Business Administration Unit 1 Business and Its Environment Chapter 2 Social & Ethical Environment of Business

Controversial Issue Text Book – Page 31 Because most jobs require more skills than in the past, should the minimum amount of education be raised to 18 years or a high school diploma 3-5 reasons for yes 3-5 reasons for no Text Book – Page 31 Read The Supervisor’s Secret

Population Size & characteristics of population important in business planning Growth rate Birth/death/immigration rate Better health care, live longer U.S. accepts more immigrants than any other country

Changing Population Baby Boom – born 1945-1965 Large # people approaching retirement within 10-20 years Baby Bust – after baby boom Shortage of workers Businesses must respond Different ages/racial groups

Moving Population 1 out of 5 move each year Frost Belt Rust Belt Northern half of country Rust Belt North central & north east Manufacturing firms dominated Sun Belt Southern half of country

Moving Population Businesses left rust belt: Unemployed workers Closed factories Decaying towns Homeless people Cities lose financial power Crime & poverty increases

Labor Force Ages 16 & up, available for work Employed or unemployed Bureau of Labor Statistics U.S. labor force is approximately 140 million

Labor Force Labor participation rate Poverty – 12-15% live in poverty % of labor force employed or actively seeking employment Rate has increased – women Poverty – 12-15% live in poverty Inner-city slums or rural areas Poorly housed, clothed & fed Female pay increases +.07/Male +.24

Equal Employment Glass Ceiling Sticky Floor Syndrome Invisible barrier to job promotion Sticky Floor Syndrome Entry-level positions, little hope of advancement Low paying, require little skill or education

Comparable Worth Paying workers equally with similar job requirements Same level of training/skills 1966 women .58 to men $1 1996 women .74 to men $1 2006 women .79 to men $1 Gap closes average ½ cent yr.

Societal Values Family - # kids living w/both parents + divorce/single mothers - birth rate Women delaying marriage Both parents working Quality of life suffers

Societal Values Gen. X – post baby boom Net Gen. – born 1977-1997 Less loyal to employer Expect to change jobs Net Gen. – born 1977-1997 Glass ceiling causes women to open own businesses Women own/operate majority of small businesses

Societal Values Changes in society include: Services Eating out Fast food Active lifestyle Law suit happy society Services Dry cleaners House cleaners Day care Delivery services Violence

Redesigning Jobs Repetitive tasks = boring Redesign jobs Work Teams Productivity drops Redesign jobs Varied, challenging, interest Knowledge to do other jobs Work Teams Improve morale/quality of work

Family Friendly Law – unpaid leave for Day care facilities Care of sick kids/parents Give birth or adopt Day care facilities Flexible scheduling Telecommute Stay in contact electronically

Environment Pollution Environmental Protection Agency (EPA) Fed Gvt. created in 1974 Control & reduce pollution Clean air & clean water acts Cars – fuel efficient & less polluting Hazardous materials Recycled materials

Environment Pollution CERES Principles Coalition of environmentally responsible economies Formed after Exxon Valdez accident in 1989 Voluntary – not legally required Sunoco first major co. to follow See page 43 - fig. 2-4 for chart

Controversial Issue Should all firms be required to use the CERES Principles (p.43) rather than practicing the principles only on a voluntary basis? 3-5 reasons for yes 3-5 reasons for no

Ethics Standards of moral conduct Defines behavior as right or wrong Set by individuals/groups Defines behavior as right or wrong Linked closely with personal values Is it right or wrong, regardless of laws

Business Ethics Principles & rules of business – Right or wrong behavior Accepting gifts from clients Using company supplies for personal use Code of ethics Formal, published values & rules Reflects firms philosophy & goals

Text Book Page 45 – Ethical Issues Read article Answer 4 questions on paper Check if done Discuss in class

Social Responsibility Business contribution-society Obligation to community Stakeholders Affected by firm’s actions Owners, customers, suppliers, employees, creditors, public, gvt.

Social Responsibility Donate money Ben & Jerry’s – donates 7% pre-tax profit to charity Sponsor exhibit College scholarships Day care for employees

Conclusion Questions Describe one example of changes in population. What effect does that change have on business? Discuss business ethics and the responsibility businesses have to society.

Group Work Text Book – pages 52-54 Solve Business Problems 3-4 students in a group Case 2-1 – 3 questions Case 2-2 – 4 questions Check if done Review in class

Work Book Pages 9 & 10 Pages 12-14, Do Problems Chapter 2 Study Guide Turn in Pages 12-14, Do Problems 2A,B,D,E - Check if done Review in class

End of Chapter 2