LSB 3213 Legal and Regulatory Environment of Business Professor Jack Wroldsen Office 210 Spears Business Building jack wroldsen okstate edu 405 744 5418 Business Ethics What do dinosaurs and ethical lawyers have in common They re both extinct Unethical Reputation Lawyers How can you tell when a lawyer is lying Her lips are moving How does an attorney sleep First he lies on one side then he lies on the other Unethical Practices Unethical reputations are hard to live down Corporate Scandals Enron Worldcom Arthur Andersen Tyco Countrywide Mortgage Business Ethics How to make the right business decision Thinking about ethics vs acting ethically Your experiences with business ethics Three Frameworks Deontology Utilitarianism Virtue Ethics This semester s goal Apply legal reasoning to business decisions Deontology Duty based ethics Follow external laws codes religion Derive duty from obligations to fellow humans Kant Kant s categorical imperative People are not a means to an end Universalize the decision Utilitarianism Greatest good for the greatest number Severity Probability Cost benefit analysis outcome based Virtue Ethics Aristotle we are what we repeatedly do Excellence then is not an act but a habit Being over doing Inward focus Opposite order from duty based approach Goal Apply the three analytical frameworks to business decisions Leads to a disciplined analysis that considers multiple perspectives Salmonella Example Quality control at food processing company Apply each ethical philosophy Duty based Utilitarian Virtue based Deontology Applied Define the duty Potential downsides to deontology What happens when two duties conflict Are duties too rigid for complex situations Utilitarianism Applied Run a cost benefit analysis Potential downsides to utilitarianism Difficult to apply when outcomes are unpredictable Easy to justify cold hearted behavior Einstein relativity applies to physics not ethics Virtue Ethics Applied Define the virtue Potential downsides to virtue ethics Less action oriented due to focus on being So flexible that it fails to guide Context Thinking ethically vs acting ethically Philosophy vs courage This semester s goal Like four legal philosophies strengthen reasoning by applying three ethical approaches Corporate Social Responsibility For profit companies helping to solve societal problems Market perspective bottom line Non market perspective triple bottom line Business Laws and Ethics Marketing restrictions Losing market share with younger consumers Foreign Corrupt Practices Act FCPA Joe Camel Tobacco Lawsuit and Settlement Lawsuit revealed internal marketing documents target male smokers aged 13 24 Today s teenager is tomorrow s regular customer Rational long term profit seeking strategy Restrictions on marketing No animated characters No human images Marlboro Man No vending machines No outdoor ads or billboards FCPA Three step analysis plus one exception 1 2 3 Illegal to bribe foreign officials or private party intermediary to obtain business But grease payments are okay Apply ethical philosophies Utilitarianism Kant s categorical imperative universalize the decision American Rice Inc Exports to Haiti Bribes at customs for tax benefits Violation of FCPA Foreign officials or intermediary to get business Grease payment Court rejects positive law bribes for tax breaks equals bribes to get business Business Ethics in Practice Invoices at coffee company Your experiences Current events Wall Street Journal on D2L Next Week Study guide and clicker registration Tuesday Chapter 2 Courts ADR Thursday Chapter 3 Court Procedures