Transcript Marketing

Chapter 17
BUSINESS ETHICS
AND SOCIAL
RESPONSIBILITY
McGraw-Hill/Irwin 2010
Modified by Jackie Kroening 2011
What is Ethics
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* Ethics expresses the standards of
conduct and morals (right and wrong) in
companies and societies.
Morality deals with how behavior should
conform to cultural ideals of right and
wrong.
Morality represents broadly based,
mostly unwritten standards of behavior.
Ethics is more precise and is often
based on written guidelines.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
What is Ethics
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Ethical standards are different from law.
Ethics violations are not always
punishable.
It is difficult to pin down ethics violations
and what the penalties for such violations
should be.
A common perception is ‘business’ and
‘ethics’ can hardly be used in the same
sentence.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
What is Ethics
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Misperceptions that affect
understanding of ethics:
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All ethical problems have simple solutions
in which right and wrong are always
obvious.
Ethics is simply a matter of complying with
a set of rules or regulations.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
What is Ethics
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Ethics and the Internet
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A sticky ethical issue is how to behave
ethically on the Internet?
Companies track employee usage,
looking for personal misuse of company
property.
The Internet has introduced enormous
compliance issues.
Online merchants purchase confidential
information about people’s buying
habits.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
What is Ethics
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Ethics and the Internet (cont.):
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Consumers resent personal
information being sold without
consent.
Due to technology, people don’t know
what the ethics issues are.
Another issue is copyright
infringement.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Codes of Ethics
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Some companies have developed
specific ethical codes.
Codes of ethics are usually based on one
of the following ethical approaches:
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Principles of justice
Individual rights
Utilitarianism
Individualism
The categorical imperative
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Codes of Ethics
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* Principle of justice – All decisions
should be consistent, unbiased, and
based on fact.
Principle of individual rights – All
decisions should respect basic human
rights and the dignity of the individual.
Principle of utilitarianism – All decisions
should do the greatest good for the
largest number of people.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Codes of Ethics
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Principle of individualism – All primary
goals should achieve long-term selfinterests.
Categorical imperative – A principle
developed by Immanuel Kant, which
asks, “What would the world—or my
company—be like if everyone were to
do this?”
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Rationalizing Unethical Behavior
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Even people with a good knowledge of
ethics can rationalize unethical
behavior.
People with high self-esteem are less
likely to seek the short-term gains of
unethical behavior and not engage in
rationalization.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
* Rationalizing Unethical Behavior
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According to Saul Gellerman, unethical
behavior starts with one of these four
rationalizations:
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Unethical behavior is within ethical/legal limits.
Because the chosen behavior will work best for
the individual/ company, the company would
expect it.
Nobody will notice.
As the behavior helps the company, it will protect
the person if he/she is caught.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Ethics in Context
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An ethical issue is people acting insincerely
with others to achieve their own ends.
Politics exists in any company; gaining
political power isn’t an unethical behavior.
When people compromise on integrity to
succeed at getting ahead, it crosses an
ethical line.
A common view is that boss massaging is
necessary for success.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
The Influence of Group Goals
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When encountering someone in need of
help, many people look the other way as
their goals or group’s pressures override
the need to help.
This creates conflict, as people are unable
to transfer helping behavior they learn at
home to the workplace.
Many people change their ethical
standards between home and work.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Global Ethics Issues
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A historical perspective
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The values and customs of other countries
are not inferior, primitive, or degraded.
They have different origins, evolutions, and
applications through history.
Discussion example: Acceptance of bribery
and kickbacks
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Global Ethics Issues
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Three concepts to remember while doing
business with foreign companies:
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Inner circle – Clique of trusted family/tribal
members/friends who are at the center of power/
influence.
Future favors – Based upon mutual obligation, and
resulting in the exchange of favors; common in
developing countries and also used in some
industrialized countries.
Gift exchange – A strong tradition in many cultures
in which giving gifts create a future obligation to
the receiver.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Social Responsibility
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* Social responsibility means putting
ethical standards to work in all areas of
the global community in which one lives.
It includes acting ethically with
customers, co-workers, suppliers,
competitors, and the community in
which one lives.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Social Responsibility
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Three accepted views of social
responsibility:
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Traditional social responsibility – An
organization is responsible only to itself
and to making a profit.
Stakeholder social responsibility –
Companies are responsible to
stakeholders.
Affirmative social responsibility –
Companies are also responsible to the
general public at large.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Social Responsibility
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Difficult questions regarding social
responsibility:
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What happens when a company can no longer
afford to support charities or organizations?
How does a company choose to support specific
organizations while not helping others?
Companies may also find that their acts of social
responsibility are misunderstood and resented.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Blowing the Whistle
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Whistleblowing
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* Turning in or otherwise exposing people
who behave unethically in a company.
The first law passed to protect
whistleblowers was the Lloyd–LaFollette
Act of 1912.
The Whistleblower Protection Act was
passed in 1989 and strengthened in 1994.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Blowing the Whistle
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Strategies for a whistleblower:
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Secretly threatening the offender with blowing the
whistle unless the unethical action is
stopped/corrected.
Anonymously blowing the whistle within the
company, keeping one’s identity a secret.
Secretly threatening a responsible manager of
blowing the whistle outside the company unless a
change is made in the conduct.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Blowing the Whistle
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Strategies for a whistleblower (cont.):
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Sabotaging the results of an unethical
behavior in some way.
Publicly blowing the whistle within the
organization.
Quietly refusing to carry out an unethical
plan.
Secretly or publicly blowing the whistle
outside the company.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Blowing the Whistle
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Top management is in an ideal position to
create an ethical environment.
Management can create low ethical
standards by the following mistakes:
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Favoritism.
“Fudging” with the expense budget.
Lying to or otherwise manipulating other
departments or offices within one’s company.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Strategies for Success
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Making ethical decisions: A quick
ethics test from Texas Instruments:
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Is it legal?
Is it consistent with the company’s
stated values?
If you do it, will you feel bad?
How would it look in the newspapers?
Do you think it’s wrong?
If you’re not sure—ask.
If you don’t get a clear answer, keep
asking until you do.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011
Strategies for Success
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Becoming culturally aware of ethical
conduct:
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Look closely at the situation.
Evaluate the intentions.
Explore your options.
Parts taken from Human Relations 4ed
Modified by Jackie Kroening 2011