1. Chapter 2 Social and Ethical Environment of Business
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Why is supply and demand of products so important to both business and consumers?
Supply and demand affect the number of products available and purchased and is a major factor in determining prices charged and paid.
Chapter 2 Social and Ethical Environment of Business

2. Chapter 2 Social and Ethical Environment of Business
©2008 Thomson/South-Western

3. Lesson 2.1 Human Resource Issues
Objectives
Describe the changing nature of the U.S. population and how this impacts businesses.
Explain the issues that businesses face with the U.S. labor force.
Chapter 2 Social and Ethical Environment of Business

4. Human Resources People are a firm’s most important resource.
A recent study of top managers found that finding and retaining qualified workers was more important than finance, technology, product innovation, or international business.
The workers help businesses achieve their organizational goals.

5. HUMAN RESOURCE ISSUES Population:
The GDP of a country cannot increase unless there are enough people to provide the necessary labor and to purchase goods and services produced. (However, GDP needs to grow at a faster rate than its population in order to improve living standards)
Population statistics enable businesses to plan how much and what kinds of goods and services to produce.

6. Population
Both the size and the characteristics of the population are important in business planning.
The population of the U.S. has grown steadily over the years.
The growth rate is determined by the birth rate, death rate , and the level of immigration in the country.
Generally as the standard of living increases, the birth rate falls

7. Population (continued)
Because of the a better healthcare system, people are living much longer.
Much of the population increase takes place through immigration.
U.S takes in the most immigrants than any other country

8. Changing Population
The growing diversity of the workforce increases the need for better cross-cultural communication and sensitivity to the interests and concerns of various groups.
Changes in birth rate has caused shifts in the number of people in different age groups.
Baby boom: the number of people aged 55 and over
The lower-birth rate period that followed the boomer period is called the baby bust period
Baby bust
created a shortage of young workers called “busters”

9. Population of the United States
Chapter 2 Social and Ethical Environment of Business

10. Moving Population Americans are people on the move.
People move short or long distances, such as from the
Frost Belt: the colder northern half of the country
Sun Belt: the warmer southern half of the nation
Businesses relocate to where customers are located, they affect where other people move to in order to find jobs. Ex: where factories have relocated to southern belt because of low wages.
Rust belt: the north central and northeastern states where the major manufacturing firms once dominated

11. Labor Force
Includes most people aged 16 or over who are available for work, whether employed or unemployed.
Many of the people in the labor force may be available for work but not actively seeking employment, such as students and full-time homemakers.
Labor participation rate: the percentage of the labor force that is either employed or actively seeking employment.
Labor participation rate increased because women are taking more jobs outside the classroom.

12. Labor Participation Rate for Men and Women

13. Poverty
The prosperity among Americans is not equally distributed among the population
About 12 and 15 percent of the population in any given year live in poverty.
Social Security is lowering the poverty rate of the elderly
Many children live in poverty because they reside in households where one or more parents do not have the education and skills to hold high-paying jobs.

14. Equal Employment
Equality for all is one of the basic principles on which the United States was founded.
Several laws have been passed to outlaw discrimination on the basis of race, gender, national origin, color, religion, age, handicap, and other characteristics.
The number of women and racial minorities are few, in many occupations.
Even when they find jobs, people in these groups may encounter difficulties in being promoted above a certain level.

15. Equal Employment
Glass Ceiling: an invisible barrier to job advancement.
Ex: if employees expressed discomfort with having a female supervisor, this may make promotion of women less likely.
Employers are now legally obligated to provide equal employment opportunities for all.
Sticky Floor Syndrome: the inability for workers to move up from entry level positions or lower paying jobs.

16. Comparable Worth
Paying workers equally for jobs with similar but not identical job requirements.
Also called “equal pay for comparable work”
To compare if work is of equal value, analysts compare factors such as special skills, physical strength, job dangers, responsibility, and education.
it is not always easy to determine the specific factors that measure the worth of jobs.

