Management

Place Slide Title Text Here
JOHN R. SCHERMERHORN, JR.

MANAGEMENT
12 Edition
th
Chapter 3
Ethical Behavior and

Social Responsibility
©2013 John Wiley & Sons, Inc. All rights reserved. 3-1
1-1
Place Slide TitleFoxconn
Text Here
& Apple
Place Slide
Planning Title Text
Ahead Here 3 Study Questions
— Chapter
1. What is ethical behavior?

2. How do ethical dilemmas complicate the
workplace?
3. How can high ethical standards be maintained?
4. What is social responsibility and governance?
Place Slide Title Text
Chapter Here Dashboard
3 Learning
1. What is ethical behavior?

1. Laws and values as determinants of ethical behavior
2. Alternative views of ethics
3. Cultural issues in ethical behavior
2. Ethics in the workplace
1. Ethical dilemmas at work
2. Influences on ethical decision making
3. Rationalizations for unethical behavior
Chapter Here Dashboard
3 Learning
3. Maintaining High Ethical Standards
1. Ethics training
2. Codes of ethical conduct
3. Moral management
4. Whistleblower protection
4. Social Responsibility
1. Stakeholder management
2. Perspectives on corporate social responsibility
3. Evaluating corporate social performance
4. Corporate governance
Takeaway Here
1: What Is Ethical Behavior?
• Ethics
– Moral code of principles.
– Set standards of “good” or “bad” or “right” or
“wrong” in one’s conduct.
• Ethical behavior
– What is accepted as good and right in the context
of the governing moral code.
Study Question 1: What is ethical behavior?
 Law, values, and ethical behavior:

 Legal behavior is not necessarily ethical
behavior.
 Personal values help determine
individual ethical behavior.
 Values broad beliefs
¡ Terminal values
¡ Instrumental values
Management 10/e - Chapter4 7

 Law, values, and ethical behavior:

 Values
 underlying beliefs and attitudes that help
determine individual behavior
1. Terminal values - preferences about desired
ends (Freedom, Security, happiness, An
exciting life…)
2. Instrumental values – preferences regarding
the means to desired ends (At Duke about 10%
of an MBA class was caught cheating on a
take-home final exam.)
Figure 3.1: Four views of ethical behavior
Place Slide Title
Takeaway 1:Text
What Here
Is Ethical Behavior?
• Four alternative ethical views

– Utilitarian
• Delivers the greatest good to the most people
– Individualism
• Advances long-term self-interests
– Moral rights
• Maintains fundamental rights of all human beings
Place Slide Title 1:
Takeaway Text Here
What Is Ethical Behavior?
– Justice view of ethics

• Fair and impartial treatment of people according to
legal rules and standards
– Procedural justice – policies and rules fairly applied
– Distributive justice – equal treatment for all people
– Interactional justice – people treated with dignity and
respect
– Commutative justice – fairness to all involved
1. Utilitarian view of ethics

• greatest good to the greatest number of people.
2. Individualism view of ethics
1. primary commitment is to one’s long-term self-interests.
¡ Moral-rights view of ethics
1. respects and protects the fundamental rights of all
people.
¡ Justice view of ethics
• fair and impartial treatment of people according to legal
rules and standards.
¡ Procedural justice – policies and rules fairly applied
¡ Distributive justice – equal treatment for all people
¡ Interactional justice – people treated with dignity and respect
¡ Commutative justice – fairness to all involved

Place Slide Title 1:
Takeaway Text Here
What Is Ethical Behavior?
• Cultural issues in ethical behavior:

– Cultural relativism
• Ethical behavior is always determined by cultural
context.
– Moral absolutism
• Behavior unacceptable in one’s home environment
should not be acceptable anywhere else.
– Ethical imperialism
• Imposing one’s ethical standards on others.
Management 12e/ ©2013 John Wiley & Sons, Inc. All rights reserved. 13 3-13
The extremes of cultural relativism and ethical

imperialism in international business ethics.
Takeaway Here
2: Ethics in the Workplace
• An ethical dilemma
– occurs when choices, although having potential
for personal and/or organizational benefit, may
be considered unethical.
Ethical Dilemmas
 Most ethical dilemmas involve a
conflict between the interests of
different groups or between the
needs of the individual versus the
needs of the organization.
 Managers can use various
approaches based on norms and
values to help them make ethical
decisions.
Management 8/e - Chapter 3 16

Hypothetical Dilemma - 1
 A runaway trolley is heading down the

tracks toward five unsuspecting people.
You are standing near a switch that will
divert the trolley onto a siding, but there
is a single workman on the siding who
cannot be warned in time to escape and
almost certainly will be killed. Would you
throw the switch?
Management 10/e – Chapter 4 17

Hypothetical Dilemma - 2
 Now, what if the workman is standing on

a bridge over the tracks and you have to
push him off the bridge to stop the
trolley with his body in order to save the
five unsuspecting people? (Assume that
his body is large enough to stop the
trolley, and your is not)
 Would you push the man, even though
he almost certainly will be killed?

