MGMT 1040 Lecture Notes - Lecture 3: Ethics, Distributive Justice, Pg. 99
20 Jul 2016
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Document Summary
Moral problems arise when financial performance and social performance are in conflict. Financial performance is easy to measure (revenues, cost, profits) Social performance is difficult to measure but represents overall satisfaction of population. Results of moral problems can benefit, harm, impose rights of and expand rights of stakeholders. Key is to find equitable balance between financial and social performance and logically convince others to accept the balance. In a global economy, stakeholders become more diverse, therefore; effectively resolving moral problems becomes more important. It is impossible to avoid all harms or rights ignored. Evaluative methods: study economic outcomes, legal requirements, and ethical duties. Manager should produce with the least wanted (cheapest) resources to produce the most wanted (highest price) goods. Greatest satisfaction for shareholders of the firm. Theoretical and practical problems exist with this approach . Legal requirements: managers must always obey the law because the law supposedly represents collective moral standards of society.
