1. Mgt 609 – Project Management Fundamentals Ethics and Professional Responsibility
Dr. Alan C. Maltz
Howe School of Technology Management
Stevens Institute of Technology
© Alan C. Maltz, Ph.D, 2014

2. Business Ethics Rules or standards governing the conduct of a business
Moral code – what is ‘right’ and what is ‘wrong’?
Highly subjective nature
Tension between different stakeholders
© Alan C. Maltz, Ph.D, 2014

3. Today’s Headlines Are they ‘moral’ or ‘ethical’ issues?
Corporate corruption
Corporate criminal behavior
Individual profiteering
Stock manipulation
Others?
Despite all the media and popular sentiment that these examples show a lack of ethics, in reality all of the examples cited above are moral issues, not ethical ones; many of the companies involved, in fact, had Codes of Ethics in place, and ethical enforcement procedures. But all the ethical guidelines in the world will have no effect on a person who has lost his or her moral compass. Calling these “ethical issues” is, in fact, giving them more status than they deserve, with the added negative affect of further lowering the value of the study of ethics in the minds of the public.
© Alan C. Maltz, Ph.D, 2014

4. Ethical Issues
Project Managers face many opportunities for unethical behavior. Common ethical missteps include:
“Wired” bids and contracts (winner has been predetermined)
“Buy-in” (bidding with low intention of cutting corners or forcing subsequent contract changes)
“Kickbacks”
“Covering” for team members (group cohesiveness)
Taking “shortcuts” (to meet deadlines or budgets)
Using marginal (substandard) materials
Compromising on safety
Violating standards
Purpose:
Provide examples for discussion related to ethical issues faced by a project manager.
Key Points:
Point out that there is a distinction between morality and legality. This distinction is especially important in dealing with multicultural projects. What may be morally acceptable in one culture may sometimes be prohibited under the law of a different culture. Ask members of the class if they have encountered any of the ethical issues listed on the slide.
What type of business career do YOU want to lead?
© Alan C. Maltz, Ph.D, 2014

5. Business Ethics Tensions: Profits versus higher wages
Expansion versus development
Production versus pollution
Supplier benefits versus consumer prices/lower costs
Survival of the business versus needs of stakeholders
© Alan C. Maltz, Ph.D, 2014

6. Ethical Issues are Seldom Black and White
Conflicting Demands:
Loyalty to company and colleagues
Concern for public welfare
Personal gain, ambition
Ethical standards are usually relative and personal, there is seldom an absolute standard
© Alan C. Maltz, Ph.D, 2014

7. Ethical Issues in the Real World
What ethical issues have you faced as project managers?
What did you do about them?
How did you feel about the choices you made?
What was the impact on the project and the team?
Purpose:
Provide examples for discussion related to ethical issues faced by a project manager.
Key Points:
Point out that there is a distinction between morality and legality. This distinction is especially important in dealing with multicultural projects. What may be morally acceptable in one culture may sometimes be prohibited under the law of a different culture. Ask members of the class if they have encountered any of the ethical issues listed on the slide.
© Alan C. Maltz, Ph.D, 2014

8. A Simple Test…
If you are facing an ethical dilemma, then you simply ask yourself, “What would you do if you knew your actions would make the front page of tomorrow’s Washington Post?”
© Alan C. Maltz, Ph.D, 2014

9. Sarbanes-Oxley Act
Created by Sen. Paul Sarbanes (D-Maryland) and Congressman Michael Oxley (R-Ohio)
Signed into law July 30, 2002
In response to the Arthur Anderson, Enron and WorldCom/MCI debacle, the Sarbanes-Oxley act seeks to:
Restore the public confidence in both public accounting and publicly traded securities
Assure ethical business practices through heightened levels of executive awareness and accountability
© Alan C. Maltz, Ph.D, 2014

10. Sarbanes-Oxley Overview
Creates the Public Corporation Accounting Oversight Board (the “Board”, PCAOB)
Adds new criminal penalties for obstruction of justice by destroying or altering records
Requires corporate executives to certify the accuracy of reported financial information
Requires registration with Board of public accounting firms
© Alan C. Maltz, Ph.D, 2014

11. Sarbanes-Oxley Affects
Any publicly-traded company
Any public accounting firm that provides auditing services for publicly-traded companies
Independent contractors to public accounting firms
Any company or agency subject to the obstruction of justice sections
Any individual
© Alan C. Maltz, Ph.D, 2014

12. Thank You - Questions?
Alan C. Maltz, Ph.D. Howe School of Technology Management Stevens Institute of Technology Castle Point on the Hudson Hoboken, NJ 07030
Phone: +1 (561)
Web:
© Alan C. Maltz, Ph.D, 2014