management ethics slides

7/18/2019 management ethics slides

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Copyright 2012 Pearson Education, Inc. All rights reserved.

Business Ethics

Concepts & Cases

Manuel G. Velasquez


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Chapter One

Basic Principles: Ethics and

Business


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Ethics and Morality

Ethics is the study of morality. Morality = The standards that an individual or a

group has aout !hat is right and !rong" or goodand evil. E#ample: B.$. %oodrich '() $raud

Moral *tandards = norms aout the +inds ofactions that are morally right and !rong" as !ell asthe values placed on !hat is morally good or ad.

,on(Moral *tandards: The standards y !hich !e-udge !hat is good or ad and right or !rong in anon(moral !ay.


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$ive Characteristics of Moral*tandards

nvolve signi/cant in-uries or ene/ts

,ot estalished y authority /gures

*hould e preferred to other valuesincluding self(interest

Based on impartial considerations

ssociated !ith special emotions andvocaulary.


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0hat is Business Ethics1

Broadly" ethics is the discipline thate#amines one2s moral standards or themoral standards of a society to evaluate

their reasonaleness and theirimplications for one2s life.

Business ethics is a speciali3ed study ofmoral right and !rong that concentrateson moral standards as they apply tousiness institutions" organi3ations" andehavior.


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Types of Ethical ssues

*ystemic4ethical 5uestions aout thesocial" political" legal" or economicsystems !ithin !hich companies

operate. Corporate4ethical 5uestions aout a

particular corporation and its policies"culture" climate" impact" or actions.

ndividual4ethical 5uestions aout aparticular individual2s decisions"ehavior" or character.


7/202Copyright 2012 Pearson Education, Inc. All rights reserved.

Can ethical 5ualities eattriuted to corporations1

6ie! 78: corporations" li+e people" actintentionally and have moral rights" andoligations" and are morally responsile.

6ie! 79: it ma+es no sense to attriute ethical5ualities to corporations since they are not li+epeople ut more li+e machines only humanscan have ethical 5ualities.

6ie! 7;: humans carry out the corporation2s

actions so they are morally responsile for !hatthey do and ethical 5ualities apply in a primarysense to them corporations have ethical5ualities only in a derivative sense.



rguments gainst BusinessEthics

n a free mar+et economy" the pursuitof pro/t !ill ensure ma#imum socialene/t so usiness ethics is not

needed.

manager2s most important oligationis loyalty to the company regardless of

ethics. *o long as companies oey the la!

they !ill do all that ethics re5uires.



rguments *upportingBusiness Ethics

Ethics applies to all human activities.

Business cannot survive !ithout ethics.

Ethics is consistent !ith pro/t see+ing.

Customers" employees" and people ingeneral care aout ethics.

*tudies suggest ethics does not detractfrom pro/ts and seems to contriute topro/ts.



Corporate *ocial


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,e! ssues in BusinessEthics

dvances in technology often create ne!issues for usiness ethics.

Currently" advances in information

technology are creating ne! issues inusiness ethics.

ncreasing connections et!een theeconomic and social systems of dierent

nations" +no!n as >gloali3ation?" hasalso created ne! issues in usinessethics.


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ohlerg2s Three Devels ofMoral )evelopment

$irst Devel: Pre(conventional *tages *tage One: punishment and oedience

orientation

*tage T!o: instrumental and relative orientation

*econd Devel: Conventional *tages *tage One: interpersonal concordance

orientation

*tage T!o: la! and order orientation

Third Devel: Post(conventional *tages *tage One: social contract orientation

*tage T!o: universal principles orientation


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Moral


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$our *teps Deading to EthicalBehavior

*tep One:


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*tep T!o: udging the ethical courseof action.


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*tep Three: )eciding to do the ethicalcourse of action. )eciding to do !hat is ethical can e

inFuenced y:The culture of an organi3ation4people2s

decisions to do !hat is ethical are greatlyinFuenced y their surroundings.

Moral seduction4organi3ations can also

generate a form of >moral seduction? that cane#ert sutle pressures that can gradually leadan ethical person into decisions to do !hat heor she +no!s is !rong.


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*tep $our: Carrying out the ethicaldecision.

$actors that inFuence !hether a personcarries out their ethical decision include:

One2s strength or !ea+ness of !ill

One2s elief aout the locus of control ofone2s actions


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Moral


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$actors that Mitigate Moral


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Business Ethics

Concepts & CasesManuel G. Velasquez


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Chapter T!o

Ethical Principles in Business


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Gtilitarianism

ctions and policies should e evaluatedon the asis of the ene/ts and coststhey !ill impose on society.

The only morally right action in anysituation is that !hose utility is greatesty comparison to the utility of all theother alternatives .

Deading utilitarian theorists:eremy Bentham

ohn *tuart Mill


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o! to pply GtilitarianPrinciples

$irst" determine !hat alternative actions orpolicies are availale to me in that situation.

*econd" for each alternative action" estimatethe direct and indirect ene/ts and costs that

the action !ill proaly produce for all personsaected.

Third" for each action" sutract the costs fromthe ene/ts to determine the net utility of each

action. $ourth" the action that produces the greatest

sum total of utility must e chosen as theethically appropriate course of action.


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Criticisms of Gtilitarianism

Critics say not all values can emeasured.

Gtilitarians respond that monetary or other

commonsense measures can measureeverything.

Critics say utilitarianism fails !ith rights

and -ustice. Gtilitarians respond that rule(utilitarianism

can deal !ith rights and -ustice.


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The Concept of a


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Moral no one is hurt?. re correlated !ith duties others have

to!ard the person !ith the right. Provide individuals !ith autonomy and

e5uality in the free pursuit of their interests. Provide a asis for -ustifying one2s actions

and for invo+ing the protection or aid ofothers.

$ocus on securing the interests of theindividual unli+e utilitarian standards !hichfocus on securing the aggregate utility ofeveryone in society.


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Three inds of Moral


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Contractual


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ant and Moral


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ant2s Categoricalmperative @$irst 6ersionA

0e must act only on reasons !e !oulde !illing to have anyone in a similarsituation act on.

0hat if everyone did that1?

>o! !ould you li+e it if someone did thatto you1?


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ant2s Categoricalmperative @*econd 6ersionA

,ever use people only as a means to yourends" ut al!ays treat them as they freelyand rationally consent to e treated and

help them pursue their freely and rationallychosen ends.

Based on the idea that humans have adignity that ma+es them dierent from

mere o-ects. t is" according to ant" e5uivalent to the

/rst formulation.


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Criticisms of ant

Both versions of the categoricalimperative are unclear.


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Diertarian Philosophy

$reedom from human constraint isnecessarily good and that all constraintsimposed y others are necessarily evile#cept !hen needed to prevent the

imposition of greater human constraints.


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Types of ustice

)istriutive ustice

re5uires the -ust distriution of ene/tsand urdens.


