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Lecture 1 20032022 080240pm

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22 views15 pages

Lecture 1 20032022 080240pm

Uploaded by

michellemalik010
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Lecture 1

Business Ethics
Business Ethics as
Ethical Decision
Making
Learning Objectives
1. Differentiate between normative and
descriptive ethics.
2. Understand the difference between law and
ethics.
3. To understand the importance of managerial
decision making.
4. To understand the importance of ethics in
business.
Business Ethics as Ethical
Decision Making
 Ethics deals with most fundamental question:
“How should we live?”

 Philosophers deals in normative ethics


 Normative Ethics: Attempts to reach conclusions about what
things are good or bad or about what actions are right or wrong
 Social Scientists deals with descriptive ethics
 Descriptive Ethics: Attempts to describe world without
reaching any conclusions about whether the world is as it should
be
Business Ethics as Ethical
Decision Making
 Various examples of unethical decision making in business
 Corporate culture can either facilitate or deter unethical actions
 Ethics as discipline
 Ethics as art to live
 Contemplation
Business Ethics as Ethical
Decision Making
 Morals are “underlying values on which our decisions are based”
 Ethics is application of those morals to the decisions themselves
 Business Ethics: Study of moral standards as they apply to
business institutions, organizations, and behavior

Social Ethics
Justice
Public Policy
Organization operates
in society
Law
It influences and is influenced
Civic Virtues
by social ethics
Organizational Structure
Political Philosophy
Managerial Decision Making

 Individual ethics & collective ethics everyday we practice


both kinds of ethics
 Magnitude of responsibility and severity of consequences increases with
the kind of decisions
 Philosophical ethics asks for examination of our norms and values
“The unexamined life is not worth living” (Socrates)
 Norms: Normal Behavior
 Values: Underlying beliefs that cause us to act in a certain way
Managerial Decision Making

 Corporations have values that are foundations of their culture


 If unethical both individual and corporation values can lead to
unethical behavior
“Values can be distinguished by the end they
serve”
Ethical Values:
 Ends of human well-being (Happiness, respect, dignity,
integrity & meaning, freedom & autonomy)
 Not selfish in nature but should be promoted impartially
“Ethical values are those beliefs and principles that
impartially promote human well-being”
Ethics & the law
 Law is necessary for society & institutions
 Legal norm may not be equal to ethical norm
 Laws can be unethical
 Liberal societies legally require moral minimum to stop serious
harm but do not promote good
 Difficult to devise law for each real & imagined ethical failure
 Law cannot anticipate each & every dilemma in the organization
 Application of law is not clear cut & rather ambiguous
 Application of law in organization is mostly limited to risk
assessment
Ethics as practical reasoning

 Practical Reasoning: Reasoning about what we should do

Different from theoretical reasoning

What we should believe

 Practical reasoning is based on theoretical reasoning


Mini Case: Ethics After an Oil Spill
marks)
(5

 In August 2011, it was reported that an oil pipeline, owned by the energy
company Enbridge, had sprung a leak near the tiny remote town of Wrigley, in
Canada’s Northwest Territories. Not surprisingly, residents were unhappy about
the spill, confronting Enbridge with the twin dilemmas of how to clean it up and
what to do about the people of Wrigley. More generally, managers at Enbridge
had to figure out, in the wake of the leak, what their obligations would be, and to
whom those obligations were owed.
 Tiny Wrigley – slightly farther north than Anchorage, Alaska, but much farther
inland – has a population of about 165. Most community residents are members of
the Canadian aboriginal group known as Dene. Citizens of the town of Wrigley
have low levels of education – most of the population has received no formal
education whatsoever. More than half of the community is unemployed. Poverty
and access to the basic amenities of modern life are a serious challenge. At
present, there isn’t even a year round road into the town. They maintain a
traditional style of living based on hunting, fishing, and trapping, a lifestyle that
leaves them almost entirely dependent on the health of local forests and
waterways. Environmental protection isn’t just a question of principle for the
people of Wrigley; it’s a matter of survival.
Mini Case: Ethics After an Oil Spill
 After the spill was discovered, it was estimated that 1,500 barrels of oil
had leaked, but company officials said luckily none of the oil had reached
the nearby Willowlake River. Locals were skeptical, with some claiming
that the water now tasted odd. Immediately after the spill was discovered,
the company devised a detailed cleanup plan – a document more than
600 pages long. But locals were not impressed and said that the complex
technical document was too difficult to understand. When the company
offered $ 5000 so that the community could hire its own experts to
evaluate the plan, locals were offended. How could a rich oil company
insult them that way, first polluting their land and then offering such a tiny
payment?
 For Enbridge, the spill was a significant blow to its ongoing effort to
maintain a positive image. Just a year earlier, in the summer 2010, the
company has made headlines when one of its pipelines ruptured in
Michigan, spilling more than 20,000 barrels of oil into local rivers. And, at
the time, Enbridge was in the midst of trying to win approval for its
proposed Northern Gateway Pipeline Project and faced serious opposition
from environmental groups and aboriginal communities.
Mini Case: Ethics After an Oil Spill
 The company faced a number of difficult issues in the wake of Wrigley spill. The first concern,
clearly, would be to clean up the spilled oil. Then, there was the issue of remediation – the
process of attempting to restore the polluted land back to something like its original state.
Further, there was the question of whether and how to compensate the local community for the
pollution and loss of use of some of their traditional hunting grounds. All of this was set against a
backdrop of controversy surrounding the impact that oil pipelines have on the lands and
communities through which they run.
 Questions:
1. What do you think motivated the company’s decision to offer the community $ 5000 to hire its
own expert? Why do you think the community was insulted? If you were the company’s local
manager, what would you have done?
2. What facts would be helpful to you, as an outsider, in evaluating the company’s behavior after
the spill?
3. What values are involved in this situation? How would Enbridge answer that question, internally?
How would the people of Wrigley answer that question, if asked?
4. Did Enbridge have obligations that went beyond cleaning up the area directly affected by the
spill from the company’s pipeline? Was it obligated to offer $ 5000? Consider the suggestion
made by a member of the community, that Enbridge should donate money to build a swimming
pool or hockey arena for local kids. Would a donation of this kind help to satisfy the company’s
Answer format

 Main ethical issues


 Other issues
 Main parties or actors in the issue
 Possible solutions of the questions asked

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