Faith and Ethics, Final Exam, Dr. Perkins, Mississippi College

The Scriptures teach

that all mankind was created by God and in the image of God

Scripture is to be interpreted

through the lens of Jesus Christ and the Holy Spirit

Christianity operates on the notion

that ethics (the study of human character) logically follows theology (the study of God's character); There is to be no division of your ethical character, you are to act the same in all situations

Just because something may be ____does not mean it is also moral

legal

Egoism

promotion of the individual pleasure through goods or career success

Utilitarianism

the option which best maximizes pleasure and minimize pain for all involved

Deontological reasoning

the keeping of moral rules such as "Don't harm others"

The ultimate goal of Christian Ethics is

to emulate God's character not for human happiness or fulfillment

We learn God's character

by studying the Scriptures

The foundation of Christian ethics is

not rules but the changeless character of God

The major difference in Christian ethics and secular ethics is

the central priority is not focused on humans but on God

Three divine characteristics which have a direct bearing on ethical decision making are repeatedly emphasized in the Bible

God is Holy, God is Just, God is Loving

Sin makes us self-seeking rather than

seeking God

Our job in making decisions is

to line up the lenses of holiness, justice and love so that they align as much as possible

Holiness is

the concept of single-minded devotion to God and absolute ethical purity; At its center, holiness calls us to zealously make God our highest priority; It demands that all other concerns such as material goods, career goals and even personal relationships be considered of lesser importance

Jesus says

Our greatest duty is to "love the Lord your God with all your heart and with all your soul and with all your mind" Matthew 22 37-38

Honesty is crucial for three reasons according to one ethicist

it builds trust, establishes community and protects the dignity of the audience

$200 million in settlements were made/paid in

discrimination lawsuits with Merrill Lynch, Morgan Stanley and Smith Barney

Christians are called to be intentional and move across

ethnic, gender, age and religious lines

Businesses have duties

to the whole world not just their customers

Property as False Security

"When you have eaten and are satisfied - be careful that you do not forget the Lord your God - then your heart will become proud - [saying], "My power and the strength of my hands have produced this wealth for me" But remember the Lord your God (Deuteronomy 8 10-18)

Three Factors in the fraud triangle

motive, rationalization, opportunity

EEOC

a federal agency that investigates any inquiries you bring them of discrimination and may sue on your behalf

Equal Employment Opportunity Commission

discrimination (protected classes)

Department of Labor

wage, hours, and work conditions (possibly not being paid overtime or working over 40 hours (off the clock)

Occupational Safety and Health Administration

workplace safety

Fundamental Protections by the Government

race, age, gender, religion, national origin (ethnicity), disability, veteran status, and sexual orientation

Three Levels of Discrimination Protection

strict scrutiny, intermediate scrutiny, and rational basis review

Strict Scrutiny

requires the government to prove that there is a compelling state interest behind the challenged policy, and the law or regulation is narrowly tailored to achieve its result; protects race, religion, and national origin (ethnicity)

Intermediate Scrutiny

requires the government to prove that it serves an important government objective and be substantially related to achieving the objective; protects age and gender

Rational Basis Review

the government has no legitimate interest in the law or policy or there is no reasonable, rational link between that interest and the challenged law

Due Process

impartiality, fair and adequate evidence, opportunity to be heard

Whistleblowing

the practice of informing on someone or putting a stop to something

Whistleblowing is the most _________ form of disclosure.

controversial

Insider Information

non-public information used in insider trading of a corporation's stock or other securities (such as bonds or stock options)

Insider trading

is the trading of a public company's stock or other securities (such as bonds or stock options) by individuals with access to non-public information about the company

Insider

anyone who has pertinent information that is not publicly available, and that give the trader an advantage over public.

