1. Business Ethics Chapter 2 Ethics? What is Ethics?

2. Effective immediately, MSNBC will no longer simulcast the "Imus in the Morning" radio program. 
Effective immediately, MSNBC will no longer simulcast the "Imus in the Morning" radio program.  This decision comes as a result of an ongoing review process, which initially included the announcement of a suspension. It also takes into account many conversations with our own employees.  What matters to us most is that the men and women of NBC Universal have confidence in the values we have set for this company.  This is the only decision that makes that possible.  Once again, we apologize to the women of the Rutgers basketball team and to our viewers. We deeply regret the pain this incident has caused.
—Statement from NBC News

3. Levels of Corporate Social Responsibility
Societal Responsibility
Stakeholder Responsibility
Ecological
Environment
Customers
Profit Responsibility
General
Public
Owners/Stockholders
Employees
Suppliers/Distributors
Public Interest Groups
Source: Marketing, 5/E by Berkowitz, Kerin, Hartley, and Rudelius.
The Social Contract

4. The Social Contract Theory
The social contract defines the permissible scope of business conduct and goes beyond the purely economic issues. If society wants more from business than profits, business must accept this mandate in order to survive in society. To do otherwise is to breach the social contract.

5. Executive's Fatal Flaw: Failing to Understand New Demands on CEOs January 4, 2007; Page A1 RE: Robert Nardelli's demise as chief executive of Home Depot “What Mr. Nardelli missed, however, is that in the post-Enron world, CEOs have been forced to respond to a widening array of shareholder advocates, hedge funds, private-equity deal makers, legislators, regulators, attorneys general, nongovernmental organizations and countless others who want a say in how public companies manage their affairs. Today's CEO, in effect, has to play the role of a politician, answering to varied constituents. And it's in that role that Mr. Nardelli failed most spectacularly.” Wall Street Journal, January 4, 2007

6. Chairman and CEO, John Mackey

7. Dixie Chicks Break Social Contract with Americans

8. Consequential and Nonconsequential Principles
Consequential (Teleological) Principles
Egoism
Utilitarianism
Feminism
Nonconsequential (deontological) Principles
Categorical Imperative
Kant – 18th Century German Philosopher
Veil of Ignorance
John Rawls
A Theory of Justice (1971)
Political Liberalism (1993)
Ethical Relativism (vergers on Political Correctness)
The Golden Rule

9. Egoism – Compassion or Competition?
“From an organizational perspective, egoism involves those actions that best promote the long-term interests of the organization. Thus, a corporation may establish a minority hiring program or a college scholarship program, and in doing so, the corporation may well be acting in a purely egoistic manner. These programs may advance the long-term interest of the corporation by improving its public image, reducing social tensions, or avoiding legal problems that might otherwise have arisen.”

10. Is this a form of Egoism?
Dr. Ned Doffoney accepts a $50,000 donation to the OAB A Legacy Renewed campaign from Ken Hatfield, vice president of communications and public affairs for the Fresno Bee on August 9.

11. Vons on Facebook…

12. Mayor Ashley Swearengin = Representing FRESNO
Egoism – An act is ethical when It promotes the best long-term Interest of the firm, or in this case City of Fresno.

13. Ethics… Ethical Theories:
Egoism – An act is ethical when It promotes the best long-term Interest of the firm.
Utilitarianism – The most ethical decision for the greatest good. One that promotes the best ethical conclusion without compromising the overall situation.

14. Ethics… Continued
Feminism – The ethics of caring. Recognizing the importance of personal relationship.
Categorical Imperative – Only when we act from a sense of duty and responsibility do actions have ethical worth.
Veil of Ignorance – Rational agents, unaware of their personal characteristic or places in society., choose the principles they wish to have govern everyone in society.

15. Kantian Ethics
A moral theory that says people owe moral duties that are based on universal rules.
Based on the premise that people can use reasoning to reach ethical decisions.
This theory would have people behave according to the categorical imperative:
“Do unto others as you would have them do unto you.”

16. Rawls’s Social Justice Theory
A moral theory that says each person is presumed to have entered into a social contract, with all others in society, to obey moral rules that are necessary for people to live in peace and harmony.
Fairness is considered the essence of justice.
Rawls proposed that the least advantaged must receive special assistance to allow them to reach their potential.

17. Rawls’s Social Justice Theory (continued)
The principles of justice should be chosen by persons who do not yet know their station in society.
This “veil of ignorance” would permit the fairest possible principles to be selected.

18. Ethical Relativism
A moral theory that holds that individuals must decide what is ethical based on their own feelings as to what is right or wrong.
There are no universal ethical rules to guide a person’s conduct.
If a person meets his or her own moral standard in making a decision, no one can criticize him or her for it.
“The “What Feels Good” approach to life!”

19. How Do You See Yourself?
Morality v. Immorality? Do you see yourself as being moral with a sense of duty and responsibility? Do you see yourself as being amoral, with a sense of knowing right from wrong, but choosing to do wrong because it meets your needs at the time of the action?

