© 2004 West Legal Studies in Business, a Division of Thomson Learning

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The Legal, Ethical, and The Legal, Ethical, and Regulatory Regulatory

Environment of Environment of BusinessBusiness

By Fisher and By Fisher and PhillipsPhillips

Prepared by Jimidene MurpheyPrepared by Jimidene Murphey

© 2004 West Legal Studies in Business, a Division of Thomson Learning

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Chapter 1Chapter 1

The Law: Legal and The Law: Legal and Business EthicsBusiness Ethics

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The Meaning, Nature, The Meaning, Nature, and Limits of Ethicsand Limits of Ethics

JurisprudenceJurisprudenceThe study of legal ethicsThe study of legal ethics

Business ethicsBusiness ethicsValues that the business Values that the business community uses to determine community uses to determine proper conductproper conduct

Ethics (deontology)Ethics (deontology)The study of conduct that is right, The study of conduct that is right, good, and moral in a set of good, and moral in a set of circumstancescircumstances

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Nature - Nature - A PrioriA Priori

Ethics are ultimate valuesEthics are ultimate values

Ethics self-justifyEthics self-justify

Ethics sometimes conflictEthics sometimes conflict

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Ethic of Positive LawEthic of Positive Law

Positive law consists ofPositive law consists ofa rule…a rule…

from a political superior to a from a political superior to a political inferior, which the political inferior, which the inferior obeys…inferior obeys…

with sanctions imposed if the with sanctions imposed if the rule is broken.rule is broken.

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Characteristics of Characteristics of Positive LawPositive Law

Command elementCommand elementNo requirements on the type No requirements on the type of rulerof rulerHabitual obedience to the Habitual obedience to the rules is expectedrules is expectedGenerally advances Generally advances constructive goalsconstructive goalsCan be moral, amoral, or Can be moral, amoral, or immoralimmoral

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Why Empirically-basedWhy Empirically-basedLaw is DominantLaw is Dominant

The lack of trust in our societyThe lack of trust in our societyCultural pluralismCultural pluralismLegalizing all areas of societyLegalizing all areas of societyMassive noncompliance with Massive noncompliance with positive lawpositive lawFailure to keep our promisesFailure to keep our promisesLack of personal responsibilityLack of personal responsibilityRewardable cheatingRewardable cheatingPassing of laws to resolve Passing of laws to resolve problemsproblems

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Justice as EthicsJustice as Ethics

Natural lawNatural law

Due processDue process

Equity courtsEquity courts

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Prominent Names in Prominent Names in JurisprudenceJurisprudence

PlatoPlatoSir William BlackstoneSir William BlackstoneJohn RawlsJohn RawlsImmanuel Kant Immanuel Kant Eugene EhrlichEugene EhrlichSigmund Freud Sigmund Freud Jerome Frank Jerome Frank Jeremy BenthamJeremy Bentham

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Ethics Influencing LawEthics Influencing Law

Ethics of Ethics of customcustomEthics of Ethics of

customcustom

Ethics of Ethics of realityrealityEthics of Ethics of

realityreality

Ethics of Ethics of utilityutilityEthics of Ethics of

utilityutility

Ethics of Ethics of norms of norms of conductconduct

Ethics of Ethics of norms of norms of conductconduct

Ethics of Ethics of civilizationcivilizationEthics of Ethics of

civilizationcivilization

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Business EthicsBusiness Ethics

Values that a business follows Values that a business follows in conducting its affairsin conducting its affairs

Examples of business ethicsExamples of business ethicsMake a profitMake a profit

Deliver best products for best Deliver best products for best priceprice

Provide workers with jobsProvide workers with jobs

Give owners return on investmentGive owners return on investment

Be a good citizenBe a good citizen

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Objectives of LawObjectives of Law

JusticeJustice

SpeedSpeed

EconomyEconomy

FlexibilityFlexibility

StabilityStability

KnowabilityKnowability

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Why Study the Law?Why Study the Law?

Cutting edge of societyCutting edge of society

Business environment is Business environment is increasingly legalizedincreasingly legalized

Businesspeople should Businesspeople should practice preventive lawpractice preventive law

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Recap - Terms to KnowRecap - Terms to Know

EthicsEthicsJurisprudenceJurisprudenceJustice and powerJustice and powerCustomCustomSociological school of Sociological school of jurisprudencejurisprudenceEthics of civilizationEthics of civilizationLegal realismLegal realismEthical utilitarianismEthical utilitarianismBusiness ethicsBusiness ethics