1. Managing Ethics and Social Responsibility
Chapter 5
Managing Ethics and Social Responsibility

2. Managerial Ethics
Ethics - code of moral principles and values that govern the behaviors of right or wrong
Standards about good/bad
Ethical issues can be complex
People in organizations have divergent views about right/wrong

3. 5.1 Three Domains of Human Action
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

4. Ethical Management Today
Ethical scandals during the last decade have been pervasive
Corporations and people have become associated with greed, deceit, irresponsibility, and lack of moral conscience
Managers carry a big responsibility for setting an ethical climate
Ethical crises have brought ethical management to the forefront

5. 5.2 Examples of Unethical and Illegal Organizational Behavior
Enron (2001),
Arthur Anderson
Sarbanes-Oxley 2002 (SOX)
Company must be compliant with SOX

6. Criteria for Ethical Decision Making
Utilitarian Approach – moral behavior produces the greatest good for the greatest number.
Individualism Approach – acts are moral if they promote the individual’s long-term interest
Moral-Rights Approach – humans have fundamental rights and liberties that cannot be taken away by an individual's decision

7. Justice Approach – moral decisions must be based on standards of equity, fairness, and impartiality
Virtue Ethics Approach– moral behavior stems from personal virtues
Practical Approach– bases decisions on prevailing standards, society, and all stakeholders

8. A Manager’s Ethical Choices
Individuals bring their own personality and traits to organizations
Personal needs, family influence, and religious background shape individuals
Personality characteristics like ego, confidence, and independence

9. Managing Company Ethics and Social Responsibility
Code of Ethics – a formal statement of the company’s values regarding ethics and social issues
Ethical Structures – systems, positions, and programs like ethics training
Whistle-blowing – employee disclosure of illegal, immoral, or illegitimate practices inside the company.

10. 5.6 Building an Ethical Organization
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.