Managing with Ethics and Social Responsibility

Examine the issues of managerial Define the terms....look at the ways Asses the role of the organization as
a member of the broader social community.
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ethics and corporate social responsibility;

of thinking about ethical behavior; and

What is Ethical Behavior?

MORALS
Doctrine of Conduct relating to, dealing with, or capable of making the distinction between right and wrong in conduct or character.

ETHICS

The system or Code of Morals of a particular person, religion, group, or profession.

 Being Ethical is:

Ethical Behavior is:

Conforming to Moral Standards; conforming to the standards of conduct of a given group or profession. Doing what is accepted as "good" and "right" as opposed to "bad" and "wrong" in the context of the governing Moral Code. Ethical Behavior=Legal Behavior +"something
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Context of the Governing Moral Code

Refers to the group,

organization, or broader societal venue within which the prevailing norms and values underlying a governing moral code are established.
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Laws, Values, and Ethical Behavior

Any behavior considered Ethical should also be legal in a just and fair society. However Legal behavior is not necessarily ethical behavior.
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Four Views of Ethical Behavior

Utilitarian View
Individualism View
Where moral behavior is that which delivers the greatest good to the greatest number of people.

Where moral behavior is that which is best for long-term self-interest.

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 Moral-Rights View
Where moral behavior is that which respects fundamental rights shared by all human beings.

Justice View
Where moral behavior is that which is impartial, fair, and equitable in treating people. (Procedural and Distributive Justice)

Managerial Ethics

Principles that guide the actions

and decisions of managers, and determine if they are good or bad, or right or wrong.

Ethical Dilemmas

An ethical dilemma occurs when

someone must decide whether or not to pursue a course of action that, although offering the potential of personal or organizational benefit or both, may be considered potentially unethical.

Most ethical dilemmas involve

conflicts with superiors, customers, and subordinates.
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Most Common Unethical Requests From the Boss

Supporting Incorrect Viewpoints Signing False Documents Overlooking Bosss Wrongdoing Doing Business with Bosss
Friend
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Rationalizations for Unethical Behavior

Convincing yourself that the behavior is

not really illegal.

Convincing yourself that the behavior is

in everyone's best interest.

Convincing yourself that nobody will

ever know what youve done. organization will protect you.
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Convincing yourself that the

Factors Affecting Managerial Ethics The Manager as a Person

Family influences Religious values Personal standards, and needs
Policies, codes of conduct Behavior of supervisors Behavior of peers
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The Employing Organization

Factors Affecting Managerial Ethics

The External Environment

Government regulations

Norms and values of society

Ethical climate of the industry

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Maintaining High Ethical Standards

ETHICAL TRAINING
It is not about teaching people right from wrong...we assume they know that, and, It is not about giving people the moral courage to do what is right...they should be able to do that anyhow.

Ethical Training is about dealing with dilemmas

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A Checklist for Making Ethical Decisions

Recognize the ethical dilemma Get the facts Identify your options Test each option
Decide which option to follow Double-check your decision by
Is it legal? beneficial? Is it right? Is it

asking:"How will I feel if my family finds out about my decision? Take action
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Whistleblower Protection
Laws vary from state to state, and federal
laws protect mainly government workers.

Where legal protection exists

whistleblowers face a number of barriers that can make it hard for them to expose unethical behavior in the workplace.

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Top Management Support

Top management set the Ethical

Top managers have the power to
Tone for the organization as a whole.

Top managers can and should serve

shape an organization's policies and set its moral tone as well.

as models of appropriate ethical behavior for the entire workforce.
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Top Management Support

Supervisors must be careful not

to unwittingly encourage unethical behavior by exerting too much pressure for the accomplishment of difficult goals.
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Formal Code of Ethics

Written and official guidelines on how to behave in situations prone to create ethical dilemmas. Areas often addressed in written codes of ethics:
Workforce Diversity Bribes and Kickbacks Conflicts of Interest Political Contributions Customer and Supplier Relations Misappropriation of Corporate Assets 19

 An obligation of the organization to

act in ways that serve both its own interests and the interests of its many external publics.

Corporate Social Responsibility

These publics are considered

STAKEHOLDERS, the persons and groups who are affected in one way or another by the behavior of an organization.
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Stakeholders
Employees Stockholders Customers Suppliers Competitors Labor Unions Financial Institutions Political Parties Educational
Institutions
Institutions

Courts and Legal

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Contrasting Views on Social Responsibility

Classical View
Holds that managements only responsibility is running a business to maximize profits.

Socio-Economic View
Holds that any organization must be concerned about the broader social welfare.
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The Classical View Against Social Responsibility

Reduced business profits Higher business costs Dilution of business purpose Too much social power for
businesses Lack of business accountability to the public
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The Socio-Economic View For Social Responsibility

Long-run profits for businesses. Public expectations support business Businesses may avoid more regulation. Businesses have the resources. Businesses have the ethical obligation. The public wants it.
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social responsibility. Better public image for businesses.

Evaluation of Corporate Social Performance

There are many action domains in which social responsibility can be pursued by business firms and other types of organizations. They include:
Concerns for Ecology and Environmental Quality.

Truth-in-Lending and Consumer Protection

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Evaluation of Corporate Social Performance

Aid-to-Education and Service to Community
Employment Practices Affecting Minorities Progressive Labor Relations

Employee Assistance
General Corporate Philanthropy
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Criteria for Evaluating Corporate Social Performance

Economic Responsibility
Legal Responsibility
Is fulfilled when it earns a profit through the provision of goods and services desired by the public. Is fulfilled when an organization operates within the law and according to the requirements of various external regulations. 27

 Ethical Responsibility
Is met when its actions voluntarily conform not only to legal expectations, but also to the broader values and moral expectations of society.

Discretionary Responsibility
Is met when the organization voluntarily moves beyond basic economic, legal, and ethical expectations to provide leadership in advancing the well-being of individuals, communities, and society as a 28 whole.

A Continuum of Social Responsibility Strategies

Obstruction
Defensive Proactive
Fight social demands

Accommodation

Do the minimum legally required

Do the minimum ethically required Take leadership in social initiatives
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Government Regulation of Business

Health and Safety Fair Labor Practices Consumer Protection Environmental Protection
FAA EPA OSHA ICC FDA EEOC OFCCP NLRB SEC
(To name a few)
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