copyright © 2003 by south- western, a division of thomson learning1 managerial and leadership...

Copyright © 2003 by South-Western, a division of Thomson Learning

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Managerial and Leadership Business Ethics Presentation I

Adapted by Jeffrey M. Wachtel, Ph. D.


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Student’s Readiness for the Ethics and Business Environment Course

Students enter without a vocabulary of ethics for economic relations because the current amoral theory of business.

Students are genuinely unable to define ethics or morality

Usually their definitions are barriers to ethical thinking. Shepard, Goldsby, & Gerde, 2004


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Small Adjacent Group Excercise Think about the forming of a new

society. Specific Assignment: Agree on the two

or three most fundamental characteristics of human nature that must be taken into account in creating the institutions of the new society.

Do not discuss the characteristics of the society itself.


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Minimum Definition of Morality/Ethics (Morality & Ethics Used Interchangeably)

R_____: Moral decision must be based on reasons acceptable to other rational persons.

I________: Interests of all those affected by a moral decision are taken into account.


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Answers: Fundamental Characteristics of Human Nature


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Some Basic Conceptual Distinctions

E M_____ A_______

(S_____) (S______& (S______)

________________)


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Barriers to Moral Reasoning P______l E__ism:

Ethical E__ism:

E_____ R_____ism:

E_____ Su_____ism:


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Chapter Topics

1. Business ethics and the changing environment

2. What is business ethics? Why does it matter?

3. Levels of business ethics4. Five myths about business ethics5. Why use ethical reasoning in business?6. Can business ethics be taught and

trained?


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Business Ethics and the Changing Environment Businesses & governments operate in changing

technological, legal, economic, social & political environments with competing stakeholders & power claims. What are some recent changes ?

Stakeholders are individuals, companies, groups & nations that cause and respond to external issues, opportunities, and threats. Examples of stakeholders?

The rate of change and uncertainty in which stakeholders & society must make & manage business & moral decisions have accelerated due to the impact of:

Internet and information technologies Globalization Deregulation Mergers Wars Oil Prices


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Globalization of the Environment

Local, national, and international environments are increasingly moving toward and into a global system of dynamically interrelated interactions among local, national, and regional politics, economies, regulations, technologies, demographics, and international law.

Economic environment Technological Political Governmental and regulatory Legal Demographic


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Stakeholder Management Approach The stakeholder management approach is a way

of understanding the effects of environmental forces and groups on specific issues that affect real-time stakeholders and their welfare.

This approach attempts to enable individuals and groups to articulate collaborative win-win strategies: based on:

Identifying and prioritizing issues, threats, or opportunities

Mapping who the stakeholders are Identifying their stakes, interests, and power sources Showing who the members of coalitions are or may become Showing what each stakeholder’s ethics are and should be Developing collaborative strategies and dialogue from a

higher ground perspective to move plans and interactions to the desired closure for all parties


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What is Business Ethics? Why Does It

Matter? Ethical solutions to business and organizational

problems may have more than one right alternative and sometimes, no right solution may seem available.

We can learn from case studies, movies, debates, and discussions about how our actions affect others in different situations.

Laura Nash has defined business ethics as “the study of how personal moral norms apply to the activities and goals of commercial enterprise,” as dealing with three basic areas of managerial decision making:

Choices about what the laws should be and whether to follow them. (e.g., closing times of entertainment, employment)

Choices about economic and social issues outside the domain of law (e.g., tour guides and commissions, taxis)

Choices about the priority of self-interest over the company’s interests (e.g., personal honesty at work)


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What Are Unethical Business Practices?

Surveys have identified the following recurring themes. Do they happen in Thailand?:

Managers lying to employees Office nepotism and favoritism Taking credit for other’s work Receiving/offering kickbacks Stealing from the company Firing an employee for whistle-blowing Padding expense accounts Divulging confidential information or trade secrets Terminating employment without sufficient notice Using company property/materials for personal

use


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What Are Unethical Business Practices?

The most unethical behavior, per one survey, happens in the following areas:

Government Sales Law Media Finance Medicine Banking Manufacturing


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Why Does Ethics Matter In Business?

“Doing the right thing” matters to employers, employees, stakeholders, and the public.

