Business Ethics and Social Responsibility Chapter 4

What is Ethics? Ethics is the set of moral principles by which people conduct themselves personally, socially, or professional.

What is Ethics? BUSINESS ETHICS a set of guidelines about how a business should conduct itself. Using ethical business practices means that for any business to be successful, it must operate legally, ethically, and humanely

Legal Responsibility Sweatshops – factories that have unsafe working conditions, treat workers badly, and pay poorly.

Legal Responsibility OSHA – Occupational Safety and Health Administration a division of Dept of Labor – sets and enforces work- related health and safety rules. Subject to fines, lawsuits, and new regulations

Legal Responsibility Code of Ethics – B usinesses police themselves by following a code of ethics. –A set of guidelines for maintaining ethics in the workplace. Professional groups such as doctors, lawyers, journalists, and teachers have their own code of ethics. –Covers everything from employee behavior to environmental safety

Ethics as Good Business Unethical business practices –Lying –Offering merchandise it knows is substandard –Treating customer unfairly –If illegal may go to jail, fined.. –If you violate code you may be fired or lose your license –Lose customer’s trust, lose business

Important Ethical Questions Is it against the law? Does it violate company or professional policies? What if everyone did this? How would I feel if someone did this to me? Am I sacrificing long-term benefits for short-term gains?

Making Decisions on Ethical Issues Not a quick task, takes hard thinking…. Identify the ethical dilemma Discover alternative actions Decide who might be affected List the probable effects of the alternatives Select the best alternative

Social Responsibility The duty to do what is best for the good of society –Provide safe products –Create jobs –Protect the environment Conflict of Interest –Business tempted to put profits before social welfare

Responsibility to Customers Offer a good safe product or service at a reasonable price. FDA …Food and Drug Administration –Government agency protects consumers from dangerous or falsely advertised products. Poisoned Tylenol capsules… alerted the public, recalled the product, changed to tamper-proof bottles

Responsibility to Employees Laws protect employees from child labor abuse, rights of workers to organize, Equal Pay Act – 1964 –Requires that men and women are paid the same wages for doing equal work American with Disabilities Act –bans discrimination against people with physical or mental disability

Responsibility to Society EPA… Environmental Protection Agency –Federal agency enforces rules protects the environment and control pollution