chapter 1 ppt slides.pptstud

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall 1-1

Chapter 1The Foundation of Ethical

Thought

Understanding Business EthicsStanwick and Stanwick

1st Edition


Ethics• The values an individual uses to interpret

whether any particular action or behavior is considered acceptable or appropriate.

• Questions to ask:– Is the behavior or action consistent with the overall

basic duties of the individual in question?– Does the behavior or action acknowledge and respect

the underlying rights of all the individuals who will be impacted by the action?

– Would the behavior or action be considered the best practice in that specific set of circumstances?

– Does the behavior or action match the overall entrenched beliefs of the individual?


Business Ethics

• The collective values of a business organization that can be used to evaluate whether the behavior of the collective members of the organization are considered acceptable and appropriate


Foundation of Ethical Theory

• Initially classified based on what perspective is considered by the reader– Descriptive ethics– Analytical ethics– Normative ethics


Descriptive Ethics

• The presentation of facts related to the specific ethical actions of an individual or organization

• Used when an observer wants to understand the course of events that generated the ethical issue

• No interpretation of the facts or assumptions concerning why that course of action took place


Analytical Ethics• Understanding the reasons a course of action that may

have an ethical impact took place• Also called metaethics• Moves from the how and when inquiry, which is the basis

of the descriptive ethics viewpoint, to asking why• Hypotheses can be developed to help understand the

relationships among different variables impacting ethical behavior

• Addresses the ‘motive’ behind the actions instead of just being satisfied with a description of the actions


Normative Ethics• A prescribed course of action that attempts to ensure

that ethical behavior will be followed in the future• Moves the evaluation of ethical behavior from the past to

future tense• Presents information on what should be done in the

future rather than what was done in the past, both part of descriptive and analytical ethics

• Allows employees and managers to address potential ethical issues before they occur

• Use of ethical tools (like ethics codes) help direct the normative ethical behavior by presenting what are acceptable and unacceptable types of behavior tolerated within the firm


Teleological Frameworks

• Focus on the results of the conduct of the individual– Ethical Egoism: focusing on each individual’s

self interest• Based on the belief that every individual should act

in a way to promote himself/herself if the net result will generate, on balance, positive rather than negative results


Teleological Frameworks

– Utilitarianism: based on the principle of utility• Each person’s actions add to the overall utility of

the community impacted by those actions• Focus on the net result of their actions instead of

the means or motives that generated the reason for their actions


Teleological Frameworks– Sidgwick’s Dualism: attempts to bridge the

gap between the two competing ethical frameworks of ethical egoism and utilitarianism

• Core of argument was that both theories had elements of cost-benefit analysis to help analyze the actions of individuals

• Adam Smith presented an argument that could support Sidgwick’s dualism – argues the greatest good for the greatest number is achieved by individuals pursuing their self-interests in the marketplace


Deontological Frameworks

• Focus on the duty or obligation in determining whether the actions are right or wrong– Existentialism

• Based on the underlying belief that the only person who can determine right and wrong is the person making the decisions

• Each individual determines his or her own actions and is ultimately responsible for the consequences of those actions


Deontological Frameworks

– Contractarianism• Social contract theory• Based on the belief that all individuals agree to

social contracts to be members within a society

– Kant’s Ethics• Ethical decisions based on the free will of the

individual• The free will to make decisions that were considered

rational needed to be converted into a universal will


Mixed Frameworks

• Seven guiding principles that are considered part of the prima facie obligation an individual has to society:– Fidelity: an individual needs to keep explicit

and implicit promises– Reparation: an individual must act on repairing

the consequences for previous wrongful acts– Gratitude: an individual must be able to show

gratitude for the kindnesses that others have given him or her


Mixed Frameworks

– Justice: an individual should try to see that any goods are fairly distributed

– Beneficence: an individual should focus on trying to improve the lives of others

– Self-Improvement: an individual should improve oneself by focusing on virtue and intelligence

– Noninjury: an individual should not cause any harm to others


Global Business Standards Codex

• A codex that captures the eight major underlying principles in which ethical behavior can be interpreted and evaluated

• Eight ethical principles:– Fiduciary– Property– Reliability– Transparency– Dignity– Fairness– Citizenship– Responsiveness


Fiduciary Principle

• Each officer has a legal fiduciary duty to act in the best interests of the stakeholders and other employees within the firm

• An implied fiduciary duty for every employee to act in a way that generates positive benefits for the firm– Examples: conflicts of interest, good faith efforts for

carrying out responsibilities. Prudence with the company’s resources, loyalty


Property Principle

• Based on the belief that every employee should respect property as well as the rights of the owners of the property

• Expected that the employee should be a good steward to the resource that he/she has access to.– Examples: theft, misappropriation of funds,

wasting resources, misappropriation of intellectual property


Reliability Principle

• Based on the belief that it is the employee’s responsibility to honor the commitments he or she has made to the firm– Examples: breaching a promise or contract,

not fulfilling a promised action, ensuring that suppliers and other business partners are paid in a timely manner


Transparency Principle

• Based on the belief that every employee should conduct business in a truthful and open manner.

• Assumes that employees will not make decisions based on a personal agenda– Examples: keep accurate and current records

of business obligations, fraudulent and deceptive actions of the employee, financial information is presented in a truthful and accurate way


Dignity Principle

• Based on the belief that each employee needs to respect the dignity of all individuals

• Encourages the enhancement of human development not only within the company and the marketplace, but also in the society at large– Examples: ensuring the human rights of

health, safety and privacy


Fairness Principle

• Based on the belief that stakeholders who have a vested interest in the firm should be treated fairly

• Reciprocal fairness, distributive fairness, fair competition, procedural fairness


Citizenship Principle

• Based on the belief that every employee should act as a responsible citizen in the community

• Expected that employees respect the laws of the community – criminal, competition, environmental, corporate social responsibility


Responsiveness Principle

• Based on the belief that employees have a responsibility to respond to the requests for information about the operations from various stakeholders

• Expected to react in a timely manner

chapter 1 ppt slides.pptstud

Documents

pearson education

prentice hall1

prentice hallcopyright

normative ethical behavior

evaluation of ethical

ethical behavioraddresses

ethical impact

specific ethical actions