Business Ethics & Corporate Social Responsibility (ch4).pdf

LE: Business Ethics & Corporate Social Responsibility (ch4) Week # of sessions year 1.1.1 Lecture course MTP Ethics in Contemporary Business Businesses contribute to society by making useful products, providing employment, and paying taxes. What is Ethical Behavior? Ethics Rules or standards gov...

LE: Business Ethics & Corporate Social Responsibility (ch4) Week # of sessions year 1.1.1 Lecture course MTP Ethics in Contemporary Business Businesses contribute to society by making useful products, providing employment, and paying taxes. What is Ethical Behavior? Ethics Rules or standards governing the conduct of a person or group Competing fairly and honestly Not knowingly deceive, intimidate or misrepresent themselves Communicating truthfully Being transparent Transparency Degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders. Not causing harm to others Making decisions that put their personal interests above those of the stakeholders Insider trading LE: Business Ethics & Corporate Social Responsibility (ch4) 1 Use of unpublicized information that an individual gains from the course of his job to benefit fromo fluctuations from the stock market Factors Influencing Ethical Behavior Cultural Differences What may be considered unethical in one culture could be accepted practice in another Knowledge The more you know and the better you understand a situation, the better your chances of making an ethical decision Organizational Behavior Code of ethics Whistle-blowing Written statement that sets forth the Disclosure of information by a company principles that guide an organization’s decisions insider that exposes illegal or unethical behavior by others within the organization Done by formal reports or externally to news media Ethical Decision Making Ethical Lapse Ethical Dilemma Situation in which an individual or a group makes a decision that is morally wrong, illegal or unethical Situation in which more than one side of an issue can be supported with valid arguments Tips to find the right answer Frame the situation accurately Consider the rights of everyone involved Be objective Don’t assume people think the way you do LE: Business Ethics & Corporate Social Responsibility (ch4) 2 Beware of conflicts of interest Conflicts of interest Situations in which competing loyalties can lead to ethical lapses Corporate Social Responsibility (CSR) Idea that business has obligations to society beyond the pursuit of profits Relationship between Business and Society Much of what we consider when assesing a society’s standard of living involves goods and services created by companies Companies cannot hope to operate profitably without the many benefits provided by a stable, functioning society Profit-seeking companies are the economic engine that powers modern society Philanthropy VS. Strategic CSR Philanthropy Strategic CSR Donation of money, time, goods, or services to charitable humanitarian or educational institutions. Social contributions that are directly aligned with a company’s overall business strategy donating to charities supporting job training efforts volunteering programs Perspectives on Corporate Social Responsibility Approaches to CSR can be categorized into four perspectives Minimalist CSR According to the minimalist view, the only social responsibility of business is to pay taxes and obey the law LE: Business Ethics & Corporate Social Responsibility (ch4) 3 Points Any business that operates ethically and legally provides society with beneficial goods and services at fair prices Defensive CSR Nongovernmental organizations (NGOs) Non profit groups that provide charitable services or promote social and environmental causes 💡 Company may take positive steps to address a particular issue ONLY because it has been embarrased into action by negative publicity Cynical CSR Company accused of irresponsible behavior promotes itself as being socially responsible without making substantial improvements in its business practices Proactive CSR Company leaders believe they have responsibilities beyond making profit. Back up their beliefs and proclamations with actions taken on their own initiave CSR: The Natural Environment Creation, delivery, use, and disposal of products that society values always generate pollution and consume natural resources Environmental issues are often as much about human health and safety as they’re about rivers and forests Many of these issues often require tough trade offs, sacrifice, disruptive change, and decision making in the face of uncertainty Efforts to Conserve Resources and Reduce Pollution Cap and Trade LE: Business Ethics & Corporate Social Responsibility (ch4) 4 Type of environmental policy that gives companies some freedom in addressing the environmental impact of specified pollutans, by either reducing emissions to meet a designated cap or buying allowances to offset excess emissions Trend Toward Sustainability Sustainable development (sustainability) Operationg business in a manner that minimizes pollution and resource depletion, ensuring that future generations will have vital resources Meets the needs of the present without compromising the ability of future generations to meet their own needs 💡 By taking long term view of their companies’ impact on the environment, managers can ensure the continued availability of the resources their organizations need and be better prepared for changes in regulations and shifting social expectations. CSR: Consumers Consumerism Movement that pressures businesses to consider consumer needs and interests Right to Buy Safe Products Product safety concerns range from safe food and automobiles to worries such as online privacy. Identity Theft Crime in which thieves steal personal information and use it to take out loans and commit other types of fraud LE: Business Ethics & Corporate Social Responsibility (ch4) 5 Right to be Informed Consumers have a right to know what they’re buying, how to use it, and whether it presents any risks to them. Right to know the true prices of goods or services and the details of purchase contracts Right to Choose Which Products to Buy 💡 Are we entitled to choose products that are potentially harmful? Should the government take measures to make such products illegal? Right to be Heard Social media gives customers numerous ways to.. ask questions voice concerns provide feedback demand attention Companies that fail to respond are likely to lose business to competitors that embracethis new media environment CSR: Employees Key responsibilities that employers have regarding employees The Push for Equality in Employment Discrimination LE: Business Ethics & Corporate Social Responsibility (ch4) 6 Denial of opportunities to individuals on the basis of some characteristic that has no bearing on their ability to perform in a job race gender disability religion Equal Employment Opportunity Commission (EEOC) is a regulatory agency responsible for monitoring hiring practices and for investigating complaints of job-related discrimination. Affirmative Action Activities undertaken by businesses to recruit and promote members of groups whose economic progress has been hindered through legal barriers Addresses… College admissions Hiring Conducting business with government agencies LE: Business Ethics & Corporate Social Responsibility (ch4) 7