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Principles of )istriutiveustice

$undamental distriute ene/ts and urdens e5ually to e5uals and une5ually

to une5uals

Egalitarian distriute e5ually to everyone

Capitalist distriute according to contriution

*ocialist distriute according to need and aility

Diertarian distriute y free choices


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Ethic of Care

Ethics need not e impartial.

Emphasi3es preserving and nurturingconcrete valuale relationships.

0e should care for those dependent onand related to us.

Because the self re5uires caring

relationships !ith others" thosaerelationships are valuale and shoulde nurtured.


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O-ections to Care pproach inEthics

n ethic of care can degenerate intofavoritism.

urnout?.


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Theories of Moral 6irtue

ristotle virtues are haits that enale a person to live

according to reason y haitually choosing the meanet!een e#tremes in actions and emotions

5uinas virtues are haits that enale a person to live

reasonaly in this !orld and e united !ith %od inthe ne#t

Macntyre virtues are dispositions that enale a person to

achieve the good at !hich human >practices? aim Pincos

virtues are dispositions !e use !hen choosinget!een persons or potential future selves

O- ti t 6i t


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O-ections to 6irtueTheories

t is inconsistent !ith psychology !hichsho!ed that ehavior is determined ythe e#ternal situation" not moral

character.


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Gnconscious vs. ConsciousMoral )ecisions

Gnconscious Moral )ecisions Comprise most of our moral decisions. Made y the rain2s >N(system? using stored

prototypes to automatically and unconsciously

identify !hat it perceives and !hat it should do. Conscious Moral )ecisions

s used in ne!" strange" or unusual situationsfor !hich the rain has no matching prototypes.

Consists of the conscious" logical ut slo!

processes of the rain2s >C(system?. Evaluates reasonaleness of our intuitions"

cultural eliefs" and the norms stored in ourprototypes.


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Business Ethics



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Chapter Three

The Business *ystem:

%overnment" Mar+ets" andnternational Trade


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Economic *ystems

Tradition(Based *ocieties: rely ontraditional communal roles and customsto carry out asic economic tas+s.

Command Economy: economic systemased primarily on a governmentauthority ma+ing the economicdecisions.

Mar+et Economy: economic systemased primarily on private individualsma+ing the main economic decisions.


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>$ree? Mar+ets and Trade

$ree Mar+ets = each individual is ale tovoluntarily e#change goods !ith others andto decide !hat !ill e done !ith !hat he orshe o!ns !ithout interference from

government.

$ree Trade = citi3ens may freely trade goods!ith the citi3ens of other nations !ithoutthe interference of taris" 5uotas" or othergovernment limits on the goods citi3ensmay uy from or sell to foreign citi3ens.


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Doc+e2s *tate of ,ature

ll persons are free and e5ual.

Each person o!ns his ody and laor"and !hatever he mi#es his o!n laor

into. People2s en-oyment of life" lierty" and

property are unsafe and insecure.

People agree to form a government toprotect and preserve their right to life"lierty" and property.

C iti i f D + 2 6i


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Criticisms of Doc+e2s 6ie!on natural? rights to life" lierty" andproperty.

Doc+e2s natural rights are negative rightsand he does not sho! these overrideconFicting positive rights.

Doc+e2s rights imply that mar+ets should efree" ut free mar+ets can e un-ust and canlead to ine5ualities.

Doc+e !rongly assumes human eings areatomistic individuals.


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$ree Mar+ets and Gtility

dam *mith Mar+et competition ensures the pursuit of self(

interest in mar+ets and advances the pulic2s!elfare.

%overnment interference in mar+ets lo!ers thepulic2s !elfare y creating shortages orsurpluses.

Private o!nership leads to etter care and use ofresources than common o!nership.

aye+ and von Mises %overnments should not interfere in mar+etsecause they cannot have enough information toallocate resources as eHciently as free mar+ets.

C iti i f $ M + t d


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Criticisms of $ree Mar+ets andGtility


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eynes2 Criticism of *mith

*mith !rongly assumes demand isal!ays enough to asor the supply ofgoods. f households forego spending" demand can

e less than supply" leading to cutac+s"unemployment" and economic depression.

%overnment spending can ma+e up forsuch shortfalls in household spending" sogovernment should intervene in mar+ets.

eynes2 vie!s !ere challenged !hengovernment spending did not cure highunemployment ut created inFation.


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*ocial )ar!inism

Belief that economic competition produceshuman progress.

6ie!s of erert *pencer Evolution operates in society !hen economic

competition ensures the /ttest survive and theun/t do not" !hich improves the human race.

f government intervenes in the economy toshield people from competition" the un/tsurvive and the human race declines" so

government should not do so. ssumes those !ho survive in usiness are

>etter? people than those !ho do not.


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$ree Trade and Gtility

dvocated y dam *mith.

everyone prospers if nations speciali3e inma+ing and e#porting goods !hose productioncosts for them are lo!er than for other nations.

dvocated y )avid


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Criticisms of $ree Trade andGtility

gnores the easy movement ofcapital y companies.

$alsely assumes that a country2sproduction costs are constant.

gnores the inFuence of internationalrule setters.

arl Mar# Critici3ing Mar+ets


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arl Mar#: Critici3ing Mar+etsand $ree Trade

Capitalist systems oer only t!osources of income.

*ale of one2s o!n laor.

O!nership of the means of [email protected]. uildings" machinery" land" and ra!materialsA.

Capitalism and its private propertysystem creates alienation among!or+ers.


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Mar# on lienation

n capitalism" !or+ers ecome alienated !henthey lose control of their o!n life activitiesand the aility to ful/ll their true humanneeds.

Capitalism alienates !or+ers from their o!nproductive !or+" the products of their !or+"their relationships !ith each other" and fromthemselves.

lienation also occurs !hen the value ofeverything is seen in terms of its mar+et price.


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Mar# and Private Property

Private o!nership of the means ofproduction is the source of the !or+er2s

loss of control over !or+" products"relationships" and self.

Productive property should serve theneeds of all and should not e privatelyo!ned" ut o!ned y everyone.

Mar#2s istorical


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Mar# s istoricalMaterialism

The methods a society uses to produceits goods determines ho! that societyorgani3es its !or+ers.

The !ay a society organi3es its!or+ers determines its social classes.

society2s ruling social class controlssociety2s government and ideologies

and uses these to advance its o!ninterests and control the !or+ingclasses.


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mmiseration of 0or+ers

Comined eects of increased concentration"cyclic crises" rising unemployment" anddeclining relative compensation. ndustrial po!er is concentrated in the hands of

a fe! !ho organi3e !or+ers for mass production. Mass production in the hands of a fe! leads tosurplus !hich causes economic depression.

$actory o!ners replace !or+ers !ith machines!hich creates unemployment they +eep !ageslo! to increase pro/ts.

The only solution is a revolution thatestalishes a classless society !hereeveryone o!ns the means of production.


