Business Ethics

Business ethics refers to implementing appropriate business policies and practices with regard to arguably controversial subjects.

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Outline

Business-Ethics-Mind-Map

PRODUCTION

producing a product that is harmful to consumers:

TOBACCO

NUCLEAR ENERGY

environmental impacts

habitat destruction

pollution

air

noise

water

urban sprawl

Energy Consumption

Carbon Emission

Depletion of the Ozone Layer

Outsourcing

company using suppliers that are unethical

child labour

MANAGING ETHICS

Compliance

Basically compliance with the law

standard of minimum behaviour

write standards stating explicit rules

establish penalties

Most common ethical standard in the US

RISKS

may give the impression that you only needminimum behaviour

can imply low level employees are target

gives no guidance on ethic issues that arise

Relying on employee values

The employee makes the ethical decisions

Assumes everyone is ethical / honorable

Expects ethical behavior

RISKS

Not everyone is ethical

Not everyone shares same ethical values

Possibility of ethical issues not being resolved

Ethics exhortation

exhorting people to act ethically

train employees

RISKS

no help identifying correct ethical standards

no guidance

may imply employees are to pay shorttermcost of acting ethically

Managing Values

defining a set of values and then managing them

educate model, reward values and standards

ADVANTAGES

gives guidance/ description for all types ofchoices

makes managing values integral part of thecompany

RISKS

takes more management effort

INTERNATIONAL

dumping / selling products at a lower price, lower then value.

Different codes/Standards

multinational corporations using standards biased on the nation they are in

Globalization

Cultural Imperialism

Outsourcing to cheaper labour / sweatshops

Child labour

INTELLECTUAL PROPERTY

Patent, Copyright, Trademark infringements. Misuse

native land

patent monopolies

patent protection

drug companies re coup losses for a time because they are the sole maker of a drug. What if it was a high demand drug that could save lives?

Gene patents

Monopolizing talent

POLICIES

many businesses have created internal policies pertaining to ethical conduct of employees:

Ethic Statements and Code

A competitive business environment may call for unethical behaviour .

Lying has become expected in some fields suchas trading.

An example of this are the issues surrounding the unethical actions of the Saloman Brothers.

HUMAN RESOURCE MANAGEMENT

Unions:

create unsustainable conditions for employers

create sustainable conditions for employees

the longer you work the more rights you have?

Longer you work the more money you get forsame job as co worker?

SALES AND MARKETING

food/products, saying something is good for you when it isn't.

Transparency

Fairness in pricing and distribution

Advertising truthfullness

marketing dangerous products/services

Ethical Dilemmas

Shareholder Wealth

stock appreciation

earnings per share

Profit Maximization

decrease quality of product

lower wages

outsourcing

minimizing taxes

not contributing to counties that allow theirbusiness

greed

Return on Investment

easy to put cost on services but hard to quantifybenefits of those said services

Externalities

financial liabilities that do not appear on thebalance sheet/income statement/cashreports

waste generated as part of the productionprocess?

Environmental Damage as result of rapidindustrialization

Fiduciary Responsiblity

acting in the best interest of of the corporation

short term financial goals having a long termimpact on society / environment

Business Ethics?

business ethics is the study of standards of business behavior which promote human welfare and the good.

can extend to animal welfare, environment welfare

HOW INDIVIDUALS ACT IN BUSINESS

STRUCTURING BUSINESSES AND THE WAY WORK

how we structure our business society, our laws affecting business , our systems