For companies, it means saving billions of dollars each year in lawsuits, settlements, and theft

Tobacco industry Dow Corning

Costs to businesses include: Deterioration of relationships Damage to reputation Declining employee productivity,creativity,

and loyalty Ineffective information flow throughout the

organization Absenteeism


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Levels of Business Ethics

Because ethical problems are not only an individual or personal matter, it is helpful to see the different levels at which issues originate and how they move to other levels.

Five levels are: Individual Organizational Association Societal International

Examination of the RU 486 story


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Asking Key Questions The following questions can be asked when a

problematic decision or action is experienced or perceived before it becomes an ethical dilemma:

What are my core values and beliefs? What are the core values and beliefs of my

organization? Whose values, beliefs, and interests may be at

risk in this decision? Why? Who will be harmed or helped by my decision or

by the decision of my organization? How will my own and my organization’s core

values and beliefs be affected or changed by this decision?

How will I and my organization be affected by the decision?


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Some Standards or Tests For Making Ethical Choices Front Page: Decision in Headlines? Golden Rule: Do unto others.. Dignity & Liberty of Others: Preserved? Equal Treatment: Minorities Treatment? Personal Gain: Same Decision if none? Congruence: Consistent with Personal

and Organizational Policies.


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Some Standards or Tests For Making Ethical Choices II Procedural Justice: Can how this

decision was made stand up to scrutiny?

Cost Benefit: Does a benefit for some cause unacceptable harm to others?

Good Night’s Sleep: If other’s know of my decision will I be able to sleep?


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Five Myths About Business Ethics

A myth is “a belief given uncritical acceptance by the members of a group, especially in support of existing or traditional practices and institutions.”

Myth 1: Ethics is a personal, individual affair, not a public or debatable matter

Myth 2: Business and ethics do not mix Myth 3: Ethics in business is relative Myth 4: Good business means good

ethics Myth 5: Information and computing are

amoral


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Why Use Ethical Reasoning In Business? Ethical reasoning is required in business

for at least three reasons: Many times laws are insufficient and do not

cover all aspects or gray areas of a problem Free-market and regulated-market mechanisms

do not effectively inform owners and managers about how to respond to complex issues and crises that have far-reaching ethical consequences

Complex moral problems require an intuitive or learned understanding and concern for fairness, justice, and due process to people, groups, and communities (reason & impartiality)


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Can Business Ethics Be Taught And Trained?

What this Ethic courses will not and should not do:

Advocate a set of rules from a single perspective

Offer only one best solution to specific ethical problems

Promise superior or absolute ways of thinking and behaving in situations


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Ethic courses and training can do the following:

Provide people with rationales, ideas, and vocabulary

Help people make sense of their environments Provide intellectual weapons Enable employees to act as alarm systems for

company practices Enhance conscientiousness and sensitivity Enhance moral reflectiveness and strengthen

moral courage Increase people's ability to become morally

autonomous ethical dissenters Improve the firm’s moral climate


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Other scholars argue that ethical training can add value to the moral environment of a firm and to relationships in the workplace by:

Finding a match between employer’s and employee’s values

Helping with ways to handle an unethical directive

Assisting people to cope with a performance system that encourages unethical means


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Stages Of Moral Development

Kohlberg’s 3 levels of moral development: Level 1: Preconventional level

(self-orientation) Stage 1: Obedience and Punishment Stage 2: Reward seeking: Individualism,

Instrumentalism, and Exchange

Level 2: Conventional level (others orientation)

Stage 3: Good person Stage 4: Law and order

Level 3: Postconventional level (universal, humankind orientation)

Stage 5: Social contact Stage 6: Universal ethical principles:


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Kohlberg: No Jumping Stages Kohlberg believed that individuals could only progress through these

stages one stage at a time. That is, they could not "jump" stages. They could only come to a comprehension of a moral rationale one

stage above their own. Thus, according to Kohlberg, it was important to present them with

moral dilemmas for discussion which would help them to see the reasonableness of a "higher stage" morality and encourage their development in that direction. The last comment refers to Kohlberg's moral discussion approach. He saw this as one of the ways in which moral development can be promoted through formal education.

Note that Kohlberg believed, as did Piaget, that most moral development occurs through social interaction. The discussion approach is based on the insight that individuals develop as a result of cognitive conflicts at their current stage.

copyright © 2003 by south- western, a division of thomson learning1 managerial and leadership...

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