LAWS310_Lectures - Week 1 Business Ethics Lecture...

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Week 1: Business Ethics - Lecture Help JavaScript is required for your course. Please ensure JavaScript is enabled in your browser preferences. Print This Page Business and Ethics Business Ethics What Business Ethics Covers Ethical Approaches Corporate Power and Corporate Critics Corporate Duty? Adelphia, ENRON, Arthur Andersen, Bristol-Myers Squibb, CMS energy, Duke energy, Global Crossing, Halliburton,, Kmart, Merck, Mirant, Peregrine Systems, Qwest Communications International, Reliant Energy, Tyco, WorldCom and Xerox. What do these corporations have in common? They have all been investigated for corporate accounting misconduct by the SEC since 2002. Many people have asked if corruption is endemic in the business world, because of the huge impact such recent misconduct has had on the reputation of American business. Given the concerns raised by the apparent widespread failure of corporate management to ensure their companies adhered to principles of integrity, we should start our consideration of business and the law with an examination of business ethics. We will consider how compatible honesty is with the coporate "ideals" of profit and what the implications of such analysis might be for the American corporation under the law. Business Ethics Business ethics is a relatively new, but increasingly important, part of business today. The question, or problem, is this: A business is expected to achieve its objectives, usually to make a decent profit for the owners/shareholders. In doing so, it may need to overlook the wishes of others. For example, it could lie about the benefits of its products in order to get more revenue. It could skip important safety checks to save costs. What should the business do? To some extent, this is an area already covered by Business Law. When society largely agrees, a law can be passed to stop the behavior of which the society disapproves. For example, discrimination against women is illegal (it wasn’t always so). What Business Ethics Covers Business ethics looks at areas that are too new, or too controversial, for society to agree on. For example, the medical business is increasingly controversial. The pharmaceutical businesses concentrate their (very
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expensive) research on illnesses that afflict rich people, because rich people (or the government of a rich country) can afford to buy these new treatments when they are launched on the market. This means too little research is done into illnesses (like malaria) that primarily affect poor people and poor governments. Is this right? So, we can have profit-maximizing businesses that don’t worry too much about who gets in their way; or we can have ethical businesses that are careful with people who get in their way, but don’t make much profit. This is the contrast, the trade-off with which we are faced. Or is it? Increasingly, there is thought about a middle way. Consumers in developed countries are
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LAWS310_Lectures - Week 1 Business Ethics Lecture...

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