISO)
developed a new standard on social
responsibility that includes guidelines on product
manufacturing, fair pay rates, appropriate
employee treatment, and hiring practices.

These standards are advisory only and will not be used
for certification purposes.
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International Ethics and Social
Responsibility
 The
formation of a single set of
international rules governing
multinational corporations is unlikely in
the near future.
 In
many places, “Fight corruption”
remains just a slogan, but even a slogan
is a start.
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Progress Assessment
1.
Explain why legality is only the first step in behaving
ethically and ask the three questions one should
answer when faced with the potentially unethical
action.
2.
Describe management’s role in setting ethical
standards and distinguish between compliance-based
and integrity-based ethics codes.
3.
Define corporate social responsibility and examine
corporate responsibility to various stakeholders.
4.
Discuss the responsibility that business has to customers,
investors, employees, society, and the environment.
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1.
What is corporate social responsibility, and
how does it relate to each of a business’s
major stakeholders?
2.
How does the strategic approach differ from
the pluralist approach?