Bs Ethics n Social Resp Ch 6 of 11

7/31/2019 Bs Ethics n Social Resp Ch 6 of 11

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Chapter 4: BUSINESS ETHICS AND SOCIAL

RESPONSIBILITY

Doing Well by Doing Good


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ETHICS AND SOCIAL RESPONSIBILITY

ETHICSBeliefs about

right and wrong.

SOCIALRESPONSIBILITY

The obligation of a businessto contribute to society.

A close relationship, but not the same


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ETHICS: MURKIER THAN YOU THINK


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UNIVERSAL ETHICAL STANDARDS

Developed by Character Counts , a nonpartisan organization of educators,community leaders, and ethicists.


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BUSINESS ETHICS: NOT AN OXYMORONEthical Dilemma

Two unfavorable options with Negative consequences. most challenging business decisions seem to arise when

values are in conflict Business Ethics the application of right and wrong in

the workplace Ethical Lapse Clear misconduct


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ETHICS AND THE INDIVIDUAL

Framework for Ethical Decisions1. Do you understand the dimensions of the problem?

2. Who would benefit? Who would suffer?

3. Are the alternative solutions legal? Are they fair?

4. Does your decision make you comfortable?

5. Could you defend your decision on the nightly news? Or toyour mother? Or to God?


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Creating and Maintaining an Ethical Organization

Organizational Culture sets the ethical culture and isled by Top Management

An effective Code of Ethics has:

Executive buy-in Clear expectations Integrated approach Global and local Whistleblower support Reporting and enforcement


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ETHICS FAME AND SHAME

Dennis Kozlowski, former CEO of Tycowas convicted of looting

millions from the company.

Ethics Hall of Shame

Brian Mulroney, former Prime Minister of Canada, admitted he accepted $225,000 in

cash, six years after doing so (and thenpaid tax on half of it.)

Martha Stewart was convicted of obstructing justice in a $40,000 well-

timed stock sale.

Sheron Watkins, former vice president of Enron reported the accounting irregularitiesthat led to the discovery of corporate fraud.

Ethics Hall of Fame

Pierre Omidyar, the founder of eBay has

given away over $100 million to helpgive economic power to the worlds poor.

Paul Newmans food company donates100% of the profits to charity, totaling

more than $150 million to date.


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SOCIAL RESPONSIBILITYa commitment to minimize business negative effects and

maximize the positive ones.

Responsibility toWhom?

Stakeholders are any

groups that have a stake

or a personal interest - in theperformance and actions

of an organization.


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RESPONSIBILITY TO EMPLOYEES

INVESTORS

COMMUNITY

ENVIRONMENT

CUSTOMERS

Creating Jobs that Work

Sustainable Development

Value, Honesty, and Communication

Fair Stewardship and Full Disclosure

Business and being good citizens

GOVERNMENT Follow laws, regulations, pay taxes


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RESPONSIBILITY TO EMPLOYEES: CREATING JOBS THAT WORK

Meet legal standards Workplace safety Minimum wage/Overtime requirements Value employees Provide work/life balance


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RESPONSIBILITY TO CUSTOMERS

CONSUMERISM: The Right to Be Safe

The Right to Be Informed

The Right to Choose

The Right to be Heard


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ROTTEN APPLE?

Planned Obsolescence Deliberately designing products to fail in order to shorten the timebetween consumer repurchases

APPLE COMPUTERS: iPods had irreplaceable battery. Batteries died after 18 months.

Customers were encouraged to purchase new iPods Two customers posted high profile protest movies online. APPLE announced replacement program.


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RESPONSIBILITY TO INVESTORS

Legal requirements U.S. Sarbanes-Oxley Act

Responsible use of corporateresources

Is optimism or pessimism sociallyresponsible?

FAIR STEWARDSHIP AND FULL DISCLOSURE


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RESPONSIBILITY TO COMMUNITY

Corporate Philanthropy - businessdonations to nonprofit groups, includingboth money and time. Corporate Responsibility - The actionsof the business rather than donations of

money and time.


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RESPONSIBILITY TO ENVIRONMENT

Green Marketing marketing environmental products andpracticesto gain a competitive edge .Greenwashing marketing environmentalpractices when there is no real green effort.


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RESPONSIBILITY TO ENVIRONMENT Responsibility to environment is a part of

responsibility to community

Reducing the amount of trash is more importantthan recycling

Although consumers support green marketing, theymay not be willing to sacrifice quality


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ETHICS AND SOCIAL RESPONSIBILITY IN THE GLOBAL AR

Corruption is part of the culture in many countries Bribes or gifts

Labour issues in host countries can be complicated Living wage Child labour Code of Conduct


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MONITORING ETHICS AND SOCIAL RESPONSIBILITY

SOCIAL AUDITA systematic evaluation of how well

a firm is meeting its ethics and socialresponsibility objectives

Bs Ethics n Social Resp Ch 6 of 11

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