Managing Ethics and

Social Responsibility
 Lecture Outline
• Managing Ethics
• What is Managerial Ethics?
• Ethical Dilemmas
• Criteria for Ethical Decision Making
• Three Levels of Personal Moral Development
• Social Responsibility
• What is Corporate Social Responsibility?
• Evaluating Corporate Social Responsibility
• Sustainability

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 What is Managerial Ethics?
• Ethics - code of moral principles and values
that govern the behaviors of right or wrong
– Standards about good/bad
• People in organizations have divergent views
about right/wrong- complex

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Three Domains of Human Action

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 Ethical Management Today
• 55% of survey respondents think that cheating in
business is more common than 10 years ago
• More businesses are being associated with greed,
deceit, and irresponsibility
• Managers are responsible for setting an ethical
climate and act as models
• Executive compensation has become a hot issue
related to ethical management

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 Discussion Question
• Do you believe it is ethical for organizational
managers to try to get access to and scrutinize
Facebook pages of employees or job
applicants?

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 Examples of Unethical and
Illegal Organizational Behavior

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 Ethical Dilemmas

What potential ethical dilemmas do you

anticipate to encounter in the work place after
graduation?
What ethical dilemmas do you face as students?

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Criteria for Ethical Decision Making
• Utilitarian Approach
• Individualism Approach :
• Moral-Rights Approach :
1. The right of free consent. Individuals are to be treated only as they knowingly and freely
consent to be treated.
2. The right to privacy. Individuals can choose to do as they please away from work and have
control of information about their private life.
3. The right of freedom of conscience. Individuals may refrain from carrying out any order that
violates their moral or religious norms.
4. The right of free speech. Individuals may criticize truthfully the ethics or legality of actions
of others.
5. The right to due process. Individuals have a right to an impartial hearing and fair
treatment.
6. The right to life and safety. Individuals have a right to live without endangerment or violation of
their health and safety.

• Justice Approach: Distributive, procedural & compensatory

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 Virtue Ethics and
Practical Approaches
• Virtue ethics approach: moral behavior stems
from personal virtues

• Practical approach: sidesteps debates about what

is right or wrong and decision making follows
prevailing standards of the profession, larger society
and stakeholder interests

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 Factors that shape managers’ ethical
decision making
• Personality
• Personal needs
• Family influence
• Religion
• Organizational values
• Organizational culture

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Three Levels of Personal Moral
Development

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 What is Corporate Social
Responsibility?
• Distinguishing right from wrong; doing right
• Good corporate citizenship
– Make choices that contribute to society as well as the
organization
• Organizational Stakeholders –?

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Major Stakeholders Relevant to
Monsanto Company

Gap Inc.

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 Sustainability

Sustainability – economic development

that generates wealth and meets the needs
of current population while preserving the
environment for the needs of future
generations

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Evaluating Corporate Social
Responsibility

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Building an Ethical Organization

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Managing Company Ethics and Social
Responsibility
Code of Ethics

Ethical Structures

Whistle-blowing

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The Business Case for Ethics and
Social Responsibility
• Ethics and social responsibility is an
important business issue
• Stakeholders are pushing more
initiatives and issues
• The connection between ethics and
financial performance has been
widely debated
• What do you THINK?

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 Some questions to consider
• Assignment: Identify important stakeholders, through
stakeholder mapping, for Johnson and Johnson’s. Go through
“The Credo” and discuss how managers balance the interests
of various stakeholders through the code of ethics.

• A noted business executive said, “A company’s first obligation

is to be profitable. Unprofitable enterprises can’t afford to be
socially responsible.” Discuss why you agree or disagree with
this statement.

– THANK YOU, Any Questions?

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