20. Ethics Check Questions:
Is It Legal?
What are the consequences?
Is It Balanced?
Does it promote fairness?
How Will It Make Me Feel About Myself?
Can I live with this decision?

21. Ruggerio’s Three common Concerns in Ethical Decision Making:
The obligations that arise from organizational relationships.
The ideals involved in any decisions that are made
The effects or consequences of alternative actions.

22. Amoral Personality
Being neither moral nor immoral: Lying outside the sphere to which moral judgments apply.
A personality that has neither a conscience or normal fear factor.

23. An Amoral Personality
While leading the life of a happy family man in the New Jersey suburbs, Richard Kuklinski was also living a bizarre double-life as a Mafia hit man. Kuklisnki tells first had how he brutally murdered men at close range, dismembered and disposed of them before returning home to his family.
                      

24. The Iceman Tapes - Conversations with a Killer (part 2)

26. Moral Personality
Any actions that honor obligations while simultaneously advancing ideals and benefiting people can be presumed to be moral actions.

27. Ethics in Business
Fact or fiction?

28. Business Attitude Caveat emptor – “Buyer Beware”
Corporate Culture Influence- “Top-Down” Approach to the way business gets done.
The “Game Theory” as a way of business
Bluffing
Lying
Cheating

29. ETHICAL? SLANDER? LAW SUIT Or ENTERTAINMENT?
Anderson Cooper on the Donald/Rosie Feud
ETHICAL? SLANDER? LAW SUIT Or ENTERTAINMENT?

30. “What are the sweep periods
“What are the sweep periods? Sweeps are designated months during the year when Nielsen Media Research measures all local markets. We survey the majority of our 210 local television markets in November, February, May and July (Local People Meter markets, however, are measured 365 days a year).”

31. Real or not?
YOU CAN’T BELIEVE EVERYTHING YOU SEE!

32. PBS ALTERS TRANSCRIPTS…

33. Scott Thompson apologizes; director in charge of vetting to step down

34. Business Scandals: Enron Adelphia Communications Global Crossing
systematically and fraudulently excluded billions of dollars in liabilities from its consolidated financial statements by hiding them on the books of off-balance sheet affiliates.
Global Crossing
conflict-of-interest offenses committed by a former accounting executive and scads of internal-control blunders at the company.
World Com
Arthur Andersen
Martha Stewart

35. SEC Investigations (2002) Accounting Energy Software Telecom
Arthur Andersen
Deloitte & Touche
Ernst & Young
KPMG
PriceWaterhouse Coopers
Energy
CMS Energy
Dynergy
Enron
Halliburton
Reliant Resources
Software
Computer Associates
Network Associates
Telecom
Global Crossing
Lucent Technologies
Qwest Communications
WorldCom
Wall Street
Credit Suisse First Boston
Hedge Funds
Capital Markets
Merrill Lynch
Source: Business Week, June 10, 2002

36. The Smartest Guys in the Room…

37. Corporate Scandal Fines
Company
Fine
Reason
Arthur Andersen
$500,000
Obstruction of Justice Shredding Enron Documents
Citigroup
$5,000,000
Analyst Issued Misleading Information
Merrill Lynch
$100,000,000
Conflict of Interest Between Investment Bank & Research Dept.
Credit Suisse
First Boston
IPO Shares Unfairly Distributed
Source: Business Week, Nov. 4, 2002

38. Bush Administration Policy in response to corporate wrong doing:
Sarbanes-Oxley Act of 2002
Requires that chief executive officers and chief financial officers certify the accuracy of quarterly financial reports. (e.g., a signature must accompany the documents sent in as financial statements of the company.)
Reports knowingly falsified could result in fines up to $1 million and incarceration for up to 10 years.

39. Corporate Citizenship
A theory of responsibility that says a business has a responsibility to do good.
Business is responsible for helping to solve social problems.
Corporations owe a duty to promote the same social goals as do individual members of society.

40. BP Oil Spill… 2010

41. BP Oil Spill

42. BP Clean-up

43. Corporate Citizenship (continued)
This theory argues that corporations owe a debt to society to make it a better place.
This duty arises because of the social power bestowed on corporations.
A major criticism of this theory is that the duty of a corporation to “do good” cannot be expanded beyond certain limits.

44. A Business Approach to Ethics
U.S. businesses need to develop a model or a framework of ethical behavior.
Business should adopt a “synthesis” approach of revolving ethical issues. Considering “Obligations, Ideals and Effects” and it is weighed towards stakeholders, employees, customers and community.

45. Business Ethics
Business should establish rules and standards, but those rules and standards also need to change as society and the business environment changes.
Only people, not corporations, have the power to make those changes.
How does that effect you?

46. Video to view: The Smartest Guys In The Room
Magnolia Home Entertainment
110 minutes
Rated R

47. Ethics Resource Center:

48. Ethics and Social Responsibility of Business Chapter 2 Ethics
Ethics and Social Responsibility of Business Chapter 2 Ethics? What is Ethics?