Fluent Essays

Of the case studies/articles in chapter four, which three individuals common ethical problems do you see as most problematic? Why is this so? Make sure to use specifics from the text to support your analysis.According to the reading in chapter three, what three components of ethical theory should we, as leaders, be most aware of as we think about the psychological approach to moral evaluation? Make sure to use the text as a resource in arguing your case. Textbook is attached, each question should be 100-200 words. APA format for any references. managing_business_ethics_straight_talk_about_how_to_do_it_right__7th_edition__linda_k._trevino.pdf Unformatted Attachment Preview Managing Business Ethics Straight Talk about How To Do It Right Seventh Edition Linda Klebe Treviño Distinguished Professor of Organizational Behavior and Ethics Smeal College of Business The Pennsylvania State University and Katherine A. Nelson Instructor Fox School of Business Temple University VP AND EDITORIAL DIRECTOR George Hoffman EDITORIAL DIRECTOR Veronica Visentin EXECUTIVE EDITOR Lise Johnson SPONSORING EDITOR Jennifer Manias EDITORIAL MANAGER Gladys Soto CONTENT MANAGEMENT DIRECTOR Lisa Wojcik CONTENT MANAGER Nichole Urban SENIOR CONTENT SPECIALIST Nicole Repasky PRODUCTION EDITOR Bharathy Surya Prakash COVER PHOTO CREDIT © Stuart Monk/Shutterstock.com Founded in 1807, John Wiley & Sons, Inc. has been a valued source of knowledge and understanding for more than 200 years, helping people around the world meet their needs and fulfill their aspirations. Our company is built on a foundation of principles that include responsibility to the communities we serve and where we live and work. In 2008, we launched a Corporate Citizenship Initiative, a global effort to address the environmental, social, economic, and ethical challenges we face in our business. Among the issues we are addressing are carbon impact, paper specifications and procurement, ethical conduct within our business and among our vendors, and community and charitable support. For more information, please visit our website: www.wiley.com/go/citizenship. Copyright © 2017, 2014, 2011, 2007, 2004 John Wiley & Sons, Inc. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per‐copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923 (Web site: www.copyright.com). Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030‐5774, (201) 748‐6011, fax (201) 748‐6008, or online at: www. wiley.com/go/permissions. Evaluation copies are provided to qualified academics and professionals for review purposes only, for use in their courses during the next academic year. These copies are licensed and may not be sold or transferred to a third party. Upon completion of the review period, please return the evaluation copy to Wiley. Return instructions and a free of charge return shipping label are available at: www.wiley.com/go/ returnlabel. If you have chosen to adopt this textbook for use in your course, please accept this book as your complimentary desk copy. Outside of the United States, please contact your local sales representative. ISBN: 978‐1‐119‐19430‐9 (PBK) ISBN: 978‐1‐119‐29854‐0 (EVALC) Library of Congress Cataloging‐in‐Publication Data Names: Treviño, Linda Klebe, author. | Nelson, Katherine A., 1948‐ author. Title: Managing business ethics : straight talk about how to do it right / Linda Klebe Treviño, Katherine A. Nelson. Description: Seventh Edition. | Hoboken : Wiley, [2017] | Revised edition of the authors’ Managing business ethics, [2014] | Includes bibliographical references and index. Identifiers: LCCN 2016053351| ISBN 9781119194309 (pbk. : alk. paper) | ISBN 9781119298519 (epub) Subjects: LCSH: Business ethics. | Business ethics — Case studies. Classification: LCC HF5387 .T734 2017 | DDC 174/.4 — dc23 LC record available at https://lccn.loc.gov/2016053351 The inside back cover will contain printing identification and country of origin if omitted from this page. In addition, if the ISBN on the back cover differs from the ISBN on this page, the one on the back cover is correct. Bri e f C o n te n ts Prefacexv Acknowledgmentsxix Section I Introduction 1 Introducing Straight Talk about Managing Business Ethics: Where We’re Going and Why 2 Section II Ethics and the Individual 2 Deciding What’s Right: A Prescriptive Approach 38 3 Deciding What’s Right: A Psychological Approach 72 4 Addressing Individuals’ Common Ethical Problems 114 Section III Managing Ethics in the Organization 5 Ethics as Organizational Culture 158 6 Managing Ethics and Legal Compliance 218 7 Managing for Ethical Conduct 257 8 Ethical Problems of Managers 295 Section IV Organizational Ethics and Social Responsibility 9 Corporate Social Responsibility 326 10 Ethical Problems of Organizations 362 11 Managing for Ethics and Social Responsibility in a Global Environment 399 Index447 iii Conte n ts Prefacexv Acknowledgmentsxix Section I Introduction 1 Introducing Straight Talk about Managing Business Ethics: Where We’re Going and Why 2 Introduction 2 The Financial Disaster of 2008 4 Borrowing Was Cheap 4 Real Estate Became the Investment of Choice 5 Mortgage Originators Peddled “Liar Loans” 5 Banks Securitized the Poison and Spread It Around 6 Those Who Were Supposed to Protect Us Didn’t 7 Moving Beyond Cynicism 10 Can Business Ethics Be Taught? 