Download Day 1 Fundamentals o..

Business ethics fundamentals
From Buchholtz and Carroll chapter 7
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Is nowhere safe? Is everyone a hypocrite or liar?
Are all standards, and examples corrupt?
Enron ,WorldCom, Arthur Andersen Parmalat ….
Racial discrimination and sexual harassment.
Texaco and cost of $196 million settlement for
racial discrimination on equal pay.
• Recent pressure on the Catholic church, BP in
the Gulf of Mexico… the Pakistan cricket betting
allegations– inappropriate unethical behaviour
and responses.
• Universities under attack from plagiarism.
Public view of business ethics
• Business ethics as contradiction
• ‘Only a fine line between a business
executive and a crook’ page 237
• Trust gap for businesses even after Enron.
• Corrupt executives who kept own wealth
and broke companies and put employees
out of work
• Greed for money and power : weakening
of personal values
• Executives can be ethical and successful
• Media financial press do not protect public.
Any ethical lapse in a company erodes its
culture
• Society is seeking (2000s) new emphasis
on values, morals, ethics
• Has business ethics really deteriorated?
Measurement?
• But media do report ethical problems more
• Is society actually changing? Unethical
practices were once seen as ethical.
Examples?
• Ethics =good and bad, moral duty and
obligation
• Morality very similar to ethics = fairness
and justice and the difficult question of
equity
• Business ethics. In business context
3 major approaches to Business Ethics
• Conventional : how normal society views
business ethics – this chapter
• Principles : use of principles or guidelines
to direct behaviour actions and policies
chapter 8 for this and tests approaches
• Ethical tests: short questions to guide
ethical decision making
Conventional approaches/ prevailing norms
of acceptability
• Bases are family, friends, religious beliefs the
local community, region of country (but is this
too American?) one’s employer, law the
profession, etc
• Conscience: but is that erratic? Advertising as
deceitful? What are acceptable conventions?
• Clash of norms: norms from culture and society
against norms derived from employment law and
business ethics (example is sexual innuendo)
Ethics and the law
• Ethics at a higher level to law, but overlap
• Law as minimum standards of conduct
and behaviour but law is codified ethics
page 246.
• Difference between letter and spirit of law.
Example is Enron. Also Hewlett Packard
which used questionable legal means to
gather leaked information from board
members.
• Law does not address all ethical
questions.
• Issue of illegal behaviour by companies.
• Why do they do it?
• What are the consequences?
• Case for next slide . ‘You should not steal
someone else’s property’. Paper clips, use
of company phones? Consensus in
principle not practice??
Making ethical judgements
• Stage 1. Decision action or practice
• Stage 2. Compare the practice with
prevailing norms of acceptability
• Stage 3. Come to ethical (value)
judgements, different personal
interpretations.
• Working out stage 2 is very hard
• Danger of ethical relativism: pick and
choose source of norms.
4 ethical questions =(tough central issues)
• What is? Real situation is hard to find..
• What ought to be? Rightness fairness or
justice of a situation. What should mgt do?
• From what is to what ought to be: practical
question for management.. What do we
intend to accomplish? What circumstances
permit us to accomplish? What are we
able to accomplish?
• Motivation for being ethical? Manipulative
or selfish
3 models of management ethics
• 1 Immoral management : no principles
implied opposition to ethics
• 2 moral management : includes
professionalism , view of the law.
• 3 Amoral management: company
excludes moral considerations as
irrelevant or is too casual about morality
Kohlberg and Gilligan
• Level 1 Preconventional
• Level 2 Conventional level
• Level 3 Postconventional, autonomous or
principled level.
• Men deal with ethics in terms that are
impersonal ,impartial , abstract.
• Challenged by Gilligan with her view that
women value relationship maintenance
and hurt avoidance
BBC Radio 4 Integrity test
• Use this link to find out your integrity score
as set up by the Essex Centre for the
Study of Integrity:
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http://news.bbc.co.uk/today/hi/today/newsi
d_9685000/9685729.stm
Situations: your views?
• Deloitte and Touche USA 2007 Ethics and
the workplace survey
• Stealing petty cash
• Cheating on expenses
• Taking credit for another person’s
accomplishments
• Lying on time sheets
• Coming into work hungover
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Telling a demeaning (racist) joke
Taking office supplies for personal use
Immoral management:
Showing preferential treatment towards
certain employees
• Rewarding employees who display wrong
behaviour
• Harassing a fellow employee (verbally
sexually racially)