Rev: CO: Org Ethics Soc Response

The basic idea of maintaining ethical orgl practices is to be able to determine right from wrong when it comes to making decisions & choosing the right decision

There are myths about business ethics such as ethics meaning simply to do what's right, when there is much more involved in an ethical lifestyle

Many orgs are holding workshops & having training programs to teach their wkrs about ethics

Mgrs balance diverse & contradictory & demands of multiple constituencies, eg owners, customers, suppliers, the community, & more

Balancing the needs of constituencies must be done while allocating & managing limited resources

The consequences of orgl decisions affect more people & environments (physical & social) than ever before

ORGS MUST BALANCE THE INTERESTS OF MANY ORGL ACTORS, CONSTITUENTS, STAKEHOLDERS, COMMUNITIES, & MORE

Never have so many conflicting demands confronted mgrs, orgs, govts & societies

Powerful interests, ie special interests, include constituencies such as the construction industry, cigarette corps, the military, environmentalists, the nuclear industry, teachers, school boards, the Baby Boomers, etc

Less powerful interest include constituencies such as children, the poor, the homeless, the disadvantaged minorities, the undereducated, the elderly, etc

With accelerating social change & the explosion of the availability of info & tech, the pace of life & orgl events is relentless; almost too fast to manage

Typical pressures on orgs, which may lead to unethical behavior, are to
- improve qual of products & ops
- increase productivity
- stay close to suppliers & customers
- value diversity
- react swiftly to global changes

Ethical issues include the rights & duties btwn a company & its wkrs, suppliers, customers & neighbors, its fiduciary responsibility to its shareholders

Issues concerning relations btwn different companies include hostile take overs & industrial espionage

Related issues include corp govt; corp soc entrepreneurship; political contributions; legal issues such as the ethical debate over introducing a crime of corp manslaughter; & the marketing of corps' ethics policies

	ETHICS, VIEWING ACTIONS IN LIGHT OF STANDARDS OF HONESTY & HONORABLE CONDUCT, AFFECT COUNTLESS ORGL DECISIONS
	Orgl ethics is a form of applied ethics or professional ethics that examines ethical principles & moral or ethical problems that arise in an orgl or business env
	Orgl ethics applies to all aspects of orgl conduct & is relevant to the conduct of individuals as well as the entire org
	Ethics is the branch of philosophy concerned w/ human values & conduct, moral duty & obligations
	Morals are values concerned w/ what is right or wrong, or beyond righteousness to virtuousness
	Ethics is concerned w/ what constitutes right & wrong human conduct, including actions & values
	Business ethics address the issue of right & wrong in the context of commerce & orgl conduct
	A person's or grp's ethics are influenced by the morality of individuals
	Religious beliefs, training, education, political beliefs, econ beliefs, socialization from family, peers grps, work experience all produces a person's moral code of ethical values
	Ethical provides two principles that may guide ethical conduct: consequential principles & non consequential principles
	Consequential principles make judgments based on the consequences of that action
	Utilitarianism advocates that people & orgs should strive to achieve the greatest good for the greatest number; the needs of the many compared to the needs of the few
	Consequential ethics determines the 'rightness' or 'wrongness' of an action by determining the ratio of good to evil that the action produces
	The 'right' action is that action that produces the greatest ratio of good to evil or any of the alternatives
	Some temper this w/ basic or fundamental rights & / or minority rights
	Non consequential principles tend to focus on the concept of duty
	A person is ethical, regardless of consequences, if they fulfill their duty
	The greatest good occurs because the duty of the individual is carried out
	If each person carries out her or his duty, society knows what to expect from each individual
Link	The Survey on Personal Ethics & Commitment to Social Responsibility emphasizes that understanding one's own ethics & commitment to soc resp is necessary to functioning in an ethical & socially resp manner
	Danny Cox complied a list of 10 characteristics common to great leaders & one of those characteristics is that one should cultivate a high standard of personal ethics
	At the core of any personal ethics is the declaration of personal responsibility
	Many business leaders agree that good business begins w/ ethics
	Successful people & orgs take ethics seriously
	Ethical attitudes determines how one treats wkrs, suppliers, stockholders, & consumers, competitors, the govt, other members of the community
	Ethical orgs suffer less resentment, inefficiency, litigation, & govt interference

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Survey on Personal Ethics & Commitment to Social Responsibility

The following questions are designed to determined to your personal ethics & commitment to acting in a socially responsible manner. Answer each honestly o get an accurate picture of where you stand

Always

Sometimes

Never

1. I like to approach problem solving w/ a consideration of how my solution will affect others

2. When an action is legal,, it is acceptable to engage in it

3. When making decisions, I like to bounce my thinking off of others

4. When considering actions, I think about their impact on society

5. One test for determining if decisions are acceptable is to ask how I would feel if my thinking were known to friends & family

6. I think that when a decisions hurts one party so that another can benefits, it is an unethical decision

7. When I see someone at work stealing from the org, I let those in authority know about it

8. I think that if the org does not care about ethics or soc responsible behavior, doing so personally is not important to my career

9. When I see litter in the office at work, I clean it up

10. I feel good about my actions

The Survey on Personal Ethics & Commitment to Social Responsibility emphasizes that understanding one's own ethics & commitment to soc resp is necessary to functioning in an ethical & socially resp manner

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Outline on the History of Orgl Ethics

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ORIGINALLY ORGS WERE ONLY CONSIDERED TO BE PROFIT ENGINES, & WHILE THEY WERE LEGALLY LIABLE FOR THEIR ACTIONS, THEY WERE NOT CONSIDERED ETHICAL, MORAL, OR SOCIALLY RESPONSIBLE ACTORS

Orgl ethics reflects the philosophy of an org / business, one of whose aims is to determine the fundamental purposes of an org

One of the early debates or roadblocks to the development of orgl ethics & soc responsibility was that it was believed that if an org's purpose is to maximize shareholder returns, then sacrificing profits to other concerns is a violation of its fiduciary responsibility

An opponent of orgl ethics & soc responsibility, economist Milton Friedman writes that corp execs' "responsibility... generally will be to make as much money as possible while conforming to their basic rules of the society, both those embodied in law & those embodied in ethical custom"

Friedman also said, "the only entities who can have responsibilities are individuals ... A business cannot have responsibilities. So the question is, do corp execs, provided they stay w/in the law, have responsibilities in their business activities other than to make as much money for their stockholders as possible? And my answer to that is, no, they do not"

A multi country 2011 survey found support for Freidman's anti orgl ethics & soc responsibility view among the "informed public" ranging from 30 to 80%

