Bs Ethics n Social Resp Ch 6 of 11
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Transcript of Bs Ethics n Social Resp Ch 6 of 11
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Chapter 4: BUSINESS ETHICS AND SOCIAL
RESPONSIBILITY
Doing Well by Doing Good
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ETHICS AND SOCIAL RESPONSIBILITY
ETHICSBeliefs about
right and wrong.
SOCIALRESPONSIBILITY
The obligation of a businessto contribute to society.
A close relationship, but not the same
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ETHICS: MURKIER THAN YOU THINK
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UNIVERSAL ETHICAL STANDARDS
Developed by Character Counts , a nonpartisan organization of educators,community leaders, and ethicists.
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BUSINESS ETHICS: NOT AN OXYMORONEthical Dilemma
Two unfavorable options with Negative consequences. most challenging business decisions seem to arise when
values are in conflict Business Ethics the application of right and wrong in
the workplace Ethical Lapse Clear misconduct
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ETHICS AND THE INDIVIDUAL
Framework for Ethical Decisions1. Do you understand the dimensions of the problem?
2. Who would benefit? Who would suffer?
3. Are the alternative solutions legal? Are they fair?
4. Does your decision make you comfortable?
5. Could you defend your decision on the nightly news? Or toyour mother? Or to God?
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Creating and Maintaining an Ethical Organization
Organizational Culture sets the ethical culture and isled by Top Management
An effective Code of Ethics has:
Executive buy-in Clear expectations Integrated approach Global and local Whistleblower support Reporting and enforcement
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ETHICS FAME AND SHAME
Dennis Kozlowski, former CEO of Tycowas convicted of looting
millions from the company.
Ethics Hall of Shame
Brian Mulroney, former Prime Minister of Canada, admitted he accepted $225,000 in
cash, six years after doing so (and thenpaid tax on half of it.)
Martha Stewart was convicted of obstructing justice in a $40,000 well-
timed stock sale.
Sheron Watkins, former vice president of Enron reported the accounting irregularitiesthat led to the discovery of corporate fraud.
Ethics Hall of Fame
Pierre Omidyar, the founder of eBay has
given away over $100 million to helpgive economic power to the worlds poor.
Paul Newmans food company donates100% of the profits to charity, totaling
more than $150 million to date.
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SOCIAL RESPONSIBILITYa commitment to minimize business negative effects and
maximize the positive ones.
Responsibility toWhom?
Stakeholders are any
groups that have a stake
or a personal interest - in theperformance and actions
of an organization.
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RESPONSIBILITY TO EMPLOYEES
INVESTORS
COMMUNITY
ENVIRONMENT
CUSTOMERS
Creating Jobs that Work
Sustainable Development
Value, Honesty, and Communication
Fair Stewardship and Full Disclosure
Business and being good citizens
GOVERNMENT Follow laws, regulations, pay taxes
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RESPONSIBILITY TO EMPLOYEES: CREATING JOBS THAT WORK
Meet legal standards Workplace safety Minimum wage/Overtime requirements Value employees Provide work/life balance
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RESPONSIBILITY TO CUSTOMERS
CONSUMERISM: The Right to Be Safe
The Right to Be Informed
The Right to Choose
The Right to be Heard
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ROTTEN APPLE?
Planned Obsolescence Deliberately designing products to fail in order to shorten the timebetween consumer repurchases
APPLE COMPUTERS: iPods had irreplaceable battery. Batteries died after 18 months.
Customers were encouraged to purchase new iPods Two customers posted high profile protest movies online. APPLE announced replacement program.
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RESPONSIBILITY TO INVESTORS
Legal requirements U.S. Sarbanes-Oxley Act
Responsible use of corporateresources
Is optimism or pessimism sociallyresponsible?
FAIR STEWARDSHIP AND FULL DISCLOSURE
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RESPONSIBILITY TO COMMUNITY
Corporate Philanthropy - businessdonations to nonprofit groups, includingboth money and time. Corporate Responsibility - The actionsof the business rather than donations of
money and time.
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RESPONSIBILITY TO ENVIRONMENT
Green Marketing marketing environmental products andpracticesto gain a competitive edge .Greenwashing marketing environmentalpractices when there is no real green effort.
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RESPONSIBILITY TO ENVIRONMENT Responsibility to environment is a part of
responsibility to community
Reducing the amount of trash is more importantthan recycling
Although consumers support green marketing, theymay not be willing to sacrifice quality
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ETHICS AND SOCIAL RESPONSIBILITY IN THE GLOBAL AR
Corruption is part of the culture in many countries Bribes or gifts
Labour issues in host countries can be complicated Living wage Child labour Code of Conduct
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MONITORING ETHICS AND SOCIAL RESPONSIBILITY
SOCIAL AUDITA systematic evaluation of how well
a firm is meeting its ethics and socialresponsibility objectives