Demonstrating Ethical Behavior and Social Responsibility

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Demonstrating Ethical Behavior and Social Responsibility

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  • Demonstrating Ethical Behavior and Social Responsibility

    1. 1. <ul><li>Nickels </li></ul><ul><li>McHugh </li></ul><ul><li>McHugh </li></ul>Nickels Cover
    2. 2. 4 Chapter Demonstrating Ethical Behavior and Social Responsibility 4-
    3. 3. Ethics <ul><li>More Than Legality </li></ul><ul><li>Standards are Fundamental </li></ul><ul><li>Stem From Individual </li></ul>
    4. 4. SEC Investigations (2002) <ul><li>Accounting </li></ul><ul><ul><li>Arthur Andersen </li></ul></ul><ul><ul><li>Deloitte & Touche </li></ul></ul><ul><ul><li>Ernst & Young </li></ul></ul><ul><ul><li>KPMG </li></ul></ul><ul><ul><li>PriceWaterhouse Coopers </li></ul></ul><ul><li>Energy </li></ul><ul><ul><li>CMS Energy </li></ul></ul><ul><ul><li>Dynergy </li></ul></ul><ul><ul><li>Enron </li></ul></ul><ul><ul><li>Halliburton </li></ul></ul><ul><ul><li>Reliant Resources </li></ul></ul><ul><li>Software </li></ul><ul><ul><li>Computer Associates </li></ul></ul><ul><ul><li>Network Associates </li></ul></ul><ul><li>Telecom </li></ul><ul><ul><li>Global Crossing </li></ul></ul><ul><ul><li>Lucent Technologies </li></ul></ul><ul><ul><li>Qwest Communications </li></ul></ul><ul><ul><li>WorldCom </li></ul></ul><ul><li>Wall Street </li></ul><ul><ul><li>Credit Suisse First Boston </li></ul></ul><ul><ul><li>Hedge Funds </li></ul></ul><ul><ul><li>Capital Markets </li></ul></ul><ul><ul><li>Merrill Lynch </li></ul></ul>Source: Business Week , June 10, 2002
    5. 5. Corporate Scandal Fines Source: Business Week , Nov. 4, 2002 IPO Shares Unfairly Distributed $100,000,000 Credit Suisse First Boston Conflict of Interest Between Investment Bank & Research Dept. $100,000,000 Merrill Lynch Analyst Issued Misleading Information $5,000,000 Citigroup Obstruction of Justice Shredding Enron Documents $500,000 Arthur Andersen Reason Fine Company
    6. 6. How Much Do Americans Trust Corporations? <ul><li>All Corporations </li></ul><ul><li>Fair Amount 41% </li></ul><ul><li>Only A Little 35% </li></ul><ul><li>Not At All 13% </li></ul><ul><li>A Great Deal 10% </li></ul><ul><li>No Opinion 1% </li></ul><ul><li>Your Employer </li></ul><ul><li>A Lot 50% </li></ul><ul><li>Only Somewhat 39% </li></ul><ul><li>Not At All 8% </li></ul><ul><li>No Opinion 3% </li></ul>Source: USA Today /CNN/Gallup Poll, Jan. 25-27, 2002
    7. 7. Why People Volunteer <ul><li>Total is more than 100%- respondents could give more than one reason. </li></ul>Percent of Respondents
    8. 8. Ethics of MBA Students <ul><li>Percent of MBA Students Who Would: </li></ul><ul><li>Buy Stock on Inside Information 52% </li></ul><ul><li>Reveal Corp. Secrets to Spouse/Family 50% </li></ul><ul><li>Let a Gift Sway Purchasing Decision 26% </li></ul><ul><li>Pay Someone Off to Close a </li></ul><ul><li> Business Deal 13% </li></ul>Source: USA Today
    9. 9. Ethics Check Questions: <ul><li>Is It Legal? </li></ul><ul><li>Is It Balanced? </li></ul><ul><li>How Will It Make Me Feel About Myself? </li></ul>
    10. 10. Ethical Decision Resolved Through: <ul><li>Religious Teachings </li></ul><ul><li>Individual Rights </li></ul><ul><li>Legislation </li></ul><ul><li>Court Decisions </li></ul>