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Criticism of Mar#

Mar#2s claims that capitalism is un-ust areunprovale.

ustice re5uires free mar+ets.

The ene/ts of private property and freemar+ets are more important than e5uality.

$ree mar+ets can encourage communityinstead of causing alienation.

mmiseration of !or+ers has not occurredinstead their condition has improved.


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Mi#ed Economy

Mi#ed Economy = an economy thatretains a mar+et and private propertysystem ut relies heavily on

government policies to remedy theirde/ciencies.

Property & ,e!


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Copyright 2012 Pearson Education, Inc. All rights reserved. 3-64

Property & ,e!Technologies

Intellectual Property Rights consists ino!nership rights over astract andnonphysical o-ects. E#amples ofIntellectual Property such soft!are

programs" songs" recipes" ne! medicine"digital image etc

Gnli+e physical o-ects" intellectual

property is nonexclusive: one personQsuse of intellectual property does note#clude other peopleQs simultaneous useof that property"

Competing vie!s on intellectualt i ht


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property rights Lockean: intellectual property is private property.

Utilitarian: private o!nership of P provides

incentives to increase intellectual productivity. Marxistsocialist: P property elongs to community

intellectual laor is inherently communal: !hile peoplemay have a right to the fruit of their laor" they have a duty

to re!ard society !hich made the very fruitfulness of laorpossile

private o!nership of intellectual property in not needed to

inspire intellectual creativity and is an impediment to thedissemination of ideas & understanding & innovation @e.g. it

prevents others from developing improved versions ofprotected soft!are or from ta+ing advantage of +ey ne!

drug discoveriesA.


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Business Ethics



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Chapter $our

Ethics in the Mar+etplace


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)e/nition of Mar+et

forum in !hich people cometogether to e#change o!nership ofgoods a place !here goods or

services are ought and sold.

Three Models of Mar+et


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Three Models of Mar+etCompetition

Per!ect co"petition free mar+et in !hich no uyer or seller

has the po!er to signi/cantly aect theprices at !hich goods are eing e#changed.

Pure "onopoly mar+et in !hich a single /rm is the only

seller in the mar+et and !hich ne! sellersare arred from entering.

#ligopoly mar+et shared y a relatively small

numer of large /rms that together cane#ercise some inFuence on prices.

E5uilirium in Perfectly


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E5uilirium in PerfectlyCompetitive Mar+ets

E5uilirium point: n a mar+et" the point at !hichthe 5uantity uyers !ant to uy e5uals the 5uantitysellers !ant to sell" and at !hich the highest priceuyers are !illing to pay e5uals the lo!est price

sellers are !illing to ta+e. Principle of diminishing marginal utility: generally

each additional unit of a good a person consumes isless satisfying than each of the earlier units theperson consumed.

Principle of increasing marginal costs: after acertain point" each additional unit a seller producescosts more to produce than earlier units.


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*upply and )emand Curves

$upply curve: line on a graphindicating the 5uantity of a productsellers !ould provide for each price

at !hich it might e selling thesupply curve also can e understoodas sho!ing the price sellers must

charge to cover the average costs ofsupplying a given amount of aproduct.


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*upply and )emand Curves

%e"an& 'urve: line on a graphindicating the 5uantity of a productuyers !ould purchase at each price

at !hich it might e selling thesupply curve also can e understoodas sho!ing the highest price uyers

on average !ould e !illing to payfor a given amount of a product.


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Perfect Competition

perfectly competitive free mar+et is one in!hich no uyer or seller has the po!er tosigni/cantly aect the prices at !hich goods areeing e#changed.

Perfectly competitive free mar+ets arecharacteri3ed y seven de/ning features:@8A numerous uyers and sellers and has a

sustantial share of the mar+et.@9A ll uyers and sellers can freely and

immediately enter or leave the mar+et.@;A Every uyer and seller has full and perfect

+no!ledge of !hat every other uyer andseller is doing.


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Perfect Competition @Cont.A

@IA The goods eing sold in the mar+et are sosimilar to each other that no one cares from!hom each uys or sells.

@RA The costs and ene/ts of producing or

using the goods eing e#changed are orneentirely y those uying or selling the goodsand not y any other e#ternal parties.

@SA ll uyers and sellers are utilityma#imi3ers.

@'A ,o e#ternal parties @such as thegovernmentA regulate the price" 5uantity" or5uality of any of the goods eing oughtand sold in the mar+et.

Characteristics of Perfectly


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Characteristics of PerfectlyCompetitive $ree Mar+ets

chieve capitalist -ustice" ut not other+inds of -ustice li+e -ustice ased onneed.

*atis/es a certain version ofutilitarianism @y ma#imi3ing utility ofmar+et participants ut not of all

societyA


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Characteristics of MonopolyMar+ets @Cont.A

Can lead to ignoring the demands ofcaring and value of humanrelationships

Can encourage vices of greed and self(see+ing and discourage virtues of+indness and caring

Can e said to emody -ustice" utility"and rights only if seven de/ningfeatures are present.

E5uilirium in Perfectly


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E5uilirium in PerfectlyCompetitive Mar+et

Price and 5uantity move to e5uilirium inperfectly competitive mar+et ecause: f price rises aove e5uilirium" surplus appears

and drives price do!n to e5uilirium.

f price falls elo! e5uilirium" shortageappears and drives price up to e5uilirium.

f 5uantity is less than e5uilirium" pro/ts rise"attracting sellers !ho increase 5uantity toe5uilirium.

f 5uantity is more than e5uilirium" prices fall"driving sellers out !hich lo!ers 5uantity toe5uilirium.

Gtility in Perfectly Competitive


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Gtility in Perfectly CompetitiveMar+ets

Prices in the system of perfectly competitivemar+ets attract resources !hen demand ishigh and drives them a!ay !hen demand islo!" so resources are allocated eHciently.

Perfectly competitive mar+ets encourage/rms to use resources eHciently to +eepcosts lo! and pro/ts high.

Perfectly competitive mar+ets let consumers

uy the most satisfying undle of goods" sothey distriute goods in !ay that ma#imi3esutility.


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Characteristics of MonopolyMar+ets

One dominant seller controls all or most ofthe mar+et2s product" and there are arriersto entry that +eep other companies out.

*eller has the po!er to set 5uantity and

price of its products on the mar+et. *eller can e#tract monopoly pro/t y

producing less than e5uilirium 5uantityand setting price elo! demand curve uthigh aove supply curve.

igh entry arriers +eep other competitorsfrom ringing more product to the mar+et.

Ethical 0ea+nesses of


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Ethical 0ea+nesses ofMonopolies

6iolates capitalist -ustice. charging more for products than producer +no!s

they are !orth

6iolates utilitarianism. +eeping resources out of monopoly mar+et and

diverting them to mar+ets !ithout such shortages removing incentives to use resources eHciently

6iolates negative rights. forcing other companies to stay out of the mar+et

letting monopolist force uyers to purchase goodsthey do not !ant letting monopolist ma+e price and 5uantity

decisions that consumer is forced to accept

Oli li ti M + t


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Oligopolistic Mar+ets

%e(nitions

Ma-or industrial mar+etsare dominated y only afe! /rms.

