Chapter 4: Managing Ethics And Social Responsibility Flashcards
Three domains of human action
Domain of codified law (legal standard)
Domain of ethics (social standard)
Domain of free choice (personal standard)
Ethics
Code of moral principles and values that govern the behaviors of right or wrong.
Unethical/illegal behavior towards customers
- false or deceptive sales practices
- submitting misleading invoices
- fabricating product quality data
Unethical/illegal behavior towards Financiers
- falsifying financial reports
- breaching database controls
- using confidential information
Unethical/illegal behaviors towards society
- violating environmental standards
- exposing public to safety risks
- violating international human rights
Unethical/illegal behavior towards suppliers
- accepting favors or kickbacks
- violating contract terms
- paying without accurate records or invoices
Unethical/illegal behaviors towards employees
- discriminating against employees
- creating a hostile work environment
- violating health and safety rules
Utilitarian approach
Moral behavior produces the greatest good for the greatest number.
Individualism approach
Acts are moral if they promote the individuals long-term interests.
Moral-rights approach
Humans have fundamental rights and liberties that cannot be taken away by an individual’s decision.
Justice approach
Moral decisions must be based on standards of equity, fairness, and impartiality.
Practical approach
Bases decisions on prevailing standards, society, and all stakeholders
Three levels of personal moral development
Level 1: preconventional
Level 2: conventional
Level 3: postconventional
Preconventional
Follows rules to avoid punishment. Acts in own interest. Obedient for its own sake.
Conventional
Lives up to expectations of others. Fulfills duties and obligations of social system. Upholds law.
Postconventional
Follows self-chosen principles of justice and right. Aware the people hold different values and seek creative solutions to ethical dilemmas. Balances concern for individual with concern for common good.
Corporate social responsibility (CSR)
Making choices that contribute to society and stakeholders.
Stakeholders
Any group within or outside of a business entity that are affected by that entity.
Sustainability
Economic development that generates wealth and meets the needs of current generation while preserving the environment for the needs of future generations.
Code of ethics
A formal statement of the company’s values regarding ethics and social issues.
Ethical structure
Systems, positions, and programs like ethics training.
Whistle-blowing
Employee disclosure of illegal, immoral, or illegitimate practices.
