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Chapter 4

Chapter 4.docx

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School of Management
Course Code
SOM 122

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Chapter 4- Ethics and Social Responsibility Ethics- a set of moral principles or values that defines right and wrong for a person or group Ethical behavior- behavior that conforms to a society’s accepted principles of right and wrong • Workplace deviance- unethical behavior that violates organizational norms about right and wrong o 1. Production Deviance- hurts the quality and quantity niesa Particu of work produced lar  EX. Leaving early, long work breaks, wasting People resources o 2. Property Deviance- aimed at the organizations property or products  EX. Stealing, sabotaging, damaging equipment  Employee shrinkage- employee theft of company merchandise o 3. Political Deviance- using ones influence to harm others in the company  EX. Making decisions based on favoritism, spreading rumors o 4. PersonalAggression- hostile or aggressive behavior towards others  EX. Sexual harassment, verbal abuse, threats 1991- US Sentencing Commission Guidelines for Organizations • Companies could be prosecuted and punished even if management didn’t know it was happening • To encourage companies to do the right thing (ethical behavior BEFORE an incident occurs) Invasion of privacy Theft Price fixing Money laundering Fraud Conflicts of interest Customs violations Embezzlement Antitrust violations Dealing with stolen goods DETERMININGACOMPANY’S PUNISHMENT 1. Compute the base fine (determine the level of offense) 2. Compute culpability score 3. Multiply culpability by base fine COMPLIANCE PROGRAM STEPS 1. Establish standards and procedures 2. Assign upper level managers to be in charge 3. Delegate decision-making authority only to ethical employees Chapter 4- Ethics and Social Responsibility 4. Encourage employees to report violations 5. Train employees on standards and procedures 6. Enforce standards consistency and fairly 7. Improve program after violations Ethical intensity- degree of concern people have about an ethical issue • Magnitude of consequences- total harm or benefit derived from an ethical decision • Social consensus- agreement on whether behavior is bad or good • Probability of effect- chance that something will happen that results in harm to others o EX. There is a clear agreement (social consensus) that an action or decision is certain (probability) that there will be large negative consequences (magnitude) = highly concerned • Temporal immediacy- time between an act and the consequences the act produces • Proximity of effect- social, psychological, cultural or physical distance of a decision marker from those affected by his or her decisions o EX. Laying off employees you know vs. employees you don’t know • Concentration of effect- how much an act affects the average person 3 PHASES OF MORAL DEVELOPMENT • Preconventional Level of Moral Development o People decide based on selfish reasons  Stage 1 (punishment and obedience) = primary concern will be to avoid trouble for yourself • Don’t copy software  Stage 2 (instrumental exchange) = worry less about punishment and more about doing things that directly advance your wants and needs • Copy software • Conventional Level o Make decisions that conform to societal expectations  Stage 3 (good boy, nice girl) = do what everyone else is doing • If everyone else is…copy • If everyone else isn’t…don’t copy  Stage 4 (law and order) = look for external guidance and do whatever the law permits • Won’t copy software • Postconventional Level o Internalized ethical principles to solve ethical dilemmas  Stage 5 (social contract) = as a whole, society is better off when the rights of others are not violated
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