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Frank believes, and he believes that the application of game theory to business helps show, that firms
profit by being socially responsible.
He indicates that being socially responsible does several things for business. One of these is to solve
commitment problems with employees, another one is to solve commitment problems with customers,
the third is to solve commitment problems with other firms, the fourth is to reflect consumers’ moral
values, and the last is to reflect prospective employees’ moral values. By doing all of these things,
Frank believes, it is clear that a business will increase its profits overall to a much greater extent than
it would by trying grab each piece of potential profit only as it presents itself.
Article: “Managing for Organizational Integrity” by Lynn Sharp Paine (pp. 274 – 287)
Paine believes that management and ethics are inextricably linked and proposes that organizational
integrity is necessary “to foster a climate that encourages exemplary behavior. . . .” Naturally,
exemplary behavior is well beyond merely complying with the law. It contains legality along with
managerial responsibility for ethical behavior within an organization. Paine clearly states that
organizations can shape the behavior of the individuals that act under the guise of that organization.
To Paine, integrity strategy means “a conception of ethics as the driving force of enterprise.” And
organizational ethics is a very real concept. Some of the characteristics of organizational ethics that
she illustrates by case studies are: an emphasis on core values, building and continuing shared
aspirations, and defining right actions (and by contrast, wrong actions as well).
Article: “The Parable of the Sadhu” by Bowen H. McCoy (pp. 287 – 293)
McCoy tells us of a trip he took to the Himalayas. During it, he and a number of hikers passed an
Indian holy man, who clearly was not dressed for the trip and clearly did not have enough supplies.
Due to the treacherousness of the journey, nobody could carry this man to safety and also expect to
live himself. Most of the hikers tried to help in some small way, but those who thought about it were
sure that without significant help this man would die. Very few did indeed think about it, most offered
a little bit of aid and continued on their once-in-a-lifetime trip.
One of McCoy’s traveling companions was greatly distressed by this happenstance. He felt that a
well-dressed, attractive, or obviously wealthy person would have been helped more than this Indian
holy man had been helped. McCoy’s companion felt that they should have stayed until one of the
following occurred: that the man actually died in their care, that the man actually demonstrated that he
could walk to safety by himself, or that they carried the man to the village and got someone in the
village to care for him. None of these three options did occur, and the companion took this to be
contributing to the death of a fellow man.
McCoy took this incident to be an example of the contrast between the individual and the group ethic.
His companion, after all, did not stay with the holy man to die, but rather continued on with the rest of
his group to safety. And yet, on reflection, they all perhaps thought that more could have been done to
save this man. McCoy thinks of ethics as a positive force rather than a constraint. We should think of
what we should do rather than what we should not do. He takes as a lesson from this event that in a
complex situation the individual requires and deserves support of the group in order to know how to
act.