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1. 4-1 Nickels McHugh McHugh
2. 4-2 Top U.S. Ethical Issues Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Top U.S. Ethical Issues
Improper accounting practices and deceptive sales/marketing practices were among the top concerns of the marketing executives in a poll conducted by the CMO Magazine in August 2004.
Ask the students: What companies come to mind when we talk about improper accounting practices? (A quick Google search brings up following well known companies for improper accounting practices: AIG, Health South, and Qwest Communications. And, of course, the famous scandals at Enron and WorldCom comes to mind as well.)
Ask the students: Which of these issues have they encountered themselves and how do they feel about them?
A good example of deceptive sales/marketing practices is the advertising by many credit card companies of 5% cash back. When you read the fine print or start using the card, you find out that you will usually get only 1% cash back.Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Top U.S. Ethical Issues
Improper accounting practices and deceptive sales/marketing practices were among the top concerns of the marketing executives in a poll conducted by the CMO Magazine in August 2004.
Ask the students: What companies come to mind when we talk about improper accounting practices? (A quick Google search brings up following well known companies for improper accounting practices: AIG, Health South, and Qwest Communications. And, of course, the famous scandals at Enron and WorldCom comes to mind as well.)
Ask the students: Which of these issues have they encountered themselves and how do they feel about them?
A good example of deceptive sales/marketing practices is the advertising by many credit card companies of 5% cash back. When you read the fine print or start using the card, you find out that you will usually get only 1% cash back.
3. 4-3 Ethics of MBA Students Percent of MBA Students Who Would:
Buy Stock on Inside Information 52%
Reveal Corp. Secrets to Spouse/Family 50%
Let a Gift Sway Purchasing Decision 26%
Pay Someone Off to Close a 13%
Business Deal Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Ethics of MBA Students
A disturbing slide that examines the potential actions of MBA students as it relates to Business Ethics.
This slide further identifies the need for ethical teaching at the highest level of our academic institutions.
Some University Programs are attempting to solve this negative social trend.
University of Maryland requires MBA students to take a 1-day trip to prison to illustrate how smart, successful, business savvy overachievers can land in jail.
Companies are showing greater awareness of this problem with 75% of the USA’s 1,000 largest companies having Corporate Ethics Officers.
Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Ethics of MBA Students
A disturbing slide that examines the potential actions of MBA students as it relates to Business Ethics.
This slide further identifies the need for ethical teaching at the highest level of our academic institutions.
Some University Programs are attempting to solve this negative social trend.
University of Maryland requires MBA students to take a 1-day trip to prison to illustrate how smart, successful, business savvy overachievers can land in jail.
Companies are showing greater awareness of this problem with 75% of the USA’s 1,000 largest companies having Corporate Ethics Officers.
4. 4-4 Ways to Prevent Unethical Behavior Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Ways to Prevent Unethical Behavior
This slide complements the previous Top US Ethical Issues slide.
Before you put this slide up, you may want to ask the students: How can the top ethics issues be addressed? What can be done to deter the unethical behaviors?
Increasing the penalty and educating the employees are among the top methods for deterring unethical behaviors, according to the CMO Ethics Poll. (Source: CMO Magazine, October 2004)
Thirty percent of the respondents in the poll suggested adding new laws to deter unethical behaviors. Ask the students: If ethics is more than legality, would new laws help? (Students should be able to argue this point. Although ethics is more than legality, if something is against the law, people may deter from such behavior. However, it should be pointed out that ethics should be the way of life, i.e., it needs to be ingrained in the employees through culture and role modeling.)Also available on a Transparency Acetate
See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
Ways to Prevent Unethical Behavior
This slide complements the previous Top US Ethical Issues slide.
Before you put this slide up, you may want to ask the students: How can the top ethics issues be addressed? What can be done to deter the unethical behaviors?
Increasing the penalty and educating the employees are among the top methods for deterring unethical behaviors, according to the CMO Ethics Poll. (Source: CMO Magazine, October 2004)
Thirty percent of the respondents in the poll suggested adding new laws to deter unethical behaviors. Ask the students: If ethics is more than legality, would new laws help? (Students should be able to argue this point. Although ethics is more than legality, if something is against the law, people may deter from such behavior. However, it should be pointed out that ethics should be the way of life, i.e., it needs to be ingrained in the employees through culture and role modeling.)
5. 4-5 Social Responsibility CORPORATE SOCIAL RESPONSIBILITY
(CSR) is a business’s concern for welfare of society.
It is based on a company’s concern for the welfare of all its stakeholders, not just the owners.
Some CRITICS of CSR believe that a manager’s sole role is to compete and win.
