0. Chapter 4. Ethics and Social Responsibility. 0. Learning Objectives. Define ethics and understand the relationship between law and ethics.
Ethics and Social Responsibility
The inner-guiding moral principles, values, and beliefs that people use to decide what is the “right” or appropriate way to behave.
An ethical dilemma is a quandary which people find themselves in when right and wrong cannot be clearly identified. Their actions might help one person at the expense of another or their own self-interest.
Ethics and laws change as norms and values of society changes
Organizational Stakeholders – people or groups that supply a company with its productive resources and have a claim on its resources.
Has a stake in the organization’s performance
When there are no laws to specify behavior, managers must decide what is the ethical way to behave toward organizational stakeholders
Problem: Adhering to the common good approach can result in ignoring the individual’s rights.
The way a company’s managers and employees view their obligation to make decisions that protect, enhance and promote the welfare of society as well as the organization.
Does the organization have responsibilities beyond economic responsibilities (maximizing profits for owners and shareholders)?