Business ethics 1 class intro.pdf

Business ethics Me Educational background Dr. Antonina LISOVSKAIA Post-doctorate, University of Barcelona, Spain 2013-2014 Associate Professor, Phd (Economics), 2009 Organizational Behavior and...

Business ethics Me Educational background Dr. Antonina LISOVSKAIA Post-doctorate, University of Barcelona, Spain 2013-2014 Associate Professor, Phd (Economics), 2009 Organizational Behavior and Specialist Degree in Human HRM Department Resources Management, [email protected] 2006 Lecturer (HSE, University of Barcelona, FS 401 office: you are welcome! Schmalkalden, Panteon Tue, Thu 16.00 -18.00 University of Athens, etc) Agenda for today: Business ethics : introduction of the course, grading policy and rationale Topic 1 Small discussions Your participance is highly appreciated!  Course content =syllabus Session Topic 1 Ethics and Business; Nature of Business ethics 2 Ethical principles and approaches to moral decision making 3 Business system: government and markets 4 Business and its external exchanges: ecology and consumers 5 Business and its internal constitutes (employee issues). Organizational moral standards. 6 CSR conceptual bases and initiatives 7,8 Summary of the course. Group presentations  COURSE OBJECTIVES Upon completion of this course, students should be able to: 1. Demonstrate understanding of the definition of ethics and the role ethical behavior plays in today’s business world. 2. Explain the philosophical approach of ethics. 3. Demonstrate understanding of the relationship between core moral values and business ethics. 4. Identify various ethical issues that occur within the internal and the external environments of the organization. 5. Evaluate the concept of corporate social responsibility and explore its relevance to ethical business activity.  LEARNING OUTCOMES 1. will recognize the importance of understanding and mastering theories and frameworks related to business ethics. 2. will capitalize on understanding of ethics to better deal with dilemmas and issues involving ethics. 3. will develop their abilities to make ethical decisions inside the working environment. SUGGESTED TEXTBOOK AND RESOURCES Title: Business Ethics: Concepts and Cases Author(s): Manuel G. Velasquez Edition: 8th Edition 2018 Moodle (slides, extra materials)  GRADING POLICY GRADING CRITERIA Continuous assessment (Contrôle continu) 50 % Midterm exam (in class, paper based) 35% a combination of multiple-choice and short answer. The midterm is designed to assess your comprehension of the readings and in-class discussions Group project presentation 15% Students should apply the course concepts, show coherence and clarity of the arguments, independence and validity of judgements and conclusions. Final exam 50 % Total 100 %  GROUP ASSIGNMENT The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and discussions) to problems in an organization of your team's choice. Class members will work in teams up to 8 people. Your team should identify a public, private, or non-profit organization to study. Your team is to gather information and explain, why ethical problems occur in this business. You may supplement this information with data from the media, the organization's literature, websites, reports, and other secondary sources. Your goal is to diagnose the mechanisms (cultural, historical, etc.) that are causing the problems or issue of concern in the organization. Initially, you may notice many symptoms, but your task is to get to the underlying reason for these symptoms.  Let's start Session Topic 1 Ethics and Business; Nature of Business ethics 2 Ethical principles and approaches to moral decision making 3 Business system: government and markets 4 Business and its external exchanges: ecology and consumers 5 Business and its internal constitutes (employee issues). Organizational moral standards. 6 CSR conceptual bases and initiatives 7,8 Summary of the course. Group presentations  First question What is good, what is bad or wrong? How you distinguish between them Lecture 1 Ethics and Business; Nature of Business ethics Dictionaries, research papers 1.principles concerning the distinction between right and wrong or good and bad behaviour 2.refer to certain codes of conduct put forward by a society or a group (such as a religion), or accepted by an individual for her own behavior 3.the rules and precepts for human conduct, by the observance of which [a happy existence] might be, to the greatest extent possible, secured. (Mill, 1861) A question –how MORALITY can be distinguish from LAW ? Five Characteristics of Moral Standards Involve significant injuries or benefits Not established by authority figures Should be preferred to other values including self-interest Based on impartial considerations Associated with special emotions and vocabulary From the age of three, humans can distinguish moral from nonmoral norms. tend to think that moral norms are more serious than nonmoral norms and apply everywhere, independent of what authorities say. the ability to distinguish moral from nonmoral norms is innate and universal Business ethics ethics is the discipline that examines one’s moral standards or the moral standards of a society to evaluate their reasonableness and their implications for one’s life. Business ethics is a specialized study of moral right and wrong that focuses on moral standards in business institutions, organizations, and activities  Ethical questions Systemic ethical questions about the social, political, legal, or economic systems within which companies operate. Corporate ethical questions about a particular corporation and its policies, culture, climate, impact, or actions. Individual ethical questions about a particular individual’s decisions, behavior, or character Small groups, 15 minutes for discussion A representative of each group will get a microphone to deliver the key thoughts  Shein, the Chinese fast-fashion brand, has witnessed exceptional growth since its establishment in 2012. a revenue of $22.7 billion in 2022, it prepares to go public in 2024, Shein’s app recorded over 261.9 million downloads in 2023, with more than 53 million users worldwide. The hashtag #Shein on TikTok garnered over 84.4 billion views, indicating its popularity among social media users. Shein introduced an impressive 150,000 new items in 2020, surpassing Zara’s annual volume in just one to two months. Generation Z consumers, who prioritize price, constitute a significant market segment for Shein. Undercover Investigation Proves Horrific Working Conditions Inside Shein Factories (youtube.com)  Read the case 1. Understanding the Situation What specific actions or behaviors can be considered unethical in this case? 2. Motivations and Intentions What motivated the individuals involved to engage in unethical behavior? Did the individuals involved have any personal or professional justifications for their actions? 