Practicing Ethical

Behavior and Social

Responsibility

Business In Action 3e

Chapter 2 - 1

Two Important Concepts

Social responsibility
Ethical behavior

Business In Action 3e

Chapter 2 - 2

Corporate Fraud
Enron
Tyco
Arthur Andersen
Adelphia
WorldCom
Ford and Firestone

Business In Action 3e

Chapter 2 - 3

What Is Ethical Behavior?

Competing fairly and honestly
Communicating truthfully
Not causing harming to others

Business In Action 3e

Chapter 2 - 4

Unethical Behavior
Cheating on expense accounts
Misuse of company resources
Creative accounting
Padding invoices
Insider trading
Conflicts of interest

Business In Action 3e

Chapter 2 - 5

Factors Influencing
Ethical Behavior
Cultural differences
Knowledge
Organizational behavior

Business In Action 3e

Chapter 2 - 6

Promoting Ethical
Behavior

Top executives
Written code of ethics
Ethics training
Ethics officer
Reporting system

Business In Action 3e

Chapter 2 - 7

Making Ethical Decisions

Stakeholder
Issues

Is It Ethical?

Philosophical
Approaches

Outsiders

Legality
and Balance

Utilitarianism

Supervisors

Acceptability

Individual, Legal
and Human Rights

Employees

Feasibility

Principles
of Justice

Business In Action 3e

Chapter 2 - 8

Ethical Situations
Ethical dilemmas
Ethical lapses

Business In Action 3e

Chapter 2 - 9

Social Responsibility in
Business
Early 20th Century
Maximize profits

Middle 20th Century

Provide jobs and pay taxes

Early 21st Century

Balance profits and social issues

Business In Action 3e

Chapter 2 -

Percentage of Executives Who Strongly Agree

or Agree That Companies Should:

Percentage

Be environmentally responsible

100

Be ethical in operations

100

Earn profits

96

Employ local residents

94

Pay taxes

94

Encourage and support employee volunteering

89

Contribute money and leadership to charities

85

Be involved in economic development

75

Be involved in public education

73

Involve community representatives in business decisions

62

Target a portion of purchasing toward local vendors

61

Help improve quality of life for low-income populations

54

Business In Action 3e

Chapter 2 -

Balancing Business and

Stakeholders Rights
Business
Investors
Consumers
Employees
Society

Business In Action 3e

Chapter 2 -

Efforts to Increase Social

Responsibility
Social audit
Cause-related marketing
Philanthropy

Business In Action 3e

Chapter 2 -

Causes of Pollution
Industrial discharges
Vehicle emissions
Chemical spills

Business In Action 3e

Chapter 2 -

Government Efforts to
Reduce Pollution
Environmental protection agency
Regulate air and water
Reduce automobile emissions
License pesticides
Control toxic substances
Safeguard drinking water

Business In Action 3e

Chapter 2 -

Business Efforts at
Reduction
Environmental issues
Environmental staff
Performance expectations
Performance rewards
Long-term cost
Product development
Supplier expectations
Training and awareness

Business In Action 3e

Chapter 2 -

Responsibility Toward
Consumers
The right to safe products
The right to be informed
The right to choice
The right to be heard

Business In Action 3e

Chapter 2 -

Responsibility Toward
Investors
Fair profit distribution
Social responsibility
Ethical behavior

Business In Action 3e

Chapter 2 -

Responsibility Toward
Employees
Equal employment opportunity
Affirmative action
Americans with Disabilities Act
Occupational health and safety

Business In Action 3e

Chapter 2 -

Global Ethics and Social

Responsibility
Bribery
Environmental abuse
Unscrupulous business practices

Business In Action 3e

Chapter 2 -