Oligopolistic mar+ets are>imperfectlycompetitive? ecausethey lie et!een the t!o

e#tremes of theperfectly competitiveand monopolisticmar+ets.

Unethical Practices in#ligopolistic Markets

Price(/#ing

Manipulation of supply

Mar+et allocation

Bid rigging

E#clusive dealingarrangements

Tying arrangements


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The $raud Triangle

The pressures or strong incentives to do!rong" such as organi3ational pressure"peer pressure" company needs" personalincentives

The opportunity to do !rong" !hichincludes the aility to carry out the!rongdoing" eing presented !ithcircumstances that allo! it" lo! ris+ of

detection The aility to rationali3e one2s action y

framing it as morally -usti/ed.

Main 6ie!s on Oligopoly


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Main 6ie!s on OligopolyPo!er

)o(nothing vie!. )o nothing since po!er of oligopolies is limited

y competition et!een industries and ycountervailing po!er of large groups

Oligopolies are competitive and ig G.*.companies are good international competitors.

ntitrust vie!. Darge monopoly and oligopoly /rms are

anticompetitive and should e ro+en up into

small companies


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Business Ethics



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Chapter $ive

Ethics and the Environment

Pollution and


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Pollution and


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Ma-or Types of ir Pollution

%reenhouse gases: caron dio#ide"methane" nitrous o#ide.

O3one depleting gases:chloroFuorocarons

cid rain gases: sulfur o#ides.

irorne to#ics: en3ene" formaldehyde"toluene" trichloroethylene" and ;9 others.

Common air pollutants: caron mono#ide"sulfur o#ides" nitrogen o#ides" airornelead" o3one" particulates.

Ma-or Types of 0ater


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- ypPollution

Organic !astes: human se!age"animal !astes" acteria" oil.

norganic pollutants: salt rines"

acids" phosphates" heavy metals"asestos" PCBs" radioactivechemicals.

Ma-or Types of Dand


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- ypPollution

To#ic sustances: acids" heavymetals" solvents" pesticides"hericides" and phenols.

*olid !astes: residential garage"industrial !astes" agricultural!astes" and mining !astes.

,uclear !astes: high level"transuranic" lo!(level.

)epletion of ,on(


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p


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Control Ecological Ethics = The ethical vie! that

nonhuman parts of the environment deserveto e preserved for their o!n sa+e" regardlessof !hether this ene/ts human eings.

The >Dast Man? rgument

s+s us to imagine a man !ho is Earth2s lastsurvivor.

0e recogni3e it is !rong for the last man to

destroy all nonhumans.

*o !e must recogni3e some nonhumans haveintrinsic value apart from humans.

Environmental


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Environmental


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Private and *ocial Costs

Private cost:The cost an individualor company must pay out of its o!npoc+et to engage in a particular

economic activity.

$ocial cost:The private internal costs

plus the e#ternal costs of engaging ina particular economic activity.

Mar+ets and Pollution


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Mar+ets and Pollution

Total costs of ma+ing a product include aseller2s internal private costs and the e#ternalcosts of pollution paid y society.

supply curve ased on all costs of ma+ing aproduct lies higher than one ased only onsellers2 internal private costs.The higher supply curve crosses the demand

curve at a lo!er 5uantity and a higher price thanthe lo!er supply curve.

0hen sellers2 costs include only private costs"too much is produced and price is too lo!.This lo!ers utility" and violates rights" and -ustice.

Ethical pproaches to


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ppEnvironmental Protection

Ecological approach. nonhumans have intrinsic value

Environmental rights approach.

humans have a right to a livaleenvironment

Mar+et approach.

e#ternal costs violate utility" rights" and-ustice therefore" they should einternali3ed.

Internalization o! the 'osts o!Pollution


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Pollution sorption of e#ternal costs y the producer"

!ho then ta+es them into account !hendetermining the price of goods.

Polluters pay those harmed an amount e5ual

to the costs imposed on them y pollution.Main dra!ac+ is the diHculty of assessing!hat damages are due to !hose actions!here there are several polluters involved.

Prevention plans" !here producers ear thecost of preventing pollution y the installationof pollution control devices. Preferred option

Optimal Devel of Pollution


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Precautionary Principle

The principle that if a practice carriesan un+no!n ris+ of catastrophic andirreversile conse5uences" ut it is

uncertain ho! large that ris+ is" thenthe practice should e re-ected untilit is certain the ris+ is none#istent or

insigni/cant.

Ma#imin


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Ma#imin


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Pollution

*ocial Ecology %et rid of social systems of hierarchy

and domination

Ecofeminism Change male pattern of dominating

nature and !omen

Other feminists E#tend the ethic of care to!ard nature

Conservation Based on


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Ethics


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*ustainaility

0e must deal !ith the environment"society" and economy so that theyhave the capacity to continue to meetthe needs of present generations!ithout compromising the aility offuture generations to meet their o!nneeds.

Environmental sustainaility"economic sustainaility" and socialsustainaility are interdependent.

Environmental *ustainaility


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Environmental *ustainaility

,ot depleting rene!ale resourcesfaster than their replacement.

,ot creating more pollution than

environment can asor. ,ot depleting non(rene!ale

resources faster than !e /nd

replacements.

Economic %ro!th


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Economic %ro!th

*chumacher 0e must aandon the goal of economic

gro!th if !e are to allo! future

generations to live as !e do. Others

0e must achieve a >steady state? !here

irths e5ual deaths and productione5uals consumption and these remainconstant at their lo!est feasile level.

Clu of


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Clu of


107/202


Economic %ro!th

t is trouling that current economicgro!th policies that have led to highrates of energy and resource

consumption in developed nations!hile developing nations are left toconsume at lo! rates.


108/202


Business Ethics



109/202


Chapter *i#

The Ethics of Consumer

Production and Mar+eting


110/202



111/202


Protection

*afety is a commodity that should not emandated y government.

*afety should instead e provided through themar+et.

n a mar+et" sellers !ill provide safety ifconsumers demand it. n a mar+et" the price of safety and the amount

sellers provide !ill e determined y the costsof providing it and the value consumers place

on it. %overnment intervention in consumer mar+ets

ma+es them unfair" ineHcient" and coercive.

Prolems !ith the Mar+et


112/202


pproach

ssumes mar+ets are perfectlycompetitive" ut they are not ecause:

Buyers do not have ade5uate information

!hen products are comple# andinformation is costly and hard to /nd.

Buyers are often not rational aout productris+ or proailities and are often

inconsistent. Many consumer mar+ets are monopolies or

oligopolies.

Contract 6ie! of Business


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$irm2s )uties to Customer

The vie! that the relationshipet!een a usiness /rm and itscustomers is essentially a contractual

relationship" and the /rm2s moralduties to the customer are thosecreated y this contractual

relationship.

