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Ethics
the study of right and wrong, and the morality of the choices individuals make.
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Business Ethics
the application of moral standards to business situations.
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Conflict of Interest
results when a business person takes advantage of a situation for his or her own personal interest rather than for the employer's interest.
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Factors Affecting Ethical Behavior
- 1 Individual Factors
- a. individual knowledge of an issue.
- b. personal values
- c. personal goals
- 2 Social Factors
- a. cultural norms
- b. coworkers
- c. significant others
- d. use of the Internet
- 3 Opportunity
- a. presence of opportunity
- b. ethical codes
- c. enforcement
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Encouraging Ethical Behavior
- 1 Government's role
- 2 Trade associations
- 3 individual companies
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Sarbanes-Oxley Act of 2002
provides sweeping new legal protection for employees who report corporate misconduct.
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Code of Ethics
a guide to acceptable and ethical behavior as defined by the organization.
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Whistle-blowing
informing the press or government officials about unethical practices within one's organization.
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Social Responsibility
the recognition that business activities have an impact on society and the consideration of that impact in business decision making.
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Caveat Emptor
the Latin phrase meaning, "let the buyer beware".
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Two views of Social Responsibility
- 1 The Economic Model
- 2 The Socioeconomic Model
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Economic model of social responsibility
the view that society will benefit most when business is left alone to produce and market profitable products that society needs.
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Socioeconomic model of social responsibility
the concept that business should emphasize not only profits but also the impact of its decisions on society.
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Pros / Cons of Social Responsibility
- For - maintain that business must do more than simply seek profits.
- Against - business should do what it does best, earn a profit by manufacturing and marketing products that people want.
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Counsumerism
all activities undertaken to protect the rights of consumers.
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The Six Basic Rights of Consumers (JFK - 1960s)
- 1 Right to Safety
- 2 Right to be Informed
- 3 Right to Choose
- 4 Right to be Heard
- 5 Right to Consumer Education (Gerald Ford-1975)
- 6 Right to Service (Clinton-1994)
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Minority
a racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavorable treatment.
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Affirmative Action Program
a plan designed to increase the number of minority employees at all levels within an organization.
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Equal Employment Opportunity Commission (EEOC)
a government agency with power to investigate complaints of employment discrimination and power to sue firms that practice it.
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Hard-core Unemployed
workers with little education or vocational training and a long history of unemployment.
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National Alliance of Business (NAB)
a joint business-government program to train the hard-core unemployed.
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Pollution
the contamination of water, air, or land through the actions of people in an industrialized society.
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Social Audit
a comprehensive report of what an organization has done and is doing with regard to social issues that affect it.
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