Management Chapter 2 What Responsibilities Does Business Have With Regard The Environment What Steps Have

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Instructor’s Manual – Chapter 2

Many cities in the United States, concerned about the declining amount of landfill space, have introduced

recycling for trash and garbage pickup. Those municipalities, as in the case of individual business firms, need

an outlet for materials saved for recycling. Sorting is a requirement for municipal recycling—whether done by

each household or by specialized sorting equipment.

Sources:

Kristina Dell, “The Promise and Pitfalls of Bioplastic,” Time, May 3, 2010,

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1. Why has recycling become more popular and widespread?

As more consumers become concerned about the environment and climate change, recycling has

become more common. Many cities offer recycling services now, and some organizations also have

2. What are some of the issues hindering businesses and organizations from offering further recycling

services?

3. What are some of the solutions companies are developing to help cut down on waste and to recycle

more?

Some companies are turning to energy saving measures like using renewable energy. They are also

C O N T R O V E R S I A L I S S U E

Would You Be the One to Blow the Whistle?

Ethics is concerned not only with an individual’s conduct but also with how an individual responds to the

actions of others. An employee who takes action upon observing improper conduct by a fellow employee is

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Instructor’s Manual – Chapter 2

One day while talking to a sales representative of one of his firm’s suppliers, Adam discovered that Martin

Cooper and his wife had received a free trip to the Bahamas, with all air, hotel, and meal expenses paid by

1. Was Martin Cooper’s free trip an example of unethical business behavior?

2. Should Adam report to one of his company’s executives about what he had discovered? Or should he

talk to Martin Cooper? Or should he just keep quiet?

3. If he decides to do nothing, is Adam guilty of unethical business behavior?

S O Y O U W A N T A J O B I N B U S I N E S S E T H I C S A N D

S O C I A L R E S P O N S I B I L I T Y

What has helped drive the increasing awareness of the importance of business ethics and social

responsibility?

Under pressure from employees and consumers, businesses understand the importance of ethical and social

C H E C K Y O U R P R O G R E S S

1. Define business ethics. Who determines whether a business activity is ethical? Is unethical conduct

always illegal?

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Instructor’s Manual – Chapter 2

2. Distinguish between ethics and social responsibility.

3. Why has ethics become so important in business?

4. What is an ethical issue? What are some of the ethical issues discussed in your text? Why are they

ethical issues?

An ethical issue is an identifiable problem, situation, or opportunity that requires a person to choose

5. What is a code of ethics? How can one reduce unethical behavior in business?

6. List and discuss the arguments for and against social responsibility by business (Table 2.8). Can you

think of additional arguments (for or against)?

Arguments for social responsibility include (1) business helped create problems and should help to solve

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7. What responsibilities does a business have toward its employees?

8. What responsibilities does business have with regard to the environment? What steps have been

taken by some responsible businesses to minimize the negative impact of their activities on the

environment?

9. What are a business’s responsibilities toward the community in which it operates?

G E T I N V O L V E D

1. Discuss some recent examples of businesses engaging in unethical practices. Classify these practices as

issues of conflict of interest, fairness and honesty, communications, or business relationships. Why do

you think the businesses chose to behave unethically? What actions might the businesses have taken?

Student answers will vary, but they should support their answers with information from the text.

Sample student answer: When Duke Energy acquired Progress Energy, it was agreed that the Duke

Energy CEO would step down and the Progress Energy CEO would assume the position of CEO of the

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2. Discuss with your class some possible methods of improving ethical standards in business. Do you

think that business should regulate its own activities or that the federal government should establish

and enforce ethical standards? How do you think businesspeople feel?

Student answers will vary. Students who might favor businesses regulating their own activities might

argue that businesses understand their industries better and would therefore have a better

3. Find some examples of socially responsible businesses in newspapers or business journals. Explain why

you believe their actions are socially responsible. Why do you think the companies chose to act as they

did?

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Instructor’s Manual – Chapter 2

B U I L D Y O U R S K I L L S

The following information is extracted from Gray Matters: The Ethics Game Manual:

Objectives

2. Stimulate students’ imaginations regarding the ethical consequences of their business decisions and

actions.

4. Involve students in discussion rather than have them listen passively to a lecture or read an abstract set

of ethical principles.

This game is designed to teach the solving of ethical dilemmas that occur almost every day in every kind of

business. It is also designed to create controversy. It is structured to bring out more than just one company’s

policies—to allow the participants to argue multiple approaches to ethical dilemmas. For example, is there

only one answer—regardless of the circumstances? Or are there modifying influences? Right is right, but

what is right?

The intentional controversy doesn’t stop with the answers. It carries on into the values of the answers. In a

game, there must be scorekeeping. You may disagree with the values of some of the answers, but do you

always agree with the penalties in football? Or that fine line that distinguishes a hit from an error in baseball?

Ethics is dynamic. No one solution is always correct nor is another solution always wrong. Some solutions

appeal to some while other solutions appeal to others. In Gray Matters, every mini-case poses four solutions.

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How to Play

Competition adds spice to the game, just as it does in real life. It can be played by individuals, or by a larger

play group divided into teams. When the class is too large to play as individuals, organize the players into

Answers, Point Values, and Rationale

CASE

NO.

