Chapter 2 - Being Ethical and Socially
Responsible
Business Ethics Defined
● Ethics
○ The study of right and wrong morality of the choices individuals make
○ An ethical decision is one that is right according to some standard of behavior
● Business ethics
○ The application of moral standards to business situations
Ethical Issues
● Fairness and honesty
○ Businesspeople are expected to refrain from knowingly deceiving, misrepresenting
● Conflict of interest
○ Issues arise when a businessperson take advantage of a situation for personal gain rather
than for the employer’s interest
● Organizational Relationships
○ A businessperson should put the welfare of others and that of the organization above his
or her own personal welfare
● Communications
○ Business communications that are false, misleading, or deceptive are both illegal and
unethical
Factors Affecting Ethical Behavior
Levels of Ethical Behavior:
Three general sets of factors appear to influence the standards of behavior in an organization
● Individual factors
○ Individual knowledge of an issue
○ Personal values
○ Personal goals
● Social factors
, ○ Cultural norms
○ Coworkers
○ Significant others
○ Use of the internet
● Opportunity
○ Presence of opportunity
■ Ex. When the teacher goes outside of the classroom while you’re taking a test,
what would you do, cheat or continue to do the test?
○ Ethical codes
○ Enforcement
Encouraging Ethical Behavior
● External to a specific organization
○ Governmental legislation and regulations
○ Trade association guidelines
● Within an organization
○ Code of Ethics
■ A written guide to acceptable and ethical behavior as defined by an organization;
it outlines policies, standards, and punishments for violations
○ Organization environment
■ Management direction
■ Employee training
■ Ethics officer
● Whistle-blowing
○ Informing the press or government officials about unethical practices within one’s
organization
Companies Today Monitor Employees
→ Phone calls
→ E-mail
→ Internet usage
→ Computer activities
→ Movements in the building
Guidelines
1. Listen and learn
2. Identify the ethical issues
Responsible
Business Ethics Defined
● Ethics
○ The study of right and wrong morality of the choices individuals make
○ An ethical decision is one that is right according to some standard of behavior
● Business ethics
○ The application of moral standards to business situations
Ethical Issues
● Fairness and honesty
○ Businesspeople are expected to refrain from knowingly deceiving, misrepresenting
● Conflict of interest
○ Issues arise when a businessperson take advantage of a situation for personal gain rather
than for the employer’s interest
● Organizational Relationships
○ A businessperson should put the welfare of others and that of the organization above his
or her own personal welfare
● Communications
○ Business communications that are false, misleading, or deceptive are both illegal and
unethical
Factors Affecting Ethical Behavior
Levels of Ethical Behavior:
Three general sets of factors appear to influence the standards of behavior in an organization
● Individual factors
○ Individual knowledge of an issue
○ Personal values
○ Personal goals
● Social factors
, ○ Cultural norms
○ Coworkers
○ Significant others
○ Use of the internet
● Opportunity
○ Presence of opportunity
■ Ex. When the teacher goes outside of the classroom while you’re taking a test,
what would you do, cheat or continue to do the test?
○ Ethical codes
○ Enforcement
Encouraging Ethical Behavior
● External to a specific organization
○ Governmental legislation and regulations
○ Trade association guidelines
● Within an organization
○ Code of Ethics
■ A written guide to acceptable and ethical behavior as defined by an organization;
it outlines policies, standards, and punishments for violations
○ Organization environment
■ Management direction
■ Employee training
■ Ethics officer
● Whistle-blowing
○ Informing the press or government officials about unethical practices within one’s
organization
Companies Today Monitor Employees
→ Phone calls
→ Internet usage
→ Computer activities
→ Movements in the building
Guidelines
1. Listen and learn
2. Identify the ethical issues