Moral )uty to Consumers


114/202


under Contractual Theory

)uty to comply !ith e#press andimplied claims of: reliaility

service life maintainaility

safety

)uty of disclosure

)uty not to misrepresent

)uty not to coerce

Prolems !ith Contractual


115/202


Theory ssumes ma+ers of products deal directly

!ith consumers ut they do not. Manufacturer2s advertisements do form a

+ind of direct promise to consumers.

*ellers can remove all their duties touyers y getting them to agree todisclaimers of responsiility.

ssumes consumer and seller meet ase5uals" ut seller has more +no!ledge soconsumer must rely on the seller.

)ue Care Theory ofi i C


116/202


$irm2s )uties to Customer

The vie! that ecausemanufacturers are in a moreadvantaged position and consumers

must rely on them" they have a dutyto ta+e special care to ensure thatconsumers2 interests are not harmed

y the products that they oer them.

Manufacturer2s )utiesi ) C Th


117/202


in )ue Care Theory

n designing product: research its ris+s in conditions of use design it so ris+s are minimi3ed ta+e capacities of users into account

n production: use strict 5uality control to eliminate defects ensure materials and manufacturing do not add

defects or ris+

n mar+eting:

provide users !ith information aout using productsafely !arn of all dangers do not mar+et to those unale to avoid ris+

Prolems !ith )ue CareTh


118/202


Theory )oes not limit !hat producer must

spend to eliminate ris+.

)oes not indicate !ho should pay for

product in-uries that cannot eforeseen.

Puts manufacturer in paternalistic

position of deciding ho! much ris+ isest for consumers.

*ocial Costs 6ie! of theManufacturer2s )uties to


119/202


Manufacturer s )uties toConsumers

The vie! that a manufacturer should paythe costs of any in-uries caused y defectsin the product" even if the manufacturere#ercised all due care in designing"

ma+ing" and mar+eting it" and the in-urycould not have een foreseen.

Product in-uries are e#ternal costs that

should e internali3ed as a cost of ringingthe product to mar+et" this ma#imi3esutility and distriutes costs more fairly.

Criticisms of the *ocialC t 6i


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Costs 6ie! Gn-ust to manufacturers since

compensatory -ustice says one shouldcompensate in-ured parties only if the

in-ury !as foreseeale and preventale. $alsely assumes that the social cost

vie! prevents accidents.

nstead" it encourages consumer

carelessness y relieving them ofresponsiility for their in-uries.

Criticisms of the *ocial Cost6i @C t A


121/202


6ie! @Cont.A

as increased the numer ofsuccessful consumer la!suits" !hichimposes heavy losses on insurance

companies and ma+es insurance tooe#pensive for small /rms.


122/202


dvertising

pulic communication aimed at alarge social group intended to inducememers of this audience to uy the

seller2s products.

t succeeds y creating a desire for theseller2s product or a elief that a product

!ill satisfy a pree#isting desire.

Criticisms of dvertising Based* i l E t


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on *ocial Eects

t deases the tastes of the pulic.


124/202


on *ocial Eects

ts costs are selling costs that" unli+eproduction costs" do not add to the utility ofproducts and so !aste resources.


125/202


on ts Eects on )esires

dvertising creates psychic desires !hich"unli+e physical desires" are pliale andunlimited.

Psychic desires are created so /rms can use us to

asor their output. Gsing us this !ay treats us as means and not as

ends and so is unethical.


126/202


a.$ocial e)ects0hat does the advertisers intend the eect of the

advertisement to e1

0hat are the actual eects of the advertisement on

individuals and on society as a !hole1

. *)ects on &esire)oes the advertisement inform or does it also see+ to

persuade1

f it is persuasive" does it attempt to create an irrational

and possily in-urious desire1

c. *)ects on +elie!s the content of advertisement truthful1

)oes the advertisement have a tendency to mislead


127/202


dvertising

n author !ho @unethicallyA intends toma+e the audience elieve !hat he or she+no!s is false y means of an intentionalact or utterance.

Media or intermediaries !ho communicatethe false message of the advertisement .

n audience !ho is vulnerale to thedeception and !ho lac+s the capacity to

recogni3e the deceptive nature of theadvertisement.

mportance of ConsumerP i


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Privacy Protects individuals from disclosures that

can shame" interfere in one2s private life"hurt loved ones" and lead to self(incrimination.

Enales the intimacy that developspersonal relationships" the trust andcon/dentiality that underlies client(

professional relationships" the aility tomaintain distinct social roles" and theaility to determine ho! others !ill see us.

Balancing


129/202


Business ,eeds

s the purpose of collecting information alegitimate usiness need that ene/ts theconsumer1

s the information that is collected relevant tothe usiness need1

s the consumer informed the information iseing collected and the purpose1

)id the consumer consent to the informationdisclosure1

s the information accurate1 s the information secure and not disclosed torecipients or used in !ays to !hich theconsumer did not consent1


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Business Ethics



131/202


Chapter *i#

The Ethics of Consumer

Production and Mar+eting


132/202


)angerous and ris+y products

)eceptive selling practices

Poorly constructed products

$ailure to honor !arranties

)eceptive and unpleasant advertising

Mar+et pproach to ConsumerProtection


133/202


Protection

*afety is a commodity that should not emandated y government.

*afety should instead e provided through themar+et.

n a mar+et" sellers !ill provide safety ifconsumers demand it.

n a mar+et" the price of safety and the amountsellers provide !ill e determined y the costsof providing it and the value consumers place

on it. %overnment intervention in consumer mar+etsma+es them unfair" ineHcient" and coercive.

Prolems !ith the Mar+etpproach


134/202


pproach

ssumes mar+ets are perfectlycompetitive" ut they are not ecause:

Buyers do not have ade5uate information!hen products are comple# andinformation is costly and hard to /nd.

Buyers are often not rational aout productris+ or proailities and are often

inconsistent. Many consumer mar+ets are monopolies or

oligopolies.

Contract 6ie! of Business$irm2s )uties to Customer


135/202


$irm s )uties to Customer

The vie! that the relationshipet!een a usiness /rm and itscustomers is essentially a contractual

relationship" and the /rm2s moralduties to the customer are thosecreated y this contractualrelationship.

Moral )uty to Consumersunder Contractual Theory


136/202


under Contractual Theory

)uty to comply !ith e#press andimplied claims of: reliaility

service life maintainaility

safety

)uty of disclosure

)uty not to misrepresent

)uty not to coerce

Prolems !ith ContractualTheory


137/202


Theory ssumes ma+ers of products deal directly

!ith consumers ut they do not. Manufacturer2s advertisements do form a

+ind of direct promise to consumers.

*ellers can remove all their duties touyers y getting them to agree todisclaimers of responsiility.

ssumes consumer and seller meet ase5uals" ut seller has more +no!ledge soconsumer must rely on the seller.