ANSWER

POINTS

RATIONAL

4

A

0

May solve the workload problem if you

can physically and mentally carry this

double workload over a long period.

Does not solve the ethical issue, so no

credit.

B

5

It brings to the attention of the

supervisor the poor work ethic of your

colleague. It also may give you an

opportunity to properly expand your

own activity.

C

10

If it works, this is the easy way to solve

the problem. Be aware, however, if it

doesn’t work, you may have to take the

next step.

D

-5

Pushes the problem solving onto

someone else. The problem is between

you, your supervisor, and your

colleague. Solve it there.

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CASE

NO.

ANSWER

POINTS

RATIONAL

7

A

5

May do some good.

B

5

May do some good.

C

0

Too confrontational.

D

10

Gets the right people involved in solving

the problem.

CASE

NO.

ANSWER

POINTS

RATIONAL

36

A

–10

How many other company policies do

you also ignore?

B

5

May solve the problem but then it may

not. In fact, it may get very

confrontational and most likely will not.

C

–10

In that case you deserve –10 points.

D

10

This is the easiest way for you to handle

the problem and the one with the most

chance of success.

CASE

NO.

ANSWER

POINTS

RATIONAL

40

A

–10

That makes you also guilty of theft.

B

0

He probably knows that.

C

10

Ethics will have it investigated.

D

5

This may also get the problem

investigated; but then again, it may not.

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SCORE SHEET: Photocopy the chart, fill in the group leader’s name at the top of each column, and record the

points for the choices selected.

CASE NO.

ANSWER

POINTS

4

A

0

B

5

C

10

D

-5

7

A

5

B

5

C

0

D

10

36

A

–10

B

5

C

–10

D

10

40

A

–10

B

0

C

10

D

5

TOTAL POINTS

Source: Gray Matters: The Ethics Game by George Sammet, Jr., Lockheed Martin Corporation.

B U I L D Y O U R B U S I N E S S P L A N

Find an example within your community of an ethical and/or societal violation, which can be an issue still

being resolved. Lead a discussion on the facts of this violation and what the implications are of this violation

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S E E F O R Y O U R S E L F V I D E O C A S E:

T H E C H A L L E N G E O F B U I L D I N G T R U S T I N B U S I N E S S

Case Overview

Discusses the challenges businesses face in regaining consumers’ trust after the scandals that have rocked

the past decade. Organizations like the Arthur Page Society and the Business Roundtable Institute for

Corporate Ethics have studied why Americans mistrust business and the ways to earn that trust back again.

1. What are some of the reasons cited in the Arthur Page Society and the Business Roundtable Institute

for Corporate Ethics Report for public distrust of corporations?

2. What are some of the recommendations made by this report? Can you think of any other

recommendations to give companies on how to behave more ethically?

The report recommends that corporations take steps to equalize the balance of power through creating

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Instructor’s Manual – Chapter 2

3. What are the benefits of being perceived as an ethical company? What are the downsides of having a

reputation for ethical misconduct?

T E A M E X E R C I S E

Sam Walton, founder of Walmart, had an early strategy for growing his business related to pricing. The

“Opening Price Point” strategy used by Walton involved offering the introductory product in a product line at

the lowest point in the market. For example, a minimally equipped microwave oven would sell for less than

anyone else in town could sell the same unit. The strategy was that if consumers saw a product, such as the

Sample Answers:

Strategy as Ethical: As long as there are plenty of these minimally equipped products on hand and Walmart is

transparent about their prices and functionality, then there is nothing wrong with the strategy. In fact, it is an

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T E R M P A P E R O R P R O J E C T T O P I C S

These topics may be assigned as individual or collaborative projects:

1. Advantages and Disadvantages of Social Responsibility Programs for Business

3. A Survey of Social Responsibility Programs in Corporations (can do a questionnaire survey of local firms)

5. Environmental Issues and Their Solutions

G U E S T S P E A K E R S U G G E S T I O N S

2. A representative from a business firm to speak about business ethics, problems with business ethics in a

competitive environment, and the importance of business ethics in dealing with consumers.

4. An individual (concerned environmentalist, teacher, professor, etc.) to speak on local environmental

issues.

T E A C H I N G S U G G E S T I O N S

1. As indicated in “Teaching Suggestions” for Chapter 1, instructors may wish to vary the daily organization

of the lesson. Varying the sequence of activities adds variety to class presentation.

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3. As a “writing to learn” exercise, allow approximately five minutes for students to write their thoughts or

summary on this topic:

What is the importance of ethics and social responsibility in business today?

The writing exercise can be done with or without the use of the textbook. The purpose of the exercise is

4. “Check Your Progress” is important for this chapter. A suggestion for large lecture halls is to assign

5. The instructor can lecture using the “Lecture Outline and Notes,” covering all of the chapter content. An

alternative is not to cover the entire chapter but simply to use the PowerPoints to cover main points of

the chapter; then the instructor may have time to use the “Supplemental Lecture” and/or “Controversial

6. Use the quiz provided. Have students write answers quickly. Then have students call out the correct

answers in unison. Ask if there are any questions about any of the answers.

7. Occasionally, an instructor may wish to give oral instructions or information to reinforce listening skills.