Ethics1 - Nature of Business Ethics Nature Business ethics...

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Unformatted text preview: Nature of Business Ethics Nature Business ethics comprises the principles Business and standards that guide the behavior of individuals and groups in the world of business. business. Some of these standards have been Some codified as laws. Ethical Missteps Can be Costly Ethical Sometimes it is difficult to define the boundary Sometimes between legal and ethical issues. How will these gray areas be resolved? Lack of effective resolution can result in legal fines and/or damage to reputation. Even individuals who intend to act ethically may cross Even into an ethical gray area. into Some individuals will knowingly act unethically Implication: Need to manage the ethical climate Implication: of the organization. of Types of Ethical Issues Types Honesty and Fairness Conflicts of Interest Fraud Marketing Accounting Discrimination BUSINESS ETHICS ACROSS ORGANIZATIONAL FUNCTIONS ORGANIZATIONAL ACCOUNTING ETHICS FINANCIAL ETHICS Insider trading,illegal stock transactions MARKETING ETHICS Conflict of interest Advertising, product info INFORMATION TECHNOLOGY ETHIC Confidentiality SENIOR MANAGERS’ ETHICS SENIOR WHO COMPANY Yrs. CASE Bernard Ebbers WorldCom 25 Jamie Olis Dynegy 24 Timothy Rigas Andrew Fastow Adelphia 20 Enron 10 His role in acctng fraud that brought down company (2005) Scheme to falsify books and disguise $300m loan (2004) Fraud to loot company of 100’s of millions (2005) Disguising comp. financial health/fraud (2004) Influences on Ethical Decision Making Making Individual factors Organizational relationships Personal character and moral philosophies Stage of moral deveopment Influence of other members of the Influence organization (climate and culture) organization Opportunity Temptation and consequences METHODS OF ETHICAL REASONING REASONING UTILITARIAN Comparing benefits and costs Net benefits exceed net costs RIGHTS Respecting entitlements JUSTICE Distributing fair shares Basic human rights are respected Benefits and costs are fairly distributed Ethical Climate and Organization Culture Organization Organizational Culture Ethical Climate Managers/supervisors and peers model appropriate behaviors in each organization. CEO establishes ethical tone. ...
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This note was uploaded on 09/29/2011 for the course BUS 682 taught by Professor Staff during the Spring '11 term at S.F. State.

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