ethical behavior and social responsibility

Introduction to Management 11e John Schermerhorn

Chapter 3Chapter 3

Ethical Behavior and Ethical Behavior and Social ResponsibilitySocial Responsibility

Planning Ahead — Chapter 3 Study Questions

1. What is ethical behavior?

2. How do ethical dilemmas complicate the workplace?

3. How can high ethical standards be maintained?

4. What is social responsibility and governance?

Study Question 1: What is ethical behavior?

Ethics Code of moral principles. Set standards of “good” or “bad” or “right” or

“wrong” in one’s conduct.

Ethical behavior What is accepted as good and right in the

context of the governing moral code.

Study Question 1: What is ethical behavior?Study Question 1: What is ethical behavior?

Law, values, and ethical behavior: Legal behavior is not necessarily ethical

behavior.

Personal values help determine

individual ethical behavior.

Study Question 1: What is ethical behavior?Study Question 1: What is ethical behavior?

Law, values, and ethical behavior:

Values - underlying beliefs and attitudes that

help determine individual behavior Terminal values - preferences about desired ends

Instrumental values – preferences regarding the

means to desired ends


Alternative ethical views Utilitarian

Delivers the greatest good to the most people

Individualism Advances long-term self-interests

Moral rights Maintains fundamental rights of all human beings


Justice view of ethics fair and impartial treatment of people according to

legal rules and standards Procedural justice – policies and rules fairly applied Distributive justice – equal treatment for all people Interactional justice – people treated with dignity and

respect Commutative justice – fairness to all involved

Four views of ethical behavior

Management 11e/ Chapter 3 8


Cultural issues in ethical behavior: Cultural relativism

Ethical behavior is always determined by cultural context.

Universalism Behavior unacceptable in one’s home

environment should not be acceptable anywhere else.

Ethical imperialism Imposing one’s ethical standards on others.


The extremes of cultural relativism and ethical imperialism in international business ethics.


Source: Developed from Thomas Donaldson, “Values in Tension: Ethics Away from Home,” Harvard Business Review, vol. 74 (September-October 1996), pp. 48-62.


Sources of information on ethical behavior: Institute for Global Ethics at www.globalethics.org

and on Facebook at http://www.facebook.com/pages/Rockland-ME/Institute-for-Global-Ethics/51585783748?ref=ts

Ethics Resource Center at www.ethics.org


http://www.globalethics.org/

http://www.facebook.com/pages/Rockland-ME/Institute-for-Global-Ethics/51585783748?ref=ts

http://www.facebook.com/pages/Rockland-ME/Institute-for-Global-Ethics/51585783748?ref=ts

http://www.ethics.org/

Study Question 2: How do ethical dilemmas complicate the workplace?

An ethical dilemma occurs when choices, although having

potential for personal and/or organizational benefit, may be considered unethical.



Ethical dilemmas include:


Checklist for ethical dilemmas



Influences on Ethical Decision Making Ethical framework

Provides personal rules or strategies for ethical decision making

Includes personal values Honesty Fairness Integrity Self-respect


Kohlberg’s stages of individual moral development



Situational Context and Ethics Intensity Will the situation pose an important ethic

challenge? Magnitude of the situation Risk of immediate harm Proximity and concentration of harm Social consensus



Organizational Culture Influence What is considered ethical behavior within

the organizational context? What are the expectations of management? What are the expectations of co-workers? Is there a code of ethics?


Study Question 2: How do ethical dilemmas complicate the workplace? Study Question 2: How do ethical dilemmas complicate the workplace?

External environment



Ethical behavior can be rationalized by convincing yourself that:

20Management 11e/ Chapter 3

Study Question 3: How can high ethical standards be maintained?

Ethics training: Structured programs that help participants to

understand ethical aspects of decision making.

Helps people incorporate high ethical standards into daily life.

Helps people deal with ethical issues under pressure.



Codes of Ethical Conduct Formal statement of an organization’s values

and ethical principles regarding how to behave in situations susceptible to the creation of ethical dilemmas



Moral Management Managers behave in one of three ways


How can high ethical standards be maintained?

24


Areas often covered by codes of ethics:



Whistleblowers Expose misdeeds of others to:

Preserve ethical standards Protect against wasteful, harmful, or illegal acts

Laws protecting whistleblowers vary



Barriers to whistleblowing include: Strict chain of command Strong work group identities Ambiguous priorities



Organizational methods for overcoming whistleblowing barriers: Ethics staff units who serve as ethics

advocates Moral quality circles



Social entrepreneurship: a unique form of entrepreneurship that seeks

novel ways to solve pressing social problems at home and abroad Housing and job training for homeless Bringing technology to poor families Improving literacy among

disadvantaged youth Offering small loans to start

minority-owned businesses


Study Question 4: What is social responsibility and corporate governance?

Corporate social responsibility and governance: Looks at ethical issues on the

organization level. Obligates organizations to

act in ways that serve both its own interests and the interests of society at large.



Stakeholder Management Stakeholders

persons, groups, and other organizations directly affected by the behavior of the organization and holding a stake in its performance.



Typical organizational stakeholders



Perspectives on social responsibility: Classical view

Management’s only responsibility is to maximize profits.

Socioeconomic view Management must be concerned

for the broader social welfare, not just profits.


Study Question 4: What is social responsibility and governance?


Criteria for evaluating corporate social performance.



Strategies for pursuing social responsibility:


Four strategies of corporate social responsibility—from obstructionist to proactive behavior.



Corporate governance: The oversight of the top management of an

organization by a board of directors.

Corporate governance involves: Hiring, firing, and compensating the CEO. Assessing strategy. Verifying financial records.



How government influences organizations: Common areas of government regulation of

business affairs: Occupational safety and health Fair labor practices Consumer protection Environmental protection


Chapter 3 Case

Patagonia: Turning a profit without losing your soul


ethical behavior and social responsibility

Education