Hypothetical Dilemma – Time
magazine’s reader’s poll
 97% of respondents said they could

throw the switch.
 But only 42% said they could actually
push the man to his death.

Hypothetical Dilemma – Harvard
Business Review
1. The minister of a foreign nation asks you to pay a
200,000 consulting fee. In return for the money,
the minister promises special assistance in
obtaining a 100 million contract that would
produce at least a 5 million profit for your
company. Would you pay the consulting fee?
2. You learn that a competitor has made an important
scientific discovery. It will reduce your profit for
about a year. Would you hire one of the
competitor’s employees who knows the details of
the discovery?

Hypothetical Dilemma – Harvard
Business Review
1. 42% would refuse to pay; 22% would

pay but consider it unethical; 36%
would pay and consider it ethical in the
foreign context.
2. 50% hire the person and 50% would
not.

Harvard Business Review –
common unethical requests from bosses
 Supporting incorrect report.

 Signing false document.
 Overlooking boss’s wrongdoings
 Doing business with boss’s friends

Takeaway Here
• Ethical dilemmas include:
Checklist for Here
ethical dilemmas
Takeaway Here
• Influences on Ethical Decision Making

– Ethical framework
• Provides personal rules or strategies for ethical
decision making
• Includes personal values
– Honesty
– Fairness
– Integrity
– Self-respect
Place Slidestages
Kohlberg’s Title Text Here moral development
of individual
Takeaway Here
• Situational Context and Ethics Intensity

– Will the situation pose an important ethic
challenge?
• Magnitude of the situation
• Risk of immediate harm
• Proximity and concentration of harm
• Social consensus
Takeaway Here
• Organizational Culture
– What is considered ethical behavior within the
organizational context?
• What are the expectations of management?
• What are the expectations of co-workers?
• Is there a code of ethics?
Takeaway
Place Slide 2: Ethics
Title Text Herein the Workplace
• External environment
Takeaway Here
• Ethical behavior can be rationalized by

convincing yourself that:
Takeaway Here
• Ethical behavior can be rationalized by

convincing yourself that:
PlaceTakeaway
Slide Title Text Here
3: Maintaining High Ethical Standards
•Moral Management
Managers behave in one of three
ways
PlaceTakeaway
• Ethics training:
– Structured programs that help participants to
understand ethical aspects of decision making. Give
people moral courage to do what is right.
– Helps people incorporate high ethical standards into
daily life. (holistic people)
– Helps people deal with ethical issues under pressure.
Avoid the four common rationalization for unethical
behavior that were discussed earlier.
PlaceTakeaway
• Codes of Ethical Conduct

– Formal statement of an organization’s values and
ethical principles regarding how to behave in
situations susceptible to the creation of ethical
dilemmas
PlaceTakeaway
• Areas often covered by codes of ethics:
Toward Customers
• False or deceptive sales

practices
• Submitting misleading invoices
• Fabricating product quality data
Management 8/e - Chapter 3 36

PlaceTakeaway
• Whistleblowers
– Expose misdeeds of others to:
• Preserve ethical standards
• Protect against wasteful, harmful, or illegal acts
– Laws protecting whistleblowers vary
PlaceTakeaway
• Barriers to whistleblowing include:

– Strict chain of command
– Strong work group identities
– Ambiguous priorities
Place SlideResponsibility
4: Social Title Text Here
&Corporate Governance
• Sustainability:
– A better quality of life for everyone now and for
generations to come.
– acting in ways that support a high quality of life
for present and future generations
• Alternative energy
• Recycling
• Waste avoidance
Place SlideTakeaway
Title Text HereResponsibility
4: Social
• Corporate social responsibility (CSR) and

governance:
– Looks at ethical issues on the organization level.
– Obligates organizations to act in ways that serve
both its own interests and the interests of society
at large.
Place SlideTakeaway
Title Text HereResponsibility
4: Social
• Stewardship
– Taking personal responsibility to always respect
and protect the interests of society at large
– Triple bottom line
– 3 P’s of organizational performance – profit,
people, and planet
Takeaway HereResponsibility
4: Social
• Stakeholder Management
– Stakeholders: persons, groups, and other organizations directly
affected by the behavior of the organization and holding a
stake in its performance.
– Stakeholder power: the capacity of the stakeholder to
positively or negatively affect the operations of the
organization.
– Demand legitimacy: the validity and legitimacy of a stakeholde
r’s interest in the organization.
– Issue urgency: the extent to which a stakeholder’s concerns
need immediate attention.
Figure 3.4: The Many Stakeholders of Organizations
Harvard Business Review –
common unethical requests from bosses
 Supporting incorrect report.

