Chapter 3 Flashcards
Define ethics
Standards/moral values dictating right vs. Wrong; culturally based;formed based on society expectations; varies by person/situation
Does everyone develop their own “ethics code”?
Yes
What influences ethical behaviour?
Family + peer group + experiences
Define managerial ethics
Standards of behaviour guiding managers
What are behaviour types in the workplace
- Towards employees 2. Towards org. 3. Towards other economic entities
How is ethical behaviour assessed in the workplace?
- Relevant, factual info gathered 2. facts analyzed to determine appropriate moral values 3. Ethical judgement made based on rightness or wrongness of proposed activity/policy
Define utility
Act optimizing (or not) what is best for people affected by it
Define a right
Respecting (or not) individuals involved
Define justice
Consistent (or not) with fairness
Define caring
Consistency (or not) with peoples’ responsibilities toward others
What do written codes of ethics do for a workplace?
- Increase public confidence in firm 2. Helps stem tide of govt regulation 3. Improve internal operations by providing consistent standards of ethical and legal conduct 4. Helps managers respond to problems as result from unethical or illegal behaviours
How often do organizational objectives change?
Infrequently
How often do the core principles of a company change?
Never
How often are strategies or practises revised?
Frequently
Define corporate social responsibility
Business should balance commitments to individuals/groups directly affected by activities
Define fair-trade movement
Designed to help workers in developing countries receive fair pay
What are the four areas of social responsibility?
Towards enviro., customers, employees, investors
What responsibilities does a company have towards the enviro?
Air pollution, land pollution (toxic waste disposal, recycling), water pollution
What responsibilities does a company have towards their customers?
Consumer rights (consumerism), unfair pricing (collusion), advertising ethics
What are advertising ethics?
Truth in ads, ads of counterfeit, morally objectionable ads
What are consumer rights? (6)
Right to: safe products, info of relevant aspects of product, be heard, choose what they buy, educated about purchase, courteous service
What responsibilities does a company have towards their employees?
Legal, social commitments ; HR, social responsibility, privacy issues; drug testing; computer monitoring; encouraging ethical behaviour (whistle blowers)
What responsibilities does a company have towards their investors?
Avoid improper financial management, kiting cheques, insider trading, misrepresentation of finances
Define improper financial management
Company’s financial resources are poorly managed, legally unpunishable because no law is being broken
Define cheque kiting
Illegal practice of writing cheques against $$ not yet in bank account ; creative cheque later can write from account to accountwith no money to back up; assumption that $ will arrive before cheque clears
Define insider trading
Using confidential (non- public) info to gain from stock sale; can involve collision between investors buying vs. Selling at right time to make huge profit
Define misrepresentation of finance
Companies not conforming to accounting guidlines and principles; not following GAAP to inflate expected profit figure and misleading investors
What are the 4 levels (from lowest to highest) of social responsibility?
Obstructionist stance, defensive stance, accommodative stance, proactive stance
What are examples of corporate charitable donations?
Companies contributing to programs (ex Ronald McDonald house); often donating goods after disasters; employees encouraged to volunteer
What are the 4 steps to implementing a social responsibility program?
- Top management support 2. Strategic planning 3. Appointing director 4. Social adult
Define step 1 of implementing a social responsibility program
Top management support: developping policy statement outlining commitment to ethical behaviour
Define step 2 of implementing a social responsibility program
Strategic planning: top managers develop plan of level of support; percent of sales revenue goes to social causes; promise to train chronically unemployed people
Define step 3 of implementing a social responsibility program
Appointing director: Executive-level admin. appointed to oversee program; part-time commitment on part of existing top managers
Define step 4 of implementing a social responsibility program
Social adult: Systematic analysis of how a firm uses funds; adresses effectiveness of money spent; triple bottom line reporting; sustainable development
Define triple bottom line reporting
Financial reports, social audits, sustainability reports
Define sustainable development
Activites meeting current needs not putting future gens. at disadvantages
Are small businesses impacted by social responsibility like large businesses? Why/why not?
Yes, due to limited financial resources and concerns for economic survival; tempted to take cash deals (sometimes illegal, trying to justify) or avoid sustainable products because of higher costs