17. Questions The U.S. labor force includes
People aged 16 and over who are available for work
Employed aged 16 and over
Unemployment people aged 16 and over
All of the above
Answer: all of the above

18. Questions
When people encounter difficulties in being promoted to management above a certain level they have encountered
A glass ceiling
A promotion ceiling
A sticky floor
A legal barrier
Answer: a glass ceiling

19. Questions
What factors are contributing to the growth of the U.S. population?
Immigration, better health care, and birth rates.
What has caused the decline in the number of young workers in recent years?
Low birth rate after the baby boom.

20. Assignment

21. Lesson 2.1 Human Resource Issues
Objectives/Exit Ticket
Describe the changing nature of the U.S. population and how this impacts businesses.
Explain the issues that businesses face with the U.S. labor force.
Chapter 2 Social and Ethical Environment of Business

22. Lesson 2.2 Societal Values
Objectives
Discuss how the values of Americans have changed.
Explain how businesses have adapted to changing values.
Describe the dilemma posed by the need for business to grow and the need to protect the natural environment.

23. Societal Values Change is constant in our society.
We produce a steady stream of new products, new ideas, new ways of doing things, and new attitudes.
Societal values have been undergoing change at a fast pace.

24. Changing American Values
Generation X: workers from the post-baby-boom generation.
Feel less loyal to a particular employer than did earlier generations
Expects to change jobs many times during their careers
Net Generation: those born between 1977 – 1997.
Expect to change jobs many times during their careers.

25. Employer Responses
To attract and retain competent workers, employers have responded to social changes (children, aging parents, illnesses, and financial burdens) by taking action to improve the way work is done, to assure healthier and safer work conditions, and to help workers deal with some personal problems.

26. Redesigning Jobs
When jobs consist of mainly repetitive tasks, workers get bored, productivity drops, and morale declines.
To retain workers, employers redesign jobs to make them varied and challenging.
Today’s employees often work in teams, which can improve morale as well as the quality of work.
Businesses also try to improve job satisfaction through empowering workers to make important decisions.

27. Improving Health and Safety
The United States is facing an obesity epidemic that is negatively affecting employees’ health.
Businesses have responded to this epidemic by operating wellness and fitness programs.
An unfit employee is absent more and is less productive than a fit employee
Many businesses encourage healthy lifestyle by providing incentives to smokers to quit, membership to health clubs, counseling services where workers can receive support for stress or emotional problems and payment for treatment of drugs, alcohol, and other forms of addiction.

28. Family-Friendly Practices
Given the changes in the family structure, employers are making efforts to address this aspect of their employees’ lives
By law, employers have to provide unpaid leave to employees.
Many progressive businesses provide daycare facilities for young children of employees.
Provide flexible scheduling so that workers can avoid communicating to and from work during hectic times.
Accommodate their family needs and lifestyle

29. Family-Friendly Practices
Advances in communication technology in the form of the Internet, , mobile phones, and fax have led many businesses to allow workers to telecommute.
Telecommuters work from home or on the road, staying in contact with their employers electronically.

30. Natural Resources Issues
A growing population means more people to buy more things.
More purchases means more packaging, boxes, and worn-out products to throw away.
The increasing demand for products places great pressure on natural resources, such as land, water, air, minerals, and forests.
It also affects the habitats of wild animals and the lives of native peoples
Both business and society have to address the issue

31. Managing the Environment
Preserving the natural environment and properly disposing of consumer and industrial waste have become major concerns of our society.
Recycling: reusing products and packaging whenever possible.
We are trying to conserve natural resources, such as oil, natural gas, and iron ore.
At the same time, we are using more renewable resources, such as electricity generated from the sun (solar power), from water, and from wind.

32. Controlling Environmental Pollution
The government created the Environmental Protection Agency (EPA) in 1974 to help control and reduce pollution in the basic areas, water, solid waste, pesticides, noise, and radiation.
The EPA enforces such laws as the Clean Air Act, Clean Water Act, Resource recovery Act, Federal Water Pollution Control Act, Federal Environmental Pesticides Control Act, Noise Control Act, and Resources Conservation and Recovery Act.