In opposing orgl ethics & soc responsibility, author & business consultant Peter Drucker observed, "There is neither a separate ethics of business nor is one needed," implying that standards of personal ethics cover all business situations

However, Drucker's view is less anti orgl ethics & soc responsibility than Friedman in that he observed that the ultimate responsibility of an org is not to harm owners & stakeholders

CORPS WERE GRANTED MANY OF THE BENEFITS OF 'PERSONHOOD' W/ FEW OF THE LIABILITIES / RESPONSIBILITIES

Corp entities became legally considered as persons in the US in the mid 1860s

As a matter of interpretation of the word "person" in the Fourteenth Amendment, US, 1868, courts have extended certain constitutional protections to corps

Opponents of corporate personhood seek to amend the U.S. Constitution to limit these rights to those provided by state law and state constitutions

While the 'corporate person' is legally entitled to the rights & liabilities due to citizens as persons, it has only recently become clear that corps can & should be ethical, moral, & socially responsible actors

ORGL ETHICS & CORP SOC RESPONSIBILITY (CSR) BEGAN TO BE INFLUENTIAL AS EARLY AS THE 1970s

Thus, the anti orgl ethics & soc responsibility view has not prevailed & today most orgs at least give verbal acknowledgment, & most have put some form of it into practice

The term 'business ethics' came into common use in the US in the early 1970s

The idea of business ethics caught the attn of academics, media & business firms by the end of the Cold War

Interest in orgl ethics accelerated dramatically during the 1980s & 1990s, both w/in major corps & w/in academia

Today most major corps promote their commitment to non econ values under headings such as ethics codes & social responsibility charters

Govts use laws & regs to direct orgl behavior in what they perceive to be beneficial directions

Ethics implicitly regulates areas & details of behavior that lie beyond govt control

The emergence of large corps w/ limited relationships & sensitivity to the communities in which they operate accelerated the development of formal ethics regimes

Orgl ethical norms reflect the norms of each historical period & thus as time passed, those norms evolved, & many behaviors that were once generally accepted became objectionable

ORGL ETHICS & CORP SOC RESPONSIBILITY (CSR) HAS BECOME MAINSTREAM AS IT BECAME INSTITUTIONALIZED IN BUSINESS & ACADEMIA

Orgl ethics & the resulting behavior evolved as well as the development of norms & values

By the mid 1980s at least 500 courses in business ethics reached 40,000 students, using some twenty textbooks, at least ten casebooks, & was supported by professional societies, centers & journals of business ethics

The Society for Business Ethics was started in 1980

European business schools adopted business ethics after 1987 commencing w/ the European Business Ethics Network (EBEN)

In 1982 the first single authored books in the field or orgl ethics appeared

Firms started highlighting their ethical stature in the late 1980s & early 1990s, possibly trying to distance themselves from the business scandals of the day, such as the savings & loan crisis

Legitimate criticism of business practices was attacked for infringing the "freedom" of entrepreneurs & critics were accused of support from communists

This scuttled the discourse of business ethics both in media & academia only for a while

	THROUGHOUT HISTORY ORGL MALFEASANCE, EXPANSION OF RESPONSIBILITY OF ORGS, & BUSINESS MORALITY ARE SEEN AS THE MAJOR JUSTIFICATIONS FOR ORGL ETHICS & CORP SOC RESPONSIBILITY (CSR)
	Orgs need to self police & prevent & punish white collar corp crime
	If orgs do not practice orgl ethics & soc responsibility, then govt, activist consumers, unions, NGO, & others will act to enforce standards of orgl ethics & soc responsibility
	Orgs have more responsibility than just econ obligation to the stockholders given that they have such large impacts on many sectors of society
	Stakeholders have demanded, & successfully passed some laws & regs, related to orgl ethics & soc responsibility
	Orgl ethics & soc responsibility builds good will & thus creates a favorable env for org practices, ie it is good business sense
	The ethical argument is that orgl ethics & soc responsibility are just the right thing to do

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Outline on Ethical Management

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LACK OF ORGL ETHICS & ETHICAL MGT IS A REOCCURRING PROBLEM

Org crime & ethical lapses are rampant throughout history & in the modern world

Business was involved in slavery, colonialism, genocide, war, & the cold war & much more

Recent scandals include the Savings & Loan collapse of the 1970s, World Com, Enron, & the 2008 Bush Recession bank & housing mkt collapses, & more

While few people endorse cheating, stealing, telling lies, breaking rules, & overcharging customers, the reality is that people & orgs (businesses & govt orgs) do this every day

In a climate of downsizing, retrenching, etc, the people who remain feel threatened & insecure

In the modern env of competition & globalization, the corp message is often: 'reaching objectives is what maters & how you there isn't that important'

One survey of mid mgt found that 20 to 30% of them have written reports that are deceptive

Mgrs & wkrs who act unethically are often motivated by a fear of losing their job, or the necessity to create some benefit for the org at any cost

In business, the bottom line & self interest are the driving forces

The moral dilemma comes at crunch time & at that time there seems to be little choice btwn ethics & profit

But many orgs do act ethically

for example a small firm called Just Deserts believes that they need to mix social goals w/ business goals & thus the bottom line becomes not only whether you made a profit but also whether you hired more people, improved your product, improved your workplace, & improved your community

	MGT LEADS BY WORDS & EXAMPLES IN EVERYDAY MATTERS & ORGL ETHICS & CORP SOC RESPONSIBILITY (CSR)
	The role of mgt in orgl ethics is to offer frequent declarations of the importance of orgl ethics & CSR & to teach through example
	Mgrs, leaders, wkrs, all orgl actors teach through example
	Ethical & soc responsible standards will not be met in an org until they are part of mgt's phil & backed by commitments of money & time
	Leaders instill in all members of the org the importance of ethical behavior
	Measuring something makes it important even if it wasn't before
	The US Army embraces the dictum: don't expect what you don't inspect
	The corp embraces the dictum: what the boss watches well gets done well
	Ethics only become important if & when it's measured
	MGRS SHOULD STRIVE TO KEEP EACH ORGL ACTORS' CONSCIENCE AWAKE THROUGH WORDS, POLICIES, OVERSIGHT, & EXAMPLE
	The first line of defense against unethical conduct is each person's conscience
	Leader, & all orgl actors have to do everything they can to keep the conscience awake
	The second line of defense against unethical conduct is to eliminate or minimize the circumstances that can overwhelm a conscience, or deceive it, or put it to sleep
	Gellerman observed policies & practices which discourage unethical behavior, including:
	1. Draw a clear line btwn the behavior you will tolerate & behavior you have to punish
	Drawing clear lines btwn acceptable & unacceptable behavior means estbing a code of ethics or conduct that the org is will to commit to & enforce
	2. Invest time & money in making sure ethical distinctions / lines are understood & remembered
	Training, oversight, & estb of rewards for ethical beh keeps the conscience awake
	3. Put the fear into would be violators by conspicuously raising the risk of exposure
	Punish wrong doers fairly & swiftly
	People learn from each example of misbehavior & how it is handled

