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BusinessandSocietyUnit1Lead-inBusinessisakeyactivityofthecultureofanysociety,enablingpeopletoservetheneedsofeachotherfreely.Makingprofitisagoodsignthatbusinessisrunningwell,atthesametime,businessethicisnecessarybothforthecorporatesuccessandapositivecorporateimage.Ethicalbusinessbehavioralsocoverssupportingpeople’srightsasconsumers.Afterstudyingthisunit,youwillbeableto:

Understandtherelationshipbetweenbusinessandsociety.

Discussissuesconcerningbusinessethics.

Knowhowtoprotectyourselfasaconsumer.TextASocialResponsibility1.SocialResponsibility2.DevelopmentsinSocialResponsibility3.SocialResponsibilityToday4.OtheropinionstowardssocialResponsibilityWhatissocialresponsibility?Socialresponsibilityistheideathatfirmshaveobligationstosocietybeyondtheireconomicobligationstoownersorstockholdersandalsothoseprescribedbylaworcontract.SocialResponsibilityIngeneral,abusinesshastwomainresponsibilities.1.toobeythelaw.2.toearnprofitstocontinueoperations,payemployees,andprovideareturntoownersandstockholders.SocialResponsibilityTobehaveinasociallyresponsibleway,managersmustbewareofhowtheiractionsinfluencetheenvironment.SocialResponsibilitySocialResponsibilityDevelopmentsinSocialResponsibility★Governmentregulationintheearly1900swasminimal.★Mostconsumersbelievedthatcompetitionandgeneralmarketactivitywouldcorrecttheabusesofthemarketplace.DevelopmentsinSocialResponsibility★From1920to1950,businessesusedaggressivesalesmethodstoexpandtheirprofits.Theybelievedthatthebestwaystoinformconsumersaboutproductswerepersonalsellingandadvertising.

★Asthemarketplacebecameincreasinglycompetitive,theCongresspassedlawstoreducethemonopolistictendenciesofbigbusinessandforcedcompaniestoprovidesocialservicestoindividuals.SocialResponsibilitySocialResponsibilitySocialResponsibilityToday

Bytheearly1950s,findingthatthekeytoincreasingsalesistoproducethingsthatpeoplewantandneed,businessesplannedproductstomeetcustomers’needs.SocialResponsibilitySocialResponsibilityTodaySocietyexpresseswhatitdoesnotwantinseveralways.1.Lawmakersandregulatorygroupsattempttoprohibitandcontrolundesiredbusinesspractices.2.Awidevarietyoflawsandguidelinesrelatetoproductsafety,warranties,packaging,labeling,advertising,personalselling,andpricing,nottomentioncompetitiveandenvironmentalissues.3.special-interestgroupspressurebusinesstoachievedesiredperformancestandardsortochangecertainongoingactivities.SocialResponsibilitySocialResponsibilityToday

