Chapter 5: Social Responsibility and Ethics – Flashcards

when a firm engages in social actions because of its obligation to meet certain economic and legal responsibilities

the view that management's only social responsibility is to maximize profits

the view that mangement's social responsibility goes beyond making profits to include protecting and improving society's welfare

when a firm engages in social actions in response to some popular social need

a business's intention, betounf its legal and economic obligations, to do the right things and act in ways that are good for society

- public expectations + public opinion now supports businesses pursuring economic and social goals - long-run profits + socially responsible companies tend to have more secure long-run profits - ethical obligation + businesses should be socially responsible because responsilb eactions are the right thing to do - public image + businesses can create a favorable public image by pursuing social goals - better environment + business involvement can help solve difficult social problems - discouragement of further government regulation + by becoming socially responsible, businesses can expect less government regulation - balance of responsibility and power + businesses have a lot of power and an equally large amount of responsibility is needed to balance against that power - stockholder interests + social responsibility will improve a business's stock price in the long run - possession of resources + businesses have the resources to support public and charitable projects that need assistance - superiority of prevention over cures + businesses should address social problems before they become serious and costly to correct

- violation of profit maximization + business is being socially responsible only when it pursues its economic interests - dilution of purpose + pursuying social goals dilutes business's primary purpose - economic productivity - costs + many socially responsible actions do not cover their costs and someone must pay those costs - too much power + businesses have a lot of power already; if they pursure social goals, they will have even more - lack of skills + business leaders lack the necessary skills to address social issues - lack of accountability + there are no direct lines of accountability for social actions

applying social criteria (screens) to investment decisions

managers consider the impact of their organization on the natural environment

principles, values, and beliefs that define what is right and wrong behavior

basic convictions about what is right and wrong

- preconventional 1. sticking to rules to aviod physical punishment 2. following rules only when doing so is in your immediate interest - conventional 3. living up to what is expected by people close to you 4. maintaining conventional order by fulfilling obligations to which you have agreed - principled 5. valuing rights of others and upholding absolute values and rights regardless of the majority's opinion 6. following self-chosen ethical principles even if they violate the law

a personality measure of the strength of a person's convictions

a personality attribute that measures the degree to which people believe they control their own fate

the organization's values guide employees in the way they do their jobs

- consensus of wrong + how much agreement is there that this aciton is wrong? - greatness of harm + how many people will be harmed? - concentration of effect + how concentrated is the effect of the action on the victim(s)? - proximity to victim(s) + how close are the potential victims? - immediacy of consequences + will hamr be felt immediately? - probability of harm + how likely is it that this action will cause harm?

- human rights 1. business should support and respect the protection of internationally-proclaimed human rights within their sphere of influency 2. make sure they are not complicit in human rights abuse - labor standards 3. business should uphold the freedom of association and the effective recognition of the right to collective bargaining 4. the elimination of all forms of forced and compulsory labor 5. the effective abolition of chld labor 6. the elimination of discrimination in respect to employment and occupation - environment 7. business should support a precautionary approach to environmental challenges 8. undertake initiatives to promote greater environmental responsibility 9. encourage the development and diffusion of environmentally friendly technologies - anti-corruption 10. business should work against corruption in all its forms, including extortion and bribery

a formal statement of an organization's primary values and the ethical rules it expects its employees to follow

- comply with safety, health, and security regulations - demonstrate courtesy, respect, honesty, and fairness - illegal drugs and alcohol at work are prohibited - manage personal finances well - exhibit good attendance and punctuality - follow directives of supervisors - do not use abusive language - dress in business attire - firearms at work are prohibited

- conduct business in compliance with all laws - payments for unlawful purposes are prohibited - bribes are prohibited - avoid outside activites that impari duties - maintain confidentiality of records - comply with all antitrust and trade regulations - comply with all accounting rules and controls - do not use company property for personal benefit - employees are personally accountable for company funds - do not propagate false or misleading information - make decisions without regard for personal gain

- convey true claims in product advertisements - perform assigned duties to the best of your ability - provide products and services of the highest quality

1. what is the ethical dilemme? 2. who are the affected stakeholders? 3. which personal, organizational, and external factors are important in this decision? 4. what are possible alternatives? 5. what is my decision and how will i act on it?

- be a good role model by being ethical and honest + tell the truth always + don't hide or manipulate information + be willing to admit your failures - share tour personal values by regularly communicating them to employees - stress the organization's or team's important shared values - use the reward system to hold everyone accountable to the values

indiviaul who raises ethics concerns or issues to others

an individual or ogranization who seeks out opportunities to improve society by using practices, innovative, and sustainable approaches