1. Chapter 3 Ethics and Social Responsibility

2. 2 Philosophical Principles Underlying Business Ethics Focus on consequences and pragmatism (So who is hurt?) Focus on rights of individuals (deontology emphasizes principles) Focus on integrity (virtue ethics focuses on character of person)

3. 3 Values and Ethics Ethics converts values into action. The right values can lead to competitive advantage. Ethically-centered management focuses on quality of product rather than completion date.

4. 4 Contributing Factors to Ethical Problems Greed, gluttony, and self-gain Unethical organizational culture Moral laxity (“Forget ethics for now.”) Self-interest (“I’ll take care of me first.”) Unconscious bias (“A man is best for the job of CEO.”) Rationalization (“Everybody else cheats on taxes.”)

5. 5 Ethical Temptations and Violations 1. Stealing from employers and customers 2. Illegally copying software 3. Treating people unfairly 4. Sexual harassment 5. Conflict of interest (lose objectivity) 6. Accepting kickbacks and bribes

6. 6 Ethical Temptations and Violations, continued 7. Divulging confidential information 8. Misuse of corporate resources (“Let’s take the corporate jet to Cancun.”) 9. Corporate espionage (e.g., dumpster diving for dirt on the competition) 10. Poor cyberethics (e.g., stealing identities from résumés posted online)

7. 7 A Guide to Ethical Decision Making 1. Is it right? 2. Is it fair? 3. Who gets hurt? 4. Would you be comfortable if your decision were widely circulated? 5. Would you tell your child to do it? 6. How does it smell?

8. 8 Background Concepts of Social Responsibility Corporate social responsibility— obligations to society beyond profits Stockholder viewpoint—only responsibility is to owners/stockholders Stakeholder viewpoint—firm is responsible to all affected groups Iron law—lose power if irresponsible Corporate social performance—good citizen in the community

9. 9 Social Responsibility Initiatives Environmental protection Work-life programs (such as flexible work schedules) Community redevelopment projects Acceptance of whistle blowers Compassionate downsizing (such as outplacement services and emotional support)

10. 10 Ethical and Socially Responsible Workplace Formal mechanisms for monitoring ethics (e.g., ethics committee, ethics hotline) Written organizational codes of conduct Communication about ethics and social responsibility Leadership by example and ethical role models Confrontation about ethical deviations Training in ethics and social responsibility