StudentNotesETHICSandSOCIALR - Business 18: Introduction to...

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Business 18: Introduction to Business Law ( S.Spencer) “What you are thunders so loudly that I cannot hear what you say to the contrary” -- Ralph Waldo Emerson WHY BOTHER WITH ETHICS? We need to study business ethics to make better decisions for ourselves, the businesses we work for and the society we live it. Society as a Whole Benefits o Corporate compliance with the law is insufficient alone to ensure ethical conduct b/c the laws do not encompass all expressions of ethical behavior. (Corporate Social Responsibility Debate) STAKEHOLDER THEORY vs. PROFIT MAXIMIZATION THEORY People Feel Better o Studying ethical concepts and theories will help individuals define ethical conduct and learn to use a strategy or framework for making decisions. o Studying ethical concepts and theories helps us understand ourselves and others better. Unethical Behavior Can Be Very Costly o Corporations are in positions of power that allow them to do greater damage to others when they act unethically or socially irresponsibly. o Increased exposure to liability and the passage of onerous legislation controlling/ monitoring business activity. Civil and criminal actions . Congress passed the Sarbanes-Oxley Act of 2002 which increased penalties for corporate wrongdoers & established rules designed to deter and prevent future wrongdoing. Purpose of Statute : Encourage & enable corporate o Negative impact of public criticism on reputation and corps ability to earn profits. o Negative impact within the firm (Unethical environment may encourage even more unethical conduct on part of employees) Page 1 of 8
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Business 18: Introduction to Business Law ( S.Spencer) WHAT IS ETHICAL BEHAVIOR? We will examine FOUR ETHICAL THEORIES: 1. RIGHTS THEORY 2. JUSTICE THEORY 3. UTILITARIANISM 4. PROFIT MAXIMIZATION These four theories can be classified in two ways: Teleological Ethical Theories = Focus on the CONSEQUENCES of a decision Deontological Ethical Theories (“deeds”) = Focus on the DECISION itself. RIGHTS THEORY Encompasses a variety of ethical philosophies holding that certain human rights are fundamental and must be respected by other humans Focus is on each individual member of society and his/her rights Each of us faces a moral obligation not to harm the fundamental rights of others KANTIANISM Immanuel Kant Strict deontologist 18 th century philosopher Humans are moral actors free to make choices and are able to judge the morality of any action by applying his famous Categorical Imperative o “Act only on that maxim whereby at the same time you can will that it shall become a universal law.” In other words, we judge an action by applying it universally. For example: Borrowing money even though you know you will never
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This note was uploaded on 02/08/2010 for the course MANAGEMENT mgmt 375 taught by Professor Daniel during the Spring '10 term at University of Alabama in Huntsville.

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StudentNotesETHICSandSOCIALR - Business 18: Introduction to...

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