Business Ethics Chapter 1 Many Are Concerned That One Person Appointed

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Ethics in Information Technology, Sixth Edition

Chapter 1

An Overview of Ethics

At a Glance

Instructor’s Manual Table of Contents

• Overview

• Objectives

Lecture Notes

Overview

Chapter 1 introduces ethics, ethics in business, and the importance of ethics in IT. The distinction

between morals, ethics, and laws is defined. The trends that have increased the likelihood of

unethical behavior are identified. The concept of corporate social responsibility is defined and

Objectives

As students read this chapter, they should consider the following questions:

• What is ethics?

• What trends have increased the likelihood of unethical behavior?

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• What is corporate social responsibility, and why is fostering good business ethics

important?

Teaching Tips

Organizations Behaving Badly

1. Explain what “cramming” is, and discuss how AT&T Mobility was using the practice.

I. What is Ethics?

1. Begin the discussion by explaining that ethics is a code of behavior that is defined by the

2. Introduce the terms morals, virtue, vice, and software piracy.

3. Discuss the relationship between ethics and morals, and highlight the many factors that

help define both ethics and morals. Use Figure 1-1 to aid the discussion.

A. The Importance of Integrity

1. Explain that a person who acts with integrity acts in accordance with a personal code of

principles. One approach to acting with integrity is to extend to all people the same

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3. Point out that many ethical dilemmas are not as simple as right versus wrong but involve

B. The Difference between Morals, Ethics, and Laws

1. Note that the law is a system of rules that tells us what we can and cannot do. Laws are

2. Laws raise important and complex issues concerning equality, fairness, and justice, but

do not provide a complete guide to ethical behavior. As a result, practitioners in many

Critical Thinking Exercise: Legal Versus Ethical

1. Students will provide a variety of examples of activities that fit into each of the four

II. Ethics in the Business World

1. Explain that ethics has risen to the top of the business agenda because the risks associated

2. Students should be aware of the trends that have increased the likelihood of unethical

behavior. For example, greater globalization has created a much more complex work

3. Employees, shareholders, and regulatory agencies are increasingly sensitive to violations

of accounting standards, failures to disclose substantial changes in business conditions,

4. Discuss some high-profile instances of ethics violations of companies around the world,

including Enron, Volkswagen, Toshiba, and Amazon.

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5. Introduce the term Bathsheba syndrome—the moral corruption of people in power,

6. Using Table 1-1 as a guide, discuss some of the most common forms of employee

Critical Thinking Exercise: Cut Testing Short

1. Students’ answers will vary but all should acknowledge that this is a situation in which an

employee has to weigh the importance of adhering to his or her personal code of ethics

III. Corporate Social Responsibility

1. Introduce the term corporate social responsibility (CSR)—the concept that an

2. Introduce the term supply chain sustainability—a component of CSR that focuses on

3. Each organization must decide if CSR is a priority and, if so, what its specific CSR goals

are. The pursuit of some CSR goals can lead to increased profits, making it easy for

senior management may be challenged to modify or drop that CSR goal entirely.

Critical Thinking Exercise: Oracle CSR Program

1. The suggested social responsibility goals for Oracle in the areas of sustainability,

education, giving, and volunteering will vary. To develop realistic goals, students should

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Ethics in Information Technology, Sixth Edition

IV. Why Fostering Corporate Social Responsibility and Good Business Ethics

Is Important

1. Briefly discuss the five reasons for pursuing CSR goals and for promoting a work

A. Gaining the Goodwill of the Community

1. Although organizations exist primarily to earn profits or provide services to customers,

2. Introduce the term stakeholder.

Teaching

To learn more about why corporate social responsibility is becoming a strategic

B. Creating an Organization That Operates Consistently

1. Organizations develop and abide by values to create an organizational culture and to

2. Consistency also means that shareholders, customers, suppliers, and the community know

C. Fostering Good Business Practices

1. Explain that in many cases, good ethics can mean good business and improved profits.

Companies that produce safe and effective products avoid costly recalls and lawsuits.

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2. Point out that bad ethics can have a negative impact on employees, many of whom may

3. Note that when a discrepancy between employee and organizational ethics occurs, it

destroys employee commitment to organizational goals and objectives, creates low

D. Protecting the Organization and Its Employees from Legal Actions

1. Explain that in a 1909 ruling (United States v. New York Central & Hudson River

Railroad Co.), the U.S. Supreme Court established that an employer can be held

2. Note that a coalition of several legal organizations, including the Association of

Corporate Counsel, the U.S. Chamber of Commerce, the National Association of

E. Avoiding Unfavorable Publicity

1. An important point to make is that the public reputation of a company strongly influences

2. Note that many organizations are motivated to build a strong ethics program to avoid

Critical Thinking Exercise: Regulating CSR Spending

1. Mandated CSR spending might reduce the benefits an organization can expect to gain

from its CSR programs relative to other companies; however, students will also likely

point out that the many of the absolute benefits of such programs would continue no

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Ethics in Information Technology, Sixth Edition

Quick Quiz 1

1. What is ethics?

2. What are morals?

3. A(n) _____ is a habit that inclines people to do what is acceptable.

4. A(n) _____ is a habit of unacceptable behavior.

5. (True or False) A person who acts with integrity acts in accordance with generally

accepted social norms.

