Ethical Issues in Business Chapter 2 Ethical Issues in Business
Ethical Issues are... problems, situations, or opportunities requiring an individual to choose among actions that may be evaluated as right or wrong, ethical or unethical ethical issues arise because of: conflict among personal/organizational values conflicts with societal values
What do you see as some of the causes of unethical behavior?
Causes of Unethical Behavior... meeting overly aggressive financial or business objectives meeting schedule pressures helping the organization survive rationalizing that others do it resisting competitive threats saving jobs
Influences on Ethical Behavior... personal values attitudes/behaviors of supervisor attitudes/behaviors of senior management internal drive to succeed performance pressures no threat of punishment friends/coworkers
Why not report organizational misconduct? afraid of not being considered a team player did not believe corrective action would be taken fear retribution or retaliation from management not on else cares about business ethics, why should I fear lack of confidentiality
Classification of Ethical Issues... conflict of interest honesty & fairness communications issues organizational relationships
Conflict of Interest... exists when an individual must choose whether to advance his or her own personal interests, those of the organization, or some other group must be able to separate personal interests from business dealings bribery is a significant concern
Honesty & Fairness honesty relates to truthfulness, integrity & trustworthiness fairness related to being just, equitable & impartial breaking or bending laws violates trust business should not be played as a “game” lack of rules & poor enforcement leads to unethical behavior
Communications... issues involved relate to advertising, product safety, pollution, & employee work conditions lying is a major ethical issue with internal & external communications false advertising relates to: exaggerated claims concealed facts & ambiguous statements lying
Organizational Relationships... relate to behavior of organizational members toward customers, suppliers, subordinates, superiors, peers & others plagarism is one ethical issue of concern to organizations
Ethical Issues Related to Ownership... owners have an obligation to society as well as their employees & customers minimize pollution compensate workers fairly produce safe products must be sensitive to legal & ethical risks of their industry & region
Financial Responsibilities... reporting & use of the companies’ finances pricing products/services fairly avoiding any antitrust activities price fixing sensitivity to socially responsible investing
Employees & Management Concerns... employee theft, sabotage & competitive intelligence fear of layoffs salary plateaus upward mobility discrimination privacy & data access health & safety
Consumer & Marketing Issues... Must consider consumer feedback safety environmental (can lead to boycotts) maximize positive publicity & avoid negative
How to Identify an Ethical Issue... an activity approved by most members of the organization & customary in the industry is probably ethical if the issue withstands open discussion between groups within & outside the organization is probably ethical covert discussion, destroyed or disguised documents indicate potential problems