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Outline on Ethical Dilemmas

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ETHICAL DILEMMAS ARISE WHEN PEOPLE ARE UNSURE, BECAUSE OF ETHICAL REASONS, OF WHAT COURSE OF ACTION TO FOLLOW

Ethics is not prescriptive in that no simple set of rules tells us how to behave morally or ethically in all situations

Codes of conduct are written in the manner of orgl policies, as brief, general guidelines & interpretation varies

Like policies, codes are meant to give freedom of action w/in boundaries & require interpretation

The safest route for following policies or codes is to not even move in the direction of violating the policy or code

In playing it safe w/ ethical dilemmas, there is the risk of being considered inefficient

IT IS BEST TO CONFRONT AN ETHICAL DILEMMA BEFORE DECIDING ON A COURSE OF ACTION

See Also: Enron, Wall Street

2. threatening unusually severe punishments for failure

People will go to whatever lengths they must to avoid calamity

One's conscience is anesthetized by terror

3. emphasizing results & avoiding concern for the means employed by subordinates to achieve results

SETTING EXAMPLES IS THE MOST POWERFUL FORM OF PEER PRESSURE, FOR GOOD OR ILL

Mgrs teach more about ethics by establishing examples for subordinates

Examples are more powerful than words or what is written in the org's ethics code

A wkr who is expected to turn a blind eye to a superior's unethical behavior receives the message loud & clear that ends are more important than means

	ENVL FACTORS CAN BE IMPORTANT MOTIVATORS FOR ETHICAL OR UNETHICAL BEHAVIOR
	Many orgs are assessing the envl factors that can lead wkr to engage in unethical conduct
	A competitive business env may call for unethical behavior
	Lying has become expected in fields such as trading
	An example of this are the issues surrounding the unethical actions of the Solomon Brothers

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Outline on Ethical Compliance

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KEYS TO ORGL ETHICAL CONDUCT ARE COMPLIANCE W/ NORMS OF BEHAVIOR, MAKING CONTRIBUTIONS TO SOCIETY, RECOGNIZING THE CONSEQUENCES OF ONE'S ACTIONS, & TRAINING

Most people are honest & are able to resist serious temptations, esp if they are helped by others

Everyone has a conscience, a warning voice inside that tells one that an action might be wrong

Guilt, shame, fear, remorse, & dread are but a few of the emotions one experiences when faced w/ the temptation or ramifications of improper conduct

See Kohlberg: Stages of Moral Development

Solomon & Hanson, 1985, business ethics is nothing less than the full awareness of what one is doing, its consequences & complications

1. COMPLIANCE IS THE YIELDING OR CONSENTING TO THE LAW, ORGL POLICY, & A CODE OF ETHICS

Compliance is living & behaving according to the law, corps code of ethics, orgl rules, principles of morality, community expectations, & such general concepts s equity & fair play

Orgl actors must go further than simple obedience to what the law demands

Shortcuts in quality which lead to customer dissatisfaction may be legal, they are discourage repeat business

Treating wkrs w/ respect & fairness is essential to building trust & a productive, stable wkforce

To promote ethics, orgl actors must forge credibility which is the power to elicit belief

	2. CONTRIBUTIONS ARE WHAT ORGS GIVE BACK TO SOCIETY
	Contributions are what orgs give back to society
	Typical orgl contributions might include a valuable product, employment, meeting needs of people & society, improving the quality of life for wkrs & the community, & charitable contributions
	In 1990 US corps gave $7.8 bb to charities
	Gifts can include cash, goods, services
	Gifts of time can help communities, charities, non profits, etc w/ talent, expertise & willing hands
	Gifts of inventory & depreciated property can cut costs for non profits
	Each yr American's vie over $100 bb to non profits, not including the hours donated to help others

	3. IT IS ONLY THROUGH ORGL SELF AWARENESS, RECOGNIZING THE CONSEQUENCES OF ONE'S ACTIONS, THAT ETHICAL BEHAVIOR IS POSSIBLE
	The social dynamics are the same for people & orgs: to achieve a level of moral development one must become self aware
	Awareness of the self is only possible in the context of an awareness of others
	A child gains a self of self just as it gains a sense of others
	An org can only attain ethical behavior & soc responsibility through an awareness of itself as an actor in a context or env of their actors & that it's & the others' actions have consequences for each other
	A child is often, at first, unaware that it's actions may harm a pet; orgs are often unaware how & where it's actions harm, or help, other orgs or social actors

	HISTORICALLY ORGS HAVE EITHER BEEN UNAWARE OR UNCARING ABOUT THEIR IMPACT ON OTHERS & SO THE GENERAL RECOURSE WAS A LEGAL SUIT
	Inventor Robert W. Kearns was awarded $11.3 mm, or 90 cents / vehicle, from Chrysler Corp or infringing on his patent for his intermittent windshield wipers
	Ford awarded Kearns $10.2 mm, or 30 cents / vehicle, on his patent for his intermittent windshield wipers
	Rockwell Intl Corp paid $ $18.5 mm in criminal fines because it violated federal waste disposal & clean water laws at its Rocky Flats nuclear weapons plant in Colorado

	4. TRAINING IS NECESSARY FOR AN ORG TO GAIN COMPLIANCE, TO BE ABLE TO CONTRIBUTE, & TO RECOGNIZE THE CONSEQUENCES OF IT'S ACTIONS
	Without some way to communicate & enforce codes of ethics, the law, policies, orgl rules, etc. they will be just words on paper
	Madsen, 1992, director at Carnegie Melon University's Center for Advancement of Applied ethics separates ethics training into compliance training & cognitive thinking exercises
	Compliance training alerts people to policies, regs, & laws that establish acceptable behavior w/in a company
	Cognitive thinking exercises that develop skills to allow people to think through various moral mazes that may occur in the wkplace
	Ethics & legal compliance programs should estb culture & peer pressure system that spells out what is acceptable & isn't & why should involve training, ed, follow up & inspection
	Orgl leaders should devote time & resources to estb commitment to ethics programs
	Orgl leaders should assert expectations through clearly written & communicated codes & conduct surveys to monitor compliance
	GE, Citicorp, the Forest Service, Walmart, et al are typical examples of orgs doing ethics training

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Outline on Organizational Culture

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Culture may be defined as the shared content of society & thus organizational culture is the shared content of an org

The content of a society or org is it's shared knowledge, beliefs, values, & norms ( K B V N ) & the physical & abstract manifestations of that content

Org culture is the shared knowledge, beliefs, values, & norms of an org

Org culture is the interaction of the formal & informal structures of an org w/ the goals & objectives of the org leaders

Org culture is a special type of subculture that is unique to the network that includes & surrounds an org

An org culture includes all of an org's stakeholders or constituencies including customers, suppliers, govt regulators, families, similar orgs, etc.

