Marketing Manager Course - Chapter 03
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Chapter
3
Managing Social Responsibility and Ethics
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
After reading this chapter, you should be able to:
Apply the four key ethical criteria that
managers and employees should use when
making business decisions.
Understand why businesses establish codes of
ethics as a method of guiding employee
conduct.
Recognize ways to encourage ethical behavior
in business.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives(continued)
Make ethical decisions in morally challenging
situations.
Value corporate social responsibility.
Understand the influence of various
stakeholders on a company’s priorities, policies,
plans, and goals.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Ethics and social
responsibility should be high-
priority concerns of all
members of an organization,
not just managers and
executives.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
What are Business Ethics?
Ethics are principles that explain what is right
or wrong, good or bad, and what is appropriate
or inappropriate in various settings
Business ethics provide standards or guidelines
for the conduct and decision making of
employees and managers.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
What are Business Ethics? (continued)
Without a code of ethics:
There is no consensus regarding ethical principles
Different people will use different ethical criteria in
determining whether a practice or behavior is ethical
or unethical
Business ethics are not the same things as
laws.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Ethics Approaches
People utilize different ethical value systems
These systems are based on:
Personal experiences
Religious background
Education
Family training
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Approaches for Ethical Decision Making
Utilitarianism
A means of making decisions based on what is good for
the greatest number of people.
Individualism
The degree to which a society values personal goals,
autonomy, and privacy over group loyalty, commitment
to group norms, involvement in collective activities,
social cohesiveness, and intense socialization.
Individual self-interest should be promoted as long as it
does not harm others.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Approaches for Ethical Decision Making
(continued)
Rights approach
A means of making decisions based on the belief
that each person has fundamental human rights that
should be respected and protected.
Justice approach
An approach to decision making based on treating
all people fairly and consistently when making
business decisions.
Distributive Justice
Procedural Justice
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A company needs to ensure agreement about the relevant criteria on which
to judge the ethics of a business decision so that people do not base
decisions on personal value systems.
C ode ofEt cs
hi
C orporat C redos
e
Et calPolcy St em ent
hi i at s
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Numerous companies have adopted ethical
policy statements that inform employees of
acceptable standards of conduct
St. Paul Companies
Employees may accept gifts of inexpensive pens or
appointment diaries, but not liquor, lavish
entertainment, travel, or clothing.
Eli Lilly and Company
Employees may not conduct business with a
company with which they or their relatives are
associated, unless Eli Lily has given specific
approval and authorization.
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Company Examples (continued)
General Dynamics Corporation
Employees may not use or share inside information
(that is not available to the general public) for
personal gain.
J.D. Edwards and Company
Profanity and racial and sexual slurs are prohibited.
Language should convey a loving, caring, and
sensitive attitude toward other people.
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Managing Ethics
Et cs Trai ng
hi ni
Et calSt
hi ructures
W hi l ow er Polci
stebl i es
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Ethics Training
Usually contains three
elements:
Messages from top executives
emphasizing ethical business
practices
Discussion of Code of Ethics
Procedures for discussing or
reporting unethical behavior
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Ethical Structures
Ethical structures are the procedures and
divisions or departments within a company
that promotes and advocates ethical
behavior.
Two types of ethical structures:
Ethics Officer
Ethics Committee
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Whistleblower Policies Should Include the
Following Key Features
The policy encourages reporting
unethical conduct.
Meaningful procedure to deal fairly with
reported violations.
Those who report violations are protected from
retaliation.
Alternative reporting procedures.
Anonymous reporting to an ethics officer/committee.
Feedback to employees on ethics violations.
Top management support and involvement.
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Eight Ways Mangers Can Influence the Ethical
Behavior of Associates
Take actions that develop Meet with employees to
trust. discuss and define what
is expected of them.
Act consistently.
Ensure employees are
treated equitably.
Be truthful and avoid
white lies and Adhere to clear
manipulative actions. standards that are seen
as just and reasonable.
Demonstrate integrity.
Respect employees.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Four Examples of Ethical Dilemmas At Work
Performance
appraisal
Employee discipline
Office romance
Giving gifts in the
workplace
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Performance Appraisals
Formal evaluations of an employee’s
performance provided on a recurring basis
To perform effective evaluations, the
supervisor should devote substantial time to
collecting accurate performance
information
Rating are used for:
Letting employees know which skills they have
mastered and which require improvement
A basis for pay increases, future work
assignments, promotions, and sometimes layoffs
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
