David P. Twomey - Boston College Marianne M. Jennings - Arizona State University © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Business Ethics, Social Forces, and the Law Chapter 3 Business Ethics, Social Forces, and the Law Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? The Law as the Standard for Business Ethics The Notion for Universal Standards for Business Ethics Ethical Theories and Standards The Business Stakeholder Standard of Behavior Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? [LO.1] Ethics deals with values relating to the nature of human conduct and values associated with that conduct. Balancing the goal of profits with an individual’s and society’s values is called business ethics. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? The Law as the Standard for Business Ethics: Positive Law: If an act is legal it is ‘moral.’ Absent illegality, all behavior is ethical under this simple standard. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? 2. The Notion of Universal Standards for Business Ethics: Natural Law: higher standards of behavior than positive law. Must be followed even if against codified law. A law can be legal but unethical. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? Ethical Theories and Standards: The Categorical Imperative and Immanuel Kant Cannot use others in a way that gives you a one-sided benefit. International business presents some interesting dilemmas. You not only have to be fair, but also have to want to do it for the right reasons. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? Ethical Theories and Standards: The Contractarians and Justice Theory of justice: requires that we all agree on certain principles in advance. Social contract: the agreement under Locke & Rawls as to what our ethical standards will be. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? Ethical Theories and Standards: Rights Theory Everyone has a set of rights. Government must protect these rights. Ethical Egoism Theory We all act in our own self-interest. We should only judge our own ethics and not interfere with others. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? Ethical Theories and Standards: The Utilitarian Theory Do the most good for the most people. Moral Relativists Make decisions based on circumstances, not predefined standards. Plato & Aristotle: Virtue Ethics Solving dilemmas requires training. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

A. What is Business Ethics? 4. The Business Stakeholder Standard of Behavior: Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

B. Why is Business Ethics Important? The Importance of Trust Business Ethics & Financial Performance The Importance of a Good Reputation Business Ethics &Business Regulation: Public Policy, Law, and Ethics Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

B. Why is Business Ethics Important? [LO.2] 5. The Importance of Trust 6. Business Ethics and Financial Performance: Long-term success is linked to values. Poor values have an effect on financial performance. Many devastating ethical lapses. 7. Importance of a Good Reputation Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

B. Why is Business Ethics Important? Business Ethics and Business Regulation: Public Policy, Law and Ethics Complaints about business behavior lead to law changes and changes in corporate behavior. Goals include: (A) Protection of the State. (B) Protection of the Person. (C) Protection of Public Health, Safety, and Morals. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

B. Why is Business Ethics Important? Business Ethics and Business Regulation: Public Policy, Law and Ethics Goals (cont’d): (D) Protection of Property: Its Use and Title. (E) Protection of Personal Rights. (F) Enforcement of Individual Intent. (G) Protection from Exploitation, Fraud, and Oppression. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

B. Why is Business Ethics Important? Business Ethics and Business Regulation: Public Policy, Law and Ethics Goals (cont’d): (H) Furtherance of Trade. (I) Protection of Creditors and Rehabilitation of Debtors. (J) Stability and Flexibility. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Endless Cycle of Societal Interaction Chapter 3 Endless Cycle of Societal Interaction Social Forces Social Environment Ethics Law Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1

C. How to Recognize and Resolve Ethical Dilemmas Categories of Ethical Behavior Resolving Ethical Dilemmas Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

C. How to Recognize and Resolve Ethical Dilemmas [LO.3] Chapter 3 Categories of Ethical Behavior: Integrity and Truthfulness Adherence to one’s values and principles despite the cost and consequences. Promise-Keeping Loyalty: Avoiding Conflicts of Interest Doing No Harm Maintaining Confidentiality Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3

C. How to Recognize and Resolve Ethical Dilemmas Chapter 3 C. How to Recognize and Resolve Ethical Dilemmas Resolving Ethical Dilemmas: (A) Blanchard and Peale Test Is it legal? Is it balanced? How does it make me feel? (B) Front-Page-of-the-Newspaper Test Would I want my decision published? Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4

C. How to Recognize and Resolve Ethical Dilemmas Resolving Ethical Dilemmas: Laura Nash Model Requires examination of the dilemma from all perspectives. Defining the problem helps avoid the dilemma again. Ask for the perspective of family and friends. Twomey – Jennings, Anderson’s Business Law and the Legal Environment, 22nd Ed. © 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.