Textbook Notes (363,144)
Canada (158,220)
Management (801)
MGM101H5 (354)
Chapter 6

CHAPTER 6 - ETHICS & CSR summary

5 Pages
Unlock Document

University of Toronto Mississauga
Dave Swanston

Chapter 6 Notes Ethics in Management Ponzi Scheme is a type of investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ethics is a reflection of the moral principles or beliefs about what an individual views as being right or wrong. In many ways, ethics can be thought of as an invisible hand that guides us as we make decisions. Triple Yes Rule: · Yes #1—Does the decision that I am making fall within the accepted values or standards that typically apply to all organizational environments? · Yes #2—Would I be willing to have this decision communicated to all of my organization’s stakeholders, and have it reported on the front page of the newspaper or serve as the lead story on a news channel? · Yes #3—Would the people in my life with whom I have a significant personal relationship (family, spouse, etc.), as well as managers of other organizations, approve of and support my decision? These sources are individual, societal, professional, and business culture influences. In making decisions, we need to think in terms not of what is in our personal best interests, but of what is in the best interests of the stakeholders and the public at large. In making decisions, we need to think in terms not of what is in our personal best interests, but what is in the best interests of the stakeholders and the public at large. Integrity is honesty, reliability, ethics, and moral judgment The most important skill you can bring to the workplace is your integrity. Board of Directors is the term for the governing body of a corporation, comprising individuals chosen or elected to oversee the management of the organization. Just as companies are vulnerable to shifts in market conditions, changes in the intensity of competitive rivalry, disruptive technologies, and changing customers, so, too, are they vulnerable to the serious consequences and brand equity erosion that accompanies unethical behaviour within their management and employee ranks. For boards to effectively create a culture of ethical behaviour and financial integrity, they must commit to the following specific actions 1. The board must clearly define and establish boundaries of acceptable behaviour and financial integrity, and create performance standards to evaluate adherence to these parameters. 2. These boundaries must be clearly understood and communicated to all employees in the form of a policy or code of conduct. This code of conduct is not limited to financial integrity, but should clearly identify boundaries associated with ethical behaviour, both internal and external, and the consequences for failure to adhere to such a policy or codes, protocols, and overall culture. 3. The board of directors must appoint a representative (individual or committee), at the board level, whose responsibility is to audit managerial and employee performance and action in critical areas of this policy or code of conduct. This representative or committee would also be a key participant in reviewing compensation packages and other personnel-related policies to ensure these are not designed in a way which would encourage unethical behaviour. 4. The board of directors must create and support a mechanism for the reporting of ethical concerns within the organization (called whistleblowing), with such a process designed in a way that ensures employees who utilize such a process are not penalized or ostracized. 5. The board of directors or its representative must interact with senior management and external agencies monitoring the organization’s activities in order to discuss issues that could arise with respect to management or employees, and represent the best interests of the organization and its shareholders with respect to questions of ethical behaviour or financial integrity. Whistleblowing is the process through which an individual informs someone in authority of a dishonest act or the dishonest behaviour of another person To truly create a culture of ethical behaviour and financial decision integrity, the board of directors (or owner-representative body) must be active in the ongoing monitoring of the organization and take a leadership role in the tightening of such processes when and where it is required. Code of Conduct is the name for a statement that describes the required responsibilities, actions, and rules of behaviour of an organization’s employees. The board of directors, as representatives of the stakeholders of an organization, mus
More Less

Related notes for MGM101H5

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.