Spinning
something between the truth and a lie (not an outright lie)
EX: In law, pain and suffering is exaggerated (spun) in order to get more money in a lawsuit
Good Spin is...
Harmless (not a lie)
Bad spin can be...
Evil (this is considered a lie; intent is to deceive)
Spin
-Spin is the variation of the truth
-Spin can go close to the line
-Spin is acceptable
-Everybody can get away with spin
-Spin is positive
-Spin is good
Lying
-Lying has no connection to the truth
-Lying is over the line
-Lying is NOT acceptable
-Nobody should be allowed to get away with lying
-Lying is negative
-Lying is bad
4 Types of Spins
1. Lemons to Lemonade
2. Numbers Crunchers
3. Blame Game
4. Tom-"ay"-to, Tom'"ah"-to
Lemons to Lemonade
-The Happy-Face Spin (finding good in a bad situation)
ex: "oh yeah, I got into an accident, but everyone is fine!" :)
-The Boy-Scout/Girl Scout Spin (Pious denial; Pleading ignorance in the face of unethical or illegal activities).
Number Crunchers
-Free-Lunch Spin
ex: "buy this couch and you won't have to pay till 2030!"
-The Statistics Spin (people get overwhelmed by numbers; deflecting the truth using numbers)
Blame Game
-Blame-It-On-My-Youth Spin
ex: "I didn't know any better, I was young"
-The Vast Conspiracy Spin
ex: "wasn't me, someone else did it"
-The Victim Spin
ex: "I was raised this way, I didn't know any better
Tom-"ay"-to, Tom'"ah"-to
-The Twilight Zone Spin (say opposite of what you mean)
-The It-Depends-On-the Definition Spin
ex: Clinton's sexual relation definition meant something different to him as it did to everyone else.
-The Don't Believe-A-Word-I-Say Spin (say something in suc
Role Taking according to Kohlberg
Being able to see the situation through others' eyes is a key moral reasoning skill.
Who sets the tone?
Managers
Laws may be...
Insufficient because they are reactive
What may lag advances in technology?
Free-Markets and Regulatory Mechanisms
What does resolving complex moral problems require?
Intuitive or learned understanding and concern for fairness, justice, and due process to people, groups, and communities
How many stages are in Kohlbergs Stages of Moral Development?
6 stages
What are the 6 stages in Kohlbergs Stages of Moral development?
Stage 1- Pre-conventional/ Obedience and punishment
Stage 2- Instrumental
Stage 3- People Pleasing
Stage 4- Obedience/ Social Accord
Stage 5-Post-conventional/ Social Contract
Stage 6- Universal
Pre-conventional/ Obedience and punishment (stage 1)
Avoid pain and earn rewards
Instrumental (stage 2)
Costs and benefits of alternative courses of action
Stages 1 and 2
People who are under the age of 18; selfish, short-term in their focus and child like
People-Pleasing (stage 3)
individuals try to meet others expectations. Do what pleases or helps others or is approved by people close to you. (only for people you know)
Obedience/ Social Accord (stage 4)
Respond to authorities in power. Concerned about fulfilling duties and following rules or laws that promote common good. (thinking about people beyond the people you know)
Stages 3 and 4
People between the ages of 18-30
Post-conventional/ Social Contract (stage 5)
people act according to higher principles and what action would create the greatest societal good (long-term).
Universal (stage 6)
following self-chosen principles of justice and right; acting in accord with principles when laws violate principles. Independent reasoned judgements about objective principles of conduct applicable to behavior. (willing to break rules to follow principle
Stages 5 and 6
ages 30+; Very hard to achieve
according to Kohlberg, only Jesus, mother Teresa, Ghandi and himself have ever reached this level.
What are the 5 stages of Corporate Ethical Development?
1. Amoral
2. Legalistic
3. Responsive
4. Emergent Ethical
5. Ethical
Amoral
Only concern about law and ethics is that they don't get caught (easiest to achieve)
Legalistic
Organization is concerned with meeting the letter of the law
Responsive
Social pressures force these companies to a greater social role
Emergent Ethical
Overt effort to manage ethical culture
Ethical
Common set of ethical values suffuses the corporation (hardest to achieve)
What kind of cultural systems do large companies normally have?
