Chapter X

STRATEGY, ETHICS, AN SOCIAL RESPONSIBILITY

 

 I. What is Business Ethics?

bullet The application of general ethical principles and standards to business behavior
bullet Ethics:
bullet Involves the concepts of right and wrong, fair and unfair, moral and immoral.
bullet Business actions are judged by the general ethical standards of society, not by a special set of more permissive standards.

 

II. The Three Categories of Management Morality

bullet The moral manager:  Is dedicated to high standards of ethical behavior
bullet The immoral manager:  Is actively opposed to ethical behavior and ignores ethical principles in decision making
bullet The amoral manager -- Two types
bullet Intentionally amoral manager:  Believes business and ethics are not to be mixed
bullet Unintentionally amoral manager:  Careless to the fact that certain kinds of business decisions are unsavory or may have deleterious effects

 

III.  What are the Drivers of Unethical Strategies and Business Behaviors?

bullet Overzealous pursuit of personal gain, wealth and selfish interests
bullet Heavy pressures on company managers to meet or beat earnings targets
bullet Company cultures that put the bottom line ahead of ethical behavior

 

IV. Business Ethics in the Global Community

bullet Cross-Culture Variability in Ethical Standards:  Religious beliefs, historic traditions, social customs, and prevailing political end economic doctrines all affect what is deemed ethical or unethical in a particular society.
bullet The payment of bribes and kickbacks:  In many countries, it is customary to pay bribes to government officials to win government contracts, etc.
bullet See table 10.1, page 292 and 10.2, page 293.
bullet Note:  US companies are prohibited by the Foreign Corrupt Practices Act from paying bribes to government officials and others in all countries they do business with.

 

V. Approaches to Managing a Company's Ethical Conduct

bullet The unconcerned or nonissue approach: For them, ethics is a nonissue
bullet The damage control approach:  Make use of some 'window dressing' approach to ethics and their stance is one of hear no evil, speak no evil, see no evil.
bullet The compliance approach:  Emphasis is on securing broad compliance and measuring the degree to which ethical standards are upheld and observed
bullet The ethical culture approach:  Top executives believe that ethical principles must be deeply ingrained in the culture and function as guides for how things get done.

 

VI. Why Should Strategies be Ethical?

bullet Because a strategy that is unethical is morally wrong and reflects badly on the character of the company
bullet Because an ethical strategy is good business and in the self interest of the shareholders

 

VII. Strategy and Social Responsibility

bullet Social responsibility concerns a company's duty to operate by means that avoid harm to stakeholders and the environment and to consider the overall betterment of society in its decisions
bullet What is meant by social responsibility?
bullet Efforts to employ an ethical strategy
bullet Making charitable contributions, etc
bullet Protecting/enhancing the environment
bullet Creating a work environment that fosters the quality of life for employees
bullet Building a diverse workforce
bullet Linking Strategy and Social Responsibility
bullet The combination of socially responsible endeavors a company elects to pursue, to a great extent, defines its social responsibility strategy
bullet The moral case for social responsibility
bullet It is simply the right thing to do
bullet The business case for socially responsible behavior
bullet It generates internal benefits
bullet It reduces the risk of reputation damaging incidents
bullet It is in the best interests of shareholders

Next Steps:  Please review the PowerPoint Overview slides (1-30) for this chapter.  Then proceed to the Lecture Notes for chapter eleven.

 
Hosted by www.Geocities.ws

1