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Ethics What is Ethics? Ethics can be defined broadly as a set of moral principles or values. Ethics has to do with asking fundamental questions such as: “What is fair?” “What is just?” “What is the right thing to do in this situation?” Ethics involves an active process of applying values, which may range from religious principles to customs and traditions. Law versus Ethics… Law and ethics are not the same thing. Asking the question, “Is an act legal?” is different from the question, “Is an act ethical?” The law does not cover all ethical requirements. Which means that an action might be unethical, yet not necessarily illegal. For example, it might be unethical to lie to your family, but it is not necessary illegal. Why people act Unethically… The person’s ethical standards are different from those of society as a whole. The person chooses to act selfishly. In many instances, both reasons exist. A Person’s Ethical Standards Differ from General Society… Embezzlers Most Con artists Shoplifters people who commit such acts feel no remorse when they are apprehended because their ethical standards differ from those of society as a whole. A Person Chooses to Act Selfishly - Example Person A finds a briefcase containing important papers and $1,000. He tosses the briefcase and keeps the money. He brags to his friends about his good fortune. This action probably differs from most of society. Rationalizing Unethical Behavior… Everybody If does it. it’s legal, it’s ethical. Likelihood of discovery and consequences Resolving Ethical Dilemmas 1. Obtain the relevant facts. 2. Identify the ethical issues from the facts. 3. Determine who is affected. 4. Identify the alternatives available to the person who must resolve the dilemma. 5. Identify the likely consequence of each alternative. 6. Decide the appropriate action. Ethics in Business… • • • • • Morality? Fair Trade? Ethical Trade? Green Business? Socially Responsible entrepreneurship? Nickels 6e/Copyright © 2007 McGraw-Hill Ryerson Ethics Check Questions… o Is it legal? o Is it balanced? o How will it make me feel about myself? Why Manage Ethically? o To maintain a good reputation o To keep existing customers o To attract new customers o To avoid lawsuits o To reduce employee turnover o To avoid government intervention o To please customers, employees and society o TO DO THE RIGHT THING! Codes of Ethics Compliance-Based Increase control and penalize wrongdoers Integrity-Based Define guiding values Support ethical behaviour Shared accountability