)ue Care Theory of$irm2s )uties to Customer


138/202


$irm s )uties to Customer

The vie! that ecausemanufacturers are in a moreadvantaged position and consumers

must rely on them" they have a dutyto ta+e special care to ensure thatconsumers2 interests are not harmedy the products that they oer them.

Manufacturer2s )utiesin )ue Care Theory


139/202


in )ue Care Theory

n designing product: research its ris+s in conditions of use design it so ris+s are minimi3ed ta+e capacities of users into account

n production: use strict 5uality control to eliminate defects ensure materials and manufacturing do not add

defects or ris+

n mar+eting:

provide users !ith information aout using productsafely !arn of all dangers do not mar+et to those unale to avoid ris+

Prolems !ith )ue CareTheory


140/202


Theory

)oes not limit !hat producer mustspend to eliminate ris+.

)oes not indicate !ho should pay for

product in-uries that cannot eforeseen.

Puts manufacturer in paternalistic

position of deciding ho! much ris+ isest for consumers.

*ocial Costs 6ie! of theManufacturer2s )uties to


141/202


Consumers The vie! that a manufacturer should pay

the costs of any in-uries caused y defectsin the product" even if the manufacturere#ercised all due care in designing"

ma+ing" and mar+eting it" and the in-urycould not have een foreseen.

Product in-uries are e#ternal costs that

should e internali3ed as a cost of ringingthe product to mar+et" this ma#imi3esutility and distriutes costs more fairly.

Criticisms of the *ocialCosts 6ie!


142/202


Costs 6ie! Gn-ust to manufacturers since

compensatory -ustice says one shouldcompensate in-ured parties only if thein-ury !as foreseeale and preventale.

$alsely assumes that the social costvie! prevents accidents.

nstead" it encourages consumer

carelessness y relieving them ofresponsiility for their in-uries.

Criticisms of the *ocial Cost6ie! @Cont A


143/202


6ie! @Cont.A

as increased the numer ofsuccessful consumer la!suits" !hichimposes heavy losses on insurance

companies and ma+es insurance tooe#pensive for small /rms.


144/202


dvertising

pulic communication aimed at alarge social group intended to inducememers of this audience to uy the

seller2s products.

t succeeds y creating a desire for theseller2s product or a elief that a product

!ill satisfy a pree#isting desire.

Criticisms of dvertising Basedon *ocial Eects


145/202


on *ocial Eects

t deases the tastes of the pulic.


146/202


on *ocial Eects

ts costs are selling costs that" unli+eproduction costs" do not add to the utility ofproducts and so !aste resources.


147/202


on ts Eects on )esires

dvertising creates psychic desires !hich"unli+e physical desires" are pliale andunlimited.

Psychic desires are created so /rms can use us to

asor their output. Gsing us this !ay treats us as means and not as

ends and so is unethical.


148/202


dvertising

n author !ho @unethicallyA intends toma+e the audience elieve !hat he or she+no!s is false y means of an intentionalact or utterance.

Media or intermediaries !ho communicatethe false message of the advertisement .

n audience !ho is vulnerale to thedeception and !ho lac+s the capacity to

recogni3e the deceptive nature of theadvertisement.

mportance of ConsumerPrivacy


149/202


Privacy Protects individuals from disclosures that

can shame" interfere in one2s private life"hurt loved ones" and lead to self(incrimination.

Enales the intimacy that developspersonal relationships" the trust andcon/dentiality that underlies client(

professional relationships" the aility tomaintain distinct social roles" and theaility to determine ho! others !ill see us.

Balancing


150/202


Business ,eeds

s the purpose of collecting information alegitimate usiness need that ene/ts theconsumer1

s the information that is collected relevant tothe usiness need1

s the consumer informed the information iseing collected and the purpose1

)id the consumer consent to the informationdisclosure1

s the information accurate1 s the information secure and not disclosed to

recipients or used in !ays to !hich theconsumer did not consent1


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Business Ethics



152/202


Chapter *even

The Ethics of o)iscrimination

)e/nition of )iscrimination


153/202


The !rongful act of distinguishingillicitly among people not on theasis of individual merit" ut on the

asis of pre-udice or some otherinvidious or morally reprehensileattitude.

Elements of )iscrimination


154/202


8. t must e a decision not ased on individual

merit.9. The decision must derive from racial orse#ual pre-udice" false stereotypes" or someother +ind of morally un-usti/ed attitude

against memers of the class to !hich theemployee elongs.

;. The decision must have a harmful impact onthe interest of employees against !hom the

decision is made in hiring" compensation"promotion" -o assignments" or termination ofthose employees.

A helpful framework for analysing different forms of

discrimination is by categorizing discriminatory actions according

to the extent to which they are intentional and institutionalized.

Th f k i h i th di b l


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Intentional Unintentional

Isolate& solated andintentional

discrimination

solated andunintentional

discrimination

Institutional

nstitutional andintentional

discrimination

nstitutional andunintentional

discrimination

The framework is shown in the diagram below.

Types of )iscrimination


156/202


ntentional discrimination = conscious anddelierate discrimination.

Gnintentional discrimination = discriminationthat is not consciously or delierately sought"ut is rought aout y stereotypes or as anunintended outcome.

ndividual discrimination = discrimination ofone or a fe! individuals acting on their o!n.

nstitutional discrimination = discrimination

that is the result of the actions of all or many ofthe people in an institution and of their routineprocesses and policies.

0hat is Hrmative ction1


157/202


ny program designed to ensure thatminorities" !omen" or memers of someother group" are ade5uately represented!ithin an organi3ation and its various levelsy ta+ing positive steps to increase their

numer !hen underrepresented. 0hat counts as >ade5uate representation?

depends on the o-ectives of the program: some aim at having the same proportion of

!omen or minorities as e#ists in the pool from!hich ne! memers are dra!n

others aim at achieving the diversity needed tomeet organi3ational o-ectives

)iscrimination and the Da!


158/202


Civil


159/202


sc a o

n the 8SLs" discrimination is seen asindividual and intentional.

n the 8'Ls" it is seen to have institutionaland unintentional forms" as indicated y

underrepresentation of minorities or !omen"and to e remedied !ith aHrmative action.

n the 8Ls" some insist discrimination isonly individual and intentional.

n the 8Ls" the vie! prevails it can also einstitutional and unintentional.

Prima $acie ndicators of)iscrimination


160/202


verage ene/ts minorities and!omen receive compared to others.

igh proportions of minorities and

!omen at lo!est economic levels. Do! proportions of minorities and

!omen at highest economic levels.

)iscrimination in the Gnited*tates


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*tates

%ap et!een average family incomes of !hitesand minorities has not decreased.

