BLAW 3050 – BUSINESS ETHICS
I. Ethical Theories
A. Egoism – somebody who only cares about him or herself. Robert Madoff (Ponzi
Scheme). Lacks empathy
B. Utilitarianism – John Stewart Mill and Jerry Mi Betham. An action is ethical if it
serves the greater good to the greatest number of people. Ford Pinto – didn’t fix
an $11 problem. Companies are often focused in the bottom line.
C. Kantian – Even 1 injured person is too much.
D. Religious-based
E. Stockholder – Hopefully, the company’s stock will increase. Dividend. Bottom
line. Milton Freedman father of the stock holder theory
F. Stakeholder – 1984 Edward Freeman published a book stating stakeholder
management stating that corporations should focus on array of stakeholders who
have some sort of interest in the company and how the company acts. Not just the
stock. Costco has consistently outperformed Walmart because of their
stakeholders and customers.
II. Corporate Culture and Governance / Encouraging Ethical Behavior / Risk
Management
A. Code of Ethics
B. Hotlines
C. Whistleblower protection
D. Ethical training
E. Avoidance of short-termism
F. Rewards for ethical behavior and punishments for unethical behavior