* * * ** CHAPTER * Demonstrating Ethical Behavior and Social Responsibility Nickels * McHugh McGraw-Hill/Irwin Understanding Business, 8e * McHugh 1-1 4-1 © 2008 The McGraw-Hill Companies, Inc., All Rights * * * Ethics • More Than Legality • Standards are with each • Ethics begins Fundamental of us 4-2 * * * Top U.S Ethical Issues Source: CMO Magazine, October 2004 4-3 * * * Ways to Prevent Unethical Behavior Source: CMO Magazine, Oct 2004 4-4 * * * Privacy Protectors Based on a Privacy Trust Score (PTS): • Health care providers scored the highest • Grocery Stores and Department of Homeland Security (DHS) scored the lowest • Democrats have higher PTS than all other political affiliations • 81% of the respondents feel privacy is important or very important Source: www.darwinmag.com, November 2003 4-5 * * * 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 Source: USA Today 4-6 * * * Most Popular Ways to Monitor Employees • Internet (74%) • Background Exams (62%) • Store and Review Email (43%) • Store and Review Computer Files (31%) • Videotape Employees (18%) Source: USA Today 4-7 * * * Ethics Check Questions: • Is It Legal? • Is It Balanced? • How Will It Make Me Feel About Myself? 4-8 * * * Why Don’t We Trust Corporations? Source: USA Today 4-9 * * * Factors Influencing Managerial Ethics Organizational Environmental • Values • Work • Top Level Mgmt Philosophy • Competition Background • Family Status • The Firm’s Reward System • Personality • Job Dimensions Individual • Economic Conditions • Social/Cultural Institutions 4-10 * * * Codes of Ethics • Compliance-Based • Integrity-Based 4-11 * * * Steps to Improve U.S Business Ethics 1.Top management support 2.Employees’ understanding 3.Managers’ training 4.Ethics Office 5.Outsiders must be informed 6.Enforcement of ethics code 4-12 * * * Levels of Corporate Social Responsibility Societal Responsibility Stakeholder Responsibility Ecological General Customers Profit Profit Responsibility Environment Owners/Stockholders Employees Public Suppliers/Distributors Public Interest Groups Source: Marketing, Marketing, 5/E by Berkowitz, Kerin, Hartley, and Rudelius 4-13 * * * Corporate Responsibility (Percent of country’s top 100 companies that publish separate CR reports) Source: Financial Times, June 15, 2005 4-14 * * * Social Audit • Company • Outside Groups that serve as watchdogs: • Socially-Conscious Investors • Environmentalists • Union Officials • Customers 4-15 * * * 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 4-16 * * * Best Company Reputation • Johnson & Johnson (80.6) • Coca-Cola (79.7) • Google (79.5) • UPS (79.4) • 3M (78.8) Source: USA Today 4-17 * * * Most Admired Global Companies General Electric Microsoft Toyota Dell Procter & Gamble Berkshire Hathaway FedEx Apple Computer Johnson & Johnson 10.Wal-Mart Source: Fortune, 2006 4-18 ... * Top U.S Ethical Issues Source: CMO Magazine, October 2 004 4-3 * * * Ways to Prevent Unethical Behavior Source: CMO Magazine, Oct 2 004 4-4 * * * Privacy Protectors Based on a Privacy Trust Score... • Compliance-Based • Integrity-Based 4-11 * * * Steps to Improve U.S Business Ethics 1.Top management support 2.Employees’ understanding 3.Managers’ training 4.Ethics Office 5.Outsiders must be... Secrets to Spouse/Family 50% Let a Gift Sway Purchasing Decision 26% Pay Someone Off to Close a 13% Business Deal Source: USA Today 4-6 * * * Most Popular Ways to Monitor Employees • Internet (74%)