1. Ethical Issues in Business
Chapter 2
Ethical Issues in Business

2. Ethical Issues are...
problems, situations, or opportunities requiring an individual to choose among actions that may be evaluated as right or wrong, ethical or unethical
ethical issues arise because of:
conflict among personal/organizational values
conflicts with societal values

3. What do you see as some of the causes of unethical behavior?

4. Causes of Unethical Behavior...
meeting overly aggressive financial or business objectives
meeting schedule pressures
helping the organization survive
rationalizing that others do it
resisting competitive threats
saving jobs

5. Influences on Ethical Behavior...
personal values
attitudes/behaviors of supervisor
attitudes/behaviors of senior management
internal drive to succeed
performance pressures
no threat of punishment
friends/coworkers

6. Why not report organizational misconduct?
afraid of not being considered a team player
did not believe corrective action would be taken
fear retribution or retaliation from management
not on else cares about business ethics, why should I
fear lack of confidentiality

7. Classification of Ethical Issues...
conflict of interest
honesty & fairness
communications issues
organizational relationships

8. Conflict of Interest...
exists when an individual must choose whether to advance his or her own personal interests, those of the organization, or some other group
must be able to separate personal interests from business dealings
bribery is a significant concern

9. Honesty & Fairness
honesty relates to truthfulness, integrity & trustworthiness
fairness related to being just, equitable & impartial
breaking or bending laws violates trust
business should not be played as a “game”
lack of rules & poor enforcement leads to unethical behavior

10. Communications...
issues involved relate to advertising, product safety, pollution, & employee work conditions
lying is a major ethical issue with internal & external communications
false advertising relates to:
exaggerated claims
concealed facts & ambiguous statements
lying

11. Organizational Relationships...
relate to behavior of organizational members toward customers, suppliers, subordinates, superiors, peers & others
plagarism is one ethical issue of concern to organizations

12. Ethical Issues Related to Ownership...
owners have an obligation to society as well as their employees & customers
minimize pollution
compensate workers fairly
produce safe products
must be sensitive to legal & ethical risks of their industry & region

13. Financial Responsibilities...
reporting & use of the companies’ finances
pricing products/services fairly
avoiding any antitrust activities
price fixing
sensitivity to socially responsible investing

14. Employees & Management Concerns...
employee theft, sabotage & competitive intelligence
fear of layoffs
salary plateaus
upward mobility
discrimination
privacy & data access
health & safety

15. Consumer & Marketing Issues...
Must consider consumer feedback
safety
environmental (can lead to boycotts)
maximize positive publicity & avoid negative

16. How to Identify an Ethical Issue...
an activity approved by most members of the organization & customary in the industry is probably ethical
if the issue withstands open discussion between groups within & outside the organization is probably ethical
covert discussion, destroyed or disguised documents indicate potential problems