business ethics 1.ppt
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Business Ethics
Fundamentals
Prof. Sunil Bakshi
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Introduction
Business Ethics Publics interest in business ethics
increased during the last four decades
Publics interest in business ethics
spurred by the media
Inventory of ethical issues in business
Employer-Employee Relations
Company-Customer Relations
Company-Shareholder Relations
Company-Community/Public Interest
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Publics Opinion on Business
Ethics
Gallup Poll finds that only 17% to 20% ofthe public thought the business ethics ofexecutives to be very highorhigh
To understand public sentiment towardsbusiness ethics, ask three questions
Has business ethics really deteriorated?
Are the media reporting ethical problems
more frequently and vigorously? Are practices that were once socially
acceptable no longer acceptable?
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Business Ethics:
What Does It Really Mean?
Ethical Problem
Societys
Expectations of
Business Ethics
Actual BusinessEthics
1950s 2000sTime
Business Ethics: Today vs. Earlier Period
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Business Ethics:What Does It Really Mean?
Definitions: Ethics involves a discipline that examines
good or bad practices within the context ofa moral duty
Moral Conduct is behavior that is right orwrong
Business Ethics include practices andbehaviors that are good or bad
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Business Ethics:
What Does It Really Mean?
Two Key Branches of Ethics:
Descriptive ethics involves studying,
describing & characterizing morality
WhatIs Normative ethics involves supplying and
justifying moral systems
What Should Be
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Conventional Approach to
Business Ethics
Conventional approach to business ethics
involves a comparison of a decision or
practice to prevailing societal norms
Pitfall: Ethical Relativism
Decisionor
Practice
PrevailingNorms
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Sources of Ethical Norms
PeerPressure
Family
Friends
Legal
Framework
Regions ofCountry
Profession
Employer
Society at
Large
FellowEmployees
Religious
Beliefs
The
Individual
Conscience
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Ethics and the Law
Law often represents an ethical minimum Ethics often represents a standard that
exceeds the legal minimum
Ethics Law
Frequent Overlap
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Making Ethical Judgments
Behavior or act
that has been
committed
Prevailing
norms of
acceptability
Value
judgments andperceptions of
the observer
compared
with
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Four Important Ethical Questions
What is? What ought to be?
How to we get from what is to what ought
to be? What is our motivation for acting ethically?
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Three Types OfManagement Ethics
Three Approaches to
Management Ethics
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1. Immoral ManagementA style devoid ofethical principles and active opposition to
what is ethical.
2. Moral ManagementConforms to high
standards of ethical behavior.
3. Amoral Management
Intentional - does not consider ethical
factors Unintentional - casual or careless about
ethical considerations in business
Approaches To Mgmt Ethics
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Models of Management Ethics- Emphasis on Corp Social Resp
Moral Mgmt
Model
Economic
Resp
Legal
Resp
Ethical
Resp
Philanthropic
Resp
Immoral Mgmt XXX X XAmoral Mgmt XXX XX X X
Moral Mgmt XXX XXX XXX XXX
Component of the CSR Definition
Weighing Code:
X = Token consideration (For appearance only)
XX = Moderate considerationXXX = Significant consideration
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Moral Management ModelsAcceptable Stakeholder Thinking
Moral Mgmt Model Acceptance of SHT SHT PostureImmoral Mgmt SHT rejected: Mgmt is
self absorbed
SHT rejected, not
deemed useful.
Accepts profit
maximization model
but does not realy
pursue it.
Amoral Mgmt SHT accepted;
Narrow view (Min nbr
of stakeholders
considered
Insrumental view of
SHT prevailsHow
will it help mgmt?
Moral Mgmt SHT enthudiasticallyembraced: Wider view
(Max nbr of
stakeholders
considered
Normative view ofSHT prevails. SHT is
fully embraced in all
decision making.
SHT: Stakeholders Thinking
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Developing Moral JudgmentWhy Managers Behave Ethically
Most of Us
Many of Us
Very Few
of Us
To avoid some punishment
To receive some reward
To be responsive to family,
friends % superiors
To be a good citizen
To do what is right, pursue
some ideal, such as justice
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Developing Moral Judgment
External Sources of ManagersValues:
Religious Values
Philosophical Values Cultural Values
Legal Values
Professional Values
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Developing Moral Judgment
Internal Sources ofManagers Values: Respect for the authority structure
Loyalty
Conformity Performance
Results
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Elements of Moral Judgment
Moral imagination Moral identification and ordering
Moral evaluation
Tolerance of moral disagreement and
ambiguity Integration of managerial and moral
competence
A sense of moral obligation
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Elements of Moral Judgment
Amoral Managers Moral Managers
Moral imagination
Moral identification Moral evaluation
Tolerance for ambiguity
and moral disagreement
Integration of managerialand moral competence
A sense of moral obligation
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Ethics, Economics, and Law
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