1

What is Ethics?

• Our Text: The system of rules that governs the ordering of values.

• The Handout: the rules or standards which govern the conduct of a person or a group.

• Others: the principles and standards of moral behavior that are accepted by society as right or good (as apposed to wrong or bad).

2

What is Ethical Behavior (as applied to business)?

1. Competing Fairly and Honestly

2. Communicating Truthfully

3. Not Causing Harm to Others

3

What is Social Responsibility

• The idea that business has certain obligations to society beyond the pursuit of profits—developed early in the 20th century.

4

Ch. 5 Outline (Not From Text)

1. Ethics in the Workplace

2. Social Responsibility in Business

3. Business’s Efforts to Increase Social Responsibility

4. Ethics and (Corporate) Social Responsibility Around the World

5

What is Ethical Behavior?

Competing FairlyCompeting Fairlyand Honestlyand Honestly

CommunicatingCommunicatingTruthfullyTruthfully

Not Harming OthersNot Harming Others

6

Factors InfluencingEthical Behavior

Cultural DifferencesCultural Differences

KnowledgeKnowledge

OrganizationalOrganizationalBehaviorBehavior

LegislationLegislation

7

Ethical Dilemma vs. Ethical Lapse

• Ethical dilemma – a situation in which one must choose between two conflicting but arguably valid sides.

• Ethical lapse – a situation in which an individual makes a decision that is clearly wrong, such as divulging trade secrets to a competitor.

8

Social Responsibility in Business

EarlyEarly2020thth Century Century

MiddleMiddle2020thth Century Century

EarlyEarly2121stst Century Century

MaximizeMaximizeProfitsProfits

Provide JobsProvide Jobsand Pay Taxesand Pay Taxes

Balance ProfitsBalance Profitsand Social Issuesand Social Issues

9

Balancing Business and Stakeholders’ Rights

BusinessBusiness

Safe Safe ProductsProducts

Product Product ChoiceChoice

ConsumersConsumers

Informed Informed PurchasePurchase

EmployeesEmployees

EquityEquityHealth & SafetyHealth & Safety

InvestorsInvestors

ProfitsProfitsFair DisclosureFair Disclosure

SocietySociety

CleanCleanEnvironmentEnvironment

10

ResponsibilityToward Consumers

The Right to Safe ProductsThe Right to Safe ProductsThe Right to Safe ProductsThe Right to Safe Products

The Right to Be InformedThe Right to Be InformedThe Right to Be InformedThe Right to Be Informed

The Right to ChoiceThe Right to ChoiceThe Right to ChoiceThe Right to Choice

The Right to Be HeardThe Right to Be HeardThe Right to Be HeardThe Right to Be Heard

11

Responsibility TowardEmployees

Equal EmploymentEqual EmploymentOpportunityOpportunity

AffirmativeAffirmativeActionAction

OccupationalOccupationalHealth and SafetyHealth and Safety

Americans withAmericans withDisabilities ActDisabilities Act

12

Equality in Employment and The Elimination of Discrimination

• Civil Rights Act of 1964

• Civil Rights Act of 1991

• Affirmative Action

• Diversity Initiatives

• American Disabilities Act of 1990