1. Explain why obeying the law is only the frst step in behaving ethically.
2. How can we tell if our business decisions are ethical?
3. How is legality different from ethics?
4. How can we tell if our business decisions are ethical?
5. Wha is managements roles in setting ethical standards?
6. Whats the difference between compliance-based on integrity-based ethics codes?
7. What is corporate social responsibility?
8. How do businesses demonstrate corporate responsibility toward stakeholders?
9. How are a company’s social responsibility efforts measured?
10. How can U.S companies influence ethical behavior and social responsibility in global markets?
11. What effects have the new laws protecting whistleblowers had on the business environment? Go online or to the library to research individuals who reported their employers’ illegal and/or uethical behavior. Did the companies change their policies? If so, what effect have theses policies had on the companies’ stakeholders? What effect did trportig the problem have on the whistleblowers themselves?
According to household products and personal care company Seventh Generation, corporate responsibility is in its DVA as it considers the effects of its actions on the next seven generations. It strives to limit the effect of all aspects of its products on the environment, from development to their production, purchase, use, and disposal. Visit the company’s website at https://seventhgeneration.com. Then answer the following questions:
1. What is the social mission of Seventh Generation?
2. How is Seventh Generation involved in improving the Vermont community?
3. How does Seventh Generation communicate the company’s social mission to its customers?
2 & 4. How can we tell if our business decisions are ethical?
A common framework used to test the ethics of a business decision involves asking three questions:
Is it Legal? Will I be violating civil law or company policy? (The minimum bar).
Is it Balanced? Is the decision fair to all stakeholders in the long run? Does one party win at the expense of another?
How Will It Make Me Feel? Would I be proud to see this action reported on the news? Would my family, friends, or co-workers approve? (This is often called the "Gut Feeling" or "Golden Rule" test).
5. What is management's role in setting ethical standards?
Management's role is critical; they are responsible for creating and sustaining an ethical culture through modeling and enforcement.
Modeling: Top management must consistently demonstrate impeccable ethical behavior. This sets the "tone at the top."
Formalizing: They must draft and communicate a clear code of ethics.
Enforcing: They must enforce the code consistently, rewarding ethical behavior and punishing unethical behavior regardless of the offender's position or performance
Sample Answer
You've presented a comprehensive list of questions regarding business ethics and corporate social responsibility (CSR). Here are the answers, followed by an analysis of the Seventh Generation company.
Business Ethics and Social Responsibility
1. Why obeying the law is only the first step in behaving ethically.
Obeying the law establishes the minimum standard of behavior required by society. It dictates what a business must do (or must not do) to avoid penalties. Ethics, however, is a higher standard that dictates what a business should do to be morally right, fair, and just. A legal action can still be unethical if it exploits loopholes, harms stakeholders, or violates a moral code (e.g., selling a harmful but legal product).