14 Aren’t Bad Apples the Cause of Ethical Problems in Organizations? 15 Shouldn’t Employees Already Know the Difference between Right and Wrong? 16 Aren’t Adults’ Ethics Fully Formed and Unchangeable? This Book is About Managing Ethics in Business 20 Ethics and the Law 21 Why Be Ethical? Why Bother? Who Cares? 22 Individuals Care about Ethics: The Motivation to Be Ethical 23 Employees Care about Ethics: Employee Attraction and Commitment 24 Managers Care about Ethics 25 Executive Leaders Care about Ethics 26 Industries Care about Ethics 26 Society Cares about Ethics: Business and Social Responsibility 27 The Importance of Trust 28 17 v vi  Contents The Importance of Values 30 How This Book Is Structured 31 Conclusion 32 Discussion Questions 33 Exercise: Your Cynicism Quotient Notes 35 34 Section II Ethics and the Individual 2 Deciding What’s Right: A Prescriptive Approach 38 Ethics and the Individual 38 Ethical Dilemmas 38 Prescriptive Approaches to Ethical Decision Making in Business 39 Eight Steps to Sound Ethical Decision Making in Business 53 Practical Preventive Medicine 59 Conclusion 62 Discussion Questions 62 Exercise: Clarifying Your Values 64 Introducing the Pinto Fires Case 64 Case: Pinto Fires 65 Short Cases 70 Notes 70 3 Deciding What’s Right: A Psychological Approach Ethical Awareness and Ethical Judgment 72 Individual Differences, Ethical Judgment, and Ethical Behavior 76 Cognitive Moral Development 77 Locus of Control 84 Machiavellianism 85 Moral Disengagement 86 Facilitators of and Barriers to Good Ethical Judgment Thinking about Fact Gathering 89 Thinking about Consequences 90 Thinking about Integrity 92 Thinking about Your Gut 94 Unconscious Biases 95 Emotions in Ethical Decision Making 96 72 88 Contents  vii Toward Ethical Action 99 Revisiting the Pinto Fires Case: Script Processing and Cost–Benefit Analysis 104 Cost–Benefit Analysis 106 Conclusion 108 Exercise: Understanding Cognitive Moral Development Discussion Questions 109 Short Case 109 Notes 110 4 Addressing Individuals’ Common Ethical Problems Identifying Your Values—and Voicing Them People Issues 118 Discrimination 118 Harassment, Sexual and Otherwise 122 Conflicts of Interest 126 What Is It? 126 How We Can Think about This Issue 130 Why Is It an Ethical Problem? 131 Customer Confidence Issues 132 What Is It? 132 How We Can Think about This Issue 136 Why Is It an Ethical Problem? 137 Use of Corporate Resources 137 What Is It? 137 How We Can Think about This Issue 142 Why Is It an Ethical Problem? 143 When all Else Fails: Blowing the Whistle 143 When Do You Blow the Whistle? 146 How to Blow the Whistle 146 Conclusion 151 Discussion Questions 151 Short Cases 152 Notes 153 Section III Managing Ethics in the Organization 5 Ethics as Organizational Culture Introduction 158 Organizational Ethics as Culture 158 159 115 108 114 viii  Contents What Is Culture? 159 Strong versus Weak Cultures 159 How Culture Influences Behavior: Socialization and Internalization 160 Ethical Culture: A Multisystem Framework 161 Alignment of Ethical Culture Systems 162 Ethical Leadership 163 Executive Leaders Create Culture 163 Leaders Maintain or Change Organizational Culture 164 Other Formal Cultural Systems 174 Selection Systems 174 Values and Mission Statements 175 Policies and Codes 177 Orientation and Training Programs 179 Performance Management Systems 180 Organizational Authority Structure to Support Responsibility 182 Decision‐Making Processes 186 Informal Cultural Systems 187 Role Models and Heroes 188 Norms 189 Rituals 190 Myths and Stories 190 Language 191 Organizational Climates: Fairness, Benevolence, Self‐Interest, Principles 193 Developing and Changing the Ethical Culture 194 How an Ethical Culture Can Become an Unethical Culture 195 Becoming a More Ethical Culture 196 A Cultural Approach to Changing Organizational Ethics 199 Audit of the Ethical Culture 199 Cultural Systems View 199 A Long‐Term View 200 Assumptions about People 200 Diagnosis: The Ethical Culture Audit 201 Ethical Culture Change Intervention 203 The Ethics of Managing Organizational Ethics 204 Conclusion 205 Discussion Questions 205 Contents  ix Case: Culture Change at GM? 206 Case: Culture Change at Texaco 207 Case: An Unethical Culture in Need of Change: Tap Pharmaceuticals 209 Case: “Bad to the Bone” 211 Notes 213 6 Managing Ethics and Legal Compliance 218 Introduction 218 Structuring Ethics Management 218 Making Ethics Comprehensive and Holistic 222 Managing Ethics: The Corporate Ethics Office 222 Ethics and Compliance Officers 222 The Ethics Infrastructure 224 The Corporate Ethics Committee 225 