V. How Organizations Can Improve Their Ethics

1. Briefly discuss the characteristics of a successful ethics program, as defined by the Ethics

Resource Center (ERC). Use Figure 1-5 to aid a discussion of the ways in which an

A. Appointing a Corporate Ethics Officer

1. Introduce the concept of a corporate ethics officer (also called a corporate compliance

2. An interesting point to make is that the ethics officer position has its critics. Many are

3. Briefly discuss the responsibilities of the ethics officer.

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B. Require the Board of Directors to Set and Model High Ethical Standards

1. Point out that in a for-profit company, the board of director’s primary objective is to

oversee the organization’s business activities and management for the benefit of all

2. Note that board members are expected to conduct themselves according to the highest

standards for personal and professional integrity, while setting the standard for company-

wide ethical conduct and ensuring compliance with laws and regulations.

C. Establish a Corporate Code of Ethics

1. Explain that a code of ethics is a statement that highlights an organization’s key ethical

2. Note that a code of ethics cannot gain company-wide acceptance unless it is developed

3. Intel Corporation is recognized as one of the most ethical companies in the IT industry.

D. Conduct Social Audits

1. Explain that in a social audit, an organization reviews how well it is meeting its ethical

and social responsibility goals, and communicates its new goals for the upcoming year.

E. Require Employees to Take Ethics Training

1. Note that Lawrence Kohlberg found that many factors stimulate a person’s moral

2. An organization’s code of ethics must be promoted and continually communicated within

the organization, from top to bottom. Explain that organizations can do this by showing

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3. Formal ethics training not only makes employees more aware of a company’s code of

ethics and how to apply it, but also demonstrates that the company intends to operate in

F. Include Ethical Criteria in Employee Appraisals

1. Note that managers can help employees to meet performance expectations by monitoring

D. Create an Ethical Work Environment

1. Explain that employees in highly competitive workplaces may feel the pressure to engage

2. Use the examples on page 23 to discuss how managerial behavior can encourage

Critical Thinking Exercise: How Does Your Employer Rate?

1. Students’ answers to this will vary. Encourage those students who are not currently

employed to audit their school or a local employer. When discussing changes that should

Quick Quiz 2

1. A(n) _____ provides an organization with vision and leadership in the area of business

conduct.

2. (True or False) A corporate ethics officer should have a background in law.

3. A(n) _____ is a statement that highlights an organization’s key ethical issues and

identifies the overarching values and principles that are important to the organization and

its decision making.

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4. In a(n) _____, an organization reviews how well it is meeting its ethical and social

responsibility goals, and communicates its new goals for the upcoming year.

Teaching

Tip

Discuss reasons why employees might not report ethics violations, even when the

appropriate reporting mechanism is in place.

VI. Including Ethical Considerations in Decision Making

1. Note that most of us have developed a decision-making process that we execute

A. Develop a Problem Statement

1. It is important for students to understand that a good problem statement (which is a

clear, concise description of the issue that needs to be addressed) answers the following

questions: What do people observe that causes them to think there is a problem? Who is

directly affected by the problem? Is anyone else affected? How often does the problem

occur? What is the impact of the problem? How serious is the problem?

2. Note that developing a good problem statement is the most critical step in the decision-

3. Use the sample problem statements on page 25 to aid a discussion of how to develop a

B. Identify Alternatives

1. Explain that during this stage of decision making, it is ideal to enlist the help of others,

2. It is important to note that during any brainstorming process, one should try not to be

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D. Choose an Alternative

1. Explain that once a set of alternatives has been identified, they should be evaluated based

2. Point out that the alternative selected should be ethically and legally defensible; be

E. Implement the Decision

1. Explain that once an alternative is selected, it should be implemented in an efficient,

effective, and timely manner. This is often much easier said than done, because people

F. Evaluate the Results

1. Note that after the solution to the problem has been implemented, the results must be

monitored to see if the desired effect was achieved, and its impact on the organization and

Critical Thinking Exercise: An Overwhelmed Employee

1. When using the five-step process for ethical decision making to determine a course of

action in this scenario, students should develop a problem statement that is based on facts

rather than assumptions. Point out that that could be more challenging in this situation

2. Students should develop a plan to implement their decision that focuses on

communication—taking into account all of the people who might need to be

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VII. Ethics in Information Technology

1. Explain that the growth of the Internet and social networks; the ability to capture, store,

2. Point out that general business managers must assume greater responsibility for important

business-technology decisions with strong ethical implications, but to do so, they must be

Critical Thinking Exercise: CIO Surprises CFO

1. Students may suggest a variety of mistakes made by the CIO, including the fact that the

CFO and other staff members were surprised by her proposal, that she has not suggested

other items in the budget that could be trimmed to accommodate the security expenses,

Quick Quiz 3

1. A(n) _____ is a clear, concise description of the issue that needs to be

addressed.

2. The final step in the five-step ethical decision-making process is “implement decision.”.

3. (True or False) Important business-technology decisions with strong ethical implications

are too often left to the technical experts to decide.

Discussion Questions

1. Many employees are aware of reporting procedures for ethics violations, but what types of

managerial behaviors would be worthy of reporting as an ethics violation?

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Additional Projects

1. Design an ethics training program for low-level employees, and describe what changes (if

any) should be made to the same program in order to target middle management.

Additional Resources

1. Ethics Resource Center (www.ethics.org)

Key Terms

Bathsheba syndrome: The moral corruption of people in power, which is often facilitated by a

tendency for people to look the other way when their leaders act inappropriately.

corporate social responsibility (CSR): The concept that an organization should act ethically by

taking responsibility for the impact of its actions on its shareholders, consumers, employees,

community, environment, and suppliers.

ethics: A code of behavior that is defined by the group to which an individual belongs.

integrity: Adherence to a personal code of principles.

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problem statement: A clear, concise description of the issue that needs to be addressed.

social audit: A process whereby an organization reviews how well it is meeting its ethical and

social responsibility goals and communicates its new goals for the upcoming year.