1. SOCIAL, ETHICAL, AND LEGAL ISSUES
MIS 503 Management Information Systems
MBA Program

2. THE LEGAL ENVIRONMENT
Purpose of law is to constrain behavior within a society so that its needs are satisfied and harm is prevented
Law is related to, not the same as, ethics
IT impact has:
Made new forms of crime possible
Changed mechanisms for reproducing material, photos, art, and music
Legal system has lagged behind technology

3. ETHICS FRAMEWORKS Why discuss ethics?
IT is having a growing effect on our lives
Managers determine how IT is used
Managers are responsible for ethical implications of effects of using IT

4. ETHICS FRAMEWORKS
To act ethically requires that we take responsibility for our actions
Careers as managers and professionals are in jeopardy if unethical
Consider Enron and what happened to its managers!

5. ETHICS FRAMEWORKS
Identifying Ethical Problems
First step: recognize that a decision or action has ethical implications
Ask these questions to identify potential ethical problems:
Is this fair to everyone that will be affected?
Would I want my mother to know about this?
Would I care if everyone knew about this?
What would be the result if everyone did this?

6. ETHICS FRAMEWORKS Code of ethics for software engineering profession
Analyzing Ethical Problems
Code of ethics for software engineering profession
Recognizes that managers and organizations have special responsibilities
Developed jointly by IEEE and ACM

7. Figure 16.2 Section 3 of the ACM
Code of Ethics

8. ETHICS FRAMEWORKS Analyzing Ethical Problems
Basic principles to guide ethical behavior come from:
Religious traditions
Philosophers
Two basic ethical theories:
Deontologism
Consequentialism

9. ETHICS FRAMEWORKS Analyzing Ethical Problems
Deontologism – action is ethical or unethical based only upon the action itself without regard to its consequences in the particular case
It is our intent, not the actual result, that determines whether an action is ethical or unethical
In the Western world rules by which actions are judged have roots in Judeo-Christian tradition
Problems:
Rules are absolutes
Different cultures have different rules
Ignores the consequences that come from a specific action

10. ETHICS FRAMEWORKS Analyzing Ethical Problems
Consequentialism – judges an action by evaluating all the consequences that it produces – if consequences good then action is ethical
Similar to “the ends justify the means”

11. ETHICS FRAMEWORKS Analyzing Ethical Problems
Utilitarianism – one type of consequentialism where all parties who will be affected by the action must be identified and consequences delineated and quantified, with beneficial results measured on a positive scale and harmful results measured on the negative scale
Problems:
Quantification – how to assign numerical values and probabilities
What happens when all benefit is to one and all harm is to another, with net zero?

12. ETHICS FRAMEWORKS Analyzing Ethical Problems
IT Management topics with ethical implications:
Computer crime
Cyberattacks on computers
Identity theft
Impact of IT on privacy
Access to the technology and freedom of speech issues
Intellectual property issues
Hazards of inaccuracy
Impact of IT on workers
Topics addressed in chapter

13. ETHICS FRAMEWORKS Analyzing Ethical Problems
Other social issues with ethical implications that managers need to be aware of:
Hate
Cyberstalking
Sexual abuse via the Internet
Pornography
Topics not addressed in chapter

14. COMPUTER CRIME Computer crime is big business and is growing rapidly
Alarming statistics:
85-97% of computer intrusions never detected
10% of detected are reported, and only a few of reported are solved

15. COMPUTER CRIME Forms of computer crime: Financial crimes
Businesses stealing competitors’ secrets
Espionage agents stealing military intelligence
Attacks on computers by terrorists
Grudge attacks by disgruntled employees
Attacks by “hacker” for fun
Use of IT by criminals to run criminal businesses

16. COMPUTER CRIME Forms of financial crime: Financial Crimes
Embezzlements
Sabotage as a way of “getting back” at an employer
Logic bomb – a program designed to destroy data at a specified date and time
Fraud on the Web
Spoofing – setting up a Web site that mimics a legitimate site

