1. Ethics and Social Responsibility: Doing the Right Thing
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Business Ethics
The fundamental moral values and behavioral standards that form the foundation for the people of an organization as they make decisions and interact with stakeholders
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3. Customers Special Interest Groups Unions Employees Investors Board of
Key Stakeholders
External Stakeholders
Customers
Special Interest
Groups
Unions
Internal Stakeholders
Employees
Investors
Board of
Directors
Management
Creditors
Suppliers
Government
General Public
Chapter 21 Ethics and Social Responsibility Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

4. Three Levels of Ethical Standards
The law
Organizational policies and procedures
The moral stance employees take when faced with decisions not governed by formal rules
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An Ethical Framework
Step 1. Recognize the ethical dimensions involved in the dilemma or decision
Step 2. Identify the key stakeholders involved and determine how the decision will affect them
Step 3. Generate alternative choices and distinguish between ethical and unethical responses
Step 4. Choose the “best” ethical response and implement it
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6. Three Styles of Management
Immoral management - driving force is greed
Amoral management - does not consider ethical impact on others
Moral management - sees the law as a minimum standard of behavior
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7. The Benefits of Moral Management
Earning a profit does not conflict with maintaining high ethical standards
Avoid the damage to a company’s reputation that results from unethical behavior
Dealing with diverse stakeholders is easier with a solid ethical foundation
Attracting and retaining quality workers is easier
A company’s ethical philosophy determines its ability to provide value for its customers
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8. Why Ethical Lapses Occur
An unethical employee
An unethical organizational culture
Moral blindness
Competitive pressures
Opportunity pressures
Globalization of business
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9. Establishing Ethical Standards
The utilitarian principle
Kant's categorical imperative
The professional ethic
The Golden Rule
The television test
The family test
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10. Maintaining Ethical Standards
Create a company credo
Develop a code of ethics
Enforce the code fairly and consistently
Conduct ethics training
Hire the right people
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11. Maintaining Ethical Standards
Perform periodic ethical audits
Establish high standards of behavior... not just rules
Set an impeccable ethical example
Create a culture that emphasizes two-way communication
Involve employees in establishing ethical standards
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12. Social Responsibility
Social responsibility - the awareness by a company’s managers of the social environmental, political, human, and financial consequences its actions produce
Studies: Companies that incorporate social responsibility into their competitive strategies outperform those that fail to do so
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13. Business has a Social Responsibility to...
The environment
Employees
Customers
Investors
The community
Chapter 21 Ethics and Social Responsibility Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

14. Responsibility to the Environment
The “Three R’s”:
Reduce the amount of materials used in your company
Reuse whatever you can
Recycle the materials that you must dispose of
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15. Responsibility to Employees
Diversity
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16. Composition of the U.S. Workforce
Chapter 21 Ethics and Social Responsibility Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

17. SPLENDID Approach to Diversity
Study
Plan
Lead
Encourage
Notice
Discussion
Inclusion
Dedication
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Managing Diversity
Assess your company’s diversity needs
Learn to recognize your own biases and stereotypes
Avoid making invalid assumptions
Push for diversity in your management team
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Managing Diversity
Concentrate on communication
Make diversity a core value in the organization
Continue to adjust your company to your workers
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20. Responsibility to Employees
Diversity
Drug testing
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21. A Drug Prevention Program Should Include...
A written substance abuse policy
Training supervisors to detect drug-using workers
An employee education program
A drug testing program, when necessary
An employee assistance program (EAP)
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22. Responsibility to Employees
Diversity
Drug testing
AIDS
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23. An AIDS Policy Should Address…
Employment
Discrimination
Employee benefits
Confidentiality
Education
“Reasonable accommodations”
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24. Responsibility to Employees
Diversity
Drug testing
AIDS
Sexual harassment
                                                
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Sexual Harassment
Any unwelcome sexual advance, request for sexual favors, or other verbal or physical sexual conduct made explicitly or implicitly as a condition of employment
84% of sexual harassment cases are filed by women
Harassment can take several forms
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26. Behavior Leading to Sexual Harassment Charges
Quid Pro Quo (“something for something”) harassment
Hostile environment
Harassment by non-employees
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27. Number of Sexual Harassment Charges Filed
Source: Equal Employment Opportunity Commission, 2010
Chapter 21 Ethics and Social Responsibility Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

28. Preventing Sexual Harassment
Education
Policy
Procedure
Listen without judging
Investigate complaints promptly
Interview parties involved and witnesses
Maintain confidentiality
Follow company policy
Inform both parties of actions taken
Document the investigation
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29. Responsibility to Employees
Diversity
Drug testing
AIDS
Sexual harassment
Privacy
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30. Responsibility to Customers
Right to safety
Right to know
Right to be heard
Right to education
Right to choice
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31. Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.
Copyright ©2012 Pearson Education, Inc.  Publishing as Prentice Hall
Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall