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  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics Levels at Which Ethical Issues May Be Addressed Personal Level Organizational Level Industry Level Societal and International Levels Personal and Managerial Ethics Principles Approach to Ethics Ethical Tests Approach Managing Organizational Ethics Factors Affecting the Organization’s Moral Climate Improving the Organization’s Ethical Climate Summary
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics
  • Chapter 8 Personal and Organizational Ethics

Transcript

  • 1. 0 Personal and Organizational Ethics Chapter 8 Prepared by Deborah Baker Texas Christian University 1Business and Society: Ethics and Stakeholder Management, 7e • Carroll & BuchholtzCopyright ©2009 by South-Western, a division of Cengage Learning. All rights reserved
  • 2. 0 Chapter 8 Learning Outcomes1. Understand the different levels at which business ethics may be addressed.2. Differentiate between consequence-based and duty-based principles of ethics.3. Enumerate and discuss principles of personal ethical decision making and ethical tests for screening ethical decisions.4. Identify the factors affecting an organization’s moral climate and provide examples.5. Describe and explain actions, strategies, or “best practices” to improve an organization’s ethical climate. 2
  • 3. 0 Chapter 8 Outline Levels at Which Ethics May Be Addressed Personal and Managerial Ethics Managing Organizational Ethics From Moral Decisions to Moral Organizations Summary Key Terms Discussion Questions 3
  • 4. 0 Introduction to Chapter 8 This chapter focuses on the day-to-day ethical issues that managers face Many managers have no training in business ethics or ethical decision making Ethics is vital to business success 4
  • 5. 0 Levels at Which Ethical Issues May Be Addressed Personal Situations faced in our personal Level lives outside the work contextOrganizational Workplace situations faced as Level managers and employees 5
  • 6. 0 Levels at Which Ethical Issues May Be Addressed Situations where a manager or Industry organization might influence Level business ethics at the industry level Local-to-global situationsSocietal and confronted indirectly as aGlobal Levels management team 6
  • 7. 0 Personal and Managerial Ethics Conventional approachResolving Ethical Principles approachConflicts Ethical tests approach 7
  • 8. 0 Types of Ethical PrinciplesTeleological Focus on the consequences or Theories results of the actions they produceDeontological Focus on duties Theories Aretaic Focus on virtue Theories 8
  • 9. 0 Principles Approach to Ethics Major Principles of Ethics Utilitarianism  Care Rights  Virtue ethics Justice  Servant leadership  Golden Rule 9
  • 10. 0 Principle of Utilitarianism Utilitarianism focuses on acts that produce the greatest ratio of good to evil for everyone Strengths Weaknesses Forces thinking about the  Ignores actions that may be general welfare and inherently wrong stakeholders  May come into conflict with Allows personal decisions to fit the idea of justice into the situation complexities  Difficult to formulate satisfactory rules for decision making 10
  • 11. 0 Kant’s Categorical Imperative Kant’s Categorical Imperative is a duty-based principle of ethics. A sense of duty arises from reason or rational nature. Formulations Act only on rules that you would be willing to see everyone follow. Act to treat humanity in every case as an end and never as a means. Every rational being is able to regard oneself as a maker of universal law. We do not need an external authority to determine the nature of the moral law. 11
  • 12. 0 Principle of RightsPrinciple of Rights focuses on examining and possibly protecting individual moral or legal rights 12
  • 13. 0 Principle of RightsFigure 8-1 13
  • 14. 0 Principle of Justice Principle of justice involves considering what alternative promotes fair treatment of peopleTypes of justiceDistributiveCompensatoryProceduralRawlsian 14
  • 15. 0 Ethical Due ProcessProcess Fairness2. Have employees been given input into the decision process?3. Do employees believe the decisions were made and implemented in an appropriate manner?5. Do managers provide explanations when asked? Do they treat others respectfully? Do they listen to comments being made? 15