%aps et!een average incomes and medianearnings of men and !omen have decreasedut are still large. !omen earn less than less(educated men

!omen earn less in every occupational group

%aps et!een the average earnings ofminorities and of !hites have hardly narro!ed Minorities earn less than less educated !hites Percent of minorities in poverty is 9 to ; times the

!hite percentage

)iscrimination in the Gnited*tates


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*tates

Poverty rate of families headed y!omen is t!ice that of male(headedfamilies.

*alaries of >!omen2s -os? are

signi/cantly lo!er than >men2s -os.? Top(paying e#ecutive positions are /lled

y men a >glass ceiling? stops !omen.

The earnings gaps are not e#plained yeducation" career choices" preferences"!or+ history" training" or asenteeism.

ncreasing Prolemsfor 0omen and Minorities


163/202


0omen and minorities ma+e up mostne! !or+ers" ut face signi/cantdisadvantages.

0omen are steered into lo!(paying

-os and face a >glass ceiling? andse#ual harassment.

Minorities need s+ills and educationut lac+ them.

rguments gainst)iscrimination


164/202


)iscrimination

Gtilitarian )iscrimination leads to ineHcient use of human

resources.

inferior.? )iscrimination cannot e universali3ed.

ustice(ased )iscrimination results in un-ust distriutions of

ene/ts and urdens.

)iscrimination violates the formal principle ofe5uality y dierentiating et!een people on theasis of characteristics that are not relevant to -operformance.

*e#ual arassment


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Gn!elcome se#ual advances" re5uests forse#ual favors and other veral or physicalcontact of a se#ual nature constitute se#ualharassment !hen:

@8A sumission to such conduct is made either

e#plicitly or implicitly a term or condition of anindividual2s employment@9A sumission to or re-ection of such conduct yan individual is used as the asis foremployment decisions aecting such individual

@;A such conduct has the purpose or eect ofunreasonaly interfering !ith an individual2s!or+ performance or creating an intimidating"hostile or oensive !or+ing environment.

Moral O-ections to *e#ualarassment %uidelines


166/202


%uidelines prohiit >intimidating" hostile"or oensive !or+ing environment.? But it is sometimes hard to distinguish this

from male rudeness not intended to degrade

!omen. %uidelines prohiit >veral or physical

contact of a se#ual nature? !hen it hasthe >eect of unreasonaly interfering

!ith an individual2s !or+ performance.? But this seems to re5uire use of purely

su-ective -udgments.

Moral O-ections to *e#ualarassment %uidelines


167/202


%uidelines prohiit >veral conduct? thatcreates an >intimidating" hostile oroensive !or+ing environment.? But this can conFict !ith the right to free

speech.

%uidelines hold employer guilty ofemployee2s se#ual harassment even ifemployer did not +no! nor could haveprevented it.

But some respond that eradicating se#ualharassment -usti/es forcing employer to eresponsile for preventing it" and it is an>e#ternal cost? employers should internali3e.

Other Types of)iscrimination


168/202


ge" !hich is protected y the ge)iscrimination in Employment ct

*e#ual orientation" !hich has fe!protections against discrimination

Transse#ual status" !hich has fe!protections

)isaility" !hich is protected y themericans !ith )isailities ct

Oesity" !hich has no protections.

Degal *tatus of Hrmativection


169/202


Hrmative action is legal !hen used tocorrect a racial or se#ual imalance that isthe result of previous discrimination.

t is also legal !hen used to correct an

egregious" persistent" and manifest racialimalance not caused y previousdiscrimination.

t can e used in hiring.

Can e used to achieve educationaldiversity and roadcast diversity.

Degal *tatus of Hrmativection


170/202


Cannot use inFe#ile 5uotas4must enarro!ly tailored to their o-ectives.

Cannot e used in layos.

Cannot overrule seniority.

Cannot e used in government set(aside programs e#cept as a last resort

in an e#treme case involving previousracial ias y the government.

Compensation rgument forHrmative ction


171/202


Claims aHrmative action compensatesgroups for past discrimination.

Critici3ed as unfair ecause those !hoene/t !ere not harmed and those !hopay did not in-ure.

*ome argue in response to criticism thatdiscrimination has harmed all minorities

and !omen" and all !hites and maleshave ene/ted from it.

Gtilitarian rgumentfor Hrmative ction


172/202


Claims aHrmative action reducesneed y ene/ting minorities and!omen in need" and so increases

utility Critici3ed on grounds that its costs

out!eigh its ene/ts and that other!ays of reducing need !ill produce

greater utility.

E5ual ustice rgumentfor Hrmative ction


173/202


Hrmative action !ill secure e5ualopportunity y a fairer distriution of

-os" y neutrali3ing the eects of

unconscious ias that aects-udgments aout minorities and!omen" and y placing !omen andminorities in less disadvantaged andmore competitive positions incompetitions !ith males and !hites.

E5ual ustice rgumentfor Hrmative ction


174/202


Hrmative action is a morally legitimatemeans for securing e5ual opportunity.

t is not a form of >reverse discrimination?ecause it is not ased on invidious -udgments of

male inferiority nor aims at destroying e5ualopportunity.

t does not use a non(relevant characteristic sincerace and se# are relevant in this limited conte#t.

t does not harm minorities and !omen and anyharm !ould e less than the harms inFicted ycurrent unconscious discrimination.

Conclusions


175/202


6aluing and managing a diverse !or+force is more than ethically andmorally correct.

t2s also a usiness necessity. Companies that fail to do an e#cellent-o of recruiting" retaining" developingand promoting !omen and minoritiessimply !ill e unale to meet theirstaHng needs.


176/202


Business EthicsConcepts & Cases

Manuel G. Velasquez


177/202


Chapter Eight

Ethics and the Employee

The


178/202


$ormal hierarchies identi/ed in theorgani3ational chart are the /rm2s fundamentalrealities.

Organi3ations see+ to coordinate the activitiesof memers so as to achieve their goals !ith

ma#imum eHciency. nformation rises from the ottom of the

organi3ation to the top.

Contracts oligate the employee to loyally

pursue the organi3ation2s goals and theemployer to provide a -ust !age and -ust!or+ing conditions.

,ecessary Conditionsfor a ConFict of nterest to

rise


179/202


rise

Employee or oHcer is engaged incarrying out a certain tas+ for his or heremployer.

Employee has an interest that gives

him or her an incentive to do the tas+in a !ay that serves that interest.

The employee has an oligation to do

the tas+ in a !ay that serves theinterests of his or her employer free ofany incentive to serve another interest.

voiding or Eliminatinga ConFict of nterest


180/202



181/202


The ethics of accepting gifts dependson:

The value of the gift

The purpose of the giftThe circumstances of the gift

The -o of the recipient

ccepted local practices

Company policies on gifts

Degal prohiitions on gifts

Theft of nformation


182/202


ncludes the theft of digiti3ed programs" music"movies" e(oo+s" etc." as !ell as trade secrets"company plans" and proprietary formulas orother data. s theft even if the original is not ta+en nor changed

ut only copied" e#amined" or used !ithout theconsent of the o!ner

6iolates the o!ner2s right to have his or herproperty used as he or she chooses" even if thetheft does not in-ure the o!ner

The s+ills one ac5uires from a company are notinformation and so it is not theft to ta+e them!hen leaving the company.

