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Flashcards in Ch 2 Deck (38)

4 sources of ethical values?

1 Legal regulation
2 professional codes of ethics
3 codes of ethics from business organizations
4 individual values


Property reflects moral values concerning the...

Allocation of resources among people


Ethics and the business cycle

When times are tough ethics improve

When businesses thrive and regulatory intervention remains
At status quo, ethics erode


Ethics and government

Business leaders promote business ethics to prevent the
Likelihood of additional government regulation


Internet and media: ethics

Exposé ethics more visibly than in any other time period


Economic interdependence

People are no longer self sufficient they depend on the market


Public education and family values

Have declined as public school funding has declined and
Parents have less time to spend with children b/c work



Collection of values that guides human behavior


Shared moral values lead to...

Trust, cooperation and social harmony



Systematic statement of right and wrong

Also a Philosophical system that justifies and necessitates
rules of conduct


Difference btw law and ethics

Legal system is an institution of the state, which enforces
Legal rules (civil + criminal sanctions, monetary damages etc.)

Ethical values aren't always enforced by the state



Approach to ethics that affirms an absolute morality

A particular act is in itself right or wrong in every situation

Have duty or moral obligation not to lie


Categorical imperative

You have moral duty to act in way you believe everyone
Should act


Social contract theory, what does it concern itself with?

Concerns itself with how to construct a just society given
The many inequalities of wealth, knowledge and social status


Social contract theory, how is it implemented and why?

We should assume that we don't know our age, gender,
Wealth, race, intelligence, strength or social status

Vital b/c it keeps us from being self interested in values
We consider


Rawl's "veil of ignorance" means to...

To Think ethically you must lose the assumption that what
You personally need or want it necessarily morally correct


Social contract: rawls 1st ethical principle

Everyone is entitled to basic equal rights including liberty,
Freedom of association and personal security


Social contract Rawls 2nd ethical principle: although there might be social and economic inequalities...

These inequalities must be based on what a person does,

Not on who a person is, everyone must have an equal
opportunity for achievement (equal starting place)


Consequentialism,define, example

Concerns itself with moral consequences of actions rather
Than with morality of actions themselves

Lying itself is not unethical, it's the end result that should be
Evaluated, harm or loss of trust done by lying is unethical


Dominant form of consequentialism: Utalitarianism

Judges actions by usefulness, by whether they serve to
Increase the common good


Research shows that the best performing companies are led by...

Those who can promote moral principles throughout their organization


Protestant ethic

Human desire and indulgence should be bent to god's will
Through self denial, rational planning and productivity

A formalist approach: honesty and keeping promises were
Intrinsically good


Protestant ethic vs. capitalism

Protestant ethic eroded under capitalism with rising wealth

Supports bureaucratic managerial system

The part of Protestant ethic that supported hard work,
Success and rational planning continued without
Original absolute moral values


5 major ethical rules drawn form law

1 respect for liberty and rights of others
2 importance of acting in good faith
3 importance of exercising due care
4 importance of honoring confidentiality
5 avoidance of conflicts of interest


Law: liberty and rights

Legislation protects privacy, equal opportunity employment,
Guaranteed freedom of expression and due process of law


Law: good faith

Good faith is demonstrate in economic transactions

All sales must be made with honesty and intent


Due care AKA Due diligence

Derives from society's expectations about how fair and reasonable actions are

Promotes common good


Negligence cases, balancing test

Balancing test- likelihood that defendants conduct causes
Harmful consequences

Negligence cases use the balancing test



It is malpractice for a professional agent to tell others
What a client told them in confidence


Conflict of interest

Occurs when person secretly serves 2 masters

Ex 2 When a judge owns stock in a company he makes a
decision on in a court case


Self regulation

Ethical codes that exist within industries And corporations

Aren't enforced by the state, but by the professional
Organization in the industry


Individual values: self assessment 5 questions?

1 have I thought whether the action I will take is right or wrong?
2 will I be proud to tell my family, employer, media about
This action?
3 am I willing for everyone to act as I'm thinking of acting?
4 will my decision cause harm to others or the environment?
5 will my actions violate the law?


Major obstacle for corporations ethics

Emphasis on profits


Top management and ethics

Top management must follow the code Of ethics as they
Are role models for employees throughout corporation


Openness in communication

Promotes trust

Important to have a willingness to openly talk about Issues
for employees throughout corporation to make ethical decision



Interests of many different groups in society

They have something at risk when the company acts and
Thus have a stake in it


Stakeholder theory

Holds that ethical corporate behavior requires that directors
And managers take into account everyone whose interests
The corporation impacts called stakeholders



Owners who control large productive resources and
Employ others