17. COMPUTER CRIME Cyberattacks do serious economic damage
Cyberattacks on Computers
Cyberattacks do serious economic damage
Hackers originally motivated by technological challenge and intended no harm
Crackers use hacking techniques to steal information or wipe out hard drives

18. Figure 16.3 Techniques Used
to Attack Computers

19. COMPUTER CRIME Personal responsibility: Cyberattacks on Computers
Use antivirus software and keep up to date
Make sure all operating system updates are installed
Carefully protect passwords
Carefully opening messages, especially attachments

20. COMPUTER CRIME Most important:
Computer Crime Laws
Most important:
The Computer Fraud and Abuse Act of as amended (Title 18 United States Code, Chapter 47, Sections 1029 and 1030)
Section 1029 prohibits fraud and intrusion by use of counterfeit access devices
Section 1030 covers espionage, stealing financial information, knowingly damaging a computer or application by hacking, stealing passwords, and furthering a fraud by accessing a computer

21. IDENTITY THEFT
“someone appropriating your personal information without your knowledge to commit fraud or theft” (Federal Trade Commission)
Implications:
Ruined credit rating
Extreme effort to “clean up” the mess

22. IDENTITY THEFT Serious problem for businesses and individuals
Impact of Identity Theft
Serious problem for businesses and individuals
According to the DOJ, 7% of households experienced some form of Identity Theft in 2010.
8.6 million victims

24. IDENTITY THEFT Problem for victims:
Police and Bank Attitudes
Problem for victims:
Police, banks, and merchants often reluctant to pursue identity thieves

25. IDENTITY THEFT Summary: Law on identify theft is inadequate
Laws on Identity Theft
Summary:
Law on identify theft is inadequate
Enforcement of the law is poor

26. PRIVACY Privacy is difficult to define
Violating privacy generally includes:
Unwanted access to your person
Intruding into your home or office
Observing you
Obtaining information about you
Legally, our right to privacy is much weaker than our property rights and right to free speech

27. PRIVACY IT perspective:
Privacy – ability to control information about ourselves
Individual might give permission to collect and use certain personal information in exchange for some benefit or business transaction
Privacy is invaded when information used in ways never intended or agreed to

28. PRIVACY Kantian view: Utilitarian view: Ethics of Invasion of Privacy
Invasion of privacy always unethical
Treating person with disrespect
Utilitarian view:
Whether unethical depends upon results of action
Does total resulting good exceed harm caused?
But how do you measure harm caused?

29. PRIVACY U.S. Federal law: Laws on Privacy
No comprehensive legal right to privacy
Some legislation offers various types of privacy:
Fair Credit Reporting Act
Privacy Act
Family Education Rights and Privacy Act
Electronic Communications Privacy Act
Video Protection Privacy Act
Driver’s Privacy Protection Act
Health Insurance Portability and Accountability Act
Children’s Online Privacy Protection Act

30. PRIVACY U.S. federal laws offer protection for: Not well protected:
Laws on Privacy
U.S. federal laws offer protection for:
Student information
Electronic medical information
Electronic communications
Not well protected:
Financial data
Financial institutions often buy and sell information they collect on individuals
Major concern: requirement that customer “opt-out” to obtain even limited protection

31. PRIVACY Laws on Privacy
Another concern is the Patriot Act passed after 9-11:
Purpose is to protect Americans against terrorism
But it weakens constitutional protection against unreasonable search and seizure by allowing the FBI to force anyone to turn over records by telling a judge its related to ongoing terrorism or foreign intelligence
Judging by their laws, many other countries seem to value privacy more highly than U.S.

32. PRIVACY
Privacy Problems
IT has radically affected our ability to control access to information about ourselves
Potential problems:
Government agencies using online databases for official records containing private information
Marketers increasingly value personal information

33. PRIVACY E-Commerce Privacy Concerns
Many trusted businesses are collecting personal information about us and our shopping activities and selling them to others
Method: use of “cookies” when you visit Web sites
Cookie – a small record that identifies you to the Web site you visited and allows it to set up a file on its computer that can record information about the actions you take with that site
Except for the financial industry, no U.S. laws regulate collection and sharing of data

34. PRIVACY
Workplace Privacy
More than 75% of employers record employee Web use, voice mail, , or phone calls, review computer files, or videotape workers
Up to 25% do not tell workers
Ethical (and practical) implication: Is it important that company policies for monitoring employee activities and communications be clearly communicated to employees?

