Chapter 3 Copyright © 2011 by Nelson Education Ltd. 1 Social Trends, Social Responsibility, and Making Ethical Decisions in Business Social Trends, Social Responsibility, and Making Ethical Decisions in Business Prepared by Norm Althouse University of Calgary Prepared by Norm Althouse University of Calgary

Chapter 3 Learning Outcomes Copyright © 2011 by Nelson Education Ltd. 2 1.Identify some of the current social factors that have the greatest impact on business. 2.Explain how demographic shifts are creating both challenges and new opportunities for business. 3.Discuss the philosophies and concepts that shape personal ethical standards. 4.Show how organizations can encourage ethical business behaviour. 5.Define social responsibility. 6.Illustrate how businesses meet their social responsibilities to various stakeholders. 7.List some of the global and domestic trends in ethics and social responsibility.

Chapter 3 Social Trends and Responsibility and Ethics Copyright © 2011 by Nelson Education Ltd. 3 The growing importance of ethical practices by business. The growing importance of ethical practices by business. Ethics Social change and its impact on business. Social change and its impact on business. Social Trends The responsibilities a business has to its stakeholders. The responsibilities a business has to its stakeholders. Social Responsibility

Chapter 3 SOCIAL TRENDS 4 Copyright © 2011 by Nelson Education Ltd. Social Factors Social Factors Attitudes Values Lifestyles  Growth of Component Lifestyles  Increase in Two-Income Families

Chapter 3 DEMOGRAPHIC TRENDS 5 Copyright © 2011 by Nelson Education Ltd. Demography Age Race Ethnicity Location

Chapter 3 Diversity in Canada Copyright © 2011 by Nelson Education Ltd. 6 The fundamental belief in Canada that all citizens are equal regardless of their racial or ethnic backgrounds The fundamental belief in Canada that all citizens are equal regardless of their racial or ethnic backgrounds Multiculturalism Immigration versus migrant workers Immigration versus migrant workers

Chapter 3 Copyright © 2011 by Nelson Education Ltd.7 Canadian11,682,680Portuguese357,690 English5,978,875Welsh350,365 French4,668,410Jewish348,605 Scottish4,157,210Russian337,960 Irish3,822,660Filipino327,550 German2,742,765Métis307,845 Italian1,270,370Swedish282,760 Chinese1,094,700Hungarian267,255 Ukrainian1,071,060American250,005 N.A. Indian1,000,890Greek215,105 Dutch923,310Spanish213,105 Polish817,085Jamaican211,720 East Indian713,330Danish170,780 Norwegian363,760Vietnamese151,410 Statistics Canada 2001 Census Canada’s Ethnic Diversity

Chapter 3 Ethics Copyright © 2011 by Nelson Education Ltd. 8 A set of moral standards for judging whether something is right or wrong. Ethics

Chapter 3 Individual Business Ethics Copyright © 2011 by Nelson Education Ltd. 9 Recognizing Unethical Business Activities Justice Individual Rights Utilitarianism Factors Influencing Individual Business Ethics Factors Influencing Individual Business Ethics

Chapter 3 Copyright © 2011 by Nelson Education Ltd. 10 Utilitarianism The greatest good for the greatest number. The greatest good for the greatest number. Individual Rights Human rights implies that certain rights are conveyed at birth and cannot be arbitrarily taken away. Human rights implies that certain rights are conveyed at birth and cannot be arbitrarily taken away. Justice Equitable distribution of the burdens and rewards that society has to offer. Equitable distribution of the burdens and rewards that society has to offer. Wrong! Fair

Chapter 3 Ethical Development Copyright © 2011 by Nelson Education Ltd. 11 StagesStages Preconventional (selfish) Conventional (social) Postconventional (principled) Reward and punishment

Chapter 3 HOW ORGANIZATIONS INFLUENCE ETHICAL CONDUCT Copyright © 2011 by Nelson Education Ltd. 12 Establish a Formal Code of Ethics Offer Ethics Training Programs Lead by Example

Chapter 3 SOCIAL RESPONSIBILITY Copyright © 2011 by Nelson Education Ltd. 13 Ethical Legal Economic Philanthropic

Chapter 3 Understanding Social Responsibility Copyright © 2011 by Nelson Education Ltd. 14 Legality Responsibility What are some examples by companies of legal but socially irresponsible acts? What are some examples by companies of legal but socially irresponsible acts?

Chapter 3 Understanding Social Responsibility Copyright © 2011 by Nelson Education Ltd. 15 ResponsibleIrresponsible Legal Illegal Harms society, and breaks laws Follows laws, but harms society Follows laws, and benefits society Benefits society, but breaks laws

Chapter 3 RESPONSIBILITIES TO STAKEHOLDERS Copyright © 2011 by Nelson Education Ltd. 16 Responsibilities of a Business Business Investors General Public Customers Employees

Chapter 3 More Stakeholders Copyright © 2011 by Nelson Education Ltd. 17 Businesses need to support their suppliers Businesses need to support their suppliers Suppliers Responsible for accurately reporting business activities Responsible for accurately reporting business activities Governments

Chapter 3 TRENDS IN ETHICS & SOCIAL RESPONSIBILITY 18 Copyright © 2011 by Nelson Education Ltd. More protection for whistle blowers A new social contract between employer and employee Growth of global ethics and social responsibility Strategic giving in corporate philanthropy

Chapter 3 Trends in Global Ethics Respect local practices and customs Ensure harmony between staff and host population Provide management leadership Develop local managers who will be a credit to the community Implement ethical guidelines within the organization in the host country 19 Copyright © 2011 by Nelson Education Ltd. Responsibilities of a Multinational Corporation