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Ethical Issues
Watch the movie “Margin Call”. In no more than three double
spaced typed written pages, analyze the business and ethical
issues involved in the business practices engaged in by the firm
in the movie as well as the individual characters. Be sure to
include a concise discussion of the ethical dilemmas involved,
the school of thought employed by the various characters,
consequences of the ethical decision made by the leaders of the
firm, alternative action the firm (and individual characters)
might have considered and the possible consequences of taking
a different course of action. Also include your opinion as to
what your recommendation would have been if faced with the
same circumstances, the reasons to support your
recommendation and the likely consequences of your
recommendation.
III. Categories of Ethical Dilemmas.
1.
Taking things that don’t belong to you
· Use postage meter to mail personal letters
· Exaggerate personal expenses
· Download music without paying
2.
Saying things you know are not true
· Telling a customer that there is a complete money back
guarantee when there may be a restocking charge
· Promising a rebate and not honoring it (Dell settlement in
2009 of claims by 46 States of deceptive practices-financing
promotions, rebate offers, tech support and repair policies)
· Telling a prospective buyer of a house that the neighborhood
is quiet (if it is not) so as not to lose the sale.
· Blaming others for your errors
3.
Giving or allowing false impressions
4.
Buying influence or engaging in conflict of interest
5.
Hiding or divulging information
· Not disclosing side effects discovered during testing of a new
drug.
6.
Taking unfair advantage
· Considering a credit card payment late if not received by
10:00 a.m.
7.
Committing personal decadence
· The office sponsored party resulting in intoxication which
causes injury to others.
8.
Perpetrating interpersonal abuse
9.
Permitting organizational abuse
10.
Violating rules
11.
Condoning unethical actions
· Failure to report a wrong
12.
Balancing ethical dilemmas – No right or wrong answer
· Downsizing-balancing effect on employees with right of
shareholders to receive a return on equity
Four schools of thought on ethical behavior for business based
on 2 questions:
i.
Whose interest does a corporation serve?
ii.
What is the best way to serve that interest?
(See Exhibit 2.2 from book below)
Policy question:
Best way to serve
Moral question:
interest is if the
Whose interest should
corporation is
corporation serve?
responsive to:
Inherence
Shareholders only
Shareholders only
Enlightened Self-Interest
Shareholders only
Larger society
Invisible Hand
Larger society
Shareholders only
Social responsibility
Larger society
Larger society
Schools of Thought Specifically
i.
The Inherence School (Milton Friedman Perspective)
A.
Serve shareholders
B.
Serve shareholders best by only looking out for shareholders –
avoid any social or political issues unless they benefit the
shareholders
ii.
The Enlightened Self‑Interest School
A.
Manager is responsible first to shareholders but serves them
best by being responsible to larger society
B.
Business value is enhanced if it is responsive to society’s needs
iii.
The Invisible Hand School
A.
Manager believes larger society should
be served but manager does that best by serving shareholders
first
B.
Do not become involved in political or social responsibility
issues – allow others to handle issues and they will comply
iv.
The Social Responsibility School
A.
Manager should serve larger society
B.
Become involved in all types of
political and social issues
C.
Encourage managers to be involved

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Ethical IssuesWatch the movie Margin Call”. In no more than .docx

  • 1. Ethical Issues Watch the movie “Margin Call”. In no more than three double spaced typed written pages, analyze the business and ethical issues involved in the business practices engaged in by the firm in the movie as well as the individual characters. Be sure to include a concise discussion of the ethical dilemmas involved, the school of thought employed by the various characters, consequences of the ethical decision made by the leaders of the firm, alternative action the firm (and individual characters) might have considered and the possible consequences of taking a different course of action. Also include your opinion as to what your recommendation would have been if faced with the same circumstances, the reasons to support your recommendation and the likely consequences of your recommendation. III. Categories of Ethical Dilemmas. 1. Taking things that don’t belong to you · Use postage meter to mail personal letters · Exaggerate personal expenses · Download music without paying 2. Saying things you know are not true · Telling a customer that there is a complete money back guarantee when there may be a restocking charge · Promising a rebate and not honoring it (Dell settlement in
  • 2. 2009 of claims by 46 States of deceptive practices-financing promotions, rebate offers, tech support and repair policies) · Telling a prospective buyer of a house that the neighborhood is quiet (if it is not) so as not to lose the sale. · Blaming others for your errors 3. Giving or allowing false impressions 4. Buying influence or engaging in conflict of interest 5. Hiding or divulging information · Not disclosing side effects discovered during testing of a new drug. 6. Taking unfair advantage · Considering a credit card payment late if not received by 10:00 a.m. 7. Committing personal decadence · The office sponsored party resulting in intoxication which causes injury to others. 8.
  • 3. Perpetrating interpersonal abuse 9. Permitting organizational abuse 10. Violating rules 11. Condoning unethical actions · Failure to report a wrong 12. Balancing ethical dilemmas – No right or wrong answer · Downsizing-balancing effect on employees with right of shareholders to receive a return on equity Four schools of thought on ethical behavior for business based on 2 questions: i. Whose interest does a corporation serve? ii. What is the best way to serve that interest?
  • 4. (See Exhibit 2.2 from book below) Policy question: Best way to serve Moral question: interest is if the Whose interest should corporation is corporation serve? responsive to: Inherence
  • 5. Shareholders only Shareholders only Enlightened Self-Interest Shareholders only Larger society Invisible Hand Larger society Shareholders only Social responsibility
  • 6. Larger society Larger society Schools of Thought Specifically i. The Inherence School (Milton Friedman Perspective) A. Serve shareholders B. Serve shareholders best by only looking out for shareholders – avoid any social or political issues unless they benefit the shareholders
  • 7. ii. The Enlightened Self‑Interest School A. Manager is responsible first to shareholders but serves them best by being responsible to larger society B. Business value is enhanced if it is responsive to society’s needs iii. The Invisible Hand School A. Manager believes larger society should be served but manager does that best by serving shareholders first
  • 8. B. Do not become involved in political or social responsibility issues – allow others to handle issues and they will comply iv. The Social Responsibility School A. Manager should serve larger society B. Become involved in all types of political and social issues C. Encourage managers to be involved