35. PRIVACY
Access
U.S. is in reasonably good shape in regard to computer access and literacy
Europe and Japan lag somewhat behind the U.S.
Developing countries lag far behind, but are making progress
Undeveloped world has limited computer literacy, but they do increasingly have mobile computing literacy

36. PRIVACY Freedom of Speech
Use of the Internet has led to a renewed controversy between our right to freedom of speech and the right of society to protect itself

37. PRIVACY Freedom of Speech
Use of the Internet has led to a renewed controversy between our right to freedom of speech and the right of society to protect itself
Is there information so harmful that it should be banned from posting on the Internet?
Instructions for making a bomb?
How to poison a city’s water supply?
Child pornography?

38. PRIVACY Freedom of Speech Spam – unsolicited commercial e-mail
ISPs spend a lot of money on anti-spam software
Typical consumers still receive a large number of unwanted s a month
Congress has attempted to write laws to outlaw spam
Freedom of speech rights make anti-spam laws difficult to write, pass, and uphold in courts

39. PRIVACY Intellectual Property Rights
Intellectual property rights – any product of the human mind, such as an idea, an invention, a literary creation, a work of art, a business method, an industrial process, a chemical formula, a computer program, or a presentation
Due to technological advances, sharing intellectual property is easy, rapid, and inexpensive

40. PRIVACY
Intellectual Property Rights
Which types of property can be owned differs from one society to another
Most societies value and reward intellectual property
U.S. patent and copyright laws try to protect intellectual property

41. PRIVACY A serious problem for the software industry
Software Piracy
A serious problem for the software industry
Software piracy rates are the lowest in North America and highest in Asia
U.S. copyright laws make it illegal to copy software and use it without vendor’s permission
There are severe penalties for violation

42. PRIVACY Software Piracy
Software vendors prosecute large companies for violations, but often individuals fly under the radar
Ethical question: Is it right to copy software for personal use?
Copyright protects against software piracy, but not against a firm “copying” a product and reselling it
Patents – give creators exclusive right to manufacture and use for a specified period of time
Computer programs are often patented

43. PRIVACY
Ethical Questions
Is it ethical to download copyrighted music or movies from the Internet, and not pay for them?

44. ACCURACY National Crime Database
FBI’s National Crime Information Center maintains an integrated, real-time transaction processing and online fingerprint-matching database
Input comes from thousands of agencies across the country
Law establishing systems required the FBI to ensure information is “accurate, relevant, timely and complete”
March 2003, Justice Department eliminated requirement for FBI to ensure accuracy
The outcome is that more innocent people might be identified as criminals

45. ACCURACY Credit Bureau Databases
There are three large credit reporting bureaus in the U.S. that maintain huge databases on 90% of Americans
Unfortunately, credit reporting information is notoriously inaccurate
The Fair Credit Reporting Act required credit bureaus to maintain “reasonable” accuracy
What is “reasonable”?
Basic responsibility for accuracy remains with the individual rather than with collecting agencies

46. ACCURACY Other Business Databases
Most businesses maintain databases used for decision making
Accuracy of data might affect individual within and outside the company
Ethical question: What responsibility does the individual manager have for accuracy of the data?

47. IMPACTS ON WORKERS IT can replace workers in some cases
IT can potentially harm the quality of working life
Being on a computer terminal too long can cause repetitive stress injuries
Computerization of tasks can leave remaining manual tasks very dull and boring
Often, the main objective of a computer system is to reduce costs by replacing people
Ethical question: How do you balance organizational benefits with consequences to people who lose jobs?

48. THE FUTURE
What will individuals and organizations do with the increased IT power available for less and less money?
What new social and ethical issues will the future bring?
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