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Business Ethics & Social Responsibility

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Presentation on theme: "Business Ethics & Social Responsibility"— Presentation transcript:

1 Business Ethics & Social Responsibility
Business Ethics – principles and standards that determine acceptable conduct in business 2-1

2 A Timeline of Ethical and Socially Responsible Concerns

3 Business Ethics & Social Responsibility
Social responsibility– business’s obligation to maximize its positive impact and minimize its negative impact on society 2-3

4 Business Ethics & Social Responsibility
Laws and regulations encourage businesses to conform to society’s standards, values, and attitudes. (E.g., in USA:Sarbanes-Oxley Act – 2002) 2-4

5 The Role of Ethics in Business
Concern about unethical business practices continue – HealthSouth’s accounting improprieties and securities fraud 2-5

6 The Role of Ethics in Business
Unethical and/or Illegal Accounting fraud Deceptive advertising Unfair competitive practices Internet theft 2-6

7 The Role of Ethics in Business
Ethical Conduct Builds trust Promotes confidence Validates relationships Learn how to recognize and resolve ethical issues 2-7

8 Recognizing Ethical Issues in Business
an identifiable problem, situation, or opportunity that requires a person to choose from among several actions that may be evaluated as right or wrong, ethical or unethical. 2-8

9 Recognizing Ethical Issues in Business
How to judge the ethics of a situation – examine the situation from your stakeholders’ position, including customers and competitors 2-9

10 Types and Incidences of Observed Misconduct
Many business issues may seem straightforward and easy to resolve on the surface, but are in reality very complex. 2-10

11 Sources of Unethical Behavior in Organizations
Overly aggressive financial or business objectives Abusive & intimidating behavior Conflict of interest Fairness & honesty Communications Business relationships 2-11

12 Sources of Unethical Behavior Abusive and intimidating behavior

13 Sources of Unethical Behavior in Organizations
Conflict of interest – the most common ethical issue identified by employees. Advance personal interests over others’ interests Benefit self at the expense of the company 2-13

14 Least Corrupt Countries

15 Business Ethics Fairness & honesty – the heart of business ethics
How employees use resources No harm to customers Accurate representations Disclosure 2-15

16 Business Ethics Most Popular Office Supplies Employees Pilfer
“More Employees Taking Supplies,” The News Journal 2-16

17 Personal Ethics Honesty? Have you ever cheated on exams?
copied documents from Internet shoplifted cheated to win at sports 2-17

18 Ethical Concerns Communications False/misleading advertising
Deceptive personal selling tactics Product safety and quality Unsubstantiated claims Product labeling 2-18

19 Ethical Concerns Business Relationships Relationships with customers
Relationships with suppliers Relationships with co-workers 2-19

20 Ethical Concerns Plagiarism
The act of taking someone else’s work and presenting it as your own without mentioning the source 2-20

21 Making Decisions About Ethical Issues
Questions to Consider in Determining Whether an Action Is Ethical Open discussion of ethical issues does not eliminate ethical problems; it does promote trust and learning in an organization. 2-21

22 Improving Ethical Behavior in Business
Ethical decisions in an organizations are influenced by three key factors 2-22

23 Improving Ethical Behavior in Business
Codes of Ethics – Formalized rules and standards that describe what a company expects of its employees. 2-23

24 Codes of Ethics National Business Ethics Survey (NBES) According to the NBES, employees in organizations with written standards of conduct are more likely to report misconduct when they observe it. 2-24

25 Codes of Ethics Whistleblowing
The act of an employee exposing an employer’s wrongdoing to outsiders, such as the media or government regulatory agencies. 2-25

26 Business Ethics – Taking Responsibility

27 Nature of Social Responsibility
SR: A business’s obligation to maximize its positive impact and minimize its negative impact on society 4 Dimensions Economic Legal Ethical Voluntary (philanthropic) 2-27

28 Pyramid of Social Responsibility

29 Nature of Social Responsibility
Corporate Citizenship The extent to which businesses meet the legal, ethical, economic, and voluntary responsibilities placed on them by their stakeholders. 2-29

30 Nature of Social Responsibility
Best (American) Corporate Citizens Intel Corporation Eaton Corporation Nike Inc. Deere and Co. See the top 20 list on page 53 2-30

31 Arguments For and Against SR

32 Social Responsibility Issues
Owners & Stockholders Primary concern with profit or ROI Financial community at large Proper accounting procedures Protecting owner’s rights and investments 2-32

33 Social Responsibility Issues
Employee Relations Provide a safe workplace Adequate compensation Listen to grievances Fair treatment 2-33

34 Social Responsibility Issues
Consumer Relations Consumerism – the activities that independent individuals, groups, and organizations undertake to protect their rights as consumers. 2-34

35 Social Responsibility Issues
Environmental Issues Animal rights Pollution Going Green 2-35

36 Social Responsibility Issues
Community Relations General community and global welfare Hardcore unemployed Charitable contributions (United Way) Avon’s Breast Cancer Awareness Crusade 2-36

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