Entrepreneurs

Ethical issues in the Business world

I. Introduction

A. How does Ethics involve business

1. hopes to control activities that are harmful but not illegal

2. Social responsibility can influence ethics

II. Low costs equals a high profit

A. Employee compensation

1. management compensation

a. Financial- stock options, salaries, larger raises

b. Non-financial public recognition, health club memberships, company cars

2. Non management compensation

a. financial- full time employment, hourly wage increases

b. Non-financial ESOP, employee awards, healthcare

B. Why does management get more money, and better non-financial benefits?

1. Masalows pyramid physiological, safety, social, esteem self actuation

2. Managers seek money as self esteem not safety, usually more educated

3. Non-managers motivated by lower needs like safety

4. Motivate managers differently than employees

III. Ethical decisions vs. Profit

A. Steps for evaluating a decision

1. is it economical

2. is it legal

3. is it ethical

4. will it provide social leadership

B. Social responsibility

1. proactive approach - leadership in social issues what is ethical

2. accommodative approach- minimal ethics, meet legal obligation

3. defensive approach- do legal minimum, ethical is minimum concern

4. obstructonalist- fight the ethical and legal obligations concern on profit

C. Examples of ethical dilemmas