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CH 3 Emerging Business Ethics Issues

This document discusses emerging business ethics issues and ethical dilemmas faced by stakeholders and businesses. It outlines the benefits of business ethics, including increased employee commitment, investor loyalty, customer satisfaction, and profits. The document identifies key stakeholders like employees, customers, investors, and communities. It discusses recognizing ethical issues and common issues around lying, fraud, conflicts of interest, discrimination, and environmental impacts. The challenge of determining ethical issues based on evolving societal values is also noted.

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fatima zaheer
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119 views

CH 3 Emerging Business Ethics Issues

This document discusses emerging business ethics issues and ethical dilemmas faced by stakeholders and businesses. It outlines the benefits of business ethics, including increased employee commitment, investor loyalty, customer satisfaction, and profits. The document identifies key stakeholders like employees, customers, investors, and communities. It discusses recognizing ethical issues and common issues around lying, fraud, conflicts of interest, discrimination, and environmental impacts. The challenge of determining ethical issues based on evolving societal values is also noted.

Uploaded by

fatima zaheer
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Emerging Business Ethics

Issues
Stakeholders, Businesses and Ethical Dilemmas
THE BENEFITS OF BUSINESS ETHICS
• Ethics Contribute to Employee Commitment
• Ethics Contribute to Investor Loyalty
• Ethics Contribute to Customer Satisfaction
• Ethics Contribute to Profits
ETHICAL ISSUE
• Regardless of what an individual believes about a particular action, if
society judges it to be unethical or wrong, whether correctly or not,
that judgment directly affects the organization’s ability to achieve its
business goals. For this reason alone, it is important to understand
business ethics and recognize ethical issues.
Stakeholders
• Business ethics issues, conflicts, and successes revolve around
relationships. Building effective relationships is considered one of the
more important areas of business today. A business exists because of
relationships between employees, customers, shareholders or investors,
suppliers, and managers who develop strategies to attain success.
• When unethical acts are discovered in organizations, it is often found
that in most cases there is knowing cooperation or compliancy that
facilitates the acceptance and continuity of unethical conduct.
• Therefore, relationships are not only associated with organizational
success but also with organizational misconduct.
Identifying Stakeholders
• In a business context, customers, investors and shareholders,
employees, suppliers, government agencies, communities, and many
others who have a “stake” or claim in some aspect of a company’s
products, operations, markets, industry, and outcomes are known as
stakeholders.
• These groups are influenced by business, but they also have the
ability to influence businesses; thus, the relationship between
companies and their stakeholders is a two-way street.
• Ethical misconduct and decisions that damage stakeholders will
generally impact the company’s reputation
Identifying Stakeholders
• We can identify two different types of stakeholders.
• Primary stakeholders are those whose continued association is absolutely
necessary for a firm’s survival; these include employees, customers, investors,
and shareholders, as well as the governments and communities that provide
necessary infrastructure. Some firms take actions that can damage relationships
with primary stakeholders.
• Secondary stakeholders do not typically engage in transactions with a company
and thus are not essential for its survival; these include the media, trade
associations, and special interest groups.
• Both primary and secondary stakeholders embrace specific values and standards
that dictate what constitutes acceptable or unacceptable corporate behaviors.
Social Responsibility and Ethics
• Social responsibility as an organization’s obligation to maximize its
positive impact on stakeholders and to minimize its negative impact.
• There are four levels of social responsibility:
• Legal: abiding by all laws and government regulations
• Economic: maximizing stakeholder wealth and/or value
• Ethical: following standards of acceptable behavior as judged by
stakeholders
• Philanthropic: giving back to society
Recognizing Ethical Issues in Business
• People make ethical decisions only after they recognize that a particular issue or
situation has an ethical component; thus, a first step toward understanding business
ethics is to develop ethical issue awareness.
• Ethical issues typically arise because of conflicts among individuals’ personal moral
philosophies and values, the values and culture of the organizations in which they
work, and those of the society in which they live.
• The business environment have many potential ethical conflicts among stakeholders.
• Characteristics of the job, the culture, and the organization of the society in which
one does business, can also create ethical issues.
• Gaining familiarity with the ethical issues frequently arise in the business world, will
help in identify and resolving issues when occur.
Recognizing Ethical Issues in Business
• To be clear, businesspeople do not have a unique set of values from
others; rather, the values they have are weighted differently when
doing business activities because of the additional responsibilities
associated with the marketplace.
• Recognizing an ethical issue is essential to understanding business
ethics and therefore to creating an effective ethics and compliance
program that will seek to minimize unethical behavior. In order to do
this, people must understand the universal moral constants of
honesty, fairness, and integrity, which are accepted by businesspeople
everywhere.
Ethical Issues and Dilemmas in Business
• Here is the list of many types of ethical issues that exist in
organizations although it is impossible to list every conceivable ethical
issue.
• An ethical issue is a problem, situation, or opportunity that requires
an individual, group, or organization to choose among several actions
that must be evaluated as right or wrong, ethical or unethical.
Ethical Issues and Dilemmas in Business
• Lying • Fraud
• Conflict of Interest • Consumer Fraud
• Bribery • Financial Misconduct
• Corporate Intelligence/ Hacking • Insider trading
• Discrimination • Intellectual property rights
• Sexual Harassment • Privacy issues
• Environmental Issues
Other Pertinent Business Ethical Issues
• Abusive behavior • Improper hiring practices
• Lying to employees and • Poor product quality
stakeholders • Stealing
• Email or internet abuse • Document alteration
• Employee benefit violation • Misuse of company’s
• Health and safety violation confidential documents
• Employee privacy violation • Customer privacy breach
• Environmental violations
Challenge of Determining an Ethical Issue
• However, over time, problems can become ethical issues as a result of
changing societal values.

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