Ethics & Social Responsibil ity MANAGING: A COMPETENCY BASED APPROACH 11 th Edition Chapter 3—Ethics and Social Responsibil ity Prepared by Argie Butler Texas A&M University Don Hellriegel John W. Slocum, Jr. Susan E. Jackson
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Transcript
Slide 111th Edition
Prepared by
Argie Butler
LEARNING GOALS
1. State the importance of ethics for individual employees and
organizations
Describe four influences that shape the ethical behavior and
decisions 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 and behavior
Ethics & Social Responsibility
SNAPSHOT
“While the majority of corporate CEOs are honest leaders dedicated
to building their companies, far too many got caught up in the
quest for personal gain and wound up sacrificing their values and
their stakeholders. Call it greed, because that’s what it is. It
threatens the very fabric of our system.”
William W. George, Former CEO and Chairman, Medtronic, Inc.
Ethics
*
Greater sales, brand image, and reputation
More employee loyalty and commitment
Less vulnerability to activist pressure and boycotts
Fewer or no fines, court-imposed remedies,
and criminal charges
Individual Influences
Culture
The dominant pattern of living, thinking, and believing that is
developed and transmitted by people, consciously or unconsciously,
to subsequent generations
Culture Values
*
*
Chapter 3: PowerPoint 3.7
Laws: Society’s values and standards that are enforceable in the
courts
Legality doesn’t always mean ethical
At one time U.S. organizations could legally discriminate against
women and minorities
Legal and Regulatory Influences
Examples of Lawful Reasons for Dismissing Employees
Incompetence in performance that does not respond to training or to
accommodation
Gross or repeated insubordination
Repeated lateness or unexcused absences
Drug activity or drunkenness on the job
*
Legal and Regulatory Influences
Blowing the whistle about illegal conduct by the employer
Reporting Occupational Safety and Health Administration
violations
Filing discrimination charges with the Equal Employment Opportunity
Commission or a state or municipal fair employment agency
*
Imposes rigorous auditing, financial disclosure, executive
compensation, and corporate governance requirements on publicly
traded companies
“…today’s compliance challenges are really information challenges.
At its core, the Sarbanes-Oxley Act is about ensuring that data is
turned into financial information in a way that enables accurate,
reliable, transparent and timely financial reporting.”
Lee Dittmar, Principal, Deloitte Consulting LLP
*
Create Formal Ethics System
Communicate Ethical Expectations
Organizational Influences
Reliability Principle: Honor commitments
Property Principle: Respect property and the rights of those who
own it
Fiduciary Principle: Act as a fiduciary (representative) for the
company and its investors
Transparency Principle: Conduct business in a truthful and open
manner
(continued)
Continued: Abbreviated Principles in a World Code of Ethics
Citizenship Principle: Act as responsible citizens of the
community
Fairness Principle: Engage in free and fair competition, deal with
all parties fairly and equitably
Dignity Principle: Respect the dignity of all people; protect the
health, safety, privacy, and human rights of others
Responsiveness Principle: Engage with parties who may have
legitimate claims and concerns relating to the company’s
activities
*
Obedience & Punishment
*
Kohlberg’s Stages of Moral Development (cont’d)
Obedience and Punishment Stage: a person does the right thing
mainly to avoid punishment or to obtain approval
Instrumental Stage: a person becomes aware that others also have
needs and begins to defer to them to get what the individual
wants
*
Kohlberg’s Stages of Moral Development (cont’d)
Law and Order Stage: a person considers proper behavior as doing
one’s duty (obligation), showing respect for authority, and
maintaining the social order for its own sake; loyalty to the
nation and its laws are paramount
Social Contract Stage: a person is aware that people hold a variety
of conflicting personal views that go beyond the letter of the law;
a “greatest good for the greatest number” emphasis
*
Whistle-blowing
Whistle-blowers: employees who report unethical or illegal actions
by their employers to other people or organizations that are
capable of taking corrective action
Four questions to ask before whistle-blowing
1. Is this the only way?
4. Am I ready?
Key Questions
not on the motives for such actions
Organizational Goal
Primary managerial obligation is to maximize shareholders’ profits
and their long-term interests
Efficiency
Conflicts of Interest
*
Core
Values
Rewards based on abilities and achievements
Sacrifice and hard work
Decisions should be consistent with fundamental rights and
privileges (e.g., life, freedom, health, and privacy).
Moral
Rights
Truthfulness
“If you are truly interested in teaching a grand and
critically important concept like honesty, you must be
willing to accept the awkward situations and inevitable
flaring of human passions that are certain to occur.
However, it’s unquestionably worth the effort.”
Tom Asacker, Business Consultant and Author of
Sandbox Wisdom
to how equitably they distribute benefits and costs
among individuals and group
Distributive Justice Principle
Requires that individuals not be treated differently on the basis
of arbitrarily defined characteristics
*
Fairness Principle
Requires employees to support the rules of the organization as long
as the organization is just (or fair) and employees have
voluntarily accepted some benefits or opportunities in order to
further their own interests
Both the organization and its employees have obligations and both
should accept their responsibilities
Procedural justice: formal process for investigating grievances and
taking remedial actions
*
Requires that decisions and behaviors be based on universal
principles associated
with being a responsible member of society
To support
and comply with just institutions
Not to cause unnecessary suffering
Help others who are in need or jeopardy, without excessive personal
risk
or loss
Universal
duties
Ideal in
identifiable groups that are affected by or can affect
the achievement of an organization’s goals
Enlightened self-interest
Sound investment
Inference avoidance
The
Organization
Media
Political
Action
Groups/
Activists
Unions
Suppliers
Employees
Shareholders
Nongovernmental
Organizations
Customers
Examples of Types of
Demands for efficiency/profitability
Examples of Types of
*
Sustainable Development
*
Sustainable Development
Using resources more efficiently and decoupling growth from
environmental damage
Recognizing that decisions and actions taken locally have global
impacts
Acting now to address sustainable development concerns, many of
which will be global and long-term in nature
Win-win-win solutions possible, rather than trade-offs between
social, environmental and economic issues
*
Proactive
Communication and