1. Chapter 10 Ethics and Social Responsibility of Business
PowerPoint Slides to accompany The Legal Environment of Business and Online Commerce 5E, by Henry R. Cheeseman
Chapter 10
Ethics and Social Responsibility
of Business
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2. Ethics and the Law
Law
Ethics
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3. Theories of Ethics Ethical fundamentalism Utilitarianism
People look to an outside source or central figure for ethical guidelines.
Utilitarianism
People choose the alternative that would provide the greatest good to society.
Kantian or duty ethics
A set of universal rules based on reasoning that establishes ethical duties.
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4. Theories of Ethics Rawls’s social justice theory Ethical relativism
Moral duties are based on an implied social contract.
Ethical relativism
Individuals decide what is ethical based on their own feelings about right and wrong.
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5. Social Responsibility of Business
Social responsibility of business is a duty owed by businesses to act socially responsible in producing and selling goods
and services.
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6. Theories of Social Responsibility
Maximize profits
To maximize profits for stockholders
Moral minimum
To avoid causing harm and to compensate for harm caused
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7. Theories of Social Responsibility
Stakeholder interest
To consider the interests of all stakeholders, including stockholders, employees, customers, suppliers, creditors, and local community
Corporate citizenship
To do good and solve social problems
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8. Sarbanes-Oxley Act
Enacted by Congress in response to corporate frauds discovered in the late 1990’s and early 2000’s
Public companies are required to disclose whether they have adopted a code of ethics for senior financial officers.
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