Preface
This book presents a number of case studies of the ethical mistakes of businesses. Seems to be provided as an ancillary text for business ethics courses.
The point of the book is not to sensationalize misdeeds or assault reputations, merely to use these case-studies as a method of illustrating ethical concepts and instances in vivo.
It is stressed that the "overwhelming majority" of business dealings are noncontroversial, and the fact that abuses receive public scrutiny aggrandizes the extent of the problem. But it also means that such irregular incidents, given the impact they can have, merit careful consideration.
Introduction and Perspective
A key point to make in terms of ethics:
The interests of a firm are best served by giving careful attention to the public interest and by seeking a trusting relationship with the various publics with which it is involved. In the process, society is also best served.
Ethics refers to "standards of right conduct" - but there is little agreement as to what constitutes "right" and therefore what actions are to be considered ethical or unethical.
It is not uncommon for companies to defer to the law - and use "just be legal" as their standard of ethics. The author suggests that ethics and legality are two separate considerations, and any coincidence is entirely coincidental: a legal action may be ethical, an ethical action may be illegal.
On the same topic, it's also worth noting that the law is full of loopholes, and there are many arguments of definition, such that the interpretation of the law is often used as a defense of activities that are plainly unethical.
An important consideration for business is their long-term interests, chiefly in maintaining their reputation. A company may suffer no judicial penalty for a plainly unethical act, but it can suffer greatly in the market as a consequence.
There are often conditions that tend to motivate shady practices. The author lists six:
- Overemphasis on Performance - Where the quantitative measure of performance are given strong emphasis, especially where there is punishment for failure to succeed by these measures, there is incentive to behave unethically to meet quotas
- Intense Competition - Where the nature of the market is highly competitive, especially for commoditized products, there is no clear basis for competitive advantage, so individuals may get creative in discovering ways to get ahead of their competitors
- Expedience and Indifference - Much unethical behavior is born of a failure to consider the impact of an action beyond its intended results
- Business as Usual - The ethics of a business may be geared toward a certain culture or environment, and as the situation changes, failure to adjust business practices (adhering to customs) may result in unethical business practices
- Groupthink- When individuals become part of a committee, consortium, or group, less consideration is given to ethics than would be if each of those individuals were acting on his own, and would be held personally responsible for the consequences of their decisions
- Looting - Aside of ethical problems that arise as a result of the organization, individuals within that organization may act unethically (even by organizational standards) in order to gain personal profit, sometimes to the detriment of the organization.
The book is divided into four parts:
- Contemporary Ethical Misconduct - Recent cases of corporate malpractice
- Classical Ethical Violations - Cases that go back a number of years, many of which have had an impact on current ethical standards
- Controversial Behavior - Instances in which there is no clear ethical misdeed, though there is some suggestion that there may be
- Good Practices - A couple of examples of "enlightened" corporate behavior, in difficult circumstances.
It is suggested that the student consider what they might have done in the same situation - and knowing what the consequences were, what might have been done differently.