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Business Ethics and Crimes
Terms in this set (34)
standards of what is right/wrong with regard to important social values and norms
Applying principles of right and wrong to workplace situations.
Why practice business ethics?
1. Customers are more confident when buying goods/services from an ethical company.
2. An ethical workplace motivates employees.
3. Ethical behavior prevents legal problems.
Be honest in all communications and actions. Ethical executives do not deliberately mislead or deceive others by misrepresentations, overstatements, partial truths, selective omissions, or any other means and when trust requires it they supply relevant information and correct misapprehensions of fact
Maintain personal integrity. Integrity refers to a wholeness of character demonstrated by consistency between thoughts, words and actions. Maintaining integrity often requires moral courage, the inner strength to do the right thing even when it may cost more than they want to pay.
Keep promises and fulfill commitments. Ethical executives can be trusted because they make every reasonable effort to fulfill the letter and spirit of their promises and commitments. They do not interpret agreements in an unreasonably technical or legalistic manner in order to rationalize non-compliance or create justifications for escaping their commitments.
Be loyal within the framework of other ethical principles. Ethical executives demonstrate loyalty by safeguarding their ability to make independent professional judgments. They avoid conflicts of interest and they do not use or disclose information learned in confidence for personal advantage. If they decide to accept other employment, ethical executives provide reasonable notice, respect the proprietary information of their former employer, and refuse to engage in any activities that take undue advantage of their previous positions.
Demonstrate compassion and a genuine concern for the well-being of others. Ethical executives are caring, compassionate, benevolent and kind. They understand the concept of stakeholders (those who have a stake in a decision because they are affected by it) and they always consider the business, financial and emotional consequences of their actions on all stakeholders. Ethical executives seek to accomplish their business objectives in a manner that causes the least harm and the greatest positive good.
Treat everyone with respect. Ethical executives demonstrate respect for the human dignity, autonomy, privacy, rights, and interests of all those who have a stake in their decisions; they are courteous and treat all people with equal respect and dignity regardless of sex, race or national origin. Ethical executives adhere to the Golden Rule, striving to treat others the way they would like to be treated.
Obey the law. Ethical executives abide by laws, rules and regulations relating to their business activities.
Commitment to Excellence
Pursue excellence all the time in all things. Ethical executives pursue excellence in performing their duties, are well-informed and prepared, and constantly endeavor to increase their proficiency in all areas of responsibility.
Exemplify honor and ethics. Ethical executives are conscious of the responsibilities and opportunities of their position of leadership and seek to be positive ethical role models by their own conduct and by helping to create an environment in which principled reasoning and ethical decision making are highly prized
Reputation and Morale
Build and protect and build the company's good reputation and the morale of its employees. Ethical executives understand the importance of their own and their company's reputation as well as the importance of the pride and good morale of employees. Thus, they avoid words or actions that that might undermine respect and they take affirmative steps to correct or prevent inappropriate conduct of others.
Be accountable. Ethical executives acknowledge and accept personal accountability for the ethical quality of their decisions and omissions to themselves, their colleagues, their companies, and their communities.
Strive to be fair and just in all dealings. Ethical executives are fundamentally committed to fairness. They do not exercise power arbitrarily nor do they use overreaching or indecent means to gain or maintain any advantage or take undue advantage of another's mistakes or difficulties. Ethical executives manifest a commitment to justice, the equal treatment of individuals, tolerance for and acceptance of diversity. They are open-minded; willing to admit they are wrong and, where appropriate, they change their positions and beliefs.
Code of Ethics
Describes a moral philosophy & gives concrete guidelines for carrying it out.
• Forces clarity of values and principles
• Prevent/resolve problems consistently
• Protection against claims of unfairness
• Challenging process: usually consult outside counsel
• Openness and accountability in business decisions and actions.
Sarbanes-Oxley Act of 2002: illegal to fire/punish employees who help authorities investigate stock market fraud. This person is known as a whistleblower.
A false representation of a matter of fact—whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed—that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury. Dishonesty calculated for advantage. A person who is dishonest may also be called a fraud.
Opportunity, Pressure or Incentive, Rationalization
Use of potentially illegal means to obtain money, assets, or other property owned or held by a financial institution, or to obtain money from depositors by fraudulently posing as a bank or other financial Institution. It is a criminal offense, enforced by police.
Act of giving money or gift giving that alters the behavior of the recipient.
an act, often a crime, involving unjustified threats to make a gain or cause loss to another unless a demand is met.
to imitate something; fake replicas of the real product
act of dishonesty withholding assets for the purpose of conversion (theft) of such assets by one or more individuals to whom such assets have been entrusted, to be held and/or used for other purposes.
Process of making, adapting, or imitating objects, statistics, or documents with the intent to deceive.
Trading of a public company's stock or other securities (such as bonds or stock options) by individuals with access to non-public information about the company.
Securities & Exchange Commission (Prevents Insider Trading)
process of concealing the source of large amounts of money that have been gained through illegitimate means.
Criminal non-payment of tax liabilities.
Violations of laws designed to protect trade and commerce from abusive practices such as price-fixing, restraints, price discrimination, and monopolization.
specific person or enterprise is only supplier of particular commodity; lack of competition.
• Due Diligence: act in good faith, consistent with a prudent person would do in a comparable situation
• Education: facts, legal terms (outside counsel), avoid conflict of interest, proper accounting (outside accountant), set internal guidelines
• Avoid bribes, political contributions, harassment/discrimination - just follow the law
• Documentation: code of ethics, standards to follow, laws posted for all to see (employee rights)
• Whistleblower without retaliation policy (already law)
• a practice or arrangement by which a company or government agency provides a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a premium.
• The purpose of business insurance is to keep you in business.
• Specialty * (management liability, crime, fiduciary, employment practices, kidnap & ransom)
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