Business Ethics

1. have strong personal character
2. have a passion to do right
3. are proactive
4. consider all stakeholders' interests
5. role models for the organization's values
6. are transparant and actively involved in decision making
7. take a holistic view of the firm's ethical culture

-employees are familiar with purpose and beliefs
-cultural motivations for ethical behavior (reward systems for ethical conduct)
-leads to higher employee satisfaction and commitment
-strong relationships with stakeholders
-positive influence on stock market

compliance based approach: emphasizes obedience to rules and regulations
integrity based approach: views ethics as an opportunity to implement core values

unethical leader: egocentric and often does whatever is necessary to achieve the organization's objectives and his own
apathetic leader: not necessarily unethica, but he doesn't care for ethics within the company (doesn't listen to employees)

occur when there are two or more positions on an ethical decision

competing: high assertiveness, low cooperativeness
avoiding: low assertiveness, low cooperativeness
accommodating: low assertiveness, high cooperativeness
collaborating: high assertiveness, high cooperativeness
compromising: in the middle

1. have tough conversations where necessary
2. listen more
3. don't rely too much on impersonal conversation (email)
4. communicate bad news in the same manner as good news
5. share performance feedback regularly
6. purposeful and thoughtful communication
7. ask for feedback
8. work on blind spots

create transparency by developing a culture where ethics is frequently descussed

reporting is a two-way process in which the communicator communicates with superiors and subordinates

interpersonal: most well-known; when two or more people interact

small group: can increase collaboration and generate a variety of different perspectives and opinions; groupthink occurs when one or more members feel pressured to conform to the group's decision even if they disagree; group polarization is more likely to move toward a more extreme position than the group members might have done individually

nonverbal: through action, body language, expressions etc.

listening: paying attention to verbal and nonverbal behavior

-emphasize that everyone is a critical evaluator with the responsibility to express opinions freely
-elimminate leadership biases by refusing to express an opinion when assigning tasks to a group
-set up a number of independent groups to work on the same issue
-encourage each team member to express the group's ideas with someone from outside the group
-express the need to examine all alternatives
-invite outside experts
assign one person to be "devil's advocate"

when leaders and followers share the same vision, ethical expectations, and objectives for the company

informal: simple conversation 
formal: employee performance evaluations

leaders need feedback from employees too

the ability to manage themselves and their relationships with others effectively

demands instantaneous obedience and focuses on achievement, initiative, and self-control

one of the most effective styles

inspires employees to follow a vision, facilitates change, and creates a strongly positive performance climate

values people, emotions, needs and relies on friendship and trust to promote flexibility, innovation and risk taking

relies on participation and teamwork to reach collaborative decisions. focuses on communication and creates a positive climate for achieving results

can create a negative climate

sets high standards: work best for attaining quick results from highly motivated individuals who value achievement and take initiative

positive climate

develops skills to foster long-term success, delegating responsibility, and skillfully issuing challenging assignments

focus on negotiating, or "bartering" for desired levels of performance

strive to raise employees' level of commitment and foster trust and motivation

passionate about the company, live out corporate values daily in their behavior in the workplace, and form long-term relationships with employees and other stakeholders

R recognize ethical issues
A avoid misconduct whenver possible
D detect ethichal risk areas
A answer stakeholder concerns when an ethical issue comes to light
R recover from a misconduct disaster by improving upon weakness in the ethics program

the potential for the long-term well-being of the natural environment, including all biological entities
the mutually beneficial interactions among nature and individuals, organizations and business strategies

-it can create competetive advantages
-stakeholders have more power with increased access to information
-companies can use their brand identity to create social value, quality and customer loyalty
-allows a firm to differentiate themselves and promote their products

--> social responsibility is part of the budget, sustainability is a tool for ethical decision making and financial performance

atmospheric: the air we breathe
water: conservation, purification and allocation
land: ethical responsibility to minimize their harmful impact

-air pollution
stationary (factories and power plants)
mobile (autos, planes, trains)
natural (windblown dust, volcanic eruptions)

-acid rain
certain elements in air pollution mix with air and water to create a new element

-greenhous gases
accelerates global warming
-->Koyoto Protocol

-water pollution
comes from various sources
contamined oceans compromise human food supplies

-water quantity
in some countries

-land pollution
from residential and industrial waste, strip mining, poor forest conservation
causes health issues, habitat destruction, erosion, altered waterways, poisoned groundwater

-waste management
plastic, obsolete computers, cell phones in our landfills leach chemicals
stakeholders believe, manufacturers should be responsible for their products' proper disposal

-deforestation
because of boom in biofuels, poverty, farmin, short-term profits from lumber sales

-urban sprawl

-biodiversity
each species plays a unique role in its ecosystem

-genetically modified organisms
controversial issue of transplanting genes from one organism to another, creating a new life form
long-term impact is unknown

the most influential regulatory agency

can file civil suits against companies

5 strategic goals that reflect public priorities:
-taking action on climate change and improving air quality
-protecting america's water
-cleaning up communities and advancing sustainable development
-ensuring the safety of chemicals and preventing pollution
-better waste management, resoration of contaminated waste sites, and emergency response

-clean air act
-endangered species act
-toxic substances control act
-clean water act
-pollution prevention act
-food quality protection act
-energy policy act

-wind power
-geothermal power
-solar power
-nuclear power (remains controversial)
-biofuels
-hydropower

-better environmental performance can increase revenue
-better environmental performance can decrease costs

a strategic process involving stakeholder assessment to create long-term relationships with customers, while maintaining, supporting and enhancing the natural environment