Chapter 9 Flashcards
Ethical Universalism
Draws on collective views of multiple societies & cultures to place clear boundaries on what constitutes. When basic moral standards do not vary significantly from country to country, a multinational company can apply a code of ethics more or less evenly across its worldwide operations. Same standards of what is ethical & what is unethical resonate with peoples of most societies regardless of (Local traditions & Cultural norms) (ex: honesty, trustworthiness)
Ethical Relativeism
Few ethical absolutes to judge a company’s conduct in various countries
ii. Plenty of situations where ethical norms are contoured to fit
a. Local customs and traditions
b. Local beliefs about what is fair
c. Local standards of “right” and “wrong”
Social Contracts Theory
the ethical standards a company should try to uphold are governed by both
a. A limited number of universal ethical principles that are widely recognized as putting legitimate ethical boundaries on actions and behavior in all situations
b. The circumstances of local cultures, traditions, and shared values that further prescribe what constitutes
What are the categories and characteristics of management morality
- Managers that are moral
- Managers that are immoral
- Managers that are amoral
Managers that are moral
i. Dedicated to high standards of ethical behavior in
a. Own actions
b. How the company’s business is to be conducted
ii. Considers it important to
a. Be a steward of ethical behavior
b. Demonstrate ethical leadership
iii. Pursues business success
a. Within confines of both letter and spirit of laws
b. With a habit of operating well above what laws require
Managers that are immoral
i. Actively opposes ethical behavior in business
ii. Willfully ignores ethical principles in making decisions
iii. Views legal standards as barriers to overcome
iv. Pursues own self-interests
v. Is an example of self-serving greed
vi. Ignores interests of others
vii. Focuses only on bottom line – making one’s numbers
viii. Will trample on others to avoid being trampled upon
Managers that are amoral
i. Believes business and ethics should not be mixed since different rules apply to
a. Business activities
b. Other realms of life
ii. Believes if a business-related action is legal then it is OK; ethical considerations in business activity don’t matter and lie outside sphere of moral judgment
iii. Views ethical considerations as inappropriate for tough, competitive business world
iv. Concept of right and wrong is lawyer-driven (what can we get by with without running afoul of the law)
What are the principal drivers of unethical behavior?
a. Large numbers of immoral & amoral business people
b. Overzealous pursuit of personal gain, wealth, and other selfish interests
c. Heavy pressures on company managers to meet or best earnings targets
d. Company cultures that place profits & good performance ahead of ethical behavior
What are the characteristics of managers committed to ethical approaches to strategy-making?
a. Possess strong moral character and deeply-ingrained ethical convictions
b. Are genuinely committed to certain core values and business practices
c. Push for and support adoption of values statements/ethics codes that truly paint the white lines for a company’s business practices
d. Insist on strict ethics compliance
e. Expect company personnel to practice/display corporate values
f. Are a role model and walk the talk in
i. Displaying a company’s stated core values
ii. Living up to high ethical standards
g. Consciously opt for strategic actions passing moral scrutiny
Identify alternative approaches to managing a company’s ethical conduct
a. Unconcerned or Nonissue Approach
b. Damage Control Approach
c. Compliance Approach
d. Ethical Culture Approach
Identify the major “levels” of costs resulting from ethical failures
Level 1 Cost, level 2 costs, level 3 costs
Level 1 Costs
Government fines & penalties, civil penalties arising form class-action lawsuits and other litigation aimed at punishing the company for its offense and the harm done to others, the costs to share-holders in the form of a lower stock price
Level 2 Costs
Legal and investigative costs incurred by the company, costs of providing remedial education and ethics training to company personnel, costs of taking corrective actions, administrative costs associated with ensuring future compliance
Level 3 Costs
Customs defections, Loss of reputation, lost employee morale and higher degrees of employee cynicism, higher employee turnover, higher recruiting costs and difficulty of attracting talented employees, adverse effects on employee productivity, the costs of complying with often harsher government regulations
Level 1 costs get ____ executive attention, and ____ costs
more, visible