Formal Cultural Systems
ex: corporate ethics training programs
What kind of cultural systems do small companies normally have?
Informal Cultural Systems
ex: rituals and informal norms
What are the 5 ways to classify companies?
1. executive commitment to business ethics
2. company ethics programs
3. method to resolve disagreements
4. sound ethical business practices
5. good corporate citizenship
CORPORATE SOCIAL RESPONSIBILITY (CSR)
A business's concern for societies welfare; requires consideration of not only the interests of the business but also its relationship to the society or community in which it operates
Levels of CSR
Level 1. Economic (be profitable regardless of what must be done)
Level 2. Legal
Level 3. Ethical
Level 4. Philanthropic (profitable by following the law and giving back)
Why do people act unethically in organizations?
-Excessive rewards for success
-Excessive penalties for failure
-Implicit sanctioning of explicitly unethical acts
-Lack of monitoring
Moral Muteness
-People are Morally Mute when they do not recognizably communicate their moral concerns in settings where such communicating would be fitting
(Not speaking up about something with a moral issue)
What are the three forms of Moral Muteness?
1. Negative Expressions
2. Positive Expressions
3. Not holding others sufficiently accountable
Negative Expressions
Not blowing the whistle on observed abuses (failing to speak up)
Positive Expressions
Not speaking up for ideals (something you strongly believe in)
Not holding others sufficiently accountable
Not providing adequate feedback in supervisory relationships.
How does Moral Muteness occur with Managers?
-Use ethical reasoning themselves
-Expect others to use ethical reasoning
-Privately acknowledge the influence of ethical reasoning on their decisions.
-Fail to explain actions using ethical terminology or ethical judgment (Moral Muteness)
What Causes Moral Muteness?
-Threat to Harmony
-Threat to Efficiency
-Threat to Image of power and effectiveness
-"Moral Myopia
Threat to Harmony
ethical reasoning involves possible confrontation (we try to protect our relationships)
Threat to efficiency
ethical reasoning is messy-no clear answer (it takes a lot of time to speak up)
Threat to image of power and effectiveness
most managers do not want to expose their own ethical illiteracy
Moral Myopia
You know that there is a moral issue, but you can't clearly see it.
ex: consumers should know better, a mcDonalds big mac won't really look the way it does in the advertisements.
Consequences of Moral Muteness
-Creation of moral amnesia
-Inappropriate narrowness in conceptions of morality
-Moral stress for individual managers
-Neglect of moral abuses
-Decreased authority of moral standards
-Physical stress-weight gain
What are the limits to Loyalty?
-Cultural Norms Against Whistle-Blowing
-Competing Cultural Norms
Cultural Norms Against Whistle-Blowing
-Loyalty to employer
-Loyalty to co-workers
-Avoiding being labeled a "snitch"
-Avoidance of confrontation
Competing Cultural Norms
-Fairness
-Justice
-Sense of Duty
-Obedience by Law
-Obedience to one's conscience
Whistle-Blowing
is the attempt of an employee to disclose what he or she believes to be wrongdoing in or by the organization.
When to consider Whistle-Blowing?
-The situation warrants whistle-blowing
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Why to investigate whistle-blower complaints?
