Chapter 9 - Ethics, corporate social responsibility, environmental sustainability, and strategy. After studying this chapter, you should be able to: Understand how the standards of ethical behavior in business relate to the ethical standards and norms of the larger society and culture in which a company operates, recognize conditions that can give rise to unethical business strategies and behavior, gain an understanding of the costs of business ethics failures. | CHAPTER 9 ETHICS, CORPORATE SOCIAL RESPONSIBILITY, ENVIRONMENTAL SUSTAINABILITY, AND STRATEGY Student Version McGraw-Hill/Irwin Copyright ®2012 The McGraw-Hill Companies, Inc. WHAT DO WE MEAN BY BUSINESS ETHICS? Business Ethics Is the application of general ethical principles to the actions and decisions of businesses and the conduct of their personnel. Are not materially different from ethical principles in general because business actions have to be judged in the context of society’s standards of right and wrong. WHERE DO ETHICAL STANDARDS COME FROM—ARE THEY UNIVERSAL OR DEPENDENT ON LOCAL NORMS? The School of Ethical Universalism The School of Ethical Relativism Integrated Social Contracts Theory Sources for Ethical Standards The School of Ethical Universalism Ethical Universalism Holds that common understandings across multiple cultures and countries about what constitutes right and wrong give rise to universal ethical standards that apply to all societies, all firms, and all businesspeople. Effect on Business Ethics Whether a business-related action is right or wrong is judged by universal standards. The School of Ethical Relativism Ethical Relativism Holds that differing beliefs, customs, and behavioral norms across countries and cultures give rise to multiple sets of standards of what is ethically right or wrong. Effect on Business Ethics Whether business-related actions are right or wrong depends on local ethical standards. Integrated Social Contracts Theory Provides a middle-ground balance between universalism and relativism. Posits that the collective views of multiple societies form universal (first order) ethical principles that all persons have a contractual duty to observe in all situations. Within the contract, cultures or groups can specify locally ethical (second-order) actions. Application of Integrated Social Contracts Theory to Multinational Business Effects on Ethical Standards: Adherence to universal ethical norms takes precedence over . | CHAPTER 9 ETHICS, CORPORATE SOCIAL RESPONSIBILITY, ENVIRONMENTAL SUSTAINABILITY, AND STRATEGY Student Version McGraw-Hill/Irwin Copyright ®2012 The McGraw-Hill Companies, Inc. WHAT DO WE MEAN BY BUSINESS ETHICS? Business Ethics Is the application of general ethical principles to the actions and decisions of businesses and the conduct of their personnel. Are not materially different from ethical principles in general because business actions have to be judged in the context of society’s standards of right and wrong. WHERE DO ETHICAL STANDARDS COME FROM—ARE THEY UNIVERSAL OR DEPENDENT ON LOCAL NORMS? The School of Ethical Universalism The School of Ethical Relativism Integrated Social Contracts Theory Sources for Ethical Standards The School of Ethical Universalism Ethical Universalism Holds that common understandings across multiple cultures and countries about what constitutes right and wrong give rise to universal ethical standards that apply to all societies, all firms, and all .
