ch03-ethical behaviour

7/30/2019 ch03-ethical behaviour

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PowerPoint Presentation

to Accompany Chapter 3 of

ManagementCanadian Edition

Schermerhorn

Wright

.

Prepared by: M ichael K. McCuddyAdapted by: Lynda Anstett & Lorie Guest

Published by: John Wiley & Sons Canada, Ltd.


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Management - Chapter 3 2

Planning AheadChapter 3 Study Questions

What is ethical behavior?

How do ethical dilemmas complicate the

workplace?How can high ethical standards be

maintained?

What is corporate social responsibility?

How do organizations and governmentswork together in society?


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Ethics

Code of moral principles.

Set standards of good and bad as opposed

to right and wrong.

Ethical behavior

What is accepted as good and right in the

context of the governing moral code.

Study Question 1: What is ethical behavior?


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Law, values, and ethical behavior:

Legal behavior is not necessarily ethical

behavior.

Personal values help determine individual

ethical behavior.

Terminal values

Instrumental values



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Utilitarian view of ethicsgreatest good to thegreatest number of people.

Individualism view of ethicsprimary

commitment is to ones long-term self-interests.

Moral-rights view of ethicsrespects andprotects the fundamental rights of all people.

Justice view of ethicsfair and impartialtreatment of people according to legal rules andstandards.


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Figure 3.1 Four views of ethical behavior.


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Cultural issues in ethical behavior:

Cultural relativism

Ethical behavior is always determined by culturalcontext.

Cultural universalism

Behavior that is unacceptable in ones homeenvironment should not be acceptable anywhere

else.



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Figure 3.2 The extremes of cultural relativism and ethicalimperialism in international business ethics.

Source: Developed from Thomas Donaldson, Values in Tension: Ethics Away from Home,

Harvard Business Review, vol. 74 (September-October 1996), pp. 48-62.


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How international businesses can respect core or universal values:

Respect for human dignity

Create culture that values employees, customers, and suppliers.

Keep a safe workplace.

Produce safe products and services.

Respect for basic rights

Protect rights of employees, customers, and communities.

Avoid anything that threatening safety, health, education, and livingstandards.

Be good citizens

Support social institutions, including economic and educationalsystems.

Work with local government and institutions to protect environment.


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An ethical dilemma occurs when choices,although having potential for personal and/ororganizational benefit, may be considered

unethical. Ethical dilemmas include:

Discrimination

Sexual harassment

Conflicts of interest

Customer confidence

Organizational resources

Study Question 2: How do ethical dilemmas

complicate the workplace?


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Study Question 2: How do ethical dilemmas

complicate the workplace?

Ethical behavior can be rationalized by convincing

yourself that:

Behavior is not really illegal.

Behavior is really in everyones best interests.

Nobody will ever find out.

The organization will protect you.


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Factors influencing ethical behavior include:

The person

Family influences, religious values, personal standards, and

personal needs.

The organization

Supervisory behavior, peer group norms and behavior, and

policy statements and written rules.

The environment

Government laws and regulations, societal norms and values,

and competitive climate in an industry.

Study Question 2: How do ethical dilemmascomplicate the workplace?


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Figure 3.3 Factors influencing ethical managerialbehaviorthe person, organization, and environment.


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Study Question 3: How can high ethical

standards be maintained?

Checklist for dealing with ethical dilemmasStep 1. Recognize the ethical dilemma

Step 2: Get the facts

Step 3. Identify your options

Step 4. Test each option: Is it legal? Is it right? Is it beneficial?

Step 5. Decide which option to follow

Step 6. Double-check decision by asking the spotlight questions: Howwould I feel if my family found out about my decision? How wouldI feel about this if my decision were printed in the local newspaper?

Step 7. Take action.


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Ethics training:

Structured programs that help participants

to understand ethical aspects of decisionmaking.

Helps people incorporate high ethicalstandards into daily life.

Helps people deal with ethical issuesunder pressure.

Study Question 3: How can high ethicalstandards be maintained?


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Whistleblowers

Expose misdeeds of others to:

Preserve ethical standards

Protect against wasteful, harmful, or illegal acts

Laws protecting whistleblowers vary



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Barriers to whistleblowing include:

Strict chain of command

Strong work group identitiesAmbiguous priorities

Organizational methods for overcomingwhistleblowing barriers:

Ethics staff units who serve as ethics advocates

Moral quality circles


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Ethical role models:

Top managers serve as ethical role models.

All managers can influence the ethical behavior of

people who work for and with them.

Excessive pressure can foster unethical behavior.

Managers should be realistic in setting performance

goals for others.


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Codes of ethics: Formal statement of an organizations values and

ethical principles regarding how to behave in situationssusceptible to the creation of ethical dilemmas.

Areas often covered by codes of ethics: Bribes and kickbacks

Political contributions

Honesty of books or records

Customer/supplier relationships

Confidentiality of corporate information



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Study Question 4: What is corporate social

responsibility?

Corporate social responsibility:

Looks at ethical issues on the organization

level.

Obligates organizations to act in ways that

serve both its own interests and the interests of

society at large.


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Study Question 4: What is corporate socialresponsibility?

Organizational stakeholders Those persons, groups, and other organizations directly affected by

the behavior of the organization and holding a stake in its

performance. Typical organizational stakeholders

Employees

Customers

Suppliers

Owners

Competitors

Regulators

Interest groups


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Figure 3.4 Multiple stakeholders in theenvironment of an organization.


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Beliefs that guide socially responsible businesspractices:

People do their best with a balance of work and familylife.

Organizations perform best in healthy communities.

Organizations gain by respecting the naturalenvironment.

Organizations must be managed and led for long-termsuccess.

Organizations must protect their reputations.


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Perspectives on corporate social responsibility:

Classical view

Managements only responsibility is to maximize profits.

Socioeconomic view

Management must be concerned for the broader social welfare,

not just profits.


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Arguments againstsocial responsibility:

Reduced business

profits Higher business costs

Dilution of businesspurpose

Too much social powerfor business

Lack of publicaccountability

Arguments in favor of

social responsibility:

Adds long-run profits

Improved public image

Avoids more

government regulation

Businesses have

resources and ethical

obligation


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Criteria for evaluating corporate social

performance:

Is the organizations

Economic responsibility met?

Legal responsibility met?

Ethical responsibility met?

Discretionary responsibility met?


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Figure 3.5 Criteria for evaluatingcorporate social performance.


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Strategies for pursuing social responsibility:

Obstructionistmeets economicresponsibilities.

Defensivemeets economic and legalresponsibilities.

Accommodativemeets economic, legal, and

ethical responsibilities. Proactivemeets economic, legal, ethical,

and discretionary responsibilities.


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Figure 3.6 Four strategies of corporate socialresponsibilityfrom obstructionist to proactive behavior.


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Study Question 5: How do organizations andgovernments work together in society?

How government influences organizations:

Common areas of government regulation of

business affairs: Occupational safety and health

Fair labor practices

Consumer protection

Environmental protection


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Study Question 5: How do organizations and

governments work together in society?

How organizations influence governments:

Personal contacts and networks

Public relations campaigns

Lobbying

Political action committees

Sometimes by illegal acts, such as bribery or illegal

financial contributions to political campaigns


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Figure 3.7 Centrality of ethics and social responsibility inleadership and the managerial role.


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Study Question 5: How do organizations andgovernments work together in society?

Corporate governance:

The oversight of the top management of an

organization by a board of directors.

Corporate governance involves:

Hiring, firing, and compensating the CEO.

Assessing strategy.

Verifying financial records.


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