Ethics Standards of moral behavior that is behavior accepted by society as right versus wrong Steps to make a business ethical 1 Top management adopts code of conduct 2 Employees understand expectations 3 Managers trained to consider ethical implications 4 Ethics office is set up 5 Outsiders are informed about ethics program 6 Ethics code must be enforced Advertise ethical policies Ideal Conform to outside standards laws and regulations cid 127 Objective Avoid criminal misconduct Leaders Lawyers cid 127 Methods Education reduced employee discretion controls penalties and stress a shared accountability among employees Ideal Conform to outside standards laws and regulations and chosen internal standards cid 127 Objective Enable responsible employee conduct Leaders Managers with aid of lawyers and others cid 127 Methods Educations leadership accountability decision processes controls and penalties cid 127 Whistleblowers Insiders who report illegal or unethical behavior Corporate social responsibility CSR A business s concern for the welfare or society Compliance based ethics codes Ethical standards that emphasize preventing unlawful behavior by increasing control and by penalizing wrongdoers Integrity based ethics codes Ethical standards that define the organization s guiding values create an environment that supports ethically sound behavior well beyond ethical it is based on a commitment to integrity fairness and respect to their customers employees and environment Corporate Philanthropy The dimension of social responsibility that includes charitable donations Corporate social initiatives Enhanced forms of corporate philanthropy directly related to the company s competencies Corporate responsibility The dimension of social responsibility that includes everything from hiring minority workers to making safe products Corporate policy The dimension of social responsibility that refers to the position a firm takes on social a political issues Insider trading An unethical activity in which insiders use private company information to further their own fortunes or those of their family and friends Ex Martha Stewart at cocktail party and hears that product won t be accepted by FDA so goes home and sell all your stock in that company Social Audit A systematic evaluation of an organization s progress toward implementing socially responsible and responsive programs Foreign Corrupt Practices Act Bribing foreign officials Competitors find out and go to justice department cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127 cid 127
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