1. Ch 3: Business Ethics and Social Responsibility Day 1: Business Ethics

2. Today’s Response Journal
List a minimum of 3 products and/or services that you consider unethical or morally wrong to sell? Provide a reason why you think these products are unethical. ***Save as Sept. 23 and in your Response Journal Folder***

3. What would you do in each of the following situations?
Ethics
What would you do in each of the following situations?
Your friend asks you to add a few extra hours to a work time sheet for him, but you know that he did not put in the time.
A salesperson in an electronics store offers to sell you an iPod after hours at a discount price.
You are aware that the teller gave you back too much money when completing a banking transaction.

4. Ethics
____________ are the rules that help us tell the difference between right and wrong, and encourage us to do the right thing
They can help people decide on the best course of action in situations where they aren’t sure what to do
Ethics

5. Ethical Behaviour
Ethical behaviour is behaviour that conforms to ethics - individual beliefs and social standards about what is right and good
Ethics are important for getting along with others, living with yourself and having a good character
Ethical behaviour is based on values such as:
Trustworthiness
Respect
Responsibility
Caring
Justice
Good citizenship
Adherence to moral rules

6. Values and Morals
Our ___________ tell us what we think is important and this, in turn, helps us make decisions about right and wrong
E.g. a person who values trustworthiness is unlikely to betray a friend
_____________ are the rules that are used to decide what is good or bad
E.g. one moral rule might be that stealing is bad because it harms the person or business you are stealing from
Values
Morals

7. Values and Morals
As a society, we tend to judge others more on their morals than on their values
Some of the most difficult decisions to make are the ones in which our personal values conflict with our moral rules
Read the example found in the bottom paragraph on page 75

8. Role of Ethics in Business
Ethics are based on both individual beliefs and standards in society
Ethics vary from person to person, situation to situation, and culture to culture
Society’s ethics are usually _____________ standards for decency and respect of others
_______________________ are related to both society’s ethics and the individual’s ethics, who works for and buys products from, the company
Read the example in paragraph 1 on page 77
Minimum
Business Ethics

9. Code of Ethics
Businesses face ethical questions every day concerning the products/services they sell and the way they deal with people inside and outside the company
A _____________________ is a document that describes specifically how a company’s employees should respond in different situations
Read the example in paragraph 4 on page 77
Helps different people approach problems in the same way
Code of Ethics

10. “If I take this action, will anyone suffer as a result?”
Applying Ethics
Instead of referring to a written guideline, you can ask yourself …
“If I take this action, will anyone suffer as a result?”
Read the example in paragraph 1 on page 79
In Canada, the law details acceptable business behaviour, but companies can still behave unethically without actually breaking the law
Although codes of ethics can help people make decisions, they are not conclusive guides to right and wrong – as a result, people should rely on their own judgment first

11. Ethical Dilemmas Dilemma
A _______________ is a situation where there is a difficult choice between 2 or more options
Dilemmas have good and bad points on both sides
Not all dilemmas are choices between right and wrong
Read the example in paragraph 3 on page 79
An ______________________ is a moral problem with potential right or wrong answers. It occurs when a business has a decision to make that weighs values and morals against profitability and competitiveness
Dilemma
Ethical Dilemma

12. Examples of Ethical Dilemmas In the Workplace
Downsizing of staff
Pollution control
How to dispose of toxic waste
Depletion of scarce resources
Changes in laws and technology
Employee rights
Product safety
Discrimination against women and minorities

13. Resolving Ethical Dilemmas
Resolving ethical dilemmas requires honesty, ability to work together, respect for others, willingness to learn, dependability, loyalty and integrity
Questions to consider:
Who will be helped by what you do?
Who will be hurt?
What are the benefits and problems of such a decision?
Will the decision survive the test of time?