Thus, the secretaries, lawyers, consultants, financial printers, and others who have access to inside information become insider because of their knowledge

The US Congress defined ___-_____ _____ as an illegal act or series of illegal acts committee d by non-physical means and by concealment or guile, to obtain money or property, or to obtain business or personal advantage

white-collar crime

Larceny

the wrongful and fraudulent taking and carrying away by one person of the mere personal goods of another from any place, with a felonious intent to convert them to his (the taker's) use, and make them his property, without the consent of the owner

Fraud

consists of a deceitful practice or willful device, resorted to with intent to deprive another of his right, or in some manner to do him an injury

Embezzlement

is one type of fraud, which means to willfully to take, or convert to one's own use, another's money or property, of which the wrongdoer acquired possession lawfully, by reason of some office or employment or position of trust

Fraud Triangle

there are three factors that exist in every situation of fraud - motive, rationalization, and opportunity

Motive (or pressure)

the need for committing fraud

Rationalization

the mindset of the fraudster that justifies them to commit fraud

Opportunity

the situation that enables fraud to occur (often when internal controls are weak or nonexistent)

Components to Prevent Fraud

1) Control Environment

2) Risk Assessment

3) Control Activities

4) Information and Communication

5) Monitoring

RICO

federal statutes address ordinary crimes, but they differ from traditional statutes relevant to the same crimes in that they specifically target the continuing racketeering activities of organized criminals

Styles of Leadership

1) authoritarian

2) paternalistic

3) democratic

4) laissez-faire

5) transactional

6) transformational

HealthSouth CEO

Rickard Scrushy

HealthSouth

Walmart of sports medicine, one-stop shop for surgery and makes it easier on patient

HealthSouth Meetings

"Monday Morning Beatings" - authoritarian leadership yelling at employees until they change behavior or numbers

HealthSouth Stock

price rose 31% a year, beat or matched expectations for 47 quarters in a row

Scrushy influenced people to manipulate

numbers on their financial statements.

HealthSouth Indictment

money laundering, extortion, obstruction of justice, racketeering, and bribery.

LISTING AND RELATE TO HEALTHSOUTH AND WORLDCOM - Common Factors in Financial Fraud

HEALTHSOUTH

1) seeking power and greed

2) fear among employees

3) perception that the company was more innovative and different than others

4) weak boards

5) tremendous community and philanthropic presences of companies and officers

6) unprecedented performance

WORLDCOM

1) Seeking power and greed

2) Numbers Pressure

3) Meeting Numbers at all costs

4) unwillingness internally and externally to raise questions about the company

5) conflicts of interest

6) always meeting goals to the penny

7) unprecedented performance

WorldCom CEO

Bernie Ebbers

WorldCom Strategies

1) undercut ATT (buying wholesale, selling at a profit less than ATT price), 2) Merge/Buyout of 65 Companies (lastly MCI)

Marsh & McLennan

Insurance brokers that colluded with insurance companies to secure deals and did not let competition to win out

Dual Morality

separation of personal and professional ethics; separates the sacred (calling of God) and secular (work)

How Dual Morality Attacks Christian Ethics

First, it violates the principle of holiness by idolizing business success. Moneymaking is so important, it is presumed, that the marketplace must be permitted to play by lower moral standards. Implicit in this position is the assumption that achieving financial success is a higher priority than pleasing God.

Perhaps most important, holiness rejects dual morality because it challenges Christ's leadership over all things by carving out a special niche that is somehow exempt from his rule. The apostle Paul counters such thinking by pointing out that all things were created "by him, for him and in him" (Colossians 1:16-17). No human activity is outside his jurisdiction. To believe otherwise is not just bad ethics, it is bad theology. Any teaching that so denigrates Christ's lordship is heresy. While Christians may play many different roles during the course ofa week- business leader, family member, churchgoer, neighbor, Christ remains Lord of each sphere.

It rejects the principle of Justice in that it ignores the character of God, due process and privacy rights when it deems certain things acceptable in an industry as common practice.

Dual Morality rejects the principle of Love: Rather than applying the Golden Rule- the opposite is promoted in business. The marketplace is viewed as a dog-eat-dog environment where automatic caring for others is inappropriate. All business players are expected to watch their own backs.