I See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
6. 4-6 Codes of Ethics Milton Friedman stated that the only social responsibility of business is to make money for stockholders.
DEFENDERS argue that CSR makes more money for investors in the long run.
One study showed a positive correlation between CORPORATE SOCIAL PERFORMANCE and CORPORATE FINANCIAL PERFORMANCE.
I See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
7. 4-7 Ethics See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91
8. 4-8 Ethics Check Questions: Is It Legal?
Is It Balanced?
Is it Fair ? Also available on a Transparency Acetate
See Learning Objective 2: Ask the three questions one should answer when faced with a potentially unethical action.
See text pages: 91-94
Ethics Check Questions
A simple scenario can be presented to the students to take them through these three questions checklist. For example: If they are making copies of personal work on company copier or they are using official company time to do personal work or billing the company for meals when traveling on a company business but the meals were covered by the suppliers/vendors. Starting with a simple scenario and gradually making it more complex can bring different issues to the table help students understand the gray areas.Also available on a Transparency Acetate
See Learning Objective 2: Ask the three questions one should answer when faced with a potentially unethical action.
See text pages: 91-94
Ethics Check Questions
A simple scenario can be presented to the students to take them through these three questions checklist. For example: If they are making copies of personal work on company copier or they are using official company time to do personal work or billing the company for meals when traveling on a company business but the meals were covered by the suppliers/vendors. Starting with a simple scenario and gradually making it more complex can bring different issues to the table help students understand the gray areas.
9. 4-9 Factors Influencing Managerial Ethics Also available on a Transparency Acetate
See Learning Objective 3: Describe management’s role in setting ethical standards.
Factors Influencing Managerial Ethics
Factors that influence business ethics are analyzed from three different perspectives: individual factors, organizational factors, and environmental factors. If you work through the acetate factor-by-factor, this should allow for maximum participation and full coverage.
Ask the students: Which of these factors tends to predominate in terms of overall managerial behavior? Do these factors change noticeably over time?
Ask the students: What factors most dominate their attitudes concerning ethical behavior? (We’ve tried this in our classes and have received some very interesting responses. Let us know by e-mail what your students have to say.)Also available on a Transparency Acetate
See Learning Objective 3: Describe management’s role in setting ethical standards.
Factors Influencing Managerial Ethics
Factors that influence business ethics are analyzed from three different perspectives: individual factors, organizational factors, and environmental factors. If you work through the acetate factor-by-factor, this should allow for maximum participation and full coverage.
Ask the students: Which of these factors tends to predominate in terms of overall managerial behavior? Do these factors change noticeably over time?
Ask the students: What factors most dominate their attitudes concerning ethical behavior? (We’ve tried this in our classes and have received some very interesting responses. Let us know by e-mail what your students have to say.)
10. 4-10 Codes of Ethics
Compliance-Based
Integrity-Based See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
11. 4-11 Codes of Ethics COMPLIANCE-BASED ETHICS CODES are ethical standards that emphasize preventing unlawful behavior by increasing control and by penalizing wrongdoers.
See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
12. 4-12 Codes of Ethics INTEGRITY-BASED ETHICS CODES are ethical standards that define the
organization’s guiding values, create an environment that supports ethically sound behavior, and stress a shared accountability among employees.
See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
13. 4-13 Ethics See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91
14. 4-14 Ethics See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91
15. 4-15 Codes of Ethics CORPORATE AND CRIMINAL FRAUD ACCOUNTABILITY ACT
(Sarbanes-Oxley, 2002) See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
16. 4-16 Steps to Improve U.S. Business Ethics Top management support
Employees’ understanding
Managers’ training
Ethics Office
Outsiders must be informed
Enforcement of ethics code
See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
See Learning Objective 4: Distinguish between compliance-based and integrity-based ethics codes, and list the six steps in setting up a corporate ethics code.
See text pages: 96-97
17. 4-17 Social Audit Company
Outside Groups that serve as watchdogs:
Socially-Conscious Investors
Environmentalists
Union Officials
Customers See Learning Objective 5: Define corporate social responsibility and examine corporate responsibility to various stakeholders.
See text pages: 99-108See Learning Objective 5: Define corporate social responsibility and examine corporate responsibility to various stakeholders.
See text pages: 99-108
18. 4-18 Ethics See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91See Learning Objective 1: Explain why legality is only the first step in behaving ethically.