14. Whistle-Blowing
_____________________ is the decision of an employee to inform company officials or the public about a legal or ethical violation
May happen when an employee discovers some type of unethical, immoral or illegal actions at work
Sometimes whistle-blowers are rewarded (E.g. 3 whistle-blowers were named Time Magazine’s Person of the Year in 2002), however sometimes they are punished (E.g. getting fired or demoted)
Whistle-Blowing

15. Whistle-Blowing Examples
Examples of issues that a whistle-blower might report include;
Someone submitting false info on an expense report
A business that ignores hiring practices for minorities
A business that ignores workplace health and safety rules

16. Day 1 – Assigned Work Students please complete the following;
Activity: Ethics In the News (Posted on ClassNet under Tasks)
Review Questions #4 & 5 on page 89

17. Ch 3: Business Ethics & Social Responsibility Day 2: Implications of Unethical Behaviour

18. Today’s Response Journal
Create a list of businesses that come to mind when you think of unethical practices? What makes them unethical? ***Save as Sept. 25 and in your Response Journal Folder***

19. Major Ethical Issues In Business
Read paragraph 1 on page 82
Some of the major ethical issues associated with business are:
Fraud
Accounting Scandals
Insider Trading

20. Fraud _____________ is the crime of lying or pretending
Some businesses mislead consumers and try to trick them into buying something in order to maximize their profits
The Competition Act, 2002 banned the below types of fraud and deceptive business practices:
False or misleading advertising
Bait and switch selling
Advertising a product on sale and then not having enough of the product available
Double Ticketing
Placing different prices on a product and selling it at the higher price

21. Types of Fraud
There are many types of fraud that impact individuals and businesses …
Bank Fraud
A banking official makes a fraudulent loan to a non- existent business/person and pockets the cash
Consumer Fraud
Unethical advertising or false claims are used to make consumers purchase products they don’t need
Contract Fraud
Temptations, such as bribes or kickbacks are used to create a contract

22. Types of Fraud Insurance Fraud Mail Fraud Pyramid Scheme Fraud
Falsely claiming lost, damaged or stolen property to receive insurance settlements
Mail Fraud
The post office is used to mail phony job opportunities, chain letters or inheritance scams
Pyramid Scheme Fraud
A person recruits others in order to receive more money than he/she invested in the scheme

23. Types of Fraud Stock Market Fraud Telemarketing Fraud Welfare Fraud
Someone uses insider trading to buy and sell stocks at artificial values
Telemarketing Fraud
Company uses high-pressure phone calls to get customers to buy goods or donate money to phony charities
Welfare Fraud
Someone receives welfare benefits when they’re not eligible
Read Bre-X on page

24. Accounting Scandals
__________________ is the process of identifying, measuring, and communicating financial information about a business so that informed judgments and decisions can be made based on that info
An _____________________________ is a publicly exposed crime involving accountants or senior company executives who alter accounting records for personal gain
When an accounting scandal is uncovered, outside accountants are appointed to find out what happened
A ___________________________ is an accountant who investigates legal and financial documents, looking for evidence of tampering
Read Enron on page
Accounting
Accounting Scandal
Forensic Accountant

25. Insider Trading
Wouldn’t it be great to have access to winning lottery numbers before they are drawn?
In business, corporate executives normally do have access to winning lottery numbers – in the form of confidential info about the business and its future plans
Buying or selling of company shares based on confidential information that is not available to the general public is known as _______________________ and is illegal
The stock market operates on the premise that everyone learns about the same info at the same time and therefore no one gets an unfair advantage
It is fine to buy and sell shares as long as you use information that is in the public domain and/or if you tell the stock exchange about it ahead of time
Read the Martha Stewart example on page 88
Insider Trading

26. Day 2 – Assigned Work Students please complete the following;
Activity: Canadian Anti-Fraud Centre (provided)

27. Ch 3: Business Ethics and Social Responsibility Day 3: Corporate Social Responsibility

28. Today’s Response Journal
Create a list of businesses that come to mind when you think of ethical practices? What makes them ethical? ***Save as Sept. 26 and in your Response Journal Folder***

29. Corporate Social Responsibility (CSR)
Businesses exhibit _______________________________________ through their values, their ethics, and the contributions that they make to their communities
In other words, CSR has to do with …
“What you do, how you do it and when and what you say”
A socially responsible business provides goods and services in line with society’s values
A socially responsible business is concerned about how they protect consumers and the treatment of their employees and shareholders
Read the example in paragraph 2 on page 90
Corporate Social Responsibility (CSR)

30. CSR Principles
Businesses that practice CSR adhere to the following CSR Principles …
Provide a safe and healthy work environment
Adopt fair labour policies
Protect the environment
Are truthful in their advertising
Avoid price discrimination
Donate to charity

