CH 5 Vocab: Ethics, CSR, Sustainability

Vocabulary flashcards covering key ethics, CSR, sustainability concepts and related frameworks from the notes.

Ethics

Accepted principles of right and wrong that govern conduct of individuals, the professions, or organizations.

Business ethics

The accepted principles of right or wrong governing the conduct of businesspeople and business decisions.

Corporate social responsibility (CSR)

The idea that business should consider social consequences of economic actions and pursue decisions with both economic and social benefits; noblesse oblige.

Sustainability

Strategies that aim to be profitable while protecting the environment and society for future generations; includes precautionary principle.

Ethical dilemma

A situation in which none of the available actions is fully ethical or morally acceptable.

Employment practices (international business)

Issues about applying home vs host nation standards for worker conditions and pay.

Human rights

Fundamental rights like freedom of expression, association, and just working conditions that transcend borders.

Environmental pollution

Pollution issues when host-country regs are weaker; involves the tragedy of the commons and cross-border impacts.

Tragedy of the commons

When a shared resource is overused by individuals acting in self-interest, leading to degradation.

Global climate change

Human activities increasing atmospheric CO2, prompting differing emission regulations worldwide.

Corruption

Payments or bribes to officials to gain business advantages; raises ethical and legal concerns.

Foreign Corrupt Practices Act (FCPA)

US law prohibiting bribes to foreign officials; allows certain facilitating payments; applies to US firms.

Facilitating payments (speed money)

Small payments to expedite routine government actions; often excluded by law but ethically debated.

OECD Convention on Combating Bribery

International treaty criminalizing bribery of foreign officials; excludes facilitation payments.

Straw men

Weak or foil arguments used to critique business ethics: Friedman doctrine, cultural relativism, righteous moralist, naive immoralist.

The Friedman doctrine

The view that the only social responsibility of business is to increase profits within the law.

Cultural relativism

Ethics reflect the culture; what is acceptable depends on local norms; moderated by universal ethics.

Righteous moralist

Home-country ethics should be followed abroad, potentially clashing with host-country norms.

Naive immoralist

If others in host country aren’t ethical, a multinational should not necessarily follow suit; may still act ethically.

Utilitarianism

Moral worth of actions judged by consequences; greatest good for the greatest number.

Kantian ethics

People should be treated as ends, never merely as means; dignity and respect are central.

Rights theories

Fundamental rights transcend borders; rights set minimum moral behavior; UDHR underpins this.

Rawls’ veil of ignorance

Designing a just system as if you didn’t know your own position; leads to principles of liberty and difference.

Rawls’ difference principle

Inequalities are allowed only if they benefit the least advantaged.

Stakeholders

Individuals or groups with a stake in the company; includes internal (employees, shareholders) and external (customers, communities).

Code of ethics

Formal document articulating ethical priorities guiding organizational decision making.

Organizational culture

Shared values and norms that influence ethical decision making within a company.

Leadership

Role models and enforcers of ethical behavior; leaders shape the ethical climate.

Decision-making processes (ethical)

Structures that require evaluating the ethical dimension of decisions; includes ethical algorithms.

Ethical algorithm

Practical guide to assess whether a decision is ethical by asking concrete questions.

Moral courage

Willingness to oppose unethical actions and withstand retaliation; essential for whistleblowing.

Precautionary principle

When knowledge is uncertain, act with caution to protect the environment and health.

Starbucks ethical sourcing

Starbucks goal of 100% ethically sourced coffee; blends of fair trade and ethically sourced beans with farmer support.