bu206w2scripts - BU206 Week 2 Powerpoint Scripts S1 Chapter...

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BU206 Week 2 Powerpoint Scripts S1 Chapter 2 S2 - Ethics are applied values: moral principles and values applied to social behavior. Specifically, for this class, the moral principles are applied to business behavior. Ethics are critical to the long-run viability of a business and to its stakeholders. As we know, the category of stakeholders includes customers, employees, the community and others. S3 Top management sets the ethical tone. Historically, many unethical decisions were made (low wages, poor working conditions, shoddy products, e.g.) because they enhanced short term profits and there was nothing there, be it moral outrage or a rule or law, to prevent the unethical behavior. Today, firms have an understanding not to behave unethically. But the great firms have an understanding of looking for truly ethical behavior. Setting unrealistic financial goals can often encourage unethical behavior….if the goals are unrealistic employees might believe they are encouraged to cut corners to boost earnings. Periodic evaluations will enhance ethical behavior by reminding employees of the importance of ethical behavior to the company. A strong code of conduct can create an ethical tone…ethical training does the same thing. Not only do they offer specifics of ethical conduct, but demonstrate that management believes that ethical behavior is important. A Corporate Compliance Program is the entire set of codes of conduct, training and other programs supported by a corporation. This would also include and ethics committee (to review behavior), and internal audits. When I was working with marketing in health care, we had to submit our television advertisements to an ethics committee for approval before we could air them. They would review ads in terms of fairness, accuracy and whether they complied with the overall spirit of the organization. We pulled an ad, on advice of the committee, because it used actors instead of actual patients. The Sarbanes-Oxley Act was legislation passed in reaction to the corporate scandals at the turn of the century (Enron, Tyco, Worldcom, e.g.). Among other things, it mandates that public companies set up confidential reporting mechanisms for suspected accounting fraud or other illegal activities. All of these programs together create a confidential Corporate Compliance Program S4 The text recaps two of the great scandals of the last decade: Enron and Mrck and its product, Vioxx. I encourage you to read those accounts. S5 Just because an action is legal, doesn’t make it ethical. For example, adultery is immoral…but it is legal; you don’t go to jail for adultery. Acting legally is, at most, a moral minimum.
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There are many “gray areas” in the law. What is “Deceptive advertising”, for example? Per product liability law, manufacturers have a duty to warn users of dangerous
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This note was uploaded on 09/10/2011 for the course BU 206 taught by Professor Rolfes during the Spring '11 term at Herzing.

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bu206w2scripts - BU206 Week 2 Powerpoint Scripts S1 Chapter...

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