    11. 11. Factors Influencing Managerial Ethics Individual Organizational Environmental <ul><li>Values </li></ul><ul><li>Work Background </li></ul><ul><li>Family Status </li></ul><ul><li>Personality </li></ul><ul><li>Top Level Mgmt. Philosophy </li></ul><ul><li>The Firm’s Reward System </li></ul><ul><li>Job Dimensions </li></ul><ul><li>Competition </li></ul><ul><li>Economic Conditions </li></ul><ul><li>Social/Cultural Institutions </li></ul>
    12. 12. Codes of Ethics <ul><li>Compliance-Based </li></ul><ul><li>Integrity-Based </li></ul>
    13. 13. Steps to Improve U.S. Business Ethics <ul><li>Top Management </li></ul><ul><li>Employees </li></ul><ul><li>Managers </li></ul><ul><li>Ethics Office </li></ul><ul><li>Outsiders </li></ul><ul><li>Enforcement </li></ul>
    14. 14. Levels of Corporate Social Responsibility Societal Responsibility Stakeholder Responsibility Profit Responsibility Owners/Stockholders General Public Customers Employees Suppliers/Distributors Ecological Environment Public Interest Groups Source: Marketing , 5/E by Berkowitz, Kerin, Hartley, and Rudelius.
    15. 15. Contributions to Charity (In Billions of Dollars)
    16. 16. New Philanthropy Source: Business Week , Dec. 2, 2002 Education $.75 Walton Family Education & Arts $1.045 Eli Broad Biomedical Research $1.5 James Stowers Conservation & Education $6.6 Gordon Moore Health & Education $25.6 Bill Gates Causes Estimated Total Given (in Millions Donor
    17. 17. Most Admired Companies by Industry <ul><li>Apparel Levi-Strauss </li></ul><ul><li>Airlines Southwest </li></ul><ul><li>Food Services McDonald’s </li></ul><ul><li>Food Products Campbell’s </li></ul><ul><li>Beverages Coca-Cola </li></ul><ul><li>Electronics Intel </li></ul>Industry Company Source: Fortune Magazine
    18. 18. <ul><li>Merck </li></ul><ul><li>Johnson & Johnson </li></ul><ul><li>Pfizer </li></ul><ul><li>Eli Lilly </li></ul><ul><li>IBM </li></ul><ul><li>Microsoft </li></ul><ul><li>Intel </li></ul><ul><li>Bank of America </li></ul><ul><li>$221.0* </li></ul><ul><li> 176.2 </li></ul><ul><li> 123.9 </li></ul><ul><li> 121.4 </li></ul><ul><li> 116.1 </li></ul><ul><li> 104.7 </li></ul><ul><li> 101.0 </li></ul><ul><li> 91.5 </li></ul>Corporate Annual Giving Source: The Taft Group * In Millions
    19. 19. Where Charitable Contributions Go (2001) In Billion $ Source: BusinessWeek . Dec. 2, 2002
    20. 20. Social Audit <ul><li>By Company </li></ul><ul><li>Outside Company </li></ul><ul><ul><li>Socially-Conscious Investors </li></ul></ul><ul><ul><li>Environmentalists </li></ul></ul><ul><ul><li>Union Officials </li></ul></ul><ul><ul><li>Customers </li></ul></ul>
    21. 21. International Ethics & Responsibility <ul><li>Ethics Not Unique To U.S.- Leaders Accountable </li></ul><ul><li>Demand for Socially Responsible Behavior </li></ul><ul><li>Inter-American Convention Against Corruption </li></ul>
    22. 22. Most Admired Global Companies (Outside of U.S.) <ul><li>Nokia Finland </li></ul><ul><li>Toyota Motor Japan </li></ul><ul><li>Sony Japan </li></ul><ul><li>Nestle’ Switzerland </li></ul><ul><li>Honda Motor Japan </li></ul><ul><li>BP Britain </li></ul><ul><li>Singapore Airlines Singapore </li></ul><ul><li>L’Oreal France </li></ul><ul><li>Royal Dutch/Shell Britain & Netherlands </li></ul><ul><li>Canon Japan </li></ul>Source: Fortune , March 4, 2002

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