Bule 303 Chapter 2 – Flashcards

The study of what constitutes right or wrong behavior; moral principals and values applied to social behavior.

What constituters right or wrong behavior and the application of moral principals in the business context.

Focuses on a corporation's profits, its impact on people, and its impact on the planet.

1. the legal implications of each decision 2. the public relations impact 3. the safety risks for consumers and employees 4. the financial implications

In the short-run, a company may increase its profits by continuing to sell a product, even though it knows that the product is defective. In the long-run, because of lawsuits, large settlements, and bad publicity, this unethical conduct would cause the profits to suffer. AKA BUSINESS ETHICS IS ONLY CONSISTENT WITH LONG-RUN.

Purdue Pharma downplaying the addictive tendencies of oxycotin when it was first put on the market

the courts have stated that assertions about businesses online are a first amendment right and not considered to be defamatory. aka people can pretty much post whatever bad reviews they want to about the business online.

the minimum degree of ethical behavior expected of a business firm, which is usually defined as compliance with the law.

the defendant was sued during business practices and essentially failed to respond to any type of communication during the legal battle and waited for a willful default.

NOT LAW. Rules that the company sets forth that it can enforce, they usually outline the company's policies on particular issues ad indicate how employees are excepted to act.

An employee sued Chrysler for failing to take action to stop harassment in the workplace. The investigation showed that the company had taken sufficient efforts to stop the behavior (such as holding meeting, increasing security, and allowing him to park in a monitored lot) and thus the company did not act with malice or reckless indifference which resulted in May receiving no money in punitive damages.

A reasoning process in which an individual links his or her moral convictions or ethical standards to the particular situation on hand.

An ethical philosophy rooted in the idea that every person has certain duties to others, including both humans and the planet. Those duties may be derived from religious principals or from other philosophical reasoning.

An ethical philosophy that focuses on the impacts of a decision on society or on key stakeholders.

The belief that human beings have certain fundamental rights. Whether an action or decision is ethical depends on how it affects the rights of various groups, such as owners, employees, consumers, suppliers, the community, and society.

an ethical guideline developed by Immanuel Kant under which an action is evaluated in terms of what would happen if everybody else in the same situation, or category, acted the same way.

An approach to ethical reasoning in which an action is evaluated in terms of its consequences for those whom it will effect. A "good" action is one that results in the greatest good for the greatest number of people.

1. a determination of which individuals will be affected by the action in question. 2. a cost-benefit analysis, which involves an assessment of the negative and positive effects of alternative actions of these individuals. 3. a choice among alternative actions that will produce maximum societal utility (the greatest positive net benefits for the greatest number of individuals)

a decision-making technique that involves weighing the costs of a given action against the benefits of that action.

an action that produces the greatest good for the most people may not always seem to be the most ethical. Ex. a drug that cures 85% of patients but leads to a painful death in the remaining 15%.

the idea that corporations can and should act ethically and be accountable to society for their actions.

Groups, other than the company's shareholders, that are affected by corporate decisions. Stakeholders include employees, customers, creditors, suppliers, and the community in which the corporation operates.

1. inquiry- find out the facts and relevant info 2. discussion- list possible actions 3. Decision- craft a consensus plan of action 4. justification- articulation of the reasons for the decison 5. evaluation- solution should be analyzed and a determination should be made it if was effective.

the plaintiff paid the car company to do repairs on his car three separate times. when the bill came back to be much higher than the estimate, the plaintiff suggested a settlement. the company refused and kept his car. the courts found all of their practices to be unethical.

requires companies to set up confidential systems so that companies and others can "raise red flags" about suspected illegal or unethical auditing and accounting practices.

prohibits US businesspeople from bribing foreign officials to secure advantageous contracts. (bribing in the US in this manner is not legal because we handle a lot of contracts in the private sector, but in other countries most of the contracts go through gov officials). does not apply to small payments made to less important people known as "grease". also do not prohibit payments to private foreign companies or other third parties unless the US firm knows that the payments will be passed on to a foreign gov.

Management's commitment and behavior are essential in creating an ethical workplace. Management's behavior, more than anything else, sets the ethical tone of a firm and influences the behavior of employees.