The Ethics of nsider Trading


183/202


nsider trading is said to e unethical ecause it is theftof information that gives the insider an unfair advantage.

t has een defended ecause :@aA it ensures stoc+ prices reFect the true value of the stoc+

@A it harms no one@cA having an advantage over others in the stoc+ mar+et is

not !rong in itself and is common among e#perts These defenses have een critici3ed ecause:

@aA the information the insider uses is not his or hers and sois stolen

@A trading on inside information has harmful eects on thestoc+ mar+et and increases the costs of uying and selling

stoc+s@cA the advantage of the inside trader is not li+e theadvantage of an e#pert ecause it is ased on theft.

$air 0ages


184/202


$air !ages depend on: 0ages in the industry and local area

The /rm2s aility to pay

The ris+s" s+ills" and demands of the -o

Minimum !age la!s

$airness in comparison to other salariesin the /rm

$airness of !age negotiations Docal living costs

rgument that 0ages in)eveloping ,ations are Too

Do!


185/202


Do!


186/202


de5uate

0ages should e set y mar+ets" not ycomparisons to other countries.

Docal factors are more important !hensetting !ages than a company2s pro/ts.

Costs of living are important" ut !agesshould also consider the local averagenumer of !or+ers per household.

o


187/202


re not -usti/ed !hen laor mar+etsare uncompetitive and ris+s areun+no!n and uncompensated.

re not -usti/ed !hen companies fail

to collect information on ris+s and failto inform !or+ers of ris+.

May not e -usti/ed !hen less(ris+y

-os are unavailale" or !hen !or+erslac+ information aout less(ris+yalternatives.

Estalishing $air 0or+ingConditions


188/202


Eliminating ris+s !hen cost isreasonale" studying potential ris+s of a-o" informing !or+ers of +no!n ris+s"compensating !or+ers for in-uries.

Providing compensation for -o ris+s similarto ris+ premiums paid in other -os.

Providing ade5uate medical and disailityene/ts.

0or+ing !ith other /rms to collectinformation aout -o ris+s.

Moral


189/202


Employer is morally responsile forad !or+ing conditions if theemployer:

Can and should improve conditions no!s aout the conditions

s not prevented from changingconditions

*imilarity rgument


190/202


*imilarities et!een the po!er ofmanagement and government implyemployees should have rights similar tociti3ens2 rights.

company2s management is a centrali3eddecision(ma+ing ody that e#ercisespo!er" li+e a government.

Managements !ield po!er and authorityover employees" li+e governments !ieldover citi3ens.

*imilarity rgument @Cont.A


191/202


Management has the po!er to distriuteincome" status" and freedom among thecorporation2s constituencies" li+egovernment does !ith respect to citi3ens.

Management shares in the monopoly onpo!er that government possesses.

*ince management2s po!er over employeesis so similar to government2s po!er overciti3ens" employees should have rights that

protect them from managers2 po!er" -ust asciti3ens2 rights protect them fromgovernment po!er.


192/202


Po!er of government is ased on consentand so is unli+e the po!er of managers!hich is ased on o!nership of thecompany" ut supporters of similarity

argument respond that today po!er ofmanagers does not come from o!ners.

Gnli+e government" the po!er ofmanagement is limited y unions" utsupporters of similarity argument respondthat most !or+ers today are not unioni3ed.


193/202


0hile it is hard for citi3ens to escapethe po!er of a government" it is easyfor employees to escape the po!er

of managers y changing -os" utsupporters of similarity argumentrespond that changing -os is notal!ays so easy.

Employee


194/202


Threatened y today2s technologies. usti/ed ecause of the interest !e

have in the protective and enaling

functions of privacy.


195/202


s -usti/ed y the interest !e have in remainingtrue to our religious and moral convictions.

Must e alanced against the legitimate rightsof the /rm" its stoc+holders" and fello!employees.

0histlelo!ing is morally justifed when: (a) the !rong is clear

@A other methods have failed

@cA it !ill prevent the !rong

@dA the !rong is serious enough to -ustify the costsof !histlelo!ing

$reedom of Conscience


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0histlelo!ing is a moral oligation fora person !hen @aAK@dA hold" and" inaddition:

the person has a special duty to preventthe !rong or is the only person !ho !ill orcan prevent the !rong

the !rong involves an e#tremely serious

harm to society2s !elfare" or e#tremelyserious in-ustice" or e#tremely seriousviolation of rights.

Employment at 0ill


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The employer o!ns the company and o!nershipgives him or her the right to decide !hether andho! long an employee !ill !or+ in his or hercompany.

Everyone has the right to do !hat they choose

@provided they do not violate the rights of othersAand so has the right to ma+e !hateveragreements they choose" including the agreement!ith employees to hire and /re them at !ill.

Businesses !ill operate most eHciently if

employers have the freedom to hire or /reemployees as they see /t.

The


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t is -usti/ed ecause of the interest !ehave in the instrumental and intrinsic valueof !or+.

0or+ has a critical instrumental valueecause it is a means to our survival.

0or+ has an intrinsic value ecause it is our asic economic contriution to society

and helps us feel !orth!hile and useful it lets us develop our potential and identity as

a particular human eing it lets us develop our character and virtues it is a source of self(esteem and self(respect.

The


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The right to !or+ is threatened y unemployment!hich in the Gnited *tates has many causes including: recessions use of ne! technologies" outsourcing of -os to lo!(!age countries free trade agreements our shift from a manufacturing to a service economy

Company layos also threaten the right to !or+ andhave many causes including: decline in demand changes in consumer demand

product osolescence the pursuit of cheaper !or+ers the need to consolidate operations

The


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This derives from the same right o!ners haveto -oin together to form a company @the rightto freely associate !ith othersA.

Gnions have a right to stri+e that derives fromevery !or+er2s right to 5uit !or+ing so long as

doing so does not violate other2s rights. Gnion memership declined from ;R percent

of !or+ers in 8I' to 8I percent in 9L8L. Many developing countries do not protect the

right to organi3e" ut G.*. companies canoften allo! their !or+ers there to unioni3eany!ay.

Characteristics of the CaringModel of Organi3ation


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Caring is focused entirely on persons"not on >pro/t? or >5uality.?

Caring is underta+en as an end in

itself not as a means to productivity. Caring is essentially personal.

Caring is gro!th(enhancing for the

cared(for.

Prolems for the CaringOrgani3ation


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Caring too much for others !hich can lead to>urnout? !hen the needs of others are given toomuch !eight compared to the needs of the self.

,ot caring enough for others ecause fatigue" self(interest" or disinterest leads us to ignore theirneeds.

The organi3ation systematically drives out caring!ith layos" ureaucracy" managerial styles thatsee employees as disposale" or re!ards that

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