BUSINESS ETHICS BUS250

The Term Ethics derived from Greek word ‘Ethos’ which means ‘Character’. Deals with right and wrong, moral and immoral, good and bad etc. Behavior when Dealing with one another

Character has two major parts: performance character and moral character.

Responsibility to others Love (Compassion) Humility Integrity Justice Moral/Ethical Character Respect Responsibility to others Love (Compassion) Humility Integrity Justice Moral courage Performance Character Commitment to continuous improvement Goal setting Work ethic Determination Self-confidence Initiative Creativity

WHAT’S THE DIFFERENCE? Performance is the outcome (the grade, the honor or award, the achievement). Performance character consists of those qualities needed to pursue our personal best—whether the outcome is realized or not.

We asked high school students: ”What persons or experiences in high school have most influenced the development of your performance character?”

The importance of being challenged: “The person who has most profoundly affected my performance character is my basketball coach. He had me play power forward, even though I am only 5’4”. When I became frustrated, he never let me give up. I never before had to do anything so far out of my comfort zone.” —A High School Girl

Moral Character: Doing the Right Thing Moral character consists of the virtues needed for ethical behavior, positive relationships, and responsible citizenship. Moral character honors the interests of others, so that we do not violate moral values as we pursue our performance goals.

A person of character embodies both performance character and moral character.

How Ethical Are You

1 True or False: Most adults have solid, well-founded ethical beliefs that can be changed only by new evidence or reasoned arguments. False. Most people's ethical judgments are easily manipulated by simply changing contextual factors. By telling them that their boss has a certain view, that their peers have a certain view, or even just by spraying the room in which they make the decision with "Fart Spray"(yes, there is such a product), psychologists can alter people's ethical judgments. Because people generally do not realize how easily their ethical judgments are manipulated, they are prone to making poor ethical choices.

True or False I am more ethical than my peers. Who knows !! that most of us tend to be overly confident in our own morality, which can lead us to make ethical decisions without being sufficiently reflective.

3 John is the captain of a submarine 3 John is the captain of a submarine. An explosion has caused the sub to lose most of its oxygen supply and has injured a crewman who is bleeding badly and is going to die from his wound no matter what happens. The remaining oxygen is not sufficient for the entire crew to make it to the surface. The only way to save the other crew members is for John to shoot dead the injured crewman now. Then there will be just enough oxygen for the rest of the crew to survive. Is it morally acceptable for John to shoot the injured crewman? There is no incontestably right answer here. Were you more thoughtful in answering this question. Did yes answer 'yes' quickly or did you answer with your gut. When people answer ethical questions spontaneously, they tend to be more rule-based ("Thou Shalt Not Kill"). With more reflection, people tend to take a more utilitarian approach taking one life to save many).

True or False: Sally is a tourist in New York City True or False: Sally is a tourist in New York City. Late at night she is confronted by a vicious mugger on a side street. Sally starts screaming for help. Sally is better off if there are 20 bystanders close by rather than only one. 4 False. Because of the "bystander effect" — the tendency of people to take their behavioral cues from those around them — Sally may be better off with only one person nearby because that person will know that unless he or she helps, Sally will be in big trouble. If there are many people around, they may all look to each other to see what to do and if no one takes the lead, they may all end up doing nothing.

5 True or False: If you were in a job interview and an interviewer started asking you sexually inappropriate questions, you would stand up and walk out of the interview. 5 False. Probably anyway. In one study, when a group of young women were asked individually what they would do in this situation, virtually every one predicted that she would walk out of the interview or protest in some other fashion. But when other young women were actually put into what they thought was a real job interview, not a single one protested. They all wanted the job so much that the ethicality of the situation just faded away. Ethical decisions you are likely to make has a lot to do with how you look at the issue. For example, if you see it as an ethical issue you will tend to make different (and more ethical) decisions than if you look at it as simply a business decision.

