Chapter 11: Business Ethics

Stakeholders

Anyone affected by a business's decisions (customers, employees, shareholders, community, etc.).

Acting with Integrity

Doing what is right even when no one is watching; honesty + consistency.

Professional of Integrity

Someone who applies ethical behaviour consistently in all business decisions.

Fairness

Treating people equally and making unbiased decisions.

Ethical Responsibility

Voluntary commitment to doing what is morally right (beyond legal rules).

Morality

The distinction between good and evil or right and wrong.

Legal and Compliance Risk

Meeting basic requirements of the law (minimum standard).

Phronesis (Practical Wisdom)

Aristotle's idea: the ability to make good, ethical judgments based on experience.

Ethical Leadership

Leaders role-model integrity and set ethical tone for organizations.

Short-Term vs Long-Term Perspective

Short-term: focuses on quarterly profits.

Long-term: focuses on sustainable success & reputation.

Social Contract

The unwritten agreement that companies must benefit society as well as make profit.

Corporate Culture

Shared values, beliefs, and behaviours inside a company.

Goodwill

Positive public reputation that increases the company's value.

Whistleblower

Someone who reports illegal or unethical behaviour inside an organization.

Corporate Social Responsibility (CSR)

When a business acts ethically and contributes to society/environment.

Ethical Business Practices

Actions that protect stakeholders, follow moral principles, and build trust.

Profitability Through Ethics

Idea that being ethical increases long-term success (loyalty, reputation, trust).

Ethical Dilemma

A situation with two morally right choices in conflict.

Moral Temptation

A choice between right and wrong (e.g., lie, cheat, steal).

Kidder's Tests

Tools to identify whether an issue is a moral temptation or ethical dilemma:

• Legal Test

• Regulations Test

• Stench Test

• Front-Page Test

• Mom Test

Kidder's 4 common ethical dilemmas:

• Truth vs Loyalty

• Self vs Community

• Short-Term vs Long-Term

• Justice vs Mercy

Utilitarianism

Idea that the goal of society should be to bring about the greatest happiness for the greatest number of people.

Ex. Ends-based

Kantianism (Dentology)

Motives and universal rules are important aspects in judging what is right or wrong.

Dutifully. Consider the duties you owe others.

Aka. Rules-based

Virtue Ethics

Remember that your actions will determine who you are.

Ex. Cares-based