Daniels Ethics Case Competition · Daniels Ethics Case Competition DESB Undergraduate Case...
Transcript of Daniels Ethics Case Competition · Daniels Ethics Case Competition DESB Undergraduate Case...
Daniels Ethics Case CompetitionDESB Undergraduate Case Competition
2013-2014
Coaching Session
Dr. Abe BakhsheshyDaniels Professor of Ethics
Professor and Lecturer of Organizational Behavior
Learning objectives
Levels at which Ethical Issues May Be Addressed
Ethical Decision Making Model (1) Ethical Decision Making Model(2) Case in point Summary
Dr. Abe
Levels at Which Ethical Issues May Be Addressed
PersonalLevel
Situations faced in our personal lives outside the work context
Organizational Level
Workplace situations faced as managers and employees
Dr. Abe
Levels at Which Ethical Issues May Be Addressed
Societal andGlobal Levels
Local-to-global situationsconfronted indirectly as a management team
IndustryLevel
Situations where a manager or organization might influence business ethics at the industry level
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The Stakeholder View of the Firm
Dr. Abe
Personal and Managerial Ethics
Conventional approachConventional approach
Principles approachPrinciples approach
Ethical tests approachEthical tests approach
ResolvingEthical
Conflicts
ResolvingResolvingEthicalEthical
ConflictsConflicts
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Conventional Approach to Business Ethics
Conventional approach to business ethics involves a comparison of a decision or practice to prevailing societal norms Pitfall: ethical relativism
Decision or Practice Prevailing Norms
Social, Ethical relativism examples:
If we don’t do it, someone else will. That’s the way it has always been done. We’ll wait until the lawyers tell us it’s wrong. It doesn’t really hurt anyone. The system is unfair. I was just following orders. Everybody else does it.
Personal and Managerial Ethics
Utilitarianism Rights Justice
Caring Virtue ethics Servant leadership Golden Rule
Principles Approach
Anchors decision making on an ethical principle such as:
Personal and Managerial Ethics
Principle of Utilitarianism focuses on an act that produces the greatest ratio of good to evil for everyone Consequentialist theory
Personal and Managerial Ethics
Principle of Rights focuses on examining and possibly protecting individual moral or legal rights
Personal and Managerial Ethics
Personal and Managerial Ethics Principle of justice involves considering
what alternative promotes fair treatment of people
Types of justice Distributive Compensatory Procedural Rawlsim
Personal and Managerial Ethics
Rawls’ Justice Each person has an equal right to the most
basic liberties comparable with similar liberties for others
Social and economic inequalities are arranged so that they are both:
a) reasonably expected to be to everyone’s advantage and
b) attached to positions and offices open to all people
Personal and Managerial Ethics
Principle of caring focuses on a person as a relational, caring and not as an individual
“Only a life lived for others worth living”
-A. Einstein
Virtue ethics focuses on individuals becoming imbued with virtues
Personal and Managerial Ethics
Golden rule focuses on the premise that you should do unto others as you would have them do unto you
Personal and Managerial Ethics
Ethics Test Approach Test of common sense Test of one’s best self Test of making something public Test of ventilation Gag test
Determine economic outcomes, legal requirements, and ethical duties where problem lies and how solution meets all
Ethical Decision-MakingIdentify decision you are about to make
Articulate all dimensions of proposed decision
Conventional ApproachStandards/Norms-Personal-Organizational-Societal-International
Principles ApproachEthical Principles-Justice-Rights-Utilitarianism-Golden Rule-Caring- Virtue- Servant Leadership
Ethical Tests ApproachEthical Tests-Common sense-One’s best self-Public disclosure-Gag test . . .
Course of action passes ethics screen
Engage in course of action
Course of action fails ethics screen
Do not engage in course of action
Identify new course of action
Understand all moral standards
Recognize all moral impacts:
Benefits to some Harms to others Rights exercised Rights denied
Evaluate the ethical duties
Consider the legal requirements
Determine the economic outcomes
Define complete moral problems
Propose convincing moral solution
Analytical Process for the Resolution of Moral Problems
April 20th, 2010Deepwater Horizon‐Gulf of Mexico
Eleven people lost their lives to the explosion of Deepwater Horizon:
BP Oil Spill
What Does 184 Million Gallons of Oil Look Like?
There have been about 4.38 million barrels of oil spilled which would be enough to power 674,563 US homes for 1 year.
BP Oil Spill
BP’s cost of dealing with the spill is up to about $4 billion.
To date, BP has payed claims totaling $207 million to settle for damages (comprised of 67,500 payments).
The total economic impact of the spill remains to be seen the tourism and fishing industries in the Gulf
states generate billions of dollars each year
Several pre-explosion risks and problems allegedly ignored by BP Problems w/ blow out preventer (BOP),
equipment readings, sudden gas release, etc. BP appears to have chosen risky procedures
to save on time and money Using fewer liners/barriers than recommended,
using only 6 centralizers instead of 21, etc.
Who benefits?
• BP and its stockholders as long as nothing catastrophic happens– Can produce more oil with less expense
• Oil consumers– Can have more of what they want, quicker
• Lawyers – Get paid to represent the parties involved,
especially the defense in this case
Who was harmed? • Gulf Coast Fishing Industry• Ecosystem of Gulf Coast• Tourism Industry in Florida, Alabama,
Mississippi, Louisiana• Victims of Deepwater Horizon explosion and
their families• Reputation of Materials Management Service• BP Stockholders• Residents of Gulf Coast States
Is it “Right,” “Just” and “Fair?”• Cutting preventive maintenance to gain more
uptime and more profits when the repercussions of those actions could be catestrophic?
• Does BP have the right to do whatever it wants if it has all of the necessary permits?
• Rights of employees’ to a safe workplace?• Who is responsible or negligent? (Workers,
BP, the US government, and/or its citizens?)
Is it “Right,” “Just” and “Fair?” cont’d Is it moral and ethical for a company to do
business in such a manner that there is a chance that their catestrophic failure could deny the rights and freedoms of others?
Whose rights were exercised? BP and its stockholders BP satisfied regulatory requirements
(MMS) to drill Oil Consumers 1/8 of all domestic oil comes from Gulf
wells Helps alleviate dependence on foreign
oil
Whose rights were denied?
Fishing industry Tourism Industry Gulf Coast Ecosystem Family members of victims Stakeholders of BP US and Global Citizens
The Economics
-Oil is big money...3 out of 5 top global corporations oil co. all 5 oil dependent. top 40 if compared to GDP of countries
-BP has lost over 70 billion in shareholder value and has pledged 20 billion to clean up.
-Was it worth the risk?
The Legal- $75 million cap that must be paid towards those affected by a spill that was set forth by the Oil Pollution Act 1990
-BP has set aside voluntarily 20 billion.
-Should a company be involved in a operation where a negative externalities could cost society more than the value of the company?
“The true essence of humankind is kindness. There are other qualities which come from education or knowledge, but it is essential, if one wishes to be a genuine human being and impart satisfying meaning to one's existence, to have a good heart.”
“Leave this world a better place!”-Tenzin Gyatso, The 14th Dalai Lama (b. 1935)