Chapter 5

tragedy of the commons

occurs when a resource held in common by all but owned by no one Is overused by individuals resulting in degradation

foreign corrupt practices act (FCPA)

outlaws paying of bribes to foreign govt officials to gain business

grease payments

(facilitation payments) legal payments to speed up or ensure performance of normal government duties

Convention on Combating Bribery of Foreign Public Officials in International Business Transactions

obliges member states and other signatories to make the bribery of foreign public officials a criminal offense

ethical dilemmas

situations in which none of the available alternatives seems ethically acceptable

determinants of ethical behavior

societal culture, decision making process, leadership, unrealistic performance goals, personal ethics, organizational culture

personal ethics

the generally accepted principles of right and wrong governing the conduct of individuals

decision making process

asking yourself "is this decision or action ethical?

organizational culture

values and norms that are shared among employees of an organization

straw men

Approaches that are raised by business ethics scholars primarily for the purpose of demonstrating that they offer inappropriate guidelines for ethical decision making in a multinational enterprise

straw men approaches

friedman doctrine, cultural relativism, righteous moralist, naive immoralist

Friedman doctrine

the only social responsibility of business is to increase profits, so long as the company stays within the rules of law

cultural relativism

belief that ethics are nothing more than the reflection of a culture; form should adopt the ethics of the culture in which it is operating

righteous moralist

One who claims that a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries

naive immoralist

if a manager of a multinational sees that firms from other nations are not following ethical norms in a host nation, that manager should not either

utilitarian approaches to ethics

these hold that the moral worth of actions or practices is determined by their consequences

Kantian ethics

the belief that people should be treated as ends and never as means to the ends of others; people have dignity and need respect

rights theories

human beings have fundamental rights and privileges which transcend national boundaries and cultures

universal declaration of human rights

A 1948 statement in which the United Nations declared that all human beings have rights to life, liberty, and security.

justice theories

focus on the attainment of a just distribution of economic goods and services

just distribution

one that is considered fair and equitable

veil of ignorance

making decisions with a blind eye to extraneous factors that could affect the decision

difference principle

Rawls' suggestion that society should reward behavior that provides the most benefit to the community as a whole

code of ethics

a formal statement of ethical principles and rules of conduct

stakeholders

individuals or groups that have an interest, claim, or stake in the company

internal stakeholders

employees, owners, board of directors

external stakeholders

people or groups in the organization's external environment that are affected by it

moral imagination

When one is facing an ethical decision, the ability to envision various alternative choices, consequences, resolutions, benefits, harms.

fundamental rights

rights and privileges considered essential by the general society

moral courage

Taking a position against something or someone even though you know the outcome may be unpopular

Corporate Social Responsibility

the notion that corporations are expected to go above and beyond following the law and making a profit; consider social consequences of economic actions when making a business decision

noblesse oblige

principle that persons of high rank or birth are obliged to act nobly

management focus

the degree to which management decisions take into account the effect of outcomes on people within the organization

sustainable strategies

Strategies that not only help the multinational firm make good profits, but that do so without harming the environment, while simultaneously ensuring that the corporation acts in a socially responsible manner with regard to its multiple stakeholders