All orgs have an org culture which is based on the social relationships, as organized by the formal org structure, that emerge among the people who work in or w/ the org

Lauer & Handel, 1983, found that all orgs have an org culture, a negotiated order

W/in an org, there are frequently org subcultures among the different org constituencies, such as employees in a dept, employees at a particular level of the org such as blue collar workers, middle mgt, & upper mgt

An example of a slice of an org culture is where two workers in an engineering firm may become friends & help each other w/ their work which a third worker may be excluded from this friendship & thus not have help w/ her/his work

Org culture has a impact on how the bureaucracy of the org actually operates, in contrast to how it operates "on paper"

Org culture & the groups w/in an org, each of which who may possess it's own org subculture, often called a workplace culture

Org culture & workplace culture may facilitate or hinder the attainment of stated org goals

The org, w/ it's org culture & workplace culture may even develop their own goals, which may be inferior or superior to the org's stated goals, depending on one's perspective

Org & workplace cultures are sometimes known as the org's "negotiated order" in recognition of their emergence from the ongoing informal negotiations among different members of the org (Fine, 1984, Ouchi, & Wilkins, 1985, Miller, 1991)

Scott, 1992, holds that regardless of the formal structure, people ultimately make the org

The negotiated order is the aggregation of the org's members needs, objectives, & experiences of others in the org

People in orgs push to get what they want, try things out, test the limits of the rules

Anselm Strauss, et al, 1964, found that the nature of the hospital they studied at any given time was the outcome of pressures, actions, & reactions of the people who made up the org

The doctors, attendants, nurses, administrators, patients, & others each has their own objectives, understandings or reality, and ideas about mental illness, which governed his or her behavior & relationships to others

Compromises, "looking the other way" & "agreements to disagree" were abundant in the hospital & were always subject to change as the situation changed or as new people entered the org

Strauss held that the hospital on one day is not the same as the hospital at a later time even though the formal structure stayed the same

Org culture is unique to each org & cannot be understood by examining the org's formal structure (Fine, 1984, Ouchi, & Wilkins, 1985)

As w/ any culture, new members must be socialized into the org culture & new employees who do not become socialized or accept the org culture experience conflict

The grapevine is the informal communication structure of the org culture

The national culture of a nation impacts the org & it's org culture

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Outline on Ethics & Organizational Culture

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OPTIMAL ORG ETHICS & SOC RESPONSIBILITY ARE ACHIEVED WHEN ORGL CULTURE IS SYNCHRONIZED W/ ORG PROCLAMATIONS & POLICY

Org culture is the shared knowledge, beliefs, values, & norms of an org

Org culture is perhaps the most important conduit for the creation, maintenance, & functioning of policies & practice of orgl ethics & soc responsibility

In general, orgl culture is more resilient than mgt direction or proclamations & thus the strongest orgl ethics & soc responsibility should be grounded in an org's culture

Org culture is the interaction of the formal & informal structures of an org w/ the goals & objectives of the org leaders

Proclamations & policies of orgl ethics & soc responsibility by mgt is the formal structure of an org

The informal structure is comprised of the orgl culture, the grape vine & other orgl customs & informal practices

When formal & informal orgl are synchronized on orgl ethics & soc responsibility, or any policy, the org will function optimally in that arena

ONE DIMENSION OF ORGL SUBCULTURES IS THEIR SUPPORT OR OPPOSITION OF ORGL ETHICS & SOC RESPONSIBILITY

Orgl cultures sustain values & beliefs that influence how people related to one another

Several cultures exist in any one or: the corp culture, promoted & exemplified by mgt action

Subcultures, reflecting different work grps or discrete ethnic grps, arise from the wkforce

Subcultures may display differing & ideally complimentary sets of values & perceptions, & unity can be achieved

In a pluralistic society, org life is one place where different cultures & personal values are forced to cooperate & compromise

Org life is the place where a single & unifying ethic is essential (Henderson, 1992)

More often than not, the wkplace ethic relates to internal work ethics & other practices & not to external or orgl ethics & soc responsibility

However, when wkrs, mgrs, staff, & orgl actors in general encounter an ethical dilemma, then an orgl ethic beyond the work ethics manifests itself & comes into play

Corp cultures & subcultures can support orgl ethics & soc responsibility or oppose them

All orgl cultures & subcultures re influenced by national, regional, & local subcultures

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The Checklist on Orgl Culture Support of Ethics & Soc Responsibility shows that orgl culture support is a complex factor as well as an important factor in fostering orgl ethics & soc responsibility

Checklists for determining if a corp culture supports ethical behavior & soc responsibility are a common tool for orgs today

Some of the self questioning on orgl culture support of ethics & soc responsibility examines the org's ethics & reputation w/ it's internal actors

Some of the self questioning on orgl culture support of ethics & soc responsibility examines the org's ethics & reputation w/ stakeholders

Some of the self questioning on orgl culture support of ethics & soc responsibility examines the org's processes for creating, maintaining, & operation of orgl ethics & soc responsibility

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Checklist on Orgl Culture Support of Ethics & Soc Responsibility

A checklist for determining if an orgl culture supports ethical behavior & social responsibility

Questions to ask to determining if an orgl culture supports ethical behavior & social responsibility include:

Yes

1. Is the org concerned about quality in its services, products, & operations?

2. Is the org concerned about its wkrs quality of life?

3. Is the org proud of its reputation in the industry?

4. Is the org focused on the needs of its community?

5. Is the org focused on the needs of its outcomes?

6. Is the org honest in its dealings w/ you?

7. Is the org honest in its dealings w/ customers?

8. Is the org honest in its dealings w/ others?

9. Is the org fair & equitable in the ways in which it decides on promotions?

10. Is the org fair & equitable in the ways in which it compensates wkrs?

11. Is the org open in its communications?

12. Is the org trusting in its relationships w/ wkrs?

13. Is the org concerned w/ developing & keeping its employees?

14. Is the org actively promoting ethical conduct in all the ops & wkrs?

15. Is the org actively searching for ways to better serve it stakeholders?

16. Is the org carefully monitoring how decisions are made & checking them for their concern for ethical behavior?

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Outline on Codes of Ethics

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CODES OF ETHICS ARE VISIBLE GUIDELINES FOR ETHICAL BEHAVIOR AT ALL LEVELS OF THE ORG