31. CSR Principles
The concept of business ethics and CSR have been around for some time, so wouldn’t most businesses have already adopted these guidelines?
The answer – NO!!!! The news is filled with examples of unethical and illegal business practices
The sad truth is that too many business people believe that normal business procedures mean dealing with ethics only when necessary, or not dealing with them at all
Read An Example of CSR on page 92

32. Laws that Govern Corporate Ethics
In Canada, we have many different laws that govern ethical behaviours in business. These laws relate to the following 6 major areas …
Workplace safety
Anti-discrimination issues
Harassment
Accessibility issues
Environmental responsibility
Labour practices

33. Workplace Safety
The workplace use to be a place where people often died
Read paragraphs 1, 2 & 3 on page 94
In Ontario, the Occupational Health and Safety Act (OHSA) was instituted to ensure workplace safety and health
The OHSA ensures workplace health and safety is a priority for all businesses in Ontario
The OHSA defines the rights and responsibilities of workers in Ontario

34. Worker’s Basic Rights
Workers have the following 3 basic rights in the workplace …
Right to refuse unsafe work
Right to participate in workplace health and safety activities
Right to know about actual hazards in the workplace

35. Anti-Discrimination Discrimination is NOT ethical behaviour
Discrimination can be based on a person’s …
Gender
Race
Religion
Age
Sexuality, etc
Although businesses have come along way, many women and minorities still face discrimination in workplace today, usually in the form of a _________________
An invisible barrier facing women, disabled or those from visible minorities as they approach senior management positions
Glass Ceiling

36. Harassment
__________________ refers to those behaviours that are found to be threatening or disturbing, those that are not acceptable in society
Many companies have policies and procedures in place for dealing with these types of situations
Harassment

37. Harassment Examples of harassment include … Bullying Stalking
Written or verbal threats
Abusive comments about race
Ridicule based on cultural grounds
Name calling
Racist jokes
Damage to property
Offensive graffiti

38. Accessibility
Laws exist to help guide businesses by balancing the rights of the disabled to work and the rights of businesses to limit how much they need to do for disabled workers
E.g. Business – built ramps and purchased alternative equipment. Disabled – right to receive a fair job interview that doesn’t discriminate
Employers have a _______________________
An employer is obligated to take the appropriate steps to eliminate discrimination in the workplace
Written into Canadian Human Rights Act
Duty to Accommodate

39. Environmental Responsibility
Both individuals and businesses are responsible for protecting the environment
Sadly, it has taken much media attention to get environmental issues high on the list of priorities for many businesses
Most environmental concerns can be categorized under _______, ________ or _________
The government of Canada has responded to environmental challenges by passing environmental protection laws, such as the Environmental Protection Act (1999)
Land
Air
Water

40. Labour Practices
In Ontario, the Employment Standards Act identifies mandatory minimum conditions of employment. It covers areas such as …
Hours of work
Overtime pay
Minimum wage
Holidays and vacations
Equal pay for men and women
Employee benefit plans
Pregnancy
Parental leave
Severance and termination pay

41. Labour Practices - Pay Equity
Pay equity is designed to ensure men and women are paid the same amount of money for the same work
Pay equity legislation came into effect in 1978
However, this legislation still doesn’t mean that there is equal pay for work of equal value
According to a recent study, women only earn 72 cents for every $1 earned by men

42. Labour Practices - Pay Equity
Same Work is judged by assessing …
The skill
The effort
The responsibility required
The conditions under which work is performed

43. Labour Practices - Privacy Laws
The Personal Information Protection and Electronic Documents Act (PIPEDA) came into effect January 1, 2004
This law requires that all provincially regulated businesses must fully explain __________ information they require from employees and customers and ________ they need it, before they can obtain it
What
Why

44. Fair Trade
____________ is the practice of helping producers in developing countries bypass middlemen so they can sell their goods in other countries for a ________ profit
Fair trade is _____________, not required by law
Fair trade started about 50 years ago
E.g. fair trade coffee and chocolate
Fair Trade products are always marked with a logo to identify them
Fair Trade
Fair
Voluntary

45. Fair Trade
The benefit of buying fair trade products is that you are not exploiting (taking advantage of) poor farmers in developing worlds
Businesses can help the sale of fair trade products by …
Enforcing fair trade practices on their suppliers
Using fair trade products (E.g. coffee and tea) for business meetings

46. Day 3 – Assigned Work Students please complete the following;
Read the Profile: Kicking Horse Coffee Co. on pages and answer the 2 questions
Review Questions #8 on pg105