LESSON 4

• Ethics


  An individual's personal beliefs regarding what is right and wrong or good and bad
• Ethical Behavior


  "Eye of the beholder" or behavior that conforms to generally accepted social norms
• Unethical Behavior


  • "Borrowing" office supplies for personal use
  • "Surfing the Net" on company time
  • Filing falsified or inflated business expense reports
• Managerial Ethics


  • Individual Values + Organizational Values = Managerial Values
• Applying Ethical Judgments


  1. Gather relevant factual information

  2. Determine the most appropriate moral values

  3. Make a judgment
• Ethical Norms Affecting Actions

  • Utility
  • Rights
  • Justice
  • Caring
• Organizational Stakeholders


  People and organizations directly affected by the behaviors of an organization and that have a stake in its performance
• Social Responsibility


  The set of obligations to behave responsibly
• Areas of Social Responsibility

  • Stakeholders
  • The natural environment
  • The general social welfare
• Arguments for and Against Social Responsibility

  • Arguments for
  • Arguments against
• Approaches to Social Responsibility

  • Obstructionist Stance
  • Defensive Stance
  • Accommodative Stance
  • Proactive Stance
• Obstructionist Stance


  Do as little as possible
• Defensive Stance


  Do only what is legally required and nothing more
• Accommodative Stance


  Meet legal and ethical obligations and go beyond that in selected cases
• Proactive Stance


  Organization views itself as a citizen and proactively seeks opportunities to contribute to society
• Business and the Government


  Influence each other
• Managing Social Responsibility: Formal Organizational Dimensions


  • Legal Compliance
  • Ethical Compliance
  • Philanthropic Giving
• Managing Social Responsibility: Informal Organizational Dimensions

  • Organization Leadership and Culture
  • Whistle Blowing
• Whistle Blowing


  The organizational response to the disclosure by an employee of illegal or unethical conduct on the part of others within the organization is indicative of the organization's stance on social responsibility
• Evaluating Social Responsibility


  • Concept of Control
  • Corporate Social Audit
• Key Terms


  • unethical behavior
  • managerial ethics
  • code of ethics
  • Sarbanes-Oxley Act of 2002
  • social responsibility
  • organizational stakeholder
  • obstructionist stance
  • defensive stance
  • accommodative stance
  • proactive stance
  • regulation
  • lobbying
  • legal compliance
  • ethical compliance
  • philanthropic giving
  • whistle blowing
  • corporate social audit