Increased pressure from more stakeholders, coupled w/ decreasing time to make decisions, means that guidelines to facilitate ethical decision making & behavior are esp important for orgs today

Codes of ethics usually appear in conjunction w/ or as an integrated part of an orgs mission statement

CODES OF ETHICS MUST BE AT THE MIDDLE LEVEL OF SPECIFICITY & TAKE INTO CONSIDERATION THE ETHICAL CODE OF THE PROFESSION

Codes of ethics must be specific enough to give concrete guidance & must be reinforced by examples set by key orgl actors

Codes of ethics must be written to give clear understanding of orgl values & commitment to ethical behavior both inside the org & in relation to key outside stakeholders

Depending on the size of the org, one could either have a single set of ethics codes or one may have a overall code then have a separate code for different depts & / or agencies

When creating a code of ethics an org has to take into consideration values, laws, regs & past practices

To begin writing a code of ethics, an org must ensure they are following governmentally set guidelines

An org should include what is considered ethical practice in the profession & / or the dept this code is written for

Included in the code should be some characteristics that are standard ethical procedure for all professions

Any code of ethics should be updated at the least, yearly

Developing policies & procedures also help a company to remain ethical in practices

If there is a policy for every possible occurrence, then an org is less likely to fall pray to favoritism or some other unethical practice/procedure

CODES OF ETHICS CAN SERVE AS BOTH REGS WHICH ARE SANCTIONABLE & LEGAL BULWARKS FOR THE ORG

Codes of ethics are an unchallengeable basis for firing an unethical wkr, even when her or his action is not against either to law or the specific terms of the job

Codes of ethics protect all personnel from the pressures of the mkt, which tend to incite desperation & unethical behavior

Codes of ethics remind orgl actors to look beyond the bottom line & provide a touchstone for appeals through the hierarchy

Codes of ethics can insulate the org from legal action, ie a legal bulwark, if they have a code, in harmony against a behavior, eg insider trading, & then if an employee violates this, they are breaking the org's code & the law

There is no general code of ethics for business

The Conference Board, a business funded research grp found that in 1992 codes of conduct were increasingly sophisticated

Nearly 1/3 of 264 CEOs survey had issued a personal statement or engaged in a formal discussion of ethics issues in 1991

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Outline on Ethics & the Law

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ORGS FACE LEGAL CONSTRAINTS ON THEIR ACTIONS, BUT ETHICS CONSTITUTE MORE THAN JUST LEGAL CONCERNS

Mgrs cultivate an awareness of the role of law in orgl & individual conduct

In a nation of laws, presumptions influence decision making at many levels

From the broad context of constitutional rights to municipal regs, orgs & their leaders are witting & unwitting creatures of the law

The relationship of the law to ethics is that there are no fixed boundaries or guidelines to follow

There is no formal codes of ethics which sets the standards

The legal profession has a Code of Professional Responsibility

The med profession has its Hippocratic Oath

The accting profession has a code of ethics

The real estate industry has a code of conduct

Other professions have codes to guide them

But business has no 'road map' of ethical conduct

The closest thing business has is the law

If a business obeys the law, it is acting legally, & it is seemingly meeting its minimum social requirements

The minimum requirement of the law offers only a structure; however, void of content & context

Laws & polices from an ethical foundation

The law is a moral minimum

No law or policy is going to cover every situation

Sooner or later orgs must use people, not rules, guidelines, codes, strats, etc, to make decisions when there is no on point law or policy to follow

The best ethics training goes beyond legal compliance

Although the law is useful in alerting us to moral issues & informing us of our rights & responsibilities, laws cannot be taken as an adequate standard of moral conduct

Conformity w/ law is neither requisite nor sufficient for determining moral behavior any more than conformity to rules of etiquette is

Non conformity w/ law is not necessarily immoral, because a law may be unjust / immoral

Link	The Table of the Legal / Ethical Types of Behavior shows that orgl behavior can be ethical (ie have positive outcomes for stakeholders), unethical (ie have negative outcomes or stakeholders), legal (in compliance w/ the law), or illegal (in violation of the law)
	Corps & their wkrs take actions every day that affect the lives of countless people from their constituents to their stakeholders
	Laws form boundaries & a basis for human & corp conduct
	Law & ethics together define acceptable behavior
	Ethics comprises more than legalities
	Ethics should protect & promote the interests of society in general & the corps's constituents in particular
	Good ethics strengthens the bonds of personal & social relationships
	The CA education system has stayed ahead of legal demands in the area of pollution control by focusing on the best interest of its customers & of society as a whole
	In four combinations of ethics & legalities, one can sort out alternative resolutions of any issue posing an ethical dilemma
	An unambiguously positive resolution occurs only w/ alternative qualifying for quadrant 1 (ethical / legal ) which poses no potentially negative consequences for decision makers, org or constituents
	All other quadrants present a legal & / or ethical dilemma

	SOME ORGL LEADERS BELIEVE ORGS SHOULD ONLY FOLLOW THE LAW, & NOT DEVELOP A CODE OF ETHICS OR SOC RESPONSIBILITY
	Very often it is held that business is not bound by any ethics other than abiding by the law
	The economist Milton Friedman is a lead advocate of the view that only the law should constrain corps
	Friedman held that corps have the obligation to maximize profit w/in the framework of the legal system, nothing more: no orgl ethics nor any soc responsibility should constrain the corp
	Friedman made it explicit that the duty of the business leaders is, "to make as much money as possible while conforming to the basic rules of the society, both those embodied in the law & those embodied in ethical custom"
	Ethics for Friedman is nothing more than abiding by 'customs' & 'laws'
	The reduction of org ethics to abidance of laws & customs, however, has drawn serious criticisms
	ORG LEADERS WHO EMBRACE ORGL ETHICS & SOC RESPONSIBILITY NOTE THAT THE LAW IS A MINIMUM STANDARD & THAT THERE ARE MANY ADVANTAGES TO ORGL ETHICS & SOC RESPONSIBILITY
	Counter to Friedman's logic, it is observed that legal procedures are technocratic, bureaucratic, rigid & obligatory where as ethical act is conscientious, voluntary choice beyond normativity
	Law is retroactive whereas crime precedes law
	For a law to be passed, the crime must have already happened
	Laws are blind to the crimes undefined in it
	Further, as per law, conduct is not criminal unless forbidden by law which gives advance warning that such conduct is criminal
	Law presumes the accused is innocent until proven guilty & that the state must establish the guilt of the accused beyond reasonable doubt
	As per liberal laws followed in most of the democracies, until the govt prosecutor proves the firm guilty w/ the limited resources available to her, the accused is considered to be innocent
	Though the liberal premise of law is necessary to protect individuals from being persecuted by govt, it is not a sufficient mechanism to make firms morally accountable
	FOLLOWING ORGL ETHICS & SOC RESPONSIBILITY INSULATES AN ORG AGAINST THE SLIPPERY SLOPE OF LAW BREAKING
	A corp that embraces policies based on orgl ethics & soc responsibilities avoids the weaknesses a corp policy based on or contained only by law
	Orgl ethics & soc responsibility have an advantage over the law in that orgs following orgl ethics & soc responsibility are less likely to test the limits of the law & so slide down the slippery slope to criminality
	While the law is retroactive & a crime may precede the law orgl ethics & soc responsibility is proactive in that an org will try to consider legal & ethical implications of a policy or behavior before the fact
	While laws are blind to the crimes undefined in it, orgl ethics & soc responsibility attempt to discern all transgressions across legal or ethical boundaries
	While it is difficult to prove someone has broken a law, any degree of guilt as far as breaking orgl ethics & soc responsibility is liable to sanctions; that is while legal guilt is all or nothing; partial guilt or responsibility is recognized under policies of orgl ethics & soc responsibility

