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Introduction to management groups g - i - managerial ethics and corporate social responsibility - sep 17, 2008

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Managerial Ethics and Corporate Social Responsibility Lecture

Managerial Ethics and Corporate Social Responsibility Lecture

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  • 1. MAN1006: Introduction to Management (Groups~BBA1G-I) Lecture 1 – The Evolution of Management Lecturer: Oswy Gayle Wednesday September 17, 2008 University of Technology, Jamaica School of Business Administration
  • 2. 1. What is ethics? How it relates to behaviour governed by law and free choice? 2. Approaches to evaluating ethical behaviour 3. How individuals and organizations shape ethical decision making 4. What is corporate social responsibility? Its importance. 5. Ethical leadership and organizational structures 6. Balancing stakeholders interest L E A R N I N G O B J E C T I V E S
  • 3. Recap - Week 1
    • Changing Dynamics of Organizations and the their driving forces
      • What is management?
      • Functions of management?
      • Skills a manager needs
      • Management in the New Workplace
  • 4. Recap - Week 2
    • The Evolution of Management
      • Understand how historical forces influence the practice of management
      • Major developments in the history of management thought
      • Components of the classical and humanistic perspectives
      • Look at the management science perspective
      • A look at the systems theory, the contingency view and total quality management
      • The learning organization and the technology driven workplace
  • 5. Recap - Week 3
    • Organizational Environment and Culture
    • We looked at
      • How an Organization's environment affects its internal effectiveness
      • General Environment & Task Environment
      • The Internal Environment – Culture
      • Types and Levels of Culture
      • How Culture affects the organization
  • 6. Today – Week 4
    • Managerial Ethics and Corporate Social Responsibility
    • This Lecture builds on the idea of corporate culture and aspects of the international and internal environment
  • 7. For approximately 15 minutes, men and women, including the elderly , went in and out of the building, which had already lost its roof , leaving with disposable diapers, a variety of beverages in crates, furniture, other food items in black plastic bags, along with empty bottles. The line of people entering the building only ended when the store had been emptied of its contents .
    • This man in Long Bay, Portland, makes off with two crates of Guinness after the roof and outer walls of a bar were destroyed by the brute force winds of Tropical Storm Gustav
  • 8.
    • Considering it was Gustav, is it ok to steal?
    • …… ..….. “Because people need to eat a food”
  • 9. Danville Walker’s Dilemma
    • My managers tell me they have been taught to suggest a penalty that encourages payment. All that does is encourage more corruption.
    • “ We have corrupt officers in customs and, unless you can find them red-handed, the ones you tend to catch are the stupid ones . These are educated people , but they are corrupt and therefore they are smart and they know the customs procedures and therefore catching them in the act is not as simple," Walker explains.
  • 10. Corporate Social Responsibility
    • Members from the community of Southside, central Kingston, called for more businesses surrounding the vicinity to exercise their corporate social responsibility and give back to the community.
    • Should the people have to ask?
  • 11. What’s happening?????
    • Trafigura – JA Government
      • 31 Million donation made to the PNP
    • Enron Scandal - USA
  • 12.
    • ethics refers to standards of behavior that tell us how human beings ought to act in the many situations
  • 13. Do these statistics look familiar? Fig. 1. Survey respondents felt that the construction industry, in general, is tainted by acts they consider unethical, such as unauthorized use of equipment or supplies and mis-reporting of costs. ( FMI, a Raleigh, N.C.-based firm)
  • 14. Studies in the Construction Industry show
    • Unauthorized use of equipment or supplies
    • Mis-reporting of costs
    • Bid Shopping – divulging solicited bids as leverage to encourage contractors to lower their prices
    • 3. Payment Games
    • 61% of the people surveyed said that unethical behaviour affects the cost of getting projects
  • 15. Are you an Ethicist?
    • Is ethics they way you feel?
    • Is ethics religion?
    • Is ethics about following the law?
    • Is ethics about culturally acceptable norms
    • Is ethics science?
  • 16.
    • There is never a right way to do the wrong thing
    What is Ethics about?
  • 17. Why ethics is so hard to define?
    • 1. On what do we base our ethical standards?
    • 2. How do those standards get applied to specific situations we face?
  • 18. What is ethics?
    • The code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong.
    • 2. Ethics sets the standards for what is good from what is bad in conduct and decision making.
  • 19.
    • 3. Ethics refers to standards of behavior that tell us how human beings ought to act in the many situations
    • 4. Ethics deals with internal values and that are apart of corporate culture and shapes decision relating to corporate social responsibility in the external environment
    What is ethics?
  • 20. Human Behaviour falls into three categories.
    • 1. Domain of Certified Law
    • (Legal Standard) – values and standards are written into the law system
    • 2. Domain of Free choice – Behaviour about which law has no say and for which an individual or organization has/enjoys complete freedom
    • 3. Domain of Ethics – no specific laws, yet it does have standards of conduct based on shared principles and values
  • 21. Three Domains of Human Action Amount of Explicit Control High Low Domain of Certified Law (Legal Standard) Domain of Ethics (Social Standard) Domain of Free Choice (Personal Standard)
  • 22. Ethical Dilemma
    • A situation that arises when all alternative choices or behaviors have been deemed undesirable because of potentially negative ethical consequences, making it difficult to distinguish right from wrong
    • Wrong and right – values are in conflict
  • 23. Example