6 Again, there is no really correct answer here 6 Again, there is no really correct answer here. Most people believe that the right thing to do is to save your brother, even though two people will die instead of one. Many psychologists believe that our tendency to favor in-group members (friends and family) in this way is evolutionarily based and helped our ancestors improve the chances that their genes would be passed down. There is quite a bit of evidence that our moral sense evolved to help us live together cooperatively in groups. True or False: You are driving and come upon a terrible collision between two cars that just happened. Both cars are on fire and will soon be consumed with flames, killing the occupants. You realize with horror that your brother is unconscious in one of the cars, while two strangers are unconscious in the other. You have time to save the occupants of only one of the cars. The moral thing for you to do is to save the two strangers.

Don't panic if you didn't correctly answer all six questions Don't panic if you didn't correctly answer all six questions. We all tend to overestimate our ability to act ethically "The big picture is that everybody...tends to think of themselves as good people with the confidence they'll make ethical decisions. But we aren't realistic about the pressures we face "The best way for us to prepare students is to explain how hard it will be to live up to their own standards."

Business ethics Meaning This means the business activities should be conducted according to ethics or moral standards.

Business ethics Definition Business Ethics is an art or science of maintaining harmonious relationship with society, groups and institutions as well as reorganizing for right or wrong of business conduct.

Ethics checking questions: Is It Legal? Is It Balanced? How Will It Make Me Feel About Myself?

Principles of business ethics AVOID EXPLOITATION OF CONSUMERS AVOID UNFAIR TRADE PRACTICES FAIR TREATMENT TO EMPLOYEES

AVOID PAYMENT OF BRIBE RESPECT CONSUMER RIGHTS ACCEPT SOCIAL RESPONSIBILITY

Importance of business ethics Improving consumer confidence Business become conscious of social responsibilities Protect consumer rights Create good image of business

Importance of business ethics Goodwill Profitability Survival of heated competition Safety from legal perspectives

Evaluating Ethical Decisions….think about Am I breaking any laws? Who are the stakeholders? What information am I missing? What are the short- and long-term consequences? Is my decision in line with my company’s core values? My personal core values? What would my mom think about this decision?

ETHICAL AND UNETHICAL HAVING MORAL VALUES FAIR PRICES FAIR WAGES NO VALUES NO ETHICS SHORT WEIGHTS AND MEASURES SUPPY INFERIOR QUALITY

Advantages of business ADVANTAGE TO BUSINESS MAN ADVANTAGE TO CONSUMER AND SOCIETY ADVANTAGE TO EMPLOYEES ADVANTAGE TO GOVERNMENT

A company's ethics will determine its reputation Good business ethics are essential for the long-term success of an organization A company's ethics will have an influence on all levels of business

Women and Administration, June, 2016 Individual rights, needs and demands are evolving The world is “Globalizaing” Why ethics now The news: Wall street, financial institution and people in public office. Individual rights, needs and demands are evolving The world is globalizing Women and Administration, June, 2016

Ethics What ethical principles that you acquired during childhood still guide you today?

VIRTUE Ethics Vocabulary COURAGE IDEALS SELF - RESPECT OBLIGATION RESPONSIBILITY OBLIGATION VIRTUE MORALS HONSETY COURAGE IDEALS CHARACTER SELF - RESPECT PROFESSIONALISM

Why Ethics is Central to Leadership Influence dimension - of leadership requires the leader to have the impact on the lives of followers Power and Control - differences create enormous ethical responsibilities for leader’s Respect for persons - sensitive to followers’ own interests, and needs Leaders help to establish and reinforce organizational values – provide an ethical climate

Ethical Leadership Combines ethical behavior with ethical decision making Requires the leader to foster ethical organizational behavior Who is the most ethical leader you know? Why did you think of this person? What are the characteristics you associate with this person. As ethical leaders we need to: Communicate the core principals of the organization. It needs to be done clearly and effectively communicated and we need to uphold the principals Provide tools for principal based decision making Clear standards Common decision making model Common vocabulary Mechanism for clarification and interpretation Mechanism for reporting wrong doing Model the behavior For leaders to be effective in a principal based organization, they must make the ethical component of their decision making explicit. Leaders must be able to point to key decisions and explain in detail how they up hold the ethical organizations principals Encourage the behaviors Decision making employees must explain, in detail, how the organization’s principals up held in any decision they advocate or present. Principals are discussed and celebrated

