1. Chapter 3: Business Ethics, Social Forces, and the Law

2. The Effect of Ethics
Business ethics is the application of values and standards to business conduct and decisions.
When a business upholds basic ethical standards, it will enjoy the competitive advantage of a good reputation and, over the long term, better earnings.
When a business violates ethical standards, social forces are set into motion, sometimes leading to changes in the law.

3. Cycle of Societal Interaction
Chapter 3
Cycle of Societal Interaction
Social Forces
Social Environment
Ethics
Law 1

4. Goals That Influence Laws
Chapter 3
Goals That Influence Laws
Protection:
of the state
of the person
of public health, safety and morals
of property
personal rights
from exploitation, fraud, and oppression
of creditors and rehabilitation of debtors
Enforcement of individual intent
Furtherance of trade
Stability and flexibility 2

5. Categories of Ethical Behavior
Chapter 3
Categories of Ethical Behavior
Integrity and Truthfulness
Promise-Keeping
Loyalty: Avoiding Conflicts of Interest
Fairness
Doing No Harm
Maintaining Confidentiality 3

6. Resolving Ethical Dilemmas
Chapter 3
Resolving Ethical Dilemmas
Blanchard and Peale Test
Is it legal?
Is it balanced?
How does it make me feel?
Front-Page-of-the-Newspaper Test
Would I want my decision published?
Laura Nash Test
Requires examination from all perspectives.
Wall Street Journal Model (3 C’s model)
Is my conduct compliant with the law?
What contribution does this action make to others?
What are the consequences? 4