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
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

3. 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
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

4. 5.2 Examples of Unethical and Illegal Organizational Behavior
Enron (2001),
Arthur Anderson
Sarbanes-Oxley 2002 (SOX)
Company must be compliant with SOX
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5. 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
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

6. Criteria for Ethical Decision Making
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
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

7. 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
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8. 5.3 Three Levels of Personal Moral Development
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9. The Ethic of Sustainability
Sustainability – economic development that generates wealth and meets the needs of current population while preserving the environment for the needs of future generations
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10. 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
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11. 5.6 Building an Ethical Organization
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