	AN EFFECTIVE CODE OF ETHICS & SOC RESPONSIBILITY MAY HAVE PREVENTED SEVERAL CORP SCANDALS & ECON COLLAPSES
	During the Savings & Loan crisis of the 1980s, then FBI director William Sessions said :Experience demonstrates that insider abuse is a major factor in almost all of our investigations involving failed financial institutions"
	William Black, former director of the now defunct Fed Savings & Loan Insurance Corp said, "Evil triumphed because too many good men & women did nothing to stop the looting of thrifts [savings & loans banks'."
	World Com
	Enron
	Billionaire investor
	Collapse of banks & Wall Str investment firms Lehman Bros, Goldman Sachs

	WHILE THE LAW IS GETTING MORE EFFECTIVE W/ WHITE COLLAR CRIME, IT IS STILL NO SUBSTITUTE FOR ORGL ETHICS & SOC RESPONSIBILITY
	Legal sanctions against individual & corp criminal behavior can be significant
	Since 1909 when the Sup Ct held that corps can be held liable, as individuals can be, for crimes involving intent corp liability has translated into fines & jail terms for corp officials
	More than half of the 50 states have some form of corp criminal liability laws under which business owners can be prosecuted for criminal negligence
	The trend is toward escalating criminal penalties that can be drastically reduced if the org can show it has a place a legal compliance program
	In Nov 1991 the trend toward harsh penalties for white collar crime continued, as new fed guidelines went into effect
	Offenses include those that are committed by wkrs w/o a org owner's knowledge to those of misrepresenting a product, bribery of a public official
	If an orgs has taken steps to ensure compliance w/ the law, an org could pay as little as 5% of the base fine
	On the other hand, if mgrs have encourages or taken part in law breaking, fines can reach 400% of the base rate
	Some believe that corp ethics policies are primarily rooted in utilitarian concerns, & that they are mainly to limit the company's legal liability, or to curry public favor by giving the appearance of being a good corp citizen
	Ideally, the company will avoid a lawsuit because its wkrs will follow the rules
	Should a lawsuit occur, the company can claim that the problem would not have arisen if the wkr had only followed the code properly
	While some see the use of orgl ethics & soc resp policies to avoid liability, the outcome remains that orgs are holding themselves & wkrs to a standard higher than the minimum requirements of the law

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Table of the Legal / Ethical Types of Behavior

1. Ethical / Legal
A decision to allow orgl actors to engage in a behavior w/ positive effects for stockholders or minimally no negative effects, & is in compliance w/ the law

2. Ethical / Illegal
A decision to allow orgl actors to engage in a behavior w/ positive effects for stockholders or minimally no negative effects, but is a violation of the law

3. Unethical / Legal
A decision to allow orgl actors to engage in a behavior w/o positive effects for stockholders, but is in compliance w/ the law

4. Unethical / Illegal
A decision to allow orgl actors to engage in a behavior w/o positive effects for stockholders, & is a violation of the law

The Table of the Legal / Ethical Types of Behavior shows that orgl behavior can be ethical (ie have positive outcomes for stakeholders), unethical (ie have negative outcomes or stakeholders), legal (in compliance w/ the law), or illegal (in violation of the law)

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Outline on Ethical Action Guidelines

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ORGL ETHICS & SOC RESPONSIBILITY MUST BE IMPLEMENTED THROUGH GUIDELINES WHICH PROVIDE TACTICAL LEVEL DIRECTION, BUT NOT PROGRAMMED PATHS OF ACTION

Someone struggling w/ a decision, torn btwn alternatives, may be confronting an issue that involves ethics

The time to consider the ethical dimensions of oneself, an org, a code of ethics, an act, is before acting

People & orgs should strive to make ethics a priority in the processes by which they make their decisions

Even if using the same ethical background, the same code of ethics, different people, orgs, societies invoke different criteria for determining if an intended action, or inaction, is ethical

It is the nature of the human condition that people will disagree, esp on the ethics of actions, & thus healthy, open, communication / discussion & debate are necessary

THERE ARE THE 'CLASSIC' ETHICAL GUIDELINES, BUT GENERALLY EACH ORG SHOULD DEVELOP IT'S OWN GUIDELINES

One ancient ethical action guideline is the Golden Rule which states that we should treat others as we ourselves want to be treated

Perhaps an even higher ethical guideline than the Golden Rule is to do to others what they want you to do to them

Utilitarianism, which came into popularity in the early industrial age, circa the 1700s, guides one to do the greatest good for the greatest number of people

Utilitarianism was found to have the weakness that it only works well when both the circumstances surrounding the act, as well as the consequences of the act are fully foreseen & understood

TRAINING ON ORGL ETHICS IS NOW STANDARD OPERATING PROCEDURES IN MOST MAJOR ORGS TODAY

Developing standard operating procedures, guidelines, policies, & procedures help an org to remain ethical in practice

Many companies are instituting ethics training for their wkrs' training or sending wkrs to workshops on ethics

Ethical training ensures that upon arrival into the org new members know what is expected of them & old members are kept up to date w/ ethics code changes & policy changes

The Business of Social Responsibility is the leading research & consulting firm in the world & they have over 250 companies in their membership

Orgs who focus on ethical training have found effective ways of solving business problems through research

Orgs who focus on ethical training consult member orgs on how to avoid unethical policies & procedures & maintain ethical practice

	ORGL THEORISTS HAVE OFFERED GENERAL DIRECTION FOR ETHICAL ACTION GUIDELINES
	Solomon & Hanson, 1985, offer the following guidelines for ethical action:
	1. Consider other people's well being, including the well being of non participants
	2. Think as a member of an orgl community & not as an isolated individual
	3. Obey, but do not depend solely on, the law
	4. Think of yourself, & the org, as part of society
	5. Obey moral rules
	6. Think objectively
	7. Ask the question, 'what sort of person would do such a thing?'

