Chapter 1 An Overview of Ethics

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Chapter 1An Overview of Ethics
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Chapter 1 - Objectives

• To understand ethics and why they are important
  in ways that are consistent with a code of
  principles.
• Understand why business ethics are becoming
  increasingly important.
• Identify what actions corporations are taking to
  reduce business ethics risks.
• Understand why corporations are interested in
  fostering good business ethics.
• Identify different approaches to ethical decision
  making.
• Discuss the risk of negative impact due to the
  unethical use of information technology.

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Ethics Defined

• Moral codes are the rules that establish the
  boundaries of generally accepted behavior.
• Morality refers to social conventions about right
  and wrong human conduct.
• Ethics are beliefs regarding right and wrong
  behavior.

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Ethics Defined

• Virtues are habits that incline us to do what is
  acceptable.
• Vices are habits that incline us to do what is
  unacceptable.
• Value System is the complex scheme of moral
  values that we choose to live by.

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The Importance of Integrity

• Integrity is used to refer to people who act in
  ways that are consistent with their own code of
  principles.
• You often reflect on your principles when you
  consider what you ought to do in different
  situations.

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Ethics in the Business World

• Globalization of organizations has created a
  complex business world.
• Risk is the likelihood of a negative event times
  the impact of the event.

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Why Business Ethics are Important

• Protect the organization and its employees from
  legal action.
• Create an organization that operates
  consistently.
• Produce good business.
• Avoid unfavorable publicity.
• Gain the goodwill of the community.

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Legal Overview

• Bribes involve providing money, property, favors,
  or anything else of value to someone in business
  or government in order to obtain a business
  advantage.
• Gifts are made openly and publicly as a gesture
  of friendship or goodwill with no expectation of
  a future favor for the donor.

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Improving Corporate Ethics

• Appoint a corporate ethics officer.
• Ethical standards should be set by a board of
  directors.
• Establish a corporate code of conduct.
• Conduct social audits.
• Require employees to take ethics training.
• Include ethical criteria in employee
  appraisal/reward systems.

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Code of Conduct

• A guide that highlights an organizations key
  ethical issues and identifies the overarching
  values and principles that are important to the
  organization and that can help in decision
  making.
• The code of conduct helps ensure that employees
• Abide by the law.
• Follow necessary regulations.
• Behave in an ethical manner.

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Ethical Decision Making

• Get the facts.
• Identify the stakeholders and their positions.
• Consider the consequences of your decision.
• Weigh various guidelines and principles (Virtue,
  Utilitarian, Fairness, Common Good).
• Develop and evaluate options.
• Review your decision.
• Evaluate the results of your decision.

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Four Common Approaches Used in Ethical
Decision-Making
Table 1.5
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Ethics in Information Technology

• The increased use of information technology has
  raised many ethical issues for todays IT
  professional.
• Licensing of IT professionals
• Internet communication
• Intellectual property
• Employee/employer issues

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Summary

• Ethics are beliefs regarding right and wrong
  behavior.
• Business ethics are becoming increasingly
  important because the risks associated with
  inappropriate behavior have grown.
• Corporations are interested in fostering good
  business ethics
• Protect the company and employees from legal
  action.
• Create an organization that operates
  consistently.
• To produce good business.
• To avoid negative publicity.
• To gain the good will of the community.

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Summary

• Ethical decision making process
• Get the facts
• Identify shareholders and their positions
• Consider the consequences
• Weigh guidelines and principles
• Develop and evaluate options
• Review your decision
• Evaluate the results of your decision
• The growth of use in IT has also increased the
  risk of unethical uses of IT.

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Case 1Missing White House E-mail

• E-mail problems in the Clinton White House became
  public in February 2000 through a 90 million
  class-action suite filed by Judicial Watch, a
  conservative group that had dogged the Clinton
  administration with a number of lawsuits since
  1994.

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Case 2McKesson HBOC Accused of Accounting
Improprieties

• HBOC delivered cost effective patient information
  and hospital data collection systems. Accounting
  irregularities and questionable business
  practices resulted in a loss in stock prices and
  many other legal problems.