See text pages: 90-91
19. 4-19 International Ethics and Social Responsibility Ethical problems are Not Unique to the U.S. managers
Demand for Socially Responsible Behavior from Global Suppliers
Joint Initiative on Corporate Accountability and Workers’ Rights
Inter-American Convention Against Corruption See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
See text pages: 108-109See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
See text pages: 108-109
20. 4-20 Best Company Reputation Johnson & Johnson (80.6)
Coca-Cola (79.7)
Google (79.5)
UPS (79.4)
3M (78.8) See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
Best Company Reputations
Reputation quotient was based on the respondent’ rating of each company on 20 attributes.
Harris Interactive Annual RQ survey was conducted in 2005.
Ask the students: Which of these companies they would rate highest and why? (Many of them may pick up Google simply because of their familiarity. If they ask for criteria, etc., they are thinking in the right direction.)
An interesting assignment for students may be to research how this list compares with Fortune Magazine’s Most Admired Corporations. (Fortune’s Top 10 companies for 2006: GE, FedEx, Southwest Airlines, Procter & Gamble, Starbucks, Johnson & Johnson, Berkshire Hathaway, Dell, Toyota Motors, and Microsoft.)See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
Best Company Reputations
Reputation quotient was based on the respondent’ rating of each company on 20 attributes.
Harris Interactive Annual RQ survey was conducted in 2005.
Ask the students: Which of these companies they would rate highest and why? (Many of them may pick up Google simply because of their familiarity. If they ask for criteria, etc., they are thinking in the right direction.)
An interesting assignment for students may be to research how this list compares with Fortune Magazine’s Most Admired Corporations. (Fortune’s Top 10 companies for 2006: GE, FedEx, Southwest Airlines, Procter & Gamble, Starbucks, Johnson & Johnson, Berkshire Hathaway, Dell, Toyota Motors, and Microsoft.)
21. 4-21 Most Admired Global Companies General Electric
Toyota
Procter & Gamble
FedEx
Johnson & Johnson
Microsoft
Dell
Berkshire Hathaway
Apple Computer
Wal-Mart See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
Most Admired Global Companies
This slide complements the previous slide Best Company Reputations.
Ask the students: Why do both the lists of most admired global companies and most admired US companies have so many common companies? (Most of these U.S. companies are global giants as well.)
An interesting assignment for students could be to read and research Fortune’s criteria to determine how the companies were selected for these lists. Were they on the list because of profitability or great CSR or happy employees or fantastic service?
How can other companies improve their standing on this list? (The researched criteria for the previous question should provide the necessary answer for this question as well.)See Learning Objective 6: Analyze the role of American businesses in influencing ethical behavior and social responsibility in global markets.
Most Admired Global Companies
This slide complements the previous slide Best Company Reputations.
Ask the students: Why do both the lists of most admired global companies and most admired US companies have so many common companies? (Most of these U.S. companies are global giants as well.)
An interesting assignment for students could be to read and research Fortune’s criteria to determine how the companies were selected for these lists. Were they on the list because of profitability or great CSR or happy employees or fantastic service?
How can other companies improve their standing on this list? (The researched criteria for the previous question should provide the necessary answer for this question as well.)
22. 4-22 Also available on a Transparency Acetate
See Learning Objective 5: Define corporate social responsibility and examine corporate responsibility to various stakeholders.
Three Levels of Social Responsibility
This slide investigates differing concepts of the social responsibility of organizations.
Social Responsibility can be defined as:
Companies’ voluntary commitment to improving society by developing long-term policies that honor high ethical standards and meet responsibilities.
In class, you may want to visit a corporate website to investigate a company’s social practice. (Target Stores, Anheuser-Busch, McDonald’s Corp.)
Listed below are some examples you can share with the students of companies who practice social responsibility:
Target Corp. – Contributes over $2 million each week to the communities it serves.
Anheuser-Busch – Over the past 10 years has contributed over $320 million to charitable organizations.
McDonald’s – Ronald McDonald House CharitiesAlso available on a Transparency Acetate
See Learning Objective 5: Define corporate social responsibility and examine corporate responsibility to various stakeholders.
Three Levels of Social Responsibility
This slide investigates differing concepts of the social responsibility of organizations.
Social Responsibility can be defined as:
Companies’ voluntary commitment to improving society by developing long-term policies that honor high ethical standards and meet responsibilities.
In class, you may want to visit a corporate website to investigate a company’s social practice. (Target Stores, Anheuser-Busch, McDonald’s Corp.)
Listed below are some examples you can share with the students of companies who practice social responsibility:
Target Corp. – Contributes over $2 million each week to the communities it serves.
Anheuser-Busch – Over the past 10 years has contributed over $320 million to charitable organizations.
McDonald’s – Ronald McDonald House Charities