3. Impact and Consequences What were the immediate and long-term effects of the unethical behavior on the organization’s reputation, finances, and operation Why, despite its reputation, the company has been successful for a long time? On the other hand, how can a company benefit from this (“bad”) behavior? Shein suppliers' workers doing 75-hour week, finds probe Workers for some suppliers of the Chinese fashion giant Shein are doing excessive overtime, a non-governmental organisation has suggested. A number of staff across six sites in Guangzhou were found to be working 75-hour weeks in a report by Swiss advocacy group Public Eye. David Hachfeld of Public Eye said there was "enormous pressure" on staff to turn clothes around quickly. Shein said it takes supply chain issues seriously and will review the report. Public Eye's researchers visited 17 factories supplying Shein and its parent company Zoetop, near the Shein headquarters in Guangzhou. The organisation typically campaigns on big Swiss businesses and their dealings abroad. It interviewed 10 workers across six of those sites, which were solely receiving orders from Shein at the time. They reported that the workers they spoke to clocked three shifts per day, often with only one day off a month. Public Eye suggests the fact that workers, mainly migrants, are paid per item of clothing encourages them to work long hours. Although such hours aren't unusual in Chinese production hubs, they violate local labour laws, which set out a maximum working day of eight hours, as well as a 40-hour working week. Shein said: "Upon learning of the report, we immediately requested a copy and when we receive and review the report, we will initiate an investigation. "We have a strict supplier Code of Conduct which includes stringent health and safety policies and is in compliance with local laws. If non-compliance is identified we will take immediate action," the spokesperson said. Public Eye launched an investigation into Shein, which works with thousands of suppliers, last year in a bid to find out more about the fashion giant's structure. The private company does not disclose financial figures, but its sales are thought to have soared during the pandemic with consumers making more of online shopping. Data provider CB Insights estimates that revenues topped 63.5bn yuan (£7.4bn) in 2020. Shein has gained huge attention on social media platforms like Instagram and TikTok Shein is winning over young shoppers in the US, UK, Europe and Australia by producing fast fashion even faster, and often at cheaper prices, than its rivals Boohoo or Asos. It's been operating in its current form since 2013. The company relies on thousands of third-party suppliers in China to produce small batches of clothes, about 50-100 per item. If the items do well with its trend-conscious customers? Shein orders more from its suppliers. If not, it's discontinued. Shein has accelerated the "test and repeat" model, made famous by the likes of Zara owner Inditex and H&M. Just 6% of Shein's inventory remains in stock for more than 90 days. Mr Hachfeld, who is also the director of the Clean Clothes Campaign in Switzerland, suggested that the long hours observed were "directly linked" to the piece-rate system, which is widespread in China."If you have that without implementing checks on limits... that automatically leads to high working hours because workers need to make their living." He added: "It's striking to see that a company with such big influence and huge turnover is apparently not yet acting on its responsibility to ensure that pay rates are at a level where you can make a good living within normal working hours." In a "good month" several workers said that they might make up to 10,000 Yuan (£1,186). In slow months, their pay could be two-thirds lower. Some also claimed that they were working without a contract, the Public Eye report says, although workers generally said that they were paid on time. Business and Ethics View #1: corporations, like people, act intentionally and have moral rights, and obligations, and are morally responsible. View #2: it makes no sense to attribute ethical qualities to corporations since they are not like people but more like machines; only humans can have ethical qualities. View #3: humans carry out the corporation’s actions so they are morally responsible for what they do and ethical qualities apply in a primary sense to them; corporations have ethical qualities only in a derivative sense. Arguments Against Business Ethics In a free market economy, the pursuit of profit will ensure maximum social benefit so business ethics is not needed. A manager’s most important obligation is loyalty to the company regardless of ethics. So long as companies obey the law they will do all that ethics requires Arguments Supporting Business Ethics Ethics applies to all human activities. Business cannot survive without ethics. Ethics is consistent with profit seeking. Customers, employees, and people in general care about ethics. Studies suggest ethics does not detract from profits and seems to contribute to profits  Remember the term Ethical relativism is the view that there are no ethical standards that are absolutely true and that apply or should be applied to the companies and people of all societies. Business ethics