1. Ethics in the Business System
Chapter 7, Steiner & Steiner
Business Environment .
Do businesses and business corporations have to adhere to the same set of ethical standards as individuals?, or should business be “amoral?”
What are the major sources of ethics?, and
Your major sources of ethics?
What is/will be your ethical standard in business?
How will you manage yourself?
How would you recommend that your business maintain ethical standards?
Ethics in the Business System

2. Ethics in the Business System
Objectives
Do businesses and business corporations have to adhere to the same set of ethical standards as individuals?, or should business be “amoral?”
Describe the four major sources of ethics.
Define “ethics”
Define your basic ethical values and apply them in business cases
Ethics in the Business System

3. Ethics in the Business System
Correct Craft
Review the facts of the case
Was it ethical to cause that much suffering?
How might you have responded to inspector?
Ethics and execution are two different issues. Ineffective decisions can harm people even in an ethical stance
Ethics in the Business System

4. Two Theories of Business Ethics
Theory of Amorality
Herbert Spencer
Family ethics—relations and friends
State ethics—merit through competitive justice
Theory of Moral Unity
One set of standards
Business
People
Government
Spencer: family ethics vs. state ethics on the Mormon basketball game in Eugene: He touched it last – he turned to me “No, I believe you touched it last.”
Ethics in the Business System

5. Permissions to Break Your Moral Code
Ignorance
Incapacity
Unrealistic costs
No power to influence and outcome
No alternatives
External forces
Prevent all accidents
Change laws of Islam
Nazi Germany resource allocation
Corrupt taxes in a country
Ethics in the Business System

6. Ethics in the Business System
Major Sources/Theme?
Religion
Philosophical systems
Cultural Experience
Legal System
Theme is – reciprocity/mutual help
Ethics in the Business System

7. Ethics in the Business System--sources
Religion
Reciprocity
Religious works
Teachings of leaders
US Impact
67% of top execs attend church regularly
Ethics in the Business System--sources

8. Western Philosophical Systems
Greeks–
Absolute justice
Golden Mean
Christian ethics
God’s will
Ten Commandments
Golden Rule
Ethics in the Business System--sources

9. Western Philosophical Systems (cont.)
Secular Philosophies of Idealism
Logic leads to ethics
Kant’s Imperative
Bentham’s utilitarianism
Pleasure to the most,
Pain to the fewest
Rights: Locke – Life, liberty & pursuit of:
Happiness or property
Hand out the UN Universal Declaration on Human Rights. Take five minutes—read it.
Ethics in the Business System--sources

10. Western Philosophical Systems (cont.)
Realist School of Ethics
Evil is permanent in human nature
Ends justify the means
Fit survive, and society prospers
Idealism in business is unachievable
Ethics in the Business System--sources

11. Ethics in the Business System--sources
Cultural Experience
Hunting and gathering
Agricultural setting
Industrial setting
Information age setting?
Rules for hunters and gatherers – ask the hunters
Ask the agriculturalists
Ask the industrialists
global corporations, democracy, materialsim, consumption, growth
Ethics in the Business System--sources

12. Ethics in the Business System--sources
The Legal System
Fines – US Sentencing Commission
Court awarded damages
Prosecution of individual managers
Compliance standards handout
Suppose you are asked to check into a plant or store where something has happened. You go in and they handed you this paper. What questions would you ask to see if it was a “paper” compliance?
Read them the reasons why not to adopt the standards. Would you recommend it for your firm?
Ethics in the Business System--sources

13. Business Ethics in Other Countries
Additonal sources in other countries
Historical Experience
Stage of Economic Development
Doesn’t Historical Experience hold true in the US, also? Don’t actions engender philosophies, which rationalize actions?
Stage of economic development?
the stories of western land in the US – Tennessee, the revolutionary war, and Davy Crockett
The status of our Internet
Ethics in the Business System

14. Ethics in the Business System
Ethical Behavior
Ethical relativism
Ethics are subjective
No ethical superiority
Ethical Universalism
Basic needs of justice, equity, humility
Overlapping consensus
Human dignity—not to be manipulated
Basic rights
Support institutions & bonds of a community
Hand out the UN Universal Declaration of Human Rights
Ethics in the Business System

15. Factors that Influence Managerial Ethics
Leadership & fast tracker at Bottlg Plt
Strategy and Performance – Pru-Bache
Corporate Culture
Harvard MBA
Make your numbers
Be loyal, team player
Be legal
Be realistic (not idealistic)
Moral Muteness
Ethics in the Business System

16. Factors that Influence Managerial Ethics (cont.)
Individual Characteristics
Religious conviction
Age?
Business students vs. managers?
Results can’t be consistently confirmed
Ethics in the Business System

17. How Corporations Manage Ethics
Ethics programs
Scandal
Muted damages
General Dynamics
Major effort
Little progress
Ethics in the Business System

18. Guidelines for Managing Ethics Programs
Top Management
Codes of ethics
Organizational structure
Training
Enforcement
Cases on page 229
Compliance standards handout
Suppose you are asked to check into a plant or store where something has happened. You go in and they handed you this paper. What questions would you ask to see if it was a “paper” compliance?
Read them the reasons why not to adopt the standards. Would you recommend it for your firm?
Ethics in the Business System

19. Ethics in the Business System
Objectives
Do businesses and business corporations have to adhere to the same set of ethical standards as individuals?, or should business be “amoral?”
Describe the four major sources of ethics.
Define “ethics”
Define your basic ethical values and apply them in business cases
Ethics in the Business System