	LIKE CODES OF ETHICS, ETHICAL GUIDELINES ENCOMPASS THE NEEDS OF ALL STAKEHOLDERS, & SHOULD PROVIDE GUIDANCE, TESTS,PROCEDURES, ETC. TO GENERALLY OPERATE ETHICALLY, ADDRESS DILEMMAS, & FOLLOW THE SPIRIT OF THE LAW
	Guidelines should remind us that we are all part of a larger community
	Guidelines should remind us that our actions affect others whose interests should be considered
	Guidelines should remind us to analyzed the consequences of our actions before we take any steps
	When one makes decisions w/o guidelines, & this applies to ethical guidelines & all guidelines, then one is adrift & may rely solely on self interest & economics
	People w/o a moral foundation put themselves, their org, & others at risk
	Orgl leaders are paid to perform risk analyses to determine which risks are worth taking
	Mgt professors Kenneth Blanchard & noted cleric Norman Vincent Peale, author of The Power of Positive Thinking, wrote The Power of Ethical Management
	For Blanchard & Peale the tests for ethical action are:
	1. Is it legal? Will I be violating either civil law or company policy?
	2. Is it balanced? Is it fair to all concerned in the short term as well as the long term? Does it promote win win relationships?
	3. How will it make me feel about myself? Will it make me proud? Would I feed good if my decision were published in a newspaper? Would I feel good if my family knew about it?
	Guidelines allow one to examine intentions in private & w/ complete objectivity
	To make any critical judgment, one must take ample quiet time, away from pressures & the biases of others

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Outline on Ethical Decision Making: Boundary Dilemmas

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TO MAKE ETHICAL DECISIONS, KNOW YOUR VALUES, GOALS, ALTERNATIVES, INFO, OUTCOMES, & ACTIONS

Because the future is unpredictable, there is no such thing as a perfect choice

Some options are better than others & finding the right choice for each situation can make life less stressful & more successful

In relation to ethics & boundaries, essentials factors in decision making include:

1. knowing your values

2. establishing your goals

3. expanding your alternatives

4. seeking info on each alternative

5. predicting outcomes for the alternative

6. taking action

The values one chooses depend upon the situation one faces

Values should be the things important to the person, not those important to significant others

When estbing values, one must be honest w/ oneself

Evaluate goals according to how it satisfies values

Good decisions move one closer to their goals

Short term goals should lead toward long term goals

Alternatives developed to address problems/ goals are the heart of the decision making process

The more alts developed w/ which to address problems, the better the chances of making a good & ethical decision

Identify the factors in a situation & devise alts to address each of the factors

Collect as much info about each alt

Keep an open mind as info is gathered & note that other alts may develop

Info sources often lead to other sources

The more facts, the better the chances of being aware of all the alts

In relation to dec mking, the more facts the better, so don't make assumptions

Separate facts from opinion by being a critical listener

In dec mking, in choosing an alt, there is no perfect alt, so settle for the best choice

Predict outcomes for the various alts, considering the desirability, probability & weaknesses of each alt

Consider each alt before narrowing the list

In dec mking, any choice is risky & the future is unpredictable

In dec mking, involve the emotional, intuitive, imaginative right side of your being

After the choice of the best alt, for a plan of action & prepare to see that choice through to the end

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Outline on the Options for Dealing w/ Unethical Behavior

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- Project: Options for Dealing w/ Unethical Behavior

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- Reading: What Can Mgt Do About Unethical Behavior Nielson 1987

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THE OPTIONS FOR DEALING W/ UNETHICAL BEHAVIOR INCLUDE:

1. DON'T THINK ABOUT IT
2. GO ALONG & GET ALONG
3. PROTEST
4. CONSCIENTIOUSLY OBJECT
5. LEAVE

6. SECRETLY BLOW THE WHISTLE
7. PUBLICLY BLOW THE WHISTLE
8. SECRETLY THREATEN TO BLOW THE WHISTLE
9. SABOTAGE
10. NEGOTIATE & BUILD CONSENSUS FOR CHANGE

In 1985 there were over 1300 scholastic articles in print in the area of ethics in administration, mgt, business & public admin, business etc., focusing on what was ethical or unethical in typical business practices

Richard Nielson (1987) focuses on what people in orgs can actually do when they believe behaviors / practices are unethical

While it is important to know what is or is not ethical, it is just as important to know what to do when confronted w/ unethical behavior

1. DON'T THINK ABOUT IT

Not thinking about unethical beh avoids a zero sum game btwn superiors & peers

Not thinking about, not engaging in a zero sum game avoids getting into the situation where someone has to win & someone has to lose

Not thinking about one path of action makes one more susceptible to go down the wrong path, strategically or otherwise

One risks becoming similar to the good Nazi as one tries to make the best of a bad situation, but participating in the evil policy / practices

The bad Nazi may be kind, even reluctant, but ultimately they are involved in evil policy / practices

The ability of people to compartmentalize, to not think about what is going on, questions the validity of assuming that all mgrs naturally understand what is right or wrong; there are powerful pressures to obey orders & not think about what is going on

2. GO ALONG & GET ALONG

Going along has the same advantage as not thinking about unethical behavior: one avoids the situation where someone has to win & someone has to lose

Going along means that one must think about the unethical beh at least for a while

Thinking about & going along unethical beh has the quality of an injury or illness as it slowly bleeds the individual conscience or as guilt consumes one like a cancer

Under constant pressure, mgrs & wkrs simply give in & become good 'organization people'

Conforming might affect areas of dec mking & action unrelated to the unethical beh as it reigns in thinking, initiative, enthusiasm, etc. & deprive mgrs & wkrs of info

3. PROTEST

An advantage of protesting is that one can feel good about making an effort to stop the unethical beh

The disadvantage of protesting is that the org can usually disregard objections & punish those who objected

4. CONSCIENTIOUSLY OBJECT

Conscientiously objecting to unethical beh means that one refuses to participate in it in any shape, manner, or form

