Ethical Issues
Ethics is the study of morals and systems of morality, or princiles of conduct. The study of ethics is concerned with the right or wrong and the shoulds and should nots of human decisions and actions, but we must make the difference between all questions of right and wrong that are or are not ethical issues. The ethical, or moral, frame of reference is concerned with human behavior in society and with the relationship, duties and obligations between people, groups, and organizations. It is concerned with human consequences associated with decisions and actions. actions. An ethical ethical perspective perspective requires that you etend consideration consideration beyond your own self!interest "or that of your company# to consider the interests of a wider community of people, including employees, customers, suppliers, the general public or even foreign governments. The separation of strategic or operating decisions and ethical decisions is artificial because problems in the reals world do not come with neat labels attached$ here is a finance problem% here is a marketing problem% and now, an ethical problem. &anagers may categoriz categorizee the issues issues by functi functional onal area or break break up a comple comple proble problem m into into compo componen nents ts such such as thos thosee ment mentio ione ned. d. 'sua 'suall lly y poli policy cy issu issues es and and deci decisi sions ons are are mult multif iface acete ted d and simu simult ltane aneou ously sly may have have fina financi ncial al,, mark market etin ing g and prod produc ucti tion on components. The decision!making tools for this type of situation probably would be missing. (usiness schools, traditionnally, have not emphasized the teaching of ethics as rigorously as they have the teaching of finance or marketing for eample. (usiness students and managers generally have not been trained to think about ethical issues as they have been trained in the frameworks and techniques for functional are as of specialization. )ome eamples of ethical issues may be present in many areas of operations$ the type of products produces% marketing and advertising practices% business conduct in countries where physical security is a consideration% hiring and promotion practices in countri countries es where where discri discrimin minati ation on and racism racism eist eist%% reques requests ts for paymen payments ts to secure secure contracts or sales% and payments to prevent damage to plants and equipment or in*ury to employees. )uch an eample may be the one of the ') government who tries to open up markets in )outheast Asia for cigarette manufacturers. )hould ') promote the cigarette markets in other countries if they spend money to combat smoking in their own country+ ne side argues that ') is eporting death and disease to the developing world and the other other side side counter counterss that cigarett cigarettes es are manufactu manufactured red and sold sold in countri countries es such such as Thailand. (ut what about the 's government-s attempt to try to change Thai laws that restrict or ban cigarette advertising+ Is this acceptable or is it going too far+ ne of the first things managers often do when they encounter an ethical problem is avoid it through the proces of rationalization. They may focus on some other aspect of the problem. They may transform the ethical problem into some other type of problem! a legal or accounting problem, for instance.
ompliance with laws and professional regulations is probably a minimum requirement for responsible managers. Another kind of avoidance behavior is to see the problem as only one small piece of a larger puzzle and to assume that someone higher up in the organization must be looking after any unusual aspects, such as ethical considerations. /ationalizing one-s behavior by transforming an ethical problem into another type of problem, or assuming responsibility for only one specific, technical component of the issue, or claiming it is someone else-s problem gives one the feeling of being absolved from culpability by putting the burden of responsibility elsewhere. 0ho is responsible for ensuring ethical behavior+ orporations have a responsibility to make it clear to their employees what sort of behavoir is epected. This means that eecutives in headquarters have a responsibility, not *ust for their own behavior, but also for providing guidance to subordinates. A number of companies 1ave corporate codes to do *ust this. The question always arises as to the distinction between legal and ethical behavior. The fact is that not all laws are moral. 1enderson has provided a useful way to think about the relationship between ethical and legal behavior. There are a number of 2 ways$ ethical and legal, legal but unethical, ethical but illegal, illegal and unethical.