The Law: Positivism

the dominant legal theory in the world for the past two centuries. It has three elements:

1) completely divorces law from the realm of ethics

2) accepts the law as being whatever the government says it is, never questioning its rightness or wrongness.

3) assumes the law can be studied scientifically

Problems with Positivism

You get an imperfect product because you have an imperfect political process.

It justifies immoral behavior. Legal standards set by the government cannot be reviewed by such abstract concepts as holiness-justice-love.

When we make human law the final word on what conduct is acceptable and unacceptable, God is dethroned as the ultimate moral authority.

The final problem with positivism is that it leads to more government regulation, especially in business. . This over regulation will result in legalism which further deteriorates holiness-justice-love.

The Law: Integrated Christian Approach

does not separate law and ethics

predicated on sovereignty this view argues that God's moral principles supersede and overshadow human law.

Behavior must be evaluated from a higher and more universe set of values which flow from the principles of holiness, hustle and love. These values include but are not limited to Duties and Rights.

Duties of Integrated Christian Approach (LISTING)

1) Keep Promises

2) Tell the Truth

3) Make Restitution for Harm Done

4) Respect the Rights of Others

5) Be Responsible Stewards of Human Resources

6) Show Concern for the Poor

7) Maintain Healthy Family Relationships

Rights of Integrated Christian Approach (LISTING)

1) Freedom of Choice

2) Equal Protection

3) Dignity

4) Due Process

5) Own Property

6) Life

7) Be Told the Truth

The ideal society:

one that has the least restrictive laws on the one hand and citizens committed to pursuit of the highest ethical ideals on the other. This formula maximizes individual freedom, restricts the size and influence of government and, at the same time, ensures a sense of community and ethical treatment of others. Eden was the last environment that effectively, albeit temporarily, implemented such a system.

Christian ethics makes provision for

the gap between the high moral aspirations of the theocentric approach and the way we really live.

It is self-evident that we all fall short of

the holiness-justice-love standard. Rather than be overly discouraged by this ethical deficit, we should humbly accept God's offer of grace. Through the death of His Son there is forgiveness: through his Holy Spirit there is hope of moral improvement. This is why even our ethical failings can have a silver lining. Recognizing our imperfections, we are drawn to the grace of God, which in turn leads us to assess ourselves and to treat others with tolerance.

Bernie Ebbers

MC Graduate

MC Donor

Former High School Basketball Coach

Financial Fraud Cases (apply to WorldCom and HealthSouth)

1) seeking power and greed

2) numbers pressure

3) meeting numbers at all costs

4) fear among employees

5) unwillingness internally and externally to raise questions about the company

6) perception that company was different and more innovative than others

7) weak boards

8) conflicts of interest

9) tremendous community and philanthropic presences of companies and officers

10) always meeting goals to the penny

11) unprecedented performance

Sarbanes-Oxley Act

A law passed by Congress that requires the CEO and CFO to certify that their firm's financial statements are accurate. Also requires companies to have Ethics Officers.

Ethical Questions

1) Am I treating others with dignity?

2) Am I allowing others to exercise free will in accordance with the Holy character of God?

3) Am I being impartial?

4) Do I have a conflict of interest (self benefit)?

5) Am I unbiased and not possessing a predetermination?

6) Is everyone having an opportunity to be heard?

7) Is the evidence and process fair and compelling?

8) Am I listening to every complaint based on its merits and not on who is bringing it forward?

9) Am I offering forgiveness and hope?

10) Is the judgment from me or from God through me?

11) Am I concerned about "self" at all, or just God?

12) Does the decision reflect the morality of God as shown in the Scriptures and life of Jesus Christ?

13) Does it place me in a situation of being forced to submit or assimilate with those whose behavior is in contradiction to God?

14) Am I being gracious?

15) Am I being empathetic (understanding and sharing same feelings as others)?

16) Am I showing God's mercy (taking action on behalf of the empathy felt for other)?

17) Am I protecting myself or sacrificing my selfish desires?