1. CHAPTER 14: ETHICS, SOCIAL RESPONSIBILITY, AND SUSTAINABILITY © John Wiley & Sons Canada, Ltd. John R. Schermerhorn, Jr., Barry Wright, and Lorie Guest Business Leadership: Management Fundamentals John R. Schermerhorn, Jr., Barry Wright, and Lorie Guest

2. © John Wiley & Sons Canada Ltd. VIDEO: BEN & JERRY’S Ben & Jerry’s: The Greenest Ice Cream Around (external link)

3. Ethics: – Code of moral principles – Set standards of “good” or “bad” or “right” or “wrong” in one’s conduct Ethical behaviour: – What is accepted as good and right in the context of the governing moral code © John Wiley & Sons Canada Ltd. WHAT IS ETHICAL BEHAVIOUR?

4. Law, values, and ethical behaviour: – Legal behaviour is not necessarily ethical behaviour BRAINSTORM: CAN YOU THIN OF AN EXAMPLE? – Personal values help determine individual ethical behaviour – Values span broad beliefs: beliefs and attitudes that help determine your behaviour – Terminal values: preferences about desired ends – Instrumental values: preferences regarding the means to desired ends © John Wiley & Sons Canada Ltd. WHAT IS ETHICAL BEHAVIOUR? (CONT’D)

5. 1.Utilitarian view of ethics: – Greatest good to the greatest number of people. 2.Individualism view of ethics: – Primary commitment is to one’s long-term self-interests. 3.Moral-rights view of ethics: – Respects and protects the fundamental rights of all people. 4.Justice view of ethics: – Fair and impartial treatment of people according to legal rules and standards Procedural justice: policies and rules fairly applied Distributive justice: equal treatment for all people Interactional justice: people treated with dignity and respect © John Wiley & Sons Canada Ltd. ALTERNATE VIEWS OF ETHICS

6. © John Wiley & Sons Canada Ltd. FIGURE 14.1 FOUR VIEWS OF ETHICAL BEHAVIOUR

7. http://www.youtube.com/watch?v=vstg5c3c3g8 © John Wiley & Sons Canada Ltd. ETHICS IN THE WORKPLACE

8. An ethical dilemma occurs when certain choices may be considered unethical, despite possible potential for personal and/or organizational benefit Ethical dilemmas include: – Discrimination – Sexual harassment – Conflicts of interest – Customer confidence – Organizational resources © John Wiley & Sons Canada Ltd. ETHICS IN THE WORKPLACE

9. Checklist for dealing with ethical dilemmas: 1.Recognize the ethical dilemma 2.Get the facts 3.Identify your options 4.Test each option: Is it legal? Is it right? Is it beneficial? 5.Decide which option to follow 6.Double-check decision by asking “spotlight” questions: “How would I feel if my family found out about my decision?” “How would I feel about this if my decision were in the local news?” 7.Take action © John Wiley & Sons Canada Ltd. ETHICAL DECISION MAKING

10. Unethical behaviour can be rationalized by convincing yourself that: – The behaviour is not actually illegal – The behaviour is truly in everyone’s best interests – Nobody will ever find out – The organization will “protect” you HAVE YOU EVER FOUND YOURSELF FALLING INTO THIS TRAP? © John Wiley & Sons Canada Ltd. HOW DO WE CONVINCE OURSELVES THAT UNETHICAL BEHAVIOUR IS OKAY?

11. Whistleblowers: – Expose the misdeeds of others in order to: Preserve ethical standards Protect against wasteful, harmful, or illegal acts – Laws protecting whistleblowers may vary THINK – PAIR – SHARE: WOULD YOU EVER EXPOSE SOMEONE ELSE? WHY/WHY NOT? or WHAT WOULD SOMEONE HAVE TO DO FOR YOU TO STEP IN AND SAY SOMETHING? © John Wiley & Sons Canada Ltd. MAINTAINING HIGH ETHICAL STANDARDS

12. A unique form of entrepreneurship that seeks novel ways to solve pressing social problems at home and abroad Examples include: – Housing and job training for homeless – Bringing technology to poor families – Improving literacy among disadvantaged youth – Offering small loans to start minority-owned businesses © John Wiley & Sons Canada Ltd. SOCIAL ENTREPRENEURSHIP

13. Corporate social responsibility: – Obligates organizations to act in ways that serve both its own interests and the interests of society at large © John Wiley & Sons Canada Ltd. SOCIAL RESPONSIBILITY In 1988, Jeffery Hollender founded cleaning, paper, and personal care products company Seventh Generation. The company focuses on producing products that have a reduced environmental impact, avoiding the harsh chemicals that are part of many of today's leading cleaning and personal care products.

14. Organizational stakeholders: – Those persons, groups, and other organizations directly affected by the behaviour of the organization and holding a stake in its performance © John Wiley & Sons Canada Ltd. STAKEHOLDER ISSUES AND ANALYSIS

15. © John Wiley & Sons Canada Ltd. FIGURE 14.7 SAMPLE STAKEHOLDER MODEL

16. Classical view: –Management’s only responsibility is to maximize profits Socioeconomic view: –Management must be concerned for the broader social welfare, not just profits –Examples: –Environment –People in Community –Employee Benefit http://www.youtube.com/watch?v=SXOJEH0se9A © John Wiley & Sons Canada Ltd. PERSPECTIVES ON SOCIAL RESPONSIBILITY

17. Social Responsibility Audit: assesses organization’s accomplishments in areas of CSR – Asks: is the organization’s… 1.Economic responsibility met? Is it profitable? 2.Legal responsibility met? Does it obey the law? 3.Ethical responsibility met? Is it doing the right thing? 4.Discretionary responsibility met? Does it contribute to the broader community? © John Wiley & Sons Canada Ltd. EVALUATING CORPORATE SOCIAL PERFORMANCE

18. © John Wiley & Sons Canada Ltd. FIG. 14.8 CRITERIA FOR EVALUATING CORPORATE SOCIAL PERFORMANCE

19. Strategies for pursuing social responsibility: – Obstructionist: meets only economic responsibilities – Defensive: meets economic and legal responsibilities – Accommodative: meets economic, legal, and ethical responsibilities – Proactive: meets economic, legal, ethical, and discretionary responsibilities © John Wiley & Sons Canada Ltd. EVALUATING CORPORATE SOCIAL PERFORMANCE (CONT’D)

20. © John Wiley & Sons Canada Ltd. FIGURE 14.9 FOUR STRATEGIES OF CORPORATE SOCIAL RESPONSIBILITY—FROM OBSTRUCTIONIST TO PROACTIVE BEHAVIOUR

21. How “green” is a business? How can a business be “green”? Why is it so important in today’s society for businesses to go “green”? http://www.youtube.com/watch?v=TTNzuXZyl28 ETHICS AND THE ENVIRONMENT

22. http://www.youtube.com/watch?v=bd2jFAyEnrY What do you think of the outcome? © John Wiley & Sons Canada Ltd. YOU BE THE JUDGE ETHICAL OR NOT?!

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