chap2, by Linda Ferrell

8/7/2019 chap2, by Linda Ferrell

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Chapter 2

Ethical Issues in Business


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Ethical Issues are...

problems, situations, or opportunities

requiring an individual to choose among

actions that may be evaluated as right or

wrong, ethical or unethical

ethical issues arise because of:

conflict among personal/organizationalvalues

conflicts with societal values


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What do you see as some of the

causes of unethical behavior?


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Causes of Unethical Behavior...

meeting overly aggressive financial or

business objectives

meeting schedule pressures

helping the organization survive

rationalizing that others do it

resisting competitive threats

saving jobs


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Influences on Ethical Behavior...

personal values

attitudes/behaviors of supervisor

attitudes/behaviors of senior management

internal drive to succeed

performance pressuresno threat of punishment

friends/coworkers


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Why not report organizational

misconduct?afraid of not being considered a team player

did not believe corrective action would be taken

fear retribution or retaliation from

management

not on else cares about business ethics,

why should I

fear lack of confidentiality


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Classification of Ethical Issues...

conflict of interest

honesty & fairness

communications issues

organizational relationships


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Conflict of Interest...

exists when an individual must choose whether

to advance his or her own personal interests,

those of the organization, or some other group

must be able to separate personal interests from

business dealings

bribery is a significant concern


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Honesty & Fairness

honesty relates to truthfulness, integrity &

trustworthiness

fairness related to being just, equitable & impartial

breaking or bending laws violates trust

business should not be played as a game

lack of rules & poor enforcement leads to unethical

behavior


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Communications...

issues involved relate to advertising, productsafety, pollution, & employee work

conditionslying is a major ethical issue with internal &external communications

false advertising relates to: exaggerated claims concealed facts & ambiguous statements

lying


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Organizational Relationships...

relate to behavior of organizational members

toward customers, suppliers, subordinates,

superiors, peers & others

plagarism is one ethical issue of concern to

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Ethical Issues Related to

Ownership...owners have an obligation to society as well

as their employees & customers

minimize pollution

compensate workers fairly

produce safe products

must be sensitive to legal & ethical risksof their industry & region


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Financial Responsibilities...

reporting & use of the companies finances

pricing products/services fairly

avoiding any antitrust activities

price fixing

sensitivity to socially responsible investing


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Employees & Management

Concerns...employee theft, sabotage & competitive intelligence

fear of layoffs

salary plateaus

upward mobility

discrimination

privacy & data accesshealth & safety


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Consumer & Marketing Issues...

Must consider consumer feedback

safety

environmental (can lead to boycotts)

maximize positive publicity & avoid negative


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How to Identify an Ethical Issue...

an activity approved by most members of theorganization & customary in the industry is

probably ethicalif the issue withstands open discussionbetween groups within & outside theorganization is probably ethical

covert discussion, destroyed or disguiseddocuments indicate potential problems

chap2, by Linda Ferrell

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