Ethical Leadership Ethical Knowledge Ethical Courage Ethical Conduct - Codes, rules, knowing right from wrong - Execution in the midst of pressure - Behavior that aligns with knowledge

Women and Administration, June, 2016 Character Ethics is not only about how we think and act, it is also about character Pattern of behavior or personality trait of an individual or group that denotes moral strength Drives what we do when no-one is looking Character is the sum of who we are and is cultivated over a lifetime. Character compromises of a person patterns of behavior, and is related to the moral qualities of individual self discipline and social responsibility. Women and Administration, June, 2016

Women and Administration, June, 2016 Character Involves a choice to act morally at all times We build character by how we live, thinking good thoughts, performing good acts. Similarly bad thoughts = bad behavior Character pertains to organizations too. Good character is no accident and is a continuous process of self discovery and commitment to ethical behavior. It doesn’t matter how long you live but, how you live your life. Cory Booker, a public servant from Newark, NJ serves the public interest with integrity and a hands on approach to addressing human problems. He has a blend of ethical, technical and leadership competencies in an virtue based public service ethos Women and Administration, June, 2016

Illegal but ethical Do you consider the following illegal but ethical? Running a red light if someone’s life depended on it Allow someone else to use your asthma inhaler Leasing a car or apartment in your name for a homeless family member

Women and Administration, June, 2016 Legal but unethical Do you consider the following legal but ethical? Legal to operate a pyramid scheme, but unethical to promise they will make $40K a week Nike: Overseas sweatshop Privatization of the world’s water supply Women and Administration, June, 2016

Work Place Ethics Business Abuse: Any, Illegal, unethical irresponsible act done against an employer resulting in: Higher prices Business Failure Fewer Jobs Unpleasant Working Conditions

Work Place Ethics Examples of Work Place Abuse Stealing Merchandise Money * Shoplift * Kickback * Conflict of Interest * Unauthorized Discounts Time

Work Place Ethics Examples of Work Place Abuse Vandalism Falsify Records Break Confidentiality Ignore Safety Rules Misrepresent Merchandise

Women and Administration, June, 2016 Work Place Ethics Examples of Work Place Abuse Poor Client Service Irresponsible Behavior Addictions * drugs * alcohol * tobacco Women and Administration, June, 2016

Women and Administration, June, 2016 Work Place Ethics Examples of Work Place Abuse Sexual Harassment Harassment of Co-worker or member of the congregation Unwelcome sexual advances Compliance as condition of employment Interferes with work performance through intimidation Gossip Cause poor work environment and lowers productivity Women and Administration, June, 2016

Work Place Ethics Increase Security loss prevention management. How Employers Respond to Work Place Abuse Increase Security loss prevention management. surveillance Networks Helplines Threats of prosecution Increase Employee Loyalty fair wages & benefits fair/consistent treatment recognition for good work foster family climate

Work Place Ethics As Employees, What Are your Choices? Ignore the abuse Rationalize it away Speak Up Discuss to Clarify Issues Blow the Whistle!

Ethical Decision Making Model STOP AND THINK CLARIFY GOALS DETER-MINE FACTS DEVELOP OPTIONS CONSIDER CONSE-QUENCES CHOOSE MONITOR AND MODIFY Lets practice

Determining an ethical action: Seven practical steps Is the actions legal? How will it make me feel about myself? Is it fair to all concerned? Is it the truth? Women and Administration, June, 2016

Determining an ethical action: Seven practical steps Will it build goodwill and better friendships? Will it cause anyone personal loss or pain, or violate confidentiality, or harm somebody in any other way? Is there a conflict of interest? Lets practice now. Women and Administration, June, 2016

Final Thought “If…. You can’t be a good example, then you’ll just have to be a horrible warning.”