 Signing false document.
 Overlooking boss’s wrongdoings
 Doing business with boss’s friends

4: Social
• Perspectives on social responsibility:

– Classical view of CSR
• Management’s only responsibility is to maximize
profits.
– Socioeconomic view of CSR
• Management must be concerned for the broader
social welfare, not just profits.
4: Social
• Perspectives on social responsibility:

– Shared value view of CSR
• Approaches business decisions with the understanding
that economic and social progress are interconnected
• Virtuous circle-socially responsible behavior improves
financial performance which leads to more
responsible behavior
4: Social
Study Question 4: What is social responsibility and
governance?
 Arguments  Arguments in favor

against social of social
responsibility: responsibility:
 Reduced business
profits  Adds long-run profits
 Higher business costs  Improved public image
 Dilution of business  Avoids more
purpose
government regulation
 Too much social
power for business  Businesses have
 Lack of public resources and ethical
accountability obligation

Four strategies of corporate social responsibility—from
obstructionist to proactive behavior.
governance?
 Strategies for pursuing social

responsibility:
1. Obstructionist — meets economic
responsibilities.
2. Defensive — meets economic and legal
responsibilities.
3. Accommodative — meets economic, legal,
and ethical responsibilities.
4. Proactive — meets economic, legal,
ethical, and discretionary responsibilities.

governance?
 Corporate governance:
 The oversight of the top management of an
organization by a board of directors.
 Corporate governance involves:

l Hiring, firing, and compensating the CEO.
l Assessing strategy.
l Verifying financial records.

4: Social
• How government influences organizations:

– Businesses required by law to have boards of
directors that are elected by stockholders
governance?
 How government influences

organizations:
 Common areas of government
regulation of business affairs:
¡ Occupational safety and health
¡ Fair labor practices
¡ Consumer protection
¡ Environmental protection

Figure 3.6: Ethics Self-governance in Leadership and the
Managerial Role

Summary
 What is ethical behavior?

 How do ethical dilemmas complicate
the workplace?
 How can high ethical standards be
maintained?
 What is social responsibility and
governance?

Management

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Management

Uploaded by

Copyright:

Available Formats

Place Slide Title Text Here

JOHN R. SCHERMERHORN, JR.

Ethical Behavior and

1. What is ethical behavior?

1. What is ethical behavior?

 Law, values, and ethical behavior:

Management 10/e - Chapter4 7

 Law, values, and ethical behavior:

Figure 3.1: Four views of ethical behavior

• Four alternative ethical views

– Justice view of ethics

1. Utilitarian view of ethics

Management 10/e - Chapter4 12

• Cultural issues in ethical behavior:

The extremes of cultural relativism and ethical

Management 8/e - Chapter 3 16

 A runaway trolley is heading down the

Management 10/e – Chapter 4 17

 Now, what if the workman is standing on

Management 10/e – Chapter 4 18

 97% of respondents said they could

Management 10/e – Chapter 4 19

Management 10/e – Chapter 4 20

1. 42% would refuse to pay; 22% would

Management 10/e – Chapter 4 21

 Supporting incorrect report.

Management 10/e – Chapter 4 22

• Ethical dilemmas include:

• Influences on Ethical Decision Making

• Situational Context and Ethics Intensity

• Ethical behavior can be rationalized by

• Ethical behavior can be rationalized by

• Codes of Ethical Conduct

• Areas often covered by codes of ethics:

• False or deceptive sales

Management 8/e - Chapter 3 36

• Barriers to whistleblowing include:

• Corporate social responsibility (CSR) and

 Supporting incorrect report.

Management 10/e – Chapter 4 44

• Perspectives on social responsibility:

• Perspectives on social responsibility:

 Arguments  Arguments in favor

Management 10/e - Chapter4 48

 Strategies for pursuing social

Management 10/e - Chapter4 50

 Corporate governance involves:

l Verifying financial records.

Management 10/e - Chapter4 51

• How government influences organizations:

 How government influences

Management 10/e - Chapter4 53

Management 10/e - Chapter4 54

 What is ethical behavior?

Management 10/e - Chapter4 55

You might also like