Chapter Four

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Chapter Four
Demonstrating Ethical Behavior Social
Responsibility
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Ethics Check Questions

• Is It Legal?
• Is It Balanced?
• How Will It Make Me Feel About Myself?

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Factors That Cause WorkersTo Act Unethically

• Pressure to meet sales, budget or profit goals
• Lack of recognition
• Personal financial worries
• Balancing work family
• Poor communication

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Top Five Unethical/IllegalBehaviors of Workers

• Cut corners in quality control
• Covered up incidents
• Abused or lied about sick days
• Lied to or deceived customers
• Put inappropriate pressure on others

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Fostering Ethical Behavior

• Leadership
• Codes of Conduct
• Compliance-based
• Integrity-Based
• Social Audits
• Whistle Blowing

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Factors Influencing Managerial Ethics
Individual
Organizational
Environmental

• Values

• Competition
• Economic Conditions
• Social/Cultural Institutions

• Top Level Mgmt. Philosophy
• The Firms Reward System
• Job Dimensions

• Work Background

• Family Status

• Personality

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Business Mission Statement

• Why?
• What?
• How?

• Our mission is to show people how they can use
  the power of their bodies and minds to make their
  lives better. You can do it, we say on every
  page of our magazines and books.-Ardath Rodale,
  Rodale Publishing

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Business Mission Statement

• Our mission is to be the world leader in Customer
  Service, innovation and product value in the Hand
  Tool industry. We will accomplish this by
  fostering an environment that allows our people
  to produce quality hand tools on time and meet
  business growth needs through employee excellence
  and development.- Western Forge

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Business Ethics Social Responsibility

• Ethics- Values/Principles
• Responsibility- Consequences of Actions

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Ethical Decision Resolved Through

• Religious Teachings
• Individual Rights
• Legislation
• Court Decisions

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Classifying Business Decisions
Ethical
Ethical and Legal
Ethical but Illegal
Unethical and Illegal
Unethical but Legal
Unethical
Illegal
Legal
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Steps to Improve U.S. Business Ethics

1. Top Management
2. Employees
3. Managers

1. Ethics Office
2. Outsiders
3. Enforcement

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Three Levels of Social Responsibility
Societal Responsibility
Stakeholder Responsibility
Profit Responsibility
Ecological Environment
General Public
Customers
Employees
Owners/Stockholders
Suppliers/Distributors
Public Interest Groups
Source Marketing, 5/E by Berkowitz, Kerin,
Hartley, and Rudelius.
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Responsibility to Employees

• Working Conditions
• Equal Employment Opportunity
• Affirmative Action
• Diversity Training

• Economic Security
• Child Care/Parental Leave
• Employee Dignity
• Conflict of Interest

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What Concerns WorkersMost on the Job?
Percent

• Hazardous Materials 23
• Injury 20
• Repetitive job motions 10
• Poor ventilation 7
• HIV/Aids 6

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Responsibility to Customers/Environment

• Right To Safety
• Right To Be Informed
• Right To Choose

• Right To Be Heard
• Quality Of Life
• Ecology/Pollution

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Responsibility to Society, Investors, Suppliers

• Fairness
• Honesty
• Timely Action
• Appropriate Compensation
• Philanthropy

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Why People Volunteer

• Total is more than 100 because respondents could
  give more than one reason.

Percent of Respondents
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Contributions to Charity(In Billions of Dollars)
Source Forbes Dec. 15, 1997
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New Economy New Philanthropy
In Billions
Source Business Week, Mar. 13, 2000
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Corporate Annual Giving

• Merck
• Johnson Johnson
• Pfizer
• Eli Lilly
• IBM
• Microsoft
• Intel
• Bank of America

• 221.0
• 176.2
• 123.9
• 121.4
• 116.1
• 104.7
• 101.0
• 91.5

Source The Taft Group
In Millions
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Most Admired Companies by Industry
Industry
Company

• Apparel Levi-Strauss
• Airlines Southwest
• Food Services McDonalds
• Food Products Campbells
• Beverages Coca-Cola
• Electronics Intel

Source Fortune Magazine
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International Ethics Social Responsibilities

• U.S. not unique
• Japan/S. Korea/China influence peddling
• Mexico child labor
• Leaders being held to new/higher standards
• Chinese prison labor
• McDonalds using rain forest land for cattle
  grazing