Communicating Ethics 225 Basic Communications Principles 226 Evaluating the Current State of Ethics Communications 228 Multiple Communication Channels for Formal Ethics Communication 230 Interactive Approaches to Ethics Communication 232 Mission or Values Statements 235 Organizational Policy 237 Codes of Conduct 238 Communicating Senior Management Commitment to Ethics 240 Formal and Informal Systems to Resolve Questions and Report Ethical Concerns 245 Using the Reward System to Reinforce the Ethics Message 248 Evaluating the Ethics Program 248 Surveys 248 Values or Compliance Approaches 249 Globalizing an Ethics Program 250 Conclusion 251 Discussion Questions 251 Short Case 252 Appendix: How Fines Are Determined under the U.S. Sentencing Guidelines 253 Notes 255 x  Contents 7 Managing for Ethical Conduct 257 Introduction 257 In Business, Ethics is about Behavior 257 Practical Advice for Managers: Ethical Behavior 258 Our Multiple Ethical Selves 258 The Kenneth Lay Example 259 The Dennis Levine Example 261 Practical Advice for Managers: Multiple Ethical Selves 261 Rewards and Discipline 262 People Do What Is Rewarded and Avoid Doing What Is Punished 262 People Will Go the Extra Mile to Achieve Goals Set by Managers 263 How Goals Combined with Rewards Can Encourage Unethical Behavior 264 Practical Advice for Managers: Goals, Rewards, and Discipline 265 Recognize the Power of Indirect Rewards and Punishments 266 Can Managers Really Reward Ethical Behavior? 268 What About the Role of Discipline? 269 Practical Advice for Managers: Discipline 271 People Follow Group Norms 272 “Everyone’s Doing It” 272 Rationalizing Unethical Behavior 273 Pressure to Go Along 273 Practical Advice for Managers: Group Norms 273 People Fulfill Assigned Roles 275 The Zimbardo Prison Experiment 275 Roles at Work 277 Conflicting Roles Can Lead to Unethical Behavior 277 Roles Can Also Support Ethical Behavior 278 Practical Advice for Managers: Roles 278 To Authority: People Do What They’re Told 278 The Milgram Experiments 279 Obedience to Authority at Work 281 Practical Advice for Managers: Obedience to Authority 282 Responsibility is Diffused in Organizations 282 “Don’t Worry—We’re Taking Care of Everything” 282 Diffusing Responsibility in Groups 283 Contents  xi Diffusing Responsibility by Dividing Responsibility 284 Diffusing Responsibility by Creating Psychological Distance 285 Practical Advice for Managers: Personal Responsibility 286 Stressed‐Out Employees are More Unethical 286 Practical Advice for Managers: Stress 287 Conclusion 287 Am I Walking My Ethical Talk? 287 Discussion Questions 288 Case: Sears, Roebuck, and Co.: The Auto Center Scandal 289 Short Case 291 Notes 292 8 Ethical Problems of Managers 295 Introduction 295 Managers and Employee Engagement Managing the “Basics” 298 Hiring and Work Assignments 298 Performance Evaluation 300 Discipline 303 Terminations 305 Why Are These Ethical Problems? 307 Costs 308 Managing a Diverse Workforce 308 Diversity 309 Harassment 311 Family and Personal Issues 312 Why Are These Ethical Problems? 315 Costs 315 The Manager as a Lens 315 The Buck Stops with Managers 316 Managers Are Role Models 319 Managing Up and Across 319 Honesty Is Rule One 320 Standards Go Both Ways 321 Conclusion 322 Discussion Questions 322 Short Cases 323 Notes 324 295 xii  Contents Section IV Organizational Ethics and Social Responsibility 9 Corporate Social Responsibility 326 Introduction 326 Why Corporate Social Responsibility? 326 Types of Corporate Social Responsibility 334 Economic Responsibilities 334 Legal Responsibilities 335 Ethical Responsibilities 335 Philanthropic Responsibilities 336 Triple Bottom Line and Environmental Sustainability 339 Is Socially Responsible Business Good Business? 343 The Benefit of a Good Reputation 344 Socially Responsible Investors Reward Social Responsibility 344 The Cost of Illegal Conduct 345 The Cost of Government Regulation 346 What the Research Says about Social Responsibility and Firm Performance 349 Being Socially Responsible Because It’s the Right Thing to Do 352 Conclusion 354 Discussion Questions 354 Case: Merck and River Blindness 355 Short Case 357 Notes 357 10 Ethical Problems of Organizations 362 Introduction 362 Managing Stakeholders 363 Key Stakeholder Groups 365 Ethics and Consumers 365 Ethics and Employees 369 Ethics and Shareholders 371 Ethics and the Community 372 Key Ethical Issues Involving Multiple Stakeholders 373 Product Safety 373 Pricing Issues for Prescription Medications 378 Environmental Catastrophes 380 Additional Environmental Bombshells 381 Contents  xiii Why Are These Ethical Issues? 