    • A company is hoping to build a new manufacturing plant overseas. You could save 5 million if you do not install standard pollution control equipment that is required. The plan will employ local workers. Not doing so would also potentially affect the fishing industry in the village. What do you do?
  • 24. Criteria For Ethical Decision Making
    • Most ethical dilemmas involve
    • Conflict between needs of the part & whole
      • Individual versus the organization
      • Organization versus society as a whole
    • Managers use normative strategies (Norms and Values) to guide their decision making - norms and values
  • 25. Questions
    • 1. On what do we base our ethical standards?
    • 2. How do those standards get applied to specific situations we face?
  • 26. Ethical Decision Making Approaches
    • Utilitarian Approach
    • Individualism Approach
    • Moral-Rights Approach
    • Justice Approach
  • 27. 1. Utilitarian Approach
    • Moral behavior produces the greatest good for the greatest number
    • Critics - ask so what if the common good is squeezing the life out of the other individuals?
    • Example
      • – The Highway 2000 (Gov) vs Portmore Municipality
  • 28. 2. Individualism Approach – greater good is ultimately served as people
    • Acts are moral when they promote the individual's best long-term interests, which ultimately leads to the greater good
    • Individual self-direction is paramount
    • Individualism is believed to lead to honesty & integrity since that works best in the long-run
    • Example: Top executives lying and cheating will only lead to other executives lying and cheating. Thus, people behave in terms of what they want to be returned to them
  • 29. 3. Moral-Rights Approach
    • Moral decisions are those that best maintain the rights of those people affected by them.
    • An ethical decision is one that avoids interfering with the fundamental rights of others
    • Have rights that cannot be taken away from them.
  • 30. Six Moral Rights 1. The right of free consent 2. The right to privacy 3. The right of freedom of conscience 4. The right of free speech 5. The right to due process 6. The right to life & safety
  • 31. 4. Justice Approach
    • Moral Decisions must be based on standards of equity, fairness, impartiality
    • Three types of Justice Approaches:
    • Distributive Justice
    • Procedural Justice
    • Compensatory Justice
  • 32. Distributive Justice
    • Different treatment of people should not be based on arbitrary characteristics
    • In case of substantive differences, people should be treated differently in proportion to the differences among them
      • Men and women should be paid the same salaries if they are doing the same job
  • 33. Procedural Justice
    • Rules should be clearly stated
    • Rules should be consistently and impartially enforced
  • 34. Compensatory Justice
    • Individuals should be compensated for the cost of their injuries by the party responsible
    • Individuals should not be held responsible for matters they have no control over
  • 35. The Point is that;
    • Ethical or unethical practices in an organizational context reflect the values, attitudes, beliefs and behaviour patterns of its members
    • Ethics is as much about Individuals as it is about organizations
  • 36. Factors Affecting Ethical Choices
    • The Manager Levels or stages of moral development
      • Pre-conventional
      • Conventional
      • Post-conventional
  • 37. Levels of Personal Moral Development
  • 38. The Organization
    • Rarely can ethical or unethical corporate actions be attributed solely to the personal values of a single manager
    • Values adopted within the organization are highly important
    • Most people believe their duty is to fulfill obligations and expectations of others
    Experiential Exercise: Ethical Work Climates
  • 39. So you think you’re an ethicist? Right?
    • Can we always be ethical?
    • Is being ethical worth it/anything?
    • e.g A potato wedge??
  • 40.
    • The Organization and Corporate Social Responsibility
  • 41. Social Responsibility
    • Organization’s obligation to make choices and take actions that will contribute to the welfare and interests of society and the organization
    • Being a good corporate citizen
    • Difficulty in understanding – issues can be ambiguous with respect to right and wrong
    • Responsibility to whom?????????
  • 42. Organizational Stakeholders
    • Any group within or outside the organization that has a stake in the organization’s performance
    • Each stakeholder
      • Has a different criterion of responsiveness
      • Has a different interest in the company
  • 43. Environmental Responsibility Commitment Activist Approach Stakeholder Approach Market Approach Legal Approach The Shades of Corporate Green
  • 44. Evaluating Total Corporate Social Responsibility Performance Economic Responsibility Legal Responsibility Ethical Responsibility Discretionary Responsibility Ethical Dilemma: Should We Go Beyond the Law?
  • 45. The Ethical Organization
    • Ethical individuals = honest, have integrity, strive for a high level of moral development
    • Ethical leadership = provides the necessary actions, committed to ethical values and helps others to embody those values
    • Organizational structure = embodies a code of ethics, and methods to implement ethical behavior
  • 46. Ethics and the New Workplace
    • Telecommuting, virtual work, and flexible hours - Success of new programs depends on mutual trust
    • IT provides opportunities for monitoring
    • Companies that make an unwavering commitment to maintaining high standards of ethics and social responsibility will lead the way toward a brighter future for both business and society
  • 47. Recap
    • 1. All businesses and Organization including construction all face ethical dilemmas
    • 2. Code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong.
    • 3. Managers will need to decide on an approach towards making ethical decisions based on the level of their moral development
  • 48. Recap
    • 4. Corporate Social Responsibility is an organization’s obligation to make choices and take actions that will contribute to the welfare and interests of society and the organization. Managers must
      • **** Know who their stakeholders are
      • ****Be socially responsible totally (Economics, Legal, ethically & discretionary)
      • *****Organizations require ethical individuals, leadership and ethics structures