Chapter 2 Flashcards
Review of Chapter 2
WATCHDOG GROUP
Activist Customers Investors Unions Environmentalists Community Groups
Ethics
Ethics –
beliefs about
right and wrong
Social responsibility
Social responsibility – the obligation of a business to contribute to society
Universal ethical standards
Universal ethical standards – developed by Character Counts, a non-partisan organization of educators, community leaders, and ethicists
Ethical dilemma
Ethical dilemma – negative consequences; two unfavourable options
Ethical lapse
Ethical lapse –
clear misconduct
Business ethics
Business ethics – the application of right and wrong in the workplace
Creating and Maintaining an Ethical Organization
Organizational culture Role of top management Code of ethics: Executive buy-in Clear expectations Integrated approach Global and local Whistleblower support Reporting and enforcement
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Microsoft CEO Bill Gates and his wife established the Bill & Melinda Gates Foundation, promoting health, education, and development around the world.
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Whole Foods CEO John Mackey posted thousands of comments on Yahoo! Finance, hyping his company and attacking Wild Oats, a competitor he was planning to purchase.
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Chris Spence resigned from being the director of the Toronto District School Board for plagiarizing speeches, blogs, and newspaper articles.
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Martin Shkreli, CEO of Turing Pharmaceuticals, raised the prices for a cancer drug by 5000% after they acquired marketing rights for the drug.
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Sylvie Therrien blew the whistle in 2013 when the government forced her to meet aggressive savings quotas aimed at reducing payments to EI claimants.
Ethics at Work: How Would You Judge the Actions of These Business Leaders?
Former Prime Minister, Brian Mulroney, accepted cash from a German businessman, placing it in a home safe and a New York safety deposit box.
Social responsibility
Social responsibility – the obligation of a business to contribute to society
Stakeholders
Stakeholders – any groups that have a stake, or a personal interest, in the performance and actions of an organization
Capitalism with a Conscience
The gains in wealth, health care, education, and technology have not been evenly spread.
Half of the world’s population lives on less than $2 per day.
94% of the world’s earnings go to 40% of the people.
Bill Gates has called for a new approach to economics: creative capitalism.
Business responsibilities to….
Employees - Creating jobs that work
Customers - Values, honesty, and communication
Investors - Fair stewardship and full disclosure
Community - Business and the greater good
Environment - Sustainable development
Responsibility to Employees: Creating Jobs That Work
Meet legal standards Provide workplace safety Meet minimum wage/overtime requirements Value employees Provide work/life balance
Consumerism
Consumerism – the right to be safe, the right to be informed, the right to choose, and the right to be heard
Planned obsolescence
Planned obsolescence – deliberately designing products to fail in order to shorten the time between purchases
Fair Stewardship and Full Disclosure
Legal requirements: Sarbanes-Oxley Act
Responsible use of corporate dollars
Honesty
Is optimism or pessimism socially responsible?
Corporate philanthropy
Corporate philanthropy – business donations to non-profit groups, including both money and time
Cause-related marketing
Cause-related marketing – partnerships between businesses and non-profit organizations, designed to spike sales for the company and raise money for the non-profit
Corporate responsibility
Corporate responsibility – the actions of the business rather than donations of money and time
Sustainable development
Sustainable development – doing business to meet the needs of this generation without harming the ability of future generations
Green marketing
Green marketing – marketing environmental products and practices for competitive advantage
Carbon footprint
Carbon footprint – amount of harmful greenhouse gases that a firm emits
Social audit
Social audit – a systematic evaluation of how well a firm is meeting its ethics and social responsibility objectives
Social audit
- Establish goals
2. Determine how to measure the achievement of those goals
