What is Ethics?

 Trytel Case - Call Center High turnover – voluntary and involuntary terminations (4 for drinking before/during shift) Turnovers costly in terms of training and decreased capacity to handle volume Ryan – 10 year employee, punctual, one absence in 10 years, trainer and mentor to new employees  Recently has been drinking at lunch  His work has not been affected  Not clear he understood policy against drnking

 Issues that may be relevant to action to be taken against Ryan; Center is understaffed anyway and Ryan’s firing will make it worse Ryan’s firing will leave the center without its best trainer/mentor (who takes on those jobs without additional $ Others have been fired for drinking on the job – if Ryan is not fired, it will change the precedent Ryan’s actions violate company policy and company has a zero tolerance policy Ryan’s actions are the result of personal problems Other employees know Ryan has been drinking and that people have been fired fro what Ryan did

 Issues (continued): Ryan will have a hard time finding a comparable new job if he is fired Ryan will not have health insurance if he is fired As Ryan’s manager, you could lose your job if you don’t follow company policy Ryan is the most dependable employee No manager has ever successfully challenged a company policy If Ryan is fired, there is no money to advertise for a replacement for 6 months

 Managers’ positions: Asha- fire Ryan, ne violated company policy and others have been fired for the same thing Bernard – don’t do anything – no affect on work, good work record Carlos – refer the HR – they will fire him the right way Dimitri – talk to Ryan privately and warn him – he may not be aware that he has violated policy

 What would you do?  What factors are relevant?  Is there a difference between following company policy and acting ethically?  Is your gut reaction and ethical considerations different here?

 Ethics is about moral development and moral decision-making  Business ethics is about moral-decision- making Is there a difference between personal ethics and business ethics? Do gut reactions matter more in personal situation or business situations?

 Ethics philosophers John Locke (late 17 th century)  Theory of Rights  People have God-given, unalienable rights (Declaration of Independence)  It’s possible for a person to consider and preserve the rights of others and still act to benefit your self  Alicia’s new car and Jesse  Is that really an example of the Theory of Rights?  Was Jesse really thinking about Alicia’s rights or was Jesse thinking about the consequences to him?

 Ethical philosophers Immanuel Kant (mid-18 th century) Categorical imperative An act is ethical only if it would be ethical if everyone did it An act is ethical only if the reason for doing the act is to do the right thing Implications for corporate social responsibility (CSR) – results are not what counts, motivation is

 Ethics philosophers Jeremy Bentham/John Stuart Mills (19 th century) Utilitarianism/consequentialism Consequences of an act determine the ethics of the act An act is ethical if it results in the greatest good for the greatest number of people compared to other actions Ends justify the means

 Ethical philosophers John Rawls (20the century) Theory of Justice An act that violates a person’s right to justice and fairness is unethical Ends do not justify the means if someone’s right to justice and fairness is violated

Lawrence Kohlberg – moral development Level 1: Pre-conventional Step 1: Reaction to punishment - internal Step 2: Seeking rewards - internal Level 2: Conventional Step 1: Good boy/girl – external perception Step 2: Law & order – external focus Level 3: Post-conventional Step 1: Social contract – external effect Step 2: Universal ethics – completely external

 Application of Kohlberg’s theory Beth gains inside information that can be financially beneficial to her  Avoid punishment – using the information is illegal – will see get caught?  Seek reward – she can make money using the information – is that financial gain worth taking the chance that she will get caught?  Good girl – what will others think if they know she used the information?  Law & order – she knows using the information is illegal – is that enough to keep her from using it?

 Application of Kohlberg’s theory Social contract – she knows using the information is wrong – does she obey the social contract that says we can’t do things that we know are wrong. Universal ethics – she knows using the information will adversely affect others and that the world-wide financial system depends on people not improperly using information – does she look out for herself or society as a whole