Chapter 2

• Legal regulation
• Professional codes of ethics
• Codes of ethics from business organizations
• Individual values

• NBES
• National Business Ethics Survey

• Public Education and Family Structure
• Economic Independence
• News Media and the Internet

Business and industry have developed codes of ethics to self regulate within business organizations.

• The Wealth of Nation's written in 1700's by Adam Smith
• What is it that makes us care about the fortune of others?
• What is morality?
• What are ethics?
• How are morality and ethics similar?
• How do ethics relate to law?
• What are the major ethical systems?
• How do these systems apply to business decision making?

• Morality: is the collection of values that guide our behavior.
• Ethics: A systematic statement of right and wrong together with a philosophical system that both justifies and necessitates rules of conduct.
• the Good: in philosophy the moral goals and objectives that people choose to pursue.

Ethical values are ultimately superior to law in ensuring responsible business behavior. i.e. price gouging is considered unethical.

Formalism & Consequentialism

• Formalism: an approach to ethics that affirms an absolute morality. A duty-based view of ethics.
• Duty: moral obligation not to lie. Duty not to lie, duty not to divulge confidences.
• Categorical imperative: (Kant) you have a moral duty to ADT in the way you believe everyone should act.
• Social contract theory:(Rawls) "veil of ignorance" means to think ethically you must lose the assumption that what you personally need or want is necessarily morally correct.

• Consequentialism:  concerns itself with the moral consequences of actions rather than with the morality of the actions themselves.
• Utilitarianism: judges actions by usefulness, by whether they serve to increase the common good. Does the end justify the means?
• Protestant ethic: honesty and keeping promises.

• Legal regulation
• Professional codes of ethics
• Organizational codes of ethics
• Individual values

• Liberty and rights: rights and liberty of others
• Good Faith: honesty in intent & honesty in fact
• Due care: the common good, exercise due care, negligence.
• Confidentiality: the legal requirement of honoring confidentiality appears in agency law generally and in the professional-client relationship in particular.
• Conflicts of interest: attempt to serve 2 masters, no agent or employee of one principal can secretly work for another whose interest competes with that of the first.

Self-regulation: business code of conduct.

• Fundamental honesty and adherence to the law
• Product safety and quality
• Health and safety in the workplace
• Conflicts of interest
• Fairness in selling/marketing practices
• Financial reporting
• supplier relationships
• Pricing, billing, and contracting
• Trading in securities/using inside information
• Payments to obtain business/Foreign Corrupt Practices Act
• Ac querying and using information about others
• Security
• Political activities
• Protection of the environment
• Intellectual property/proprietary information

• Have I thought about whether the action I may take is right or wrong?
• Will I be proud to tell of my action to my family? To my employer? To the news media?
• Am I willing for everyone to act as I am thinking of acting?
• Will my actions violate the law?

• the Emphasis on Profit
• The Effect of the Group
• The Control of Resources by Nonowners

• Involvement of top management
• Openness in communication
• Consideration of all stakeholders

Stakeholder theory: holds that ethical corporate behavior requires that directors and managers take into account everyone whose interest the corporation impacts.


    

A business that does not act ethically severs itself from society, from the good, and ultimately from its own source of support.

• Criticism of property
• Support of property