1. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-1 Business and Society POST, LAWRENCE, WEBER Ethical Reasoning and Corporate Programs Chapter 6

2. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-2 Figure 6-1 Percentage of U.S. managers emphasizing a value focus in 1990 (N=413) Goal-oriented values Means-oriented values Source: Adapted from James Weber, “Managerial Value Orientations: A Typology and Assessment.” International Journal of Value-Based Management 3 (1990), pp. 37-54.

3. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-3 Figure 6-2 Stages of moral development and ethical reasoning Source: Adapted from Lawrence Kohlberg, The Philosophy of Moral Development (New York: Harper & Row, 1981).

4. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-4 Figure 6-3 The components of ethical climates Focus of ethical concern Ethical criteria Source: Adapted from Bart Victor and John B. Cullen, “The Organizational Bases of Ethical Work Climates,” Administrative Sciences Quarterly 33(1988), p. 104.

5. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-5 Figure 6-4 Three methods of ethical reasoning

6. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-6 Figure 6-5a An analytical approach to ethical problems Step 1 Ask NoYesNoYesNoYes Utility Do benefits exceed costs? Rights Are human rights respected? Justice Are benefits and costs fairly distributed?

7. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-7 Figure 6-5b An analytical approach to ethical problems Step 2 Compare results If yes is the answer to all three questions, it is probably ethical If the answers are mixed, it could be either ethical or unethical If no is the answer to all three questions, it is probably unethical

8. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-8 Figure 6-5c An analytical approach to ethical problems Step 3 Assign priorities to UtilityRightsJustice

9. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-9 Figure 6-6 Organization’s ethics safeguards at work

10. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-10 Exhibit 6-A Two approaches to ethics programs and their effectiveness Compliance-based programs Rooted in avoiding legal sanctions. Companies will establish rules and guidelines for employees to follow. Emphasizes threat of detection and punishment. Assumes employees are driven by self-interest. Research evidence shows that employees do care about moral correctness of their actions. Sources: Lynn Sharp Paine, “Managing for Organizational Integrity,” Harvard Business Review, March/April 1994, pp. 106-117 and Gary Weaver and Linda Klebe Trevino, “Compliance and Values Oriented Ethics Programs: Influences on Employees’ Attitudes and Behavior,” Business Ethics Quarterly, 9(1999), pp. 315-335.

11. © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 6-11 Exhibit 6-A(continued) Two approaches to ethics programs and their effectiveness Sources: Lynn Sharp Paine, “Managing for Organizational Integrity,” Harvard Business Review, March/April 1994, pp. 106-117 and Gary Weaver and Linda Klebe Trevino, “Compliance and Values Oriented Ethics Programs: Influences on Employees’ Attitudes and Behavior,” Business Ethics Quarterly, 9(1999), pp. 315-335. Integrity-based ethics programs Combine a concern for the law with an emphasis on employee responsibility for ethical conduct. Establish a climate of self-governance for employees based on general principles as guidelines. Employees told to act with integrity and conduct business dealings in an environment of honesty and fairness. Employees are thought of as social beings, concerned for the well-being of others. Researchers found that these programs fostered lower observed unethical conduct.