-diligent and impartial determination of facts
-uncover facts and resolve issues before govt investigation
-factual basis against wrongdoer
-give directors information to perform fiduciary duties
How to Investigate:
-select independent team
-set scope
-evaluate privilege
-consider how to treat potential wrongdoers
-preserve documents and records
-conduct interviews
-prepare a written report
Use independent counsel for investigation
-passes the reasonable standard for independence
-experience allows firms to avoid pitfalls
-specialized knowledge of investigatory process
Set Scope
-cost
-critical issues
-plan
-deadlines
-flexibility
-the engagement letter
Consider Disclosure
-Announcements to employees
-Disclosure issues
-Blanket denials
-Updates
How to treat wrongdoers
-Involvements in the investigation
-communications with the audit committee
-salary and benefits
-corporate duties
Preserve Documents
-Organize, manage, and preserve documents needed to assist with resolving the issues raised
-capture and preserve electronic data
-identify appropriate search terms "cushion"
-encourage cooperation with discovery requests
Conduct Interviews
-uncover relevant information
-identify key documents, correspondence, and emails
-explore financial impact of relevant documents
-explore other party involvement
-address privilege issues
Complete the Investigation
-review applicable legal authority
-analyze issues and claims
-exercise business judgment
-prepare a written report
-evaluate financial reporting and disclosure
-decide what is in best interests of corporation
When should whistle-blowers not be protected
-false accusations
-confidential information
-irrelevant accusations
-accusations against managers for personal reasons
-accusations based on their termination or demotion
Broad Policies, Programs, and Controls
-policies to deter fraud
-training to communicate ad reinforce policies
-policies to collect, investigate, and resolve reports of fraud, misconduct, or unethical behavior
-hotline for anonymous reporting
Tone at the Top
-Management integrity and ethical values
-communication of values to employees
-demonstration of importance of ethical business conduct to employees
-consequences for violating codes of conduct and policies regarding risks (should be applied equally to ma
Employee Rights
-Rights to privacy
-right to work (employment at will)
-right to safe working conditions
Rights to Privacy
-Health/Medical Information
-Financial Information
-Behavior on the job
-Prior employment/incarceration information
Health Information
-Pre-employment DNA testing
-Pre-employment drug testing
-pre-employment handwriting analysis
-exposure to chemicals while employed
-drug testing while employed
-HIPPA rules
Financial Information
-Pre-employment
-During employment
-Post-employment (company cannot verify salary to anyone after employment)
Behavior on the job
-Telephone monitoring
-Camera monitoring of work behavior
-GPS-based monitoring of driver behavior
-Secret Shoppers
-computer use
Why monitor on-the-job behavior?
-Internal theft
-Harm to customer
-Ensure good driving records
-Allow comparison across employees
-Allow development of benchmarks
Use of Internet at Work
-News reading (sports)
-travel arrangements
-shopping
-job hunting
-hobbies
-stock-checking
-over 50% of employees spend more than 30 minutes per day on non-work related internet use
How do employers monitor internet use?
-Software that measures: which websites ware visited, when visited and how long visited.
-Use of corporate computer usage policy
-Software that backs up and monitors emails
Employer Rights to Inspect Internet and Email Use
-the corporation reserves the right to monitor all electronic messages
-emails can retained by central server even if deleted by the user
-employees can be held liable if a message harasses or defames
Pior Employment or Incarceration
-Past arrest records
-Resume items
Right to Work
Employment at will- allows either employee or employer to terminate the employment relationship "at will
Employment at Will
when an employee does not have a written employment contract and the term of employment is indefinite duration, the employer can terminate the employee for good cause, bad cause, or no cause at all.
Statutory Exceptions to EAW
-collective bargaining agreements--generally require just cause for termination; also contain procedures for arbitrating grievances
-Title VII of Civil Rights Act--Prohibits wrongful discharge on basis of: race, religion, sex, age, national origin.
-Disab
Common-Law Exceptions to EAW
-Public Policy
-Implied-Contract
-Convenant of Good faith
Public Policy Exception
-Employees cannot be terminated for filing a workmen's compensation claim after being injured on job
-employees cannot be terminated for refusing to break the law at the request of the employer
-recognized in 43 of 50 states
Implied Contract Exception
-EAW may not exist when employer has made oral or written representation to employees regarding job security o procedures that will be followed when adverse employment actions are taken.
-contents and representations in employee handbooks may form a contr
covenant of Good Faith Exception
-A covenant of good faith and fair dealing is an integral part of every employment relationship
-prohibits termination without just cause
-prohibits termination due to malice or bad faith
-is found in 11 of 50 states
Right to Safe working conditions
-Safe Workplaces- safe procedures, safe levels of exposure to environmental contaminants (OSHA, EPA, state agencies)
-Number of hours of work-drivers, pilots, doctors (DOT, NHTSA)