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Law is strongly affected by moral concepts ethics , but law and morality are not the same. Legality is often a reliable guide to ethical behavior, but it cannot be relied upon as a perfect standard. Legal acts may be immoral, illegal acts may be moral. Certain ethical rules are based on theory rather than experimentation a priori reasoning. Individuals look to a central authority or set of rules for guidance, e. Act utilitarianism assesses each separate act in order to determine whether it produces net pleasure over pain.
Rule utilitarianism supports rules that at their inception would appear to be the best hope of producing maximum pleasure for the greatest number of people. Utilitarian notions of moral correctness are the basis for the concept of making a cost-benefit analysis in a managerial decision. The purpose of a cost-benefit analysis is to choose the most cost effective method for pursuing a goal after comparing the costs and benefits of proposed alternatives. If increasing net wealth, especially on a short-term basis, is the goal, a sound cost-benefit analysis is a helpful tool.
Actions should be judged by means and motives, rather than only results. Distributive justice also considers the needs and rights of all people, yet stresses the equality of opportunity, not of results. Libertarians claim that differences in wealth simply demonstrate different levels of skill in the marketplace. Taking wealth earned by some and giving it to others is unfair. The conventional or adolescent stage is one where an individual conforms his behavior to meet group or peer expectations.
Some people may reach the third, or post-conventional, adult level where individuals conform to internalized moral principles simply because they understand why the principles are right. Beyond setting the rules and enforcing them, Smith felt that government should stand aside.
Increased governmental intervention has occurred, however, because this model cannot be relied on to achieve objectives such as national defense, conservation of natural resources, health and safety, and social security.
Successful government regulation involves carefully balancing regulations that attempt to preserve competition and those that attempt to advance other social objectives. Many people — and even members of the corporate community itself — believe that companies have an obligation to sponsor projects that benefit society in ways beyond the economics of producing goods and services.
In July , the Dodd-Frank Wall Street Reform and Consumer Protection Act Dodd-Frank Act was enacted, improving accountability and transparency in the financial system, protecting consumers from abusive financial services practices, and improving corporate governance in publicly held companies.
Accountability — A corporation may decide to support a variety of social causes but, unlike a governmental body, will be required to submit to little public scrutiny.
Expertise — Although a corporation may have a high level of expertise in selling its goods and services, it may not be able to carry on social activities with the same degree of competence. Most people agree, however, that corporations have obligations beyond making a profit and avoiding harm to others.
The Social Contract — Since society allows for the creation of corporations and gives them special rights, including a grant of limited liability, this argument holds that corporations reciprocally owe a responsibility to our society. Less Government Regulation — When corporations act responsibly, regulation becomes unnecessary.
Long-Run Profits — Corporate involvement in social causes has the effect of creating goodwill which simply makes good business sense from a long-run profit perspective.
Does the use of affirmative action when a company is downsizing differ from when a company is hiring or conferring other benefits? The specific issue is how should Pharmakon implement its layoffs and what criteria should it use? How should a diversity policy be implemented? Is it appropriate? Is it relevant to the issues raised in Pharmakon? How much do you conserve for future use? A government? An international body?
The specific issue is what should JLM do about the particular individuals involved.
Is not providing references deception by silence? The least inclined? What is the cost to society in general? If so, when? ISSUES: Should the company follow the legal and ethical practices of its home country or the legal and ethical practices of the host country?
Customs Expediting Is it legal and ethical in home country? In host country? Probably is not a violation of Foreign Corrupt Practices Act. Campaign Contributions Is it legal and ethical in home country? Probably is a violation of Foreign Corrupt Practices Act. Lake Tahoe Is it legal and ethical in home country? Design of Plant Is it legal and ethical in home country?
Does that matter? Are any of these moral minimums applicable to any of the ethical issues raised in this case? Is it ethical to use non-disclosed agents to download land for a price lower than its known but undisclosed value? Misleading Press Release Although the press release issued in response to rumors was technically accurate, its downplaying of the situation is misleading. Is this a legal or ethical practice? Land Acquisition Is it legal and ethical to use multiple non-disclosed agents to mask the volume and value of land downloads in order to obtain land at a price lower than its actual value?
Is it ethical to download land at a low price, knowing its value is going to go up, then sell it at the elevated price? Stock download by Executives Who Is this insider trading? You have an employee who has a chemical imbalance in the brain that causes him to be severely unstable. The medication that is available to deal with this schizophrenic condition is extremely powerful and decreases the taker's life span by one to two years for every year that the user takes it.
You know that his doctors and family believe that it is in his best interest to take the medication.
What course of action should you follow? Answer: Arguments Against Social Responsibility. This question illustrates one scenario where arguments against corporate social responsibility could come into play. It could be argued that this decision may also decrease the possibility of injury or deterioration in working conditions for other employees. The other side of the argument, however, is that this type of decision is too personal for a corporation to make. The ultimate determination should reside with the employee and it should be his free decision to take or not take the medication.
This puts the responsibility back where it belongs, on the employee and his family. You have a very shy employee from another country. After a time, you notice that the quality of her performance is deteriorating rapidly. You find an appropriate time to speak with her and determine that she is extremely distraught. She tells you that her family has arranged a marriage for her and that she refuses to obey their contract. She further states to you that she is thinking about committing suicide.
Two weeks later, after her poor performance continues, you determine that she is on the verge of a nervous breakdown; and once again she informs you that she is going to commit suicide. What should you do? Consider further that you can petition a court to have her involuntarily committed to a mental hospital. You know, however, that her family would consider such a commitment an extreme insult and that they might seek retribution.
Does this prospect alter your decision? Answer: Arguments for Social Responsibility. A good, responsible manager would be hard- pressed to demand that the employee either improve her on-the-job performance or face dismissal.
However, initiating an involuntary committal to a mental hospital could constitute an improper invasion of rights with many legal repercussions. An interim step of providing appropriate psychological social counseling perhaps at company expense would seem to best fit into the concept of good corporate management.
This would benefit not only the individual, but the corporation may be able to keep a valued employee. The cost of counseling is likely to be less expensive than hiring and training a new employee.
You receive a telephone call from a company that you never do business with requesting a reference on one of your employees, Mary Sunshine. You believe that Mary is generally incompetent and would be delighted to see her take another job. You give her a glowing reference. Is this right? Answer: Utilitarianism. Pawning off an incompetent employee would certainly help the profitability of an employer.
You have just received a report suggesting that a chemical your company uses in its manufacturing process is very dangerous.
You have not read the report, but you are generally aware of its contents. You believe that the chemical can be replaced fairly easily, but that if word gets out, panic may set in among employees and community members.
A reporter asks if you have seen the report, and you say no. Is your behavior right or wrong? Proceeding with a course that acknowledges at least internally past dangerous practices, while immediately correcting the current problems, and correcting future problems in a timely manner, may be an appropriate legal as well as moral response to this problem.
This is one of the reasons many corporations have a corporate spokesperson to give appropriate and consistent responses. You and Joe Jones, your neighbor and friend, bought lottery tickets at the corner drugstore. You are the only living person who knows that Joe, not you, bought the winning ticket.