Download Code of Ethics - davis.k12.ut.us

ETHICS AND SOCIAL
RESPONSIBILITY
Values
• Values are what we prize and cherish most
• All things cannot be valued equally
• You must be willing to sacrifice lower priority values for those that
are MOST important.
Self Centeredness vs. Empathy
• As a child you are taught to be self-centered
• Hungry = Food
• Cold = Warmth
• Hurt = Nurturing
• When your needs are met you learned to feel secure =
health self-esteem
• As a teenager you are expected to move past your own
needs and consider others = empathy
Ethics in Business
• Ethics – set of moral principles or values that govern
behavior
• Managers must face sometimes difficult ethical decisions in
business situations.
• Code of Ethics – document that outlines the principles of
conduct to be used in making decisions within an
organization
A Code of Ethics Content May Address
the following:
• Honesty
• Adherence to the law
• Product safety and quality
• Trading in securities/using
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• Health and safety in the
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workplace
Conflicts of interest
Employment practices
Staffing and marketing
practices
Financial reporting
Pricing, billing, and
contracting
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confidential information
Acquiring and using
information about competitors
Security
Payments to obtain bonuses
Protection of the environment
Behaving Ethically and Unethically
• Behaving ethically:
• Helps employees gain the trust of the people with whom they work
• Helps businesses gain the trust of customers, suppliers, and others
• Behaving unethically:
• Can hurt or end a businessperson’s career
• Can cause a company to lose millions of dollars or even go out of
business altogether
Behaving Honestly
• Sarbanes-Oxley Act of 2002
• Due to Enron and WorldCom scandals, President Bush signed this
act that affects the reporting and governance of public companies
and their directors and officers.
• Employee Theft
• Employers trust their employees not to steal from them.
• Embezzlement
• Stealing supplies, inventory
Behaving Honestly
• Hours worked
• Employees who behave ethically are honest about the hours they
work.
• Ethical employees will only miss work when they are truly ill or have
a legitimate reason to be home.
• Records
• One of the worst ethical lapses an employee can commit is falsifying
records.
• Damages company reputation
• Can have grave effects on health of public (i.e. pharmaceutical company)
Dealing with Ethical Dilemmas
• An ethical dilemma is a situation in which the ethical
course of action is not clear.
The ‘Heinz’ Dilemma
• Mr. Heinz is ordinarily a law-abiding man. One day, his
wife becomes gravely ill. Heinz takes her to the doctor,
who prescribes a medication for her. She does quite well
on this medication and begins to recover. However, Heinz
has no insurance and runs out of money quickly paying
for this expensive medication. After a few months, he can
no longer purchase the medication and his wife begins to
take a turn for the worse. One day, he is in the pharmacy
and notices that no one is behind the counter. The
medication is in plain view. Should he steal the medication
to help his sick wife?
The Old Woman in the Airport
• You are in the airport, trying to catch a flight that is about
to leave. As you run down the crowded corridor, an elderly
woman suddenly slips in front of you and falls to the
ground with a cry. Do you stop to help, if you know you
will miss your flight because of it?
The Trolley
• A trolley is running out of control down a track. In its path
are 5 people who have been tied to the track by a mad
philosopher. Fortunately, you can flip a switch which will
lead the trolley down a different track. Unfortunately, there
is a single person tied to that track. Should you flip the
switch? Why?
Trolley cont.
• As before, a trolley is hurtling down a track towards five
people. You are on a bridge under which it will pass, and
you can stop it by dropping a heavy weight in front of it. As
it happens, there is a man next to you - your only way to
stop the trolley is to push him over the bridge and onto the
track, killing him to save five. Should you proceed? Why?
How is this case different from the first?
Solving Ethical Dilemmas – Ask:
• Have you defined the problem accurately?
• How would you define the problem if you stood on the
other side of the fence?
• Whom could your decision or action injure?
• Can you discuss the problem with the affected parties
before you make your decision?
Solving Ethical Dilemmas - Ask
• Are you confident that your position will be as valid over a
long period of time as it seems now?
• Could you disclose without qualm your decision to action
to your boss, your CEO, the board of directors, your
family, and society as a whole?
Laws Relating to Ethical Behavior
• The Sherman Act
• Monopolies became illegal.
• Wheeler-Lea Act of 1938
• Banned unfair or deceptive acts, such as false advertising, inform
customers of possible negative consequences of using products.
Consumer Protection
Several laws and agencies were designed to protect
consumers against unethical and unsafe business practices:
• The Federal Food, Drug, and Cosmetic Act of 1938
• Food and Drug Administration (FDA)
• Consumer Product Safety Commission (CPSC)
• Forces manufacturers to recall products that may be defective
• Truth in Leading Act of 1968
• Enacted to protect consumers in their dealing with lenders and
creditors.
Environmental Protection
• National Environmental Policy Act of 1969
• Created Environmental Protection Agency (EPA)
• Protects human health and safeguards the air, water, and land.
• The Clean Air Act of 1970
• Regulates air emissions.
• The Toxic Substances Control Act of 1976
• Gave the EPA the ability to track industrial chemicals produced In or
importing into the U.S.
• The Clean Water Act of 1977
• Sets standards on the type and quality of pollutants that industries can
put into bodies of water
Ethical Standards and Culture
• Corporate Gift Giving
• In Japan, lavish gifts are a part of business.
• In United States, government officials are not allowed to accept
gifts (and many corporations have policies against this).
• When doing business abroad, be sure to understand culture.
Ethical Standards and Culture
• Intellectual Property
• Ownership of ideas, such as inventions, books, movies, and
computer programs
• In the U.S., creators of intellectual property have the exclusive right
to market and sell their work (guaranteed through patent,
trademark, and copyright laws)
Social Responsibility
• Social responsibility refers to the obligation that individuals or
businesses have to help solve social problems.
• Profit Maximization
• Trusteeship Management
• Social Involvement
• Philanthropy and Volunteerism
• Environmental Awareness
• Sensitivity to Diversity and Quality of Work Life
Profit Maximization
• In the 19th and early 20th centuries, business owners in
the U.S. believe that their role was simply to maximize
profits their companies earned.
• Social problems were not considered a legitimate
business activity.
Trustee Management
• Recognized that owners of business had obligations to do
more than just earn profits.
• Businesses had obligations to their employees, their
customer, and their creditors.
• Most businesspeople continued to hold this view until the
1960’s.
Social Involvement
• During the 1960’s, people believed businesses should
use their influence to address social issues, such as
poverty, crime, environmental destruction, and illiteracy.
• Business have obligations to all the people affected by
their actions – stakeholders.
• Employees, customers, suppliers, and the community
Social Audit
• A review of a businesses social responsiveness
Philanthropy and Volunteerism
• A company can demonstrate social responsibility by
contributing time and money to charitable, cultural, and
civic organizations.
• Some companies grant employees paid time off to
participate in charitable activities.
• Many companies offer “matching” programs.
Environmental Awareness
• Businesses limit the damage their business causes on the
environment.
• Business can establish policies to reduce pollution.
• For example, encouraging employees to carpool.
• Business can use biodegradable and refillable containers.
• Ex: The Body Shop