  • 16. 0 Rawls’s Principles of Justice2. Each person has an equal right to the most basic liberties compatible with similar liberties for others3. Social and economic inequalities are arranged so that they are both: a) reasonably expected to be to everyone’s advantage and b) attached to positions and offices open to all 16
  • 17. 0 Ethic of Care and Virtue Ethics Principle of caring focuses on a person as a relational (cooperative) and not as an individual  Feminist theory Virtue ethics focuses on individuals becoming imbued with virtues  Aristotle and Plato 17
  • 18. 0 Servant Leadership Servant leadership focuses on serving othersfirst, such as employees, customers, and community 18
  • 19. 0 Servant Leadership Characteristics of Servant Leaders Listening Bridges Empathy Business Ethics Healing and Persuasion Leadership Awareness Foresight Conceptualization Commitment to the growth of people Stewardship Building community 19
  • 20. 0 The Golden Rule The Golden Rule focuses on the premise that you should do unto others as you would have them do unto you The Golden Rule is…2. accepted by most people3. easy to understand4. a win-win philosophy5. a compass when you need direction 20
  • 21. 0 Ethical Principles The Categorical Imperative  The Means-Ends Ethic The Conventionalist Ethic  The Might-Equals-Right Ethic The Disclosure Rule  The Organization Ethic The Golden Rule  The Professional Ethic The Hedonistic Ethic  The Proportionality Principle The Intuition Ethic  The Revelation Ethic The Market Ethic  The Utilitarian Ethic Figure 8-2 21
  • 22. 0 Reconciling Ethical Conflicts Concerns to be Addressed in Ethical Conflicts Obligations Ideals Effects 22
  • 23. 0 Guidelines for Conflicting Obligations, Ideals, and Effects When two or more moral obligations conflict, choose the stronger one When two or more ideals conflict, or when ideals conflict with obligations, honor the more important one When effects are mixed, choose the action that produces the greater good or less harm 23
  • 24. 0 Ethical Tests ApproachTest of Common SenseTest of One’s Best SelfTest of Making Something PublicTest of VentilationTest of the Purified IdeaBig Four (greed, speed, laziness, or haziness)Gag Test 24
  • 25. 0 Factors Affecting the Morality of Managers Society’s Moral Climate Business’s Moral Climate Industry’s Moral Climate Organization’s Moral Climate Superiors Individual One’s Personal Policies Situation Peers 25Figure 8-4
  • 26. 0 Factors Affecting the Organization’s Moral Climate1. Behavior of superiors2. Behavior of one’s peers in the organization3. Ethical practices of one’s industry or profession4. Society’s moral climate5. Formal organizational policy (or lack of one)6. Personal financial needFigure 8-5 26
  • 27. 0 Pressures Exerted on Employees by SuperiorsManagers feel under pressure to compromisepersonal standards to achieve company goals. Top management: 50 percent agreed Middle management: 65 percent agreed Lower management: 85 percent agreed 27
  • 28. 0 Questionable Organizational Climates Questionable Behaviors of Superiors or Peers Unethical acts, behaviors or practices Acceptance or legality as a standard of behavior Bottom-line mentality, expectations of loyalty and conformity Absence of ethical leadership Objectives and evaluation systems that overemphasize profits Insensitivity toward how subordinates perceive pressure to meet goals Inadequate formal ethics policies 28 Amoral decision making Figure 8-6
  • 29. 0 Improving the Ethical Climate Board of Directors’ Ethics Audits and Oversight Risk Assessments Ethics Programs and Officers Effective Communication Realistic Top Objectives Management Leadership Ethics Training Ethical Decision- Moral Making Processes Management Corporate Transparency Codes of Conduct Discipline of Whistle-Blowing Violators Mechanisms 29Figure 8-7
  • 30. 0 Pillars of Leadership Ethical Leadership Role Traits Modeling Moral ManagerMoral Person Ethics Behaviors Communication Decision Effective Rewards Making and Discipline 30