Conscientiously objecting makes a clear statement to the org that at least one person considers the beh unethical & refuses to participate in it

Like protesting, conscientiously objecting makes one feel good about oneself as one stands up for what they believe

Consc obj may encourage others by example

If the org recognizes the right to consc obj, then one may also be able to keep one's job

Because very few orgs recognize the right to consc obj, one is likely to lose one's job, & thus the org loses an important voice against the unethical beh

By protesting or consc objecting one often loses the ability to advance

5. LEAVE

Leaving gives a signal that it will lose good people if it continues unethical beh

If we leave & work for a competitor we help a more ethical org gain mkt share

We feel better because we had the courage not to cooperate w/ unethical beh

The disadvantage of leaving is that most wkrs are very replaceable & so the org loses an ethical voice when we leave

If the situation was a zero sum game, then mgt might see wkrs / mgrs leaving as a victory; the opposition has retreated / surrendered

If we leave & someone else cooperates, we have only helped ourselves

The example one sets is that if one encounters unethical beh & leaves, that is the only / best option

Leaving sets up the 'love it or leave it' mentality in the org

At some point we may realize that we did not have the courage to stay & fight

"The courage to be is the ethical act in which man affirms his own being in spite of those elements of existence which conflict w/ his essential self affirmation"

Tillich, 1952

Leaving cuts off dialogue & thus the org & even the person loses the chance to learn more about the situation

There are limits to dialogue in a zero or negative sum game in that everything one says can be used against one if people are not interested in transforming the situation into a positive sum situation

Dialogue has little utility unless one is solely focused on the phil / spiritual transformation that can be a part of peacemaking as an end in itself (Brinton, 1973; Buber, 1965)

6. SECRETLY BLOW THE WHISTLE

Blowing the whistle can be very effective if the org is likely to react to publicity, public pressure, govt intervention, profl accreditation orgs, the courts, etc.

An advantage of blowing the whistle is that the whistle blower cannot be retaliated against

A disadvantage of blowing the whistle is that one might feel dishonest, cowardly, traitorous, paranoid of being caught, etc.

Secretly blowing the whistle can create an atmosphere of distrust in the org & create a 'witch hunt' mentality w/in the org

Because many orgs investigate leaks, the secret whistle blower may have to face additional ethical questions bout whether to tell the truth in the leak investigation

If the secret whistle blower is discovered, they may be fired, or they may find it difficult to be trusted by other mgrs, wkrs, clients, etc.

7. PUBLICLY BLOW THE WHISTLE

Publicly blowing the whistle can be just as effective as secretly blowing the whistle

People who publicly blow the whistle are often treated both as heroes as well as pariahs

The major disadvantage of publicly blowing the whistle is that the org may retaliate w/ a legal suit, firing, transfer, smear campaign, etc.

Publicly blowing the whistle makes it difficult to interact w/ the people one is criticizing

Publicly blowing the whistle makes colleagues feel betrayed, attached, harmed it

Publicly blowing the whistle does not help the reputation of the org, & may even put it out of business

8. SECRETLY THREATEN TO BLOW THE WHISTLE

Secretly threatening to blow the whistle has all the advantages of secretly blowing the whistle w/ the additional advantage that, when it works, i.e., when the org changes its unethical beh, the org doesn't have to be hurt by bad publicity & / or sanctions that could follow

Secretly threatening to blow the whistle has the disadvantage of secretly blowing the whistle in that it does not permit dialogue btwn the unethical people & the whistle blowers

9. SABOTAGE

Sabotage in the face of unethical beh usually entails hurting or destroying the larger program in which the beh is found so that mgt shuts it down

The advantage of sabotage is that it can be effective & ones identity is protected

The disadvantages of sabotage are that one may be caught, one may feel guilty, there is often an investigation, innocent people may be hurt, etc.

The biggest disadvantage of sabotage is that there is no dialogue so there is no opportunity for real change

10. NEGOTIATE & BUILD CONSENSUS FOR CHANGE

Because in general when one person opposes a group of people in cooperate beh, that one person is likely to lose, it is difficult for one person in an org to bring about change

The advantages to building consensus for change are that
- there is strength in numbers
- the org is less likely to retaliate against a grp
- it builds a cooperate climate

The best negotiation strat for change is the tit for tat ( TFT ) strat where the change agents respond to positive moves by the other side w/ positive moves, and response to negative move w/ negative moves

The difficulty of the TFT strat is that the change agents might not have positive or negative responses available, while the org has nearly unlimited options

It is not uncommon for people who are pursuing bad / unethical goals to use bad / unethical methods to cover them up or punish those that threaten them

Negotiating & building consensus are more likely to be successful when the org is accustomed to positive sum solutions to problems

Unfortunately many mgrs are only accustomed to negative sum solutions where they attempt to win & punish the loser

It is only natural to have the 'fight or flight' reaction, even in orgs wherein when one is confronted w/ a threat at work, one often wants to leave or attack rather than calmly negotiate & build consensus

An additional reward to negotiating & building consensus is that for many, these activities are in themselves satisfying; negotiating & peacemaking can be empowering, transformative, & satisfying

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Outline on Social Responsibility

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ORGS MUST INTEGRATE INTO THEIR CULTURES, PLANNING, DECISION MAKING, & OPS A CONCERN FOR ETHICS & SOC RESPONSIBILITY

Davis, 1975, holds that social responsibility is the principle that people & orgs have certain obligations, in addition to their orgl interests, to protect & benefit others & to avoid actions that could harm them

Social responsibility is an ethical ideology or theory that an entity, be it an organization or individual, has an obligation to act to benefit society at large

Social responsibility can be passive, by avoiding engaging in socially harmful acts, or active, by performing activities that directly advance social goals

The principle of soc resp first began to take hold in the developed nations major corps in the 1980s

Western nations corps have tremendous power & thus people, grps, other orgs, societies themselves rely on them to meet various individual & societal needs

At one time, orgs did only what they had to, & many still operate on this principle, eschewing the principle of soc resp

	SOC RESPONSIBILITY ENTAILS SOLVING SOCIAL PROBLEMS, MAKING ETHICAL DECISIONS THAT BALANCE NEEDS, & MAKING DONATIONS
	Most orgs are open systems & most of what they do generates direct benefits & costs for their societies
	Today society demands that orgs join in the urgent task of solving societies' problems
	Some political philosophies go so far as to hold that private orgs, eg businesses, non profits, non governmental orgs (NGOs), private charities, etc are all better, or could be better than govt in addressing soc problems if society & it's laws, regs, & structure were reformed
	Being soc resp does not mean making everyone happy; it means making ethical decisