Ethics 04

Question 1

ETHICAL’ Aspects of Decision Making

Answer 1

Despite great interest in ethical leadership, there is at present no consensus on how this term should be defined or measured.
One reason for this is that there is no neutral basis

Question 2

Ethics

Answer 2

Moral principles or beliefs about what is right or wrong

Question 3

Law

Answer 3

Formal codes that permit or forbid certain behaviors

Question 4

Ethics

Answer 4

Consensually accepted standards of behavior for an occupation, a trade, or a profession

Question 5

Morality

Answer 5

Precepts of personal behavior based on religious or philosophical grounds

Question 6

Ethics vs. Morality

Answer 6

The way Greece was organized, is profoundly different than the way Rome was organized. And Greece was, well, not a chaos, but the first attempt at democracy. It was not the anarchy but, really a lot of chaos and turmoil. Contrarily Rome was ruled by a general, it was more an army. And so you see, they’re two different worlds.

Question 7

Ethics vs. Morality

Answer 7

On morality; what you can do, what you cannot do, on the ethical side, the difference between, right versus wrong. This is not a surprise because in Greece, the behavior was like spontaneous, come from the bottom.
In the morality side, in Rome, came much from the top. You do this, you don’t do that.
There is more difference, like ethics is based on values, morality is deduced from laws. Ethics is more induced.

Question 8

Ethics vs. Morality

Answer 8

So, let’s go a bit further, and, of course it’s like an immediate consequence of the situation.
Ethics is valid here and now. I’m facing a problem, yes, I do this and, morality is more absolute it’s for everybody and it is probably everywhere

Question 9

Ethical Leaders’ Decision Making

Answer 9

are many types of leadership behaviors that are characterized as unethical by the majority

Question 10

Ethical Leaders’ Decision Making

Answer 10

falsifying information,
stealing assets for personal gain,
blaming mistakes on others,
selling trade secrets to competitors,
accepting bribes in exchange for services,
and pursuing a ruthless leadership style that injures others.

Question 11

Leaders are often exposed to moral choices that have the character of paradoxes and dilemmas.

Answer 11

leader should be eligible to receive stock options in his or her own company to enhance his or her motivation. This may have implications for social contracts of any kind.
leaders should hold back or delay information that they have exclusive access to and that is likely to harm the stock price.
leaders keep wages down within their own organizations while raising their personal salaries drastically.

Question 12

Ethical Leaders’ Decision Making

Title

Answer 12

Developing advanced moral reasoning is considered a prerequisite for ethical conduct which is guided by their values.

Question 13

Ethical Leaders’ Decision Making

Answer 13

Value-driven leaders are concerned that their daily activities reflect important ethical values such as honesty, fairness and personal integrity.

Question 14

Ethical Leaders’ Decision Making

Answer 14

They have a highly developed moral sensitivity and are driven by formulating ethical problems.

Question 15

Ethical Leaders’ Decision Making

Answer 15

Faced with difficult decisions, they know what they stand for and often have the courage to act according to their principles.

Question 16

Ethical Leaders’ Decision Making

Answer 16

However, since moral reality is a moving target, value-driven leaders realize that they must reiteratively formulate and reformulate the ethical problems of the organization

Question 17

The justice perspective

Distributive justice

Answer 17

is about distributing resources as equitably as possible, either in full equality or on the basis of need or performance (equity).

Question 18

Procedural justice

Answer 18

assumes that the actual process of creating justice is as fair as possible, even if the outcome may be different for different individuals.
[It has been suggested that this is the outcome of the higher quality interpersonal interactions often found in the procedural justice process, which has shown to be stronger in affecting the perception of fairness during conflict resolution]
[Procedural justice concerns the fairness and the transparency of the processes by which decisions are made]

Question 19

DEGREES OF CORPORATE SOCIAL RESPONSIBILITY INVOLVEMENT

Answer 19

Social Obligation Approach
Social Responsibility Approach
Social Responsiveness Approach

Question 20

Social Obligation Approach

Answer 20

Meet only legal obligations,

Question 21

Social Obligation Approach

Answer 21

Dr. Milton Friedman (1931-)

“Business should not assume direct responsibility on both practical and theoretical grounds

Question 22

“THE BUSINESS OF BUSINESS IS BUSINESS”

Answer 22

Acting from motives other than economic may, in the long run, harm the very society the firm is trying to help.

Question 23

“THE BUSINESS OF BUSINESS IS BUSINESS”

Answer 23

By taking on the burden of these social costs, the business becomes less efficient – either prices go up to pay for the increased costs or investment in new activities and research is postponed. The results negatively affect – perhaps fatally – the long-term efficiency of a business.

Question 24

“THE BUSINESS OF BUSINESS IS BUSINESS”

Answer 24

is that business (work) of a business (an enterprise engaged in commercial activities) is business (commercial activities such as buying and selling). The last use of the word business also implies that the commercial activities are undertaken for the purpose of making profit.

Question 25

Milton Friedman

Answer 25

There is one and only one social responsibility of business—to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.

Question 26

Social Responsibility Approach

Answer 26

Dr. Keith Davis

“Social responsibility goes hand in hand with social power, and since business is the most powerful force in contemporary life, it has the obligation to assume corresponding social responsibility.”

Question 27

Social Responsibility Approach

Porter & Kramer

Answer 27

“Social and economic goals are not inherently conflicting, but integrally connected.”

Question 28

Social Responsibility Approach

Answer 28

Private corporations have responsibility to society that extend beyond making a profit

Question 29

Carroll’s 4 Responsibilities

Answer 29

Economic
Legal
Ethical
Discretionary

Question 30

Economic

Answer 30

Economic responsibilities of a business are to produce goods services of value to society

Question 31

Legal

Answer 31

Legal responsibilities are defined by governments in laws that management is expected to obey

Question 32

Ethical

Answer 32

Ethical responsibilities of a business are to follow the generally held beliefs about behavior in society

Question 33

Discretionary

Answer 33

Purely voluntary obligations. (Philanthropic, etc)

Question 34

Non-Ethical Leaders’ Decision Making

Answer 34

DESTRUCTIVE LEADERSHIP

DARK SIDE OF LEADERSHIP

Question 35

DESTRUCTIVE LEADERSHIP

Answer 35

Leaders who possess such personality characteristics
as narcissism, power orientation and lack of emotional
maturity more often engage in destructive self-oriented behavior than others.

Question 36

DESTRUCTIVE LEADERSHIP

Answer 36

History of leadership is full of flaws, failures, and even disgraceful conduct of some noteworthy leaders, including those of Hitler, Karadzic, Pol-pot, and from the business life remember Enron, WorldCom, Tyco, and Parmalat,.

Question 37

It is obvious that flawed leaders are everywhere.

Answer 37

Corporate fraud is becoming more prevalent across the world, a new survey has found.
The study by PricewaterhouseCoopers (PwC) reported that 42 per cent of financial services companies had been affected by economic crime in the past 12 months.

Question 38

It is obvious that flawed leaders are everywhere.

Answer 38

No organization is immune from crime. Large and small, companies in every industry sector and territory are seeing ever-increasing incidences of fraud and malfeasance.

Question 39

It is obvious that flawed leaders are everywhere.

Some actions and processes which bring;

Answer 39

Destruction to organization, to peers and subordinates,
Destruction to humankind in general
Destruction to self,

Question 40

Agency Theory

Answer 40

Agency Problem –
Objectives of owners & agents in conflict
Difficult for owners to verify agent performance

Question 41

Stewardship Theory

Answer 41

Executives more motivated to act in best interest of the corporation than their own self-interests. Theory that over time, senior executives tend to view corporation as extension of selves.

Question 42

Conflict of Interests

Answer 42

Long Term – Short Term Orientation

Risk Sharing Problem –

Question 43

Long Term – Short Term Orientation

Answer 43

“In my opinion, many American companies are running out of stock. They’re trading away their future health for short-term results” (Minzberg; Productivity is killing American Enterprize, 2007)

Question 44

How to enforce code of ethics

Answer 44

Code of Ethics

Audit, Nominating, and Compensation Committees all outside directors

Question 45

Corporate Stakeholders:

Answer 45

Affect or are affected by the achievement of the corporation’s objectives

Question 46

Organizational Stakeholder

Answer 46

Employees, Customers, Competitors, Governments, Suppliers, Communities, Shareholders, Unions, Trade and industry association, Social and political action group.

Question 47

Stakeholders

Answer 47

People who have an interest, claim, or stake in an organization, in what it does, and in how well it performs

Question 48

Organizational Effectiveness

Answer 48

Satisfying Stakeholders’ Goals and Interests

Each group evaluates the effectiveness of the organization by judging how well it meets the group’s specific goals

Question 49

Primary stakeholder

Answer 49

Sufficient bargaining power to affect outcomes

Customers , Employees , Suppliers , Shareholders , Creditors

Question 50

Secondary stakeholder

Answer 50

Indirect stake but are affected by corporation’s actions

Governments , NGO’s , Activists , Local communities , trade associations , Competitors

Question 51

Stakeholder Input

Answer 51

Determine whether input is necessary

Question 52

pages 43 and pages 52

Answer 52

WHAT SEEMS AT FIRST TO BE THE BEST DECISION BECAUSE IT APPEARS TO BE THE MOST PROFITABLE MAY ACTUALLY RESULT IN THE WORST SET OF CONSEQUENCES TO THE CORPORATION