Tobesuccessful,abusinessmustdeterminewhatcustomers,employees,governmentregulators,andcompetitors,aswellassocietyingeneral,wantorexpectintermsofsocialresponsibility.SocialResponsibility◆Anexpandedviewofsocialresponsibilityregardsorganizationsashavingacorporatesocialconsciousness.◆Aspartofbeingresponsible,theinterestsofthecorporationarebalancedagainstitsaccountabilityfortheeffectofitsactionsuponsociety,theenvironment,andotherinterestedparties.Acompanywithastrongcorporatesocialconsciousnesswouldbe:☆profitable☆payhighwages☆attracthigh-qualityjobcandidates☆beadmiredbythegeneralpublicandthegovernmentSocialResponsibilityOtheropinionstowardssocialResponsibilitySocialResponsibility◆Mostcompaniestodayconsidertheimplementationofsocialresponsibleactionsacostofdoingbusiness.◆AWal-Martseniorexecutivesays,““Thewatchwordforallourpeopleis‘‘Dowhatisright.’’That’’swhatwereallypreachandteach,andwewant””.◆TwoofWal-Mart’’smerchandisingdecisionsweretosell:1.huntingrifles,butnothandguns2.tabloidnewspapersliketheNationalEnquirer,butnotadultmagazineslikePenthouseOtheropinionstowardssocialResponsibility1.BusinessEthics2.ResponsibilityofBusinessinSociety3.TheConceptofthePyramidofSocialResponsibility4.EthicalDecision-Making5.EthicalLeadershipTextBFourBroadThemesofBusinessEthics6.CorporateGovernanceBusinessEthicsEthicsisthestudyofmoralsandmoralchoices.Itfocusesonstandards,rules,andcodesofconductthatgovernthebehaviorofindividualsandgroups.FourBroadThemesofBusinessEthicsFourBroadThemesofBusinessEthicsResponsibilityofBusinessinSocietyBusinessandsocietyareinterdependent.Societydependsonbusinessforwealthcreationwhilebusinessdependsonsocietyforanenvironmentwhereinitcanmeetitsdutytocreatewealth.TheConceptofthePyramidofSocialResponsibility◆Atthebottomofthepyramidistheexpectationthatbusinessescreateemploymentandwealth.◆Atthenextlevel,businessesarealsoexpectedtoobeythelawandminimizeanysocialproblemsthatappearedinrunningtheirbusiness.◆Finally,ifbusinessissuccessful,societyexpectsbusinesstogiveback.FourBroadThemesofBusinessEthicsMakingethicaldecisionscanbedifficult.Wemakemostoftheminaworldofeconomic,professionalandsocialpressures.FourBroadThemesofBusinessEthicsEthicalDecision-MakingEthicaldecision-makingrequiresmorethanabeliefintheimportanceofethics.Italsorequiresethicalsensitivitytoimplicationsofchoices,theabilitytoevaluatecomplex,ambiguousandincompletefacts,andtheskilltomakeethicaldecisionseffectively.FourBroadThemesofBusinessEthicsEthicalDecision-MakingEthicalLeadershipWithoutethicalleadership,rewardsandpromotionsforethicalbehavior,andalackoftrainingandattentiontodevelopingastrongethicalculturecanleadtocorruptionandthetypeofnewsstorieswehaveseensomuchoflately.FourBroadThemesofBusinessEthicsEthicalLeadershipLeadersandmanagersintheorganizationmustestablishvaluesandtrainemployeestounderstandthosevaluesastheyrelatetooperatingwithintheorganizationandasarepresentativeofthatorganization.FourBroadThemesofBusinessEthicsEthicalLeadershipParticularfeaturesofformalethicsprograms,suchasappointmentofaresponsibleseniorexecutiveandimplementationofcodesofconduct,trainingprograms,reportingsystems,anddisciplinarysystems,shouldbeconsideredinbusinessethicseducationprograms.FourBroadThemesofBusinessEthicsCorporateGovernance◆Corporategovernancereferstoformalsystemsofaccountability,oversightandcontrol.◆Knowingtheprinciplesandpracticesofsound,responsiblecorporategovernancecanbeanimportantdeterrenttounethicalbehavior.FourBroadThemesofBusinessEthicsBusinessprogramsshouldaddresstopicssuchasthefollowing:★shareholderrightsandstakeholderparticipationlevel★executivecompensation,CEOselectionandterminationprocesses★boardofdirectorcomposition,structure&CEOroleinboarddecisions★auditing,controlsystemsandriskmanagement★integrityoffinancialreporting★compliancewithcorporategovernancereformFourBroadThemesofBusinessEthicsCorporateGovernance1.WhatisConsumerism?2.Consumerism4.TheRighttoBeInformed5.TheRighttoChoose3.TheRighttoSafetyTextCConsumerism6.TheRighttoBeHeardWhatisConsumerism?ListeningSkillTheactivitiesundertakenbyindependentindividuals,groups,andorganizationstoprotecttheirrightsasconsumersareknownasconsumerism.ConsumerismThesefourrightsarethebasisoftheconsumerlegislationoverthelastthreedecades.1.Therighttosafety2.Therighttobeinformed3.Therighttochoose4.TherighttobeheardListeningSkillConsumerismConsumerismTheRighttoSafety★Therighttosafetymeansthataproductmustbesafeforitsintendeduse,mustincludethoroughandexplicitdirectionsforuseandmusthavebeenproperlytestedtoensurereliabilityandquality.★Toensureproductsafety,businessmustnotsellanythingthatcouldresultinpersonalinjuryorharmtoconsumers.Defectiveordangerousproductserodepublicconfidenceintheabilityofbusinesstoservesociety.ListeningSkillConsumerismListeningSkillConsumerismTheRighttoBeInformed★Therighttobeinformedgivesconsumersthefreedomtoreviewcompleteinformationaboutaproductbeforetheybuy.Thismeansthatdetailedinformationaboutingredientsandinstructionsforusearetobeprintedonlabelsandpackages.★Therighttobeinformedalsoappliestoservices.Thetruecostofborrowingmoneyandrepaymentterms,forexample,mustbeclearlystatedinacontract.TheRighttoChooseListeningSkillConsumerism★Therighttochooseensuresthatconsumershaveaccesstoav