  • 31. 0 Ethical Leadership Characteristics Ethical Leadership Characteristics Articulate and embody the purpose and values of the organization Focus on organizational success rather than on personal ego Find the best people and develop them Create a living conversation about ethics, values, and value for stakeholders Create mechanisms of dissent Take a charitable understanding of others’ values Make tough calls while being imaginative Know the limits of the values and ethical principles they live Frame actions in ethical terms Connect the basic value proposition to stakeholder support 31 and societal legitimacy
  • 32. 0 Effective Communication Candor Fidelity Confidentiality 32
  • 33. 0 Features of Ethics Programs Written standards of conduct Ethics training Mechanisms to seek ethics advice or information Methods for reporting misconduct anonymously Disciplinary measures for employees who violate ethical standards Inclusion of ethical conduct in the evaluation of employee performance 33
  • 34. 0 Key Elements for Ethics Programs Compliance standards High-level ethics personnel Avoidance of delegation of undue discretionary authority Effective communication Systems for monitoring, auditing, and reporting Enforcement Detecting offenses, preventing future offenses Keeping up with industry standardsFigure 8-8Source: U.S. Sentencing Commission Guidelines 34
  • 35. 0 Ethical Decision-Making ProcessFigure 8-9 35
  • 36. 0 Ethics Check1. Is it legal?2. Is it balanced?3. How will it make me feel about myself? 36
  • 37. 0 Texas Instruments Ethics Quick Test1. Is the action legal?2. Does it comply with our values?3. If you do it, will you feel bad?4. How will it look in the newspaper?5. If you know it’s wrong, don’t do it.6. If you’re not sure, ask.7. Keep asking until you get an answer. 37
  • 38. 0 Sears’ Guidelines1. Is it legal?2. Is it within Sears’ shared beliefs and policies?3. Is it right / fair / appropriate?4. Would I want everyone to know about this?5. How will I feel about myself? 38
  • 39. 0 Benefits of Ethics Codes1. Legal protection for the company2. Increased company pride and loyalty3. Increased consumer / public goodwill4. Improved loss prevention5. Reduced bribery and kickbacks6. Improved product quality7. Increased productivity 39
  • 40. 0 Content of Codes of Conduct Employment practices Employee, client, and vendor information Public information / communications Conflicts of interest Relationships with vendors Environmental issues Ethical management practices Political involvement 40
  • 41. 0 How Codes of Conduct Influence Behavior Codes of Conduct act as a…1. Rule book 1. Shield2. Signpost 2. Smoke detector3. Mirror 3. Fire alarm4. Magnifying glass 4. Club 41
  • 42. 0 Purposes of Ethics Training1. Increase the manager’s sensitivity to ethical problems2. Encourage critical evaluation of value priorities3. Increase awareness of organizational realities4. Increase awareness of societal realities5. Improve understanding of the importance of public image6. Examine the ethical facets of business decision making7. Bring about a greater degree of fairness and honesty in the workplace8. Respond more completely to the organization’s social responsibilities 42
  • 43. 0 Corporate Transparency A quality, characteristic, or state in which activities, processes, Corporate practices, and decisions that takeTransparency place in companies become open or visible to the outside world. 43
  • 44. 0 Board of Director Leadership and Oversight The 2002 Sarbanes-Oxley Act Companies are required to protect whistle-blowers without fear of retaliation It is a crime to alter, destroy, conceal, cover up, or falsify documents to prevent its use in a federal government lawsuit 44
  • 45. 0 From Moral Decisions to Moral Organizations Moral Decisions Moral Managers Moral OrganizationsFigure 8-10 45
  • 46. 0 Key Terms Aretaic theories  Moral rights Categorical imperative  Negative right Codes of conduct  Opacity Codes of ethics  Positive right Compensatory justice  Principle of justice Corporate transparency  Principle of rights Deontological theories  Principle of utilitarianism Distributive justice  Procedural justice Ethic of care  Rights Ethical due process  Risk assessments Ethical tests  Servant leadership Ethics audits  Teleological theories Ethics officer  Transparency Ethics programs  Utilitarianism Golden Rule  Virtue ethics Legal rights 46