382 Costs 382 Classic Ethics Cases 383 First: The Less-than-Ideal Examples 383 Models to Consider and Admire 388 Conclusion 390 Short Cases 391 Discussion Questions 395 Notes 395 11 Managing for Ethics and Social Responsibility in a Global Environment 399 Introduction 399 Focus on the Individual Expatriate Manager 399 The Difficulties of Foreign Business Assignments 400 The Need for Structure, Training, and Guidance 400 Foreign Language Proficiency 401 Learning about the Culture 401 Recognizing the Power of Selective Perception 403 Assumption of Behavioral Consistency 404 Assumption of Cultural Homogeneity 404 Assumption of Similarity 405 How Different Are Ethical Standards in Different Cultures—Really? 412 Development of Corporate Guidelines and Policies for Global Business Ethics 414 The Organization in a Global Business Environment 418 Deciding to Do Business in a Foreign Country 418 Development of a Transcultural Corporate Ethic 428 Conclusion 431 Discussion Questions 432 Short Case 433 Case: Selling Medical Ultrasound Technology in Asia 433 Case: Google Goes to China 436 Notes 441 Index447 PRE FAC E Why Does the World Need Another Business Ethics Text? The popular business press is replete with feature stories describing ethical meltdowns and how those corporate misdeeds have eroded the public trust of business leaders and their organizations. As most of us learned at our parents’ knees, trust and reputation are built over many years and take but an instant to be destroyed. So here we stand at a crossroads. Is it going to be business as usual for business? Or are businesspeople going to commit to regaining the trust of our peers, our families, and our fellow citizens? In response to this crisis of trust, universities across the country have designed new courses that incorporate leadership, communication skills, the basics of human resources management, and ethics. That’s why we wrote this book; we want to make the study of ethics relevant to real‐life work situations. We want to help businesspeople regain the trust that’s been squandered in the last few years. This book is different from other business ethics texts in several key ways. First, it was written by an unusual team. Linda Treviño is Distinguished Professor of Organizational Behavior and Ethics in the Management and Organization Department of the Smeal College of Business at the Pennsylvania State University. Her prolific research on the management of ethical conduct in organizations is published in the field’s best journals and is internationally known and referenced. She has more than 25 years of experience in teaching students and executives in university and nonuniversity settings, and she also has experience as a corporate consultant and speaker on ethics and management issues. Kate Nelson is a full‐time faculty member at the Fox School of Business at Temple University in Philadelphia, where she teaches management, business ethics, and human resources to undergraduates. Before joining Temple’s faculty, Kate worked for more than 30 years in strategic organizational communication and human resources at a variety of companies including Citicorp, Merrill Lynch, and Mercer HR Consulting. She also has worked as a consultant specializing in ethics and strategic employee communications and has designed ethics programs for numerous organizations. We think that bringing together this diverse mix of theory and practice makes the book unique. Second, the approach of this book is pragmatic, and that approach is a direct response to complaints and suggestions we have heard from students, employees, and corporate executives. “Make it real,” they have said. “Tell us what we need to know to effectively manage people. Take the mystery out of this subject that seems so murky. Get to the point.” This book starts with the assumption xv xvi Preface that ethics in organizations is about human behavior in those organizations. Research finds that behavior results from a number of factors, many of which can be influenced by managers and the organizations themselves. As a result, this book is organized into sections about individuals, managing in an organizational context, organizations in their broader environment, the ethical dilemmas managers face, and how they might solve them. It also features philosophical and psychological factors of decision making, ethical culture, how managers can influence employees’ behavior through ethical leadership, what corporations are doing to encourage ethical behavior and corporate social responsibility, and international business ethics. Third, we have used a different mix of examples than is found in conventional business ethics texts. Most texts focus on high‐level, corporate dilemmas: “Should senior executives be paid at a particular level? Should this industry do business in China? Should American environmental laws apply to American companies operating overseas?” Although these are interesting issues, the vast majority of students and employees will never have to face them. However, they will have to hire, manage, assess performance, discipline, fire, and provide incentives for staff, as well as produce quality products and services and deal effectively and fairly with customers, vendors, and other stakeholders. ... Purchase answer to see full attachment