Business in a Changing World McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc....
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Transcript of Business in a Changing World McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc....
Business in aChanging World
McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.
Chapter 2Business Ethics and Social Responsibility
Ethisphere links ethics to profitsPublication that illuminates the relationship between ethics and profits.
2-4
Business Ethics & Social Responsibility
Exec who allegedly made $270M off Enron to pay SEC $31.5M
Business Ethics – principles and standards that determine acceptable conduct in business
2-5
Business Ethics & Social Responsibility
Social responsibility– business’s obligation to maximize its positive impact and minimize its negative impact on society
2-7
Business Ethics & Social Responsibility
Laws and regulations encourage businesses to conform to society’s standards, values, and attitudes. Sarbanes-Oxley Act - 2002
2-8
The Role of Ethics in Business
Concern about unethical business practices continue –
HealthSouth’s accounting improprieties and securities fraud
2-9
The Role of Ethics in Business
Unethical and/or Illegal•Accounting fraud•Deceptive advertising•Unfair competitive practices•Internet theft
2-10
The Role of Ethics in BusinessEthical Conduct•Builds trust•Promotes confidence•Validates relationships
Learn how to recognize and resolve ethical issues
2-11
Recognizing Ethical Issues in Business
Ethical issue – an identifiable problem,
situation, or opportunity that requires a person to choose from among several actions that may be evaluated as right or wrong, ethical or unethical.
2-12
Recognizing Ethical Issues in Business
How to judge the ethics of a situation –
examine the situation from your stakeholders’ position, including customers and competitors
2-13
Types and Incidences of Observed Misconduct
Many business issues may seem straightforward and easy to resolve on the surface, but are in reality very complex.
Recognizing Ethical Issues in Business
2-14
1. Overly aggressive financial or business objectives
2. Abusive & intimidating behavior3. Conflict of interest4. Fairness & honesty5. Communications6. Business relationships
Sources of Unethical Behavior in Organizations
2-15
Conflict of interest – – the most common ethical issue identified
by employees.– Advance personal interests over others’
interests– Benefit self at the expense of the company
Sources of Unethical Behavior in Organizations
2-17
Business Ethics
Fairness & honesty – the heart of business ethics•How employees use resources•No harm to customers•Accurate representations•Disclosure
2-19
Business Ethics
Most Popular Office Supplies Employees Pilfer
“More Employees Taking Supplies,” The News Journal
2-20
Personal Ethics
25,000 high school students:•62% cheated on exams at least once•35% copied documents from Internet•27% shoplifted•23% cheated to win at sports
Honesty?
2-21
Ethical Concerns
•False/misleading advertising•Deceptive personal selling tactics•Product safety and quality•Unsubstantiated claims•Product labeling
Communications
2-22
Ethical Concerns
•Relationships with customers•Relationships with suppliers•Relationships with co-workers
Business Relationships
2-23
Ethical Concerns
The act of taking someone else’s work and presenting it as your own without mentioning the source
Plagiarism
2-24
Making Decisions About Ethical Issues
Questions to Consider in Determining Whether an Action Is Ethical
Open discussion of ethical issues does not eliminate ethical problems; it does promote trust and learning in an organization.
2-25
Improving Ethical Behavior in Business
Ethical decisions in an organizations are influenced by three key factors
2-26
Improving Ethical Behavior in Business
Codes of Ethics – Formalized rules and standards that describe what a company expects of its employees.
2-27
Codes of Ethics
According to the NBES, employees in organizations with written standards of conduct are more likely to report misconduct when they observe it.
National Business Ethics Survey (NBES)
2-29
Codes of Ethics
The act of an employee exposing an employer’s wrongdoing to outsiders, such as the media or government regulatory agencies.
Whistleblowing
2-30
Nature of Social Responsibility
1. Economic2. Legal3. Ethical4. Voluntary (philanthropic)
4 Dimensions
2-32
Nature of Social Responsibility
The extent to which businesses meet the legal,ethical, economic, and voluntary responsibilitiesplaced on them by their stakeholders.
Corporate Citizenship
2-34
Nature of Social Responsibility
1. Intel Corporation2. Eaton Corporation3. Nike Inc.4. Deere and Co.
Best Corporate Citizens
2-35
Social Responsibility Issues
• Primary concern with profit or ROI• Financial community at large• Proper accounting procedures• Protecting owner’s rights and investments
Owners & Stockholders
2-37
Social Responsibility Issues
• Provide a safe workplace• Adequate compensation• Listen to grievances• Fair treatment
Employee Relations
2-38
Social Responsibility Issues
Consumerism – the activities that independent individuals, groups, and organizations undertake to protect their rights as consumers.
Consumer Relations
2-39