33. Controlling Environmental Pollution
In the aftermath of the Exxon Valdez accident, which spilled oil along the coastal Alaska in 1989 and killed a large number of marine life, environmentalists and socially minded groups formed the Coalition of Environmentally Responsible Economies (CERES) to encourage companies to behave responsibly.

34. Questions Which of the following is not true for Net Generation?
They expect to change jobs many times during their careers
They were born between 1977 and 1997
They are the post-baby-boom generation
They feel less loyal to particular employer
Answer: They are the post-baby-boom generation

35. Questions Pollution can, in part, be controlled through Recycling
EPA regulations
Following the CERES Principles
All of the above
Answer: All of the above

36. Assignment

37. Lesson 2.2 Societal Values
Objectives/Exit Ticket
Discuss how the values of Americans have changed.
Explain how businesses have adapted to changing values.
Describe the dilemma posed by the need for business to grow and the need to protect the natural environment.

38. Chapter 2 Social and Ethical Environment of Business
Lesson 2.3 Ethical Issues
Objectives
Describe how ethics relates to business practice.
Suggest ways in which business can be socially responsible.
Chapter 2 Social and Ethical Environment of Business

39. Ethical Issues
Laws provide a minimum standard of behavior for people and businesses to follow.
Many behaviors are neither allowed nor disallowed by law
The guide that then comes into play is ethics.
Ethics — standards of moral conduct that individuals and groups set for themselves, defining what behavior they value as right or wrong

40. Business Ethics
Business ethics — collection of principles and rules that define right and wrong conduct for an organization
Any action that does not conform to these moral principles is unethical behavior.
Many businesses have created codes of ethics to guide managers and workers in their behavior.
Code of ethics — formal, published collection of values and rules that reflect a firm’s philosophy and goals

41. Ethical Dilemmas
The issue of ethics often arises when it is not clear whether a particular action is legal or illegal.
Businesses are constantly faced with ethical dilemmas of various kinds.
Ex: Should a lumber company cut down a forest if doing so would endanger a rare species of birds that nests there?
Because values also differ among nations, problems sometimes arise for firms involved in international business.

42. Social Responsibility of Business
The primary goal of business is to make a profit for the owners.
Businesses cannot survive for long if their owners are not rewarded for their investment.
Although profit plays a key role in our business system, businesses today also emphasize another business goal – social responsibility.
Social responsibility — the duty of a business to contribute to the well-being of society

43. Social Responsibility of Business
Stakeholders — any individuals or groups affected by a firm’s actions, such as owners, customers, suppliers, employees, creditors, government, and the public.
Stakeholders expect a business to be responsible and responsive to their interests.
The conduct of businesses is being increasingly and closely examined by various independent groups known as Nongovernmental Organizations (NGS’s).

44. The Future
Given the fast pace of change in the world today, society and business will face different issues in the future.
Although it is difficult to predict the future, current trends provide hints of what may be in store in the years to come.

45. Questions
Which of the following is not related to the concept of ethics?
Ethics refers to standards of moral conduct
Ethical behavior is closely linked to personal values
Ethics always shows what is right and what is wrong.
Ethics helps define what behavior is seen as right or wrong.
Answer: Ethics always shows what is right and what is wrong.

46. Questions
The duty of a business to contribute to the well-being of society is called
Business ethics
Social responsibility
Constituency analysis
Business responsibility
Answer: Social responsibility

47. Assignment
In your pairs, work on “My Business, Inc.” project (pg.51). Keep in mind that this is a continuation of the project we have previously went over
If you finish with the assignment early, please complete “Review Terms and Concepts” # 1-12 and “Determine the Best Answer” #13-20.

48. Chapter 2 Social and Ethical Environment of Business
Lesson 2.3 Ethical Issues
Objectives/Exit Ticket
Describe how ethics relates to business practice.
Suggest ways in which business can be socially responsible.
Chapter 2 Social and Ethical Environment of Business