 Ethics and Corporate Social Responsibility Nicki Sheridan, Nalini Priya, Kendra Gallion

Overview of Ethics  Discussion Question:  Define Ethics  Ethics is about doing the right thing within a moral framework.  The practical application of morality.  Not just determining what is right, but following through and doing what is right.

Test of Ethical Behavior  Morning-After Test  How will you feel about this behavior tomorrow morning?  Front-Page Test  How would you like to see this behavior written up on the front page of your hometown newspaper?  Mirror Test  How will you feel about this behavior when you look in the mirror?  Role Reversal Test  How will you feel about being on the receiving end of this behavior?  Commonsense Test  What does everyday common sense say about this behavior?

Trust & Total Quality  “The total quality approach cannot be successfully implemented in an organization that fails to subscribe to high standards of ethical behavior” (Goetsch, 2010, p. 75).  Ethical behavior builds trust.  Trust is essential to total quality.  Managers need to build trust in the organization as well as between employees.

Elements of Total Quality That Depend on Trust  Communication  Interpersonal Relations  Conflict Management  Problem Solving  Teamwork  Employee Involvement and Empowerment  Customer Focus

Values & Total Quality  An organization will not produce quality if the organizational values are not quality.  Ethical behavior begins with values  Values that lead to ethical behavior:  Fairness  Dependability  Integrity  Honesty  Truthfulness

Integrity & Total Quality  Integrity combines dependability and honesty  Discussion Question:  Does ethical behavior automatically follow if the organization has integrity?  Managers in a total quality setting need to strive for integrity vs. honesty

Responsibility & Total Quality  Accepting responsibility is part of ethical behavior.  Modern society has evolved to focus on rights but ignores the responsibilities that accompany those rights.  Total quality settings assure people are responsible for their actions rather than passing the blame.  Accepting responsibility builds trust, integrity, and other elements of ethics that are important to total quality.

Manager’s Role in Ethics  Must set consistent example of punctuality  Should be motivation and inspiration  Should be self disciplined, honest, and show commitment towards work

Manager’s Role in Ethics  Manager has three main responsibilities:  Responsible for setting example of ethical behavior  Responsible for helping employees make ethical choices  Responsible for helping employees follow through and exhibit ethical behavior after appropriate choice has been made

Approaches to Ethics  Best-Ratio Approach  Black and White Approach  Full-Potential Approach

Organization’s Role in Ethics  Create internal environment that promotes ethical behavior  Set example of ethical behavior

Ethical Environment  Establish policies and practices  Enforce policies  Develop ethics philosophy with key concepts:  Honesty  Integrity  Truth  Fairness

Setting an Example  Employees should be able to trust each other  Create ethical internal environment

Handling Ethical Dilemmas  What solutions are most likely to build trust among those involved?  What solution fits best into company’s value system?  What solution is most likely to enhance the organization integrity?  What solution is the most responsible option?

Ethics Training  Employee theft  Conflict of interest  Quality control  Misuse of company property  Environmental pollution  Method’s of gathering competitor’s information

Ethics Training  Inaccuracy of books and records  False or misleading advertising  Political contribution and activities  Improper relations with local and federal government representatives  Improper relations with foreign government officials

Codes of Business Conduct  Ethics training is becoming increasingly important as the pressures of succeeding is an intensely competitive global market place will frequently face ethical dilemmas.  Encourage two way communication  Make training practical  Avoid dogmatic statements

Ethical Decision Making Ethical issue intensity Business ethics evaluations and intentions Ethical or unethical behavior Individual factors Organizational factors Opportunity

Ethical Decision Making  Decision making models  Categorical imperative  Full-disclosure  Doctrine of the mean  Golden rule  Market-ethic  Organizational ethic  Equal freedom  Proportionality ethic  Professional ethic

Belief vs. Behaviors  Discussion Question:  What is dishonesty?  Self-Interest vs. Self-Protection  Conflicting values  i.e. Honesty vs. Loyalty  Tangible vs. Intangible

Social Responsibility  Four steps of Social Responsibility:  Philanthropic  Ethical  Economic  Legal

Social Responsibility and Ethics  Social responsibility  i.e. PNC Financial Services Group donates $28 million yearly in grants and scholarships for arts, community improvement, and education.

Corporate Social Responsibility  Also known as CSR  Discussion Question:  What is corporate social responsibility (CSR)?  “A good company delivers excellent products and services; a great company delivers excellent products and services and strives to make the world a better place” (Ford Jr. as cited in Goetsch and Davis, 2010, p. 90).

Case Study  Group Activity  Case Study  Treating your female employee differently based on her gender or in response to a harassment complaint may be considered discriminatory and unethical conduct.

Closing  Business Ethics Video  What should you learn from it?

References  Examples of Ethical Issues in Business. (n.d.). Small Business. Retrieved November 6, 2013, from smallbusiness.chron.com/examples-ethical-issues- business html  Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2011). Business ethics: ethical decision making and cases (8. ed.). Mason, OH: South-Western Cengage Learning.  Goetsch, D. L., & Davis, S. (2010). Quality management for organizational excellence: introduction to total quality (6th ed.). Upper Saddle River, N.J.: Prentice Hall.