Chapter 3 - Ethics and social responsibility Flashcards
Ethics
The set of moral principles or values that defines right and wrong for a person or group.
Ethical Behaviour
Is behaviour that conforms to a society’s accepted principles of right and wrong.
Workplace Deviance
Unethical behaviour that violates organizational norms about right and wrong.
Production Deviance
Unethical behaviour that hurts the quality of work produced.
Property Deviance
Unethical behaviour aimed at the organizations property.
Shrinkage
Employee theft of company merchandise.
Political Deviance
Is using ones influence to harm others in the company.
Personal Aggression
Is hostile, aggressive behaviour toward others.
Types of workplace deviance - Organizational - Minor
Production Deviance
- Leaving early
- Taking excessive breaks
- Intentionally working slow
- Wasting resources
Types of workplace deviance - Organizational - Serious
Property Deviance
- Sabotaging equipment
- Accepting kickbacks
- Lying about hours worked
- Stealing from company
Types of workplace deviance - Interpersonal - Minor
Political Deviance
- Showing favoritism
- Gossiping about co-workers
- Blaming co-workers
- Competing nonbeneficially
Types of workplace deviance - Interpersonal - Serious
Personal Aggression
- Sexual harassment
- Verbal abuse
- Stealing from co-workers
- Endangering co-workers
Ethical intensity depends on six factors:
- magnitude of consequences
- social consensus
- probability of effect
- temporal immediacy
- proximity of effect
- concentration of effect
Ethical intensity
The degree of concern people have about an ethical issue.
Magnitude of consequences
The total harm or benefit derived from an ethical decision.
Social Consensus
Agreement on whether behaviour is bad or good.
Probability of Effect
The chance that something will happen and then result in harm to others.
Temporal immediacy
The time between an act and the consequences the act produces.
Proximity of Effect
The social, psychological, cultural, or physical distance between a decision maker and those affected by his or her decisions.
Concentration of Effect
The total harm or benefit that an act produces on the average person.
Kohlberg’s stages of moral development
- Pre conventional level
- Conventional level
- Post conventional level
Pre conventional Level of Moral Development
First level of moral development in which people make decisions based on selfish reasons.
Conventional Level of Moral Development
Second level of moral development in which people make decisions that conform to societal expectations.
Post Conventional of Moral Development
Third level of moral development in which people make decisions based on internalized principles.
Principles of ethical decision making
- Principle of Long-Term Self-Interest
- Principle of Personal Virtue
- Principle of Religious Injunctions
- Principle of Government Requirements
- Principle of Utilitarian Benefits
- Principle of Individual Rights
- Principle of distributive Justice
Principle of Long-Term Self-Interest
Ethical principle that holds that you should never take any action that is not in your or your organizations long-term self-interest.
Principle of Personal Virtue
Ethical Principle that holds that you should never do anything that is not honest, open, and truthful, and which you would not be glad to see reported in the newspaper or on TV.
Principle of Religious Injunctions
Ethical principle that holds that you should never take any action that is not kind and that does not build a sense of community; a sense of everyone working together for a commonly accepted goal.
Principle of Government Requirements
Ethical principle that holds that you should never take any action that violates the law, for the law represents the minimal moral standard.
Principle of Utilitarian Benefits
Ethical principle that holds that you should never take any action that does not result in greater good for society. Instead, do whatever creates the greatest good for the greatest number.
Principle of Individual Rights
Ethical principle that holds that you should never take any action that infringes on others’ agreed-on rights.
Principle of distributive Justice
Ethical principle that holds that you should never take any action that harms the least among us; the poor, the uneducated, the unemployed.
Overt Integrity Test
Written test that estimates employee honesty by directly asking for job applicants what they think or feel about theft or about punishment of unethical behaviours.
Personality-Based Integrity Test
Written test that indirectly estimates employee honesty by measuring psychological traits such as dependably and conscientiousness.
Code of ethics
Statement of general business principles that specifies the company’s objectives and responsibilities to various stakeholders.
Two key factors to encourage ethical decision making
- Companies must communicate the code of ethics to others both within and outside the company.
- Management must develop practical ethical standards and procedures specific to the company’s line of business.
Practical steps to ethical decision-making
- Selecting and hiring ethical employees
- Establishing a specific code of ethics
- Training employees to make ethical decisions
- Creating an ethical climate.
Ethics training
- Develop employee awareness about ethics
- Achieve credibility with employees
- Teach employees a practical model of ethical decision-making
How to create an ethical climate
- Managers must act ethically
- Top managers should be active in the company ethics program
- Put a reporting system in place that encourages managers and employees to report potential ethics violations
- Managers must fairly and consistently punish those who violate the company’s code of ethics.
Whistle-Blowing
Reporting others’ ethics violations to management or legal authorities.
Social Responsibility
A business obligation to pursue policies, make decisions, and take actions that benefits society.
The two perspectives on whom organizations are socially responsible:
The shareholder model and the stakeholder model
Shareholder Model
View of social responsibility that holds that an organization’s overriding goal should be profit maximizing for the benefit of shareholders.
Stakeholder Model
Theory of corporate responsibility that holds that management’s most important responsibility, long-term survival, is achieved by satisfying the interest of multiple corporate stakeholders.
Stakeholders
Persons or groups with a “stake” or legitimate interest in a company’s actions.
Primary Stakeholder
Any group on which an organization relies for its long-term survival.
Secondary Stakeholder
Any group that can influence or be influenced by the company and can affect public perception about its socially responsibility behaviour.
Organizations are socially responsible for:
Benefiting their stakeholders by fulfilling their economic, legal, ethical and discretionary responsibilities.
Economic Responsibility
The expectation that a company will make a profit by producing a valued product or service.
Legal Responsibility
The expectation that a company will obey society’s laws and regulations.
Ethical Responsibility
The expectation that a company will not violate accepted principles or right and wrong when conducting its business.
Discretionary Responsibility
The expectation that a company will voluntarily serve a social role beyond its economic, legal, and ethical responsibilities.
Social Responsiveness
The strategy chosen by a company to respond to stakeholder’s economic, legal, ethical, or discretionary expectations concerning social responsibility.
The 4 social responsiveness strategies
- reactive strategy
- defensive strategy
- accommodative strategy
- proactive strategy
Reactive Strategy
A social responsiveness strategy where a company chooses to do less than society expects and to deny responsibility for problems.
Defensive Strategy
A social responsiveness strategy where a company chooses to admit responsibility for a problem but do the least required to meet social expectations.
Accommodative strategy
A social responsiveness strategy where a company chooses to accept responsibility for a problem and do all that society expects to solve problems.
Proactive Strategy
A social responsiveness strategy where a company anticipates responsibility for a problem before it occurs and would do more than society expects to address the problem.
Social responsibility and economic performance
- It can sometimes cost a company significantly if it chooses to be socially responsible.
- Sometimes it doesn’t pay to be socially responsible.
- While socially responsible behaviour may be “the right thing to do” it doesn’t guarantee profitability.
Unethical management
Unethical behaviour occurs when managers personally violate accepted principles of right and wrong.
Unintentional unethical behaviours by management:
- Unrealistic employee goals
- Creating policies that inadvertently reward employees for unethical acts
Intentional unethical behaviours by management:
- using company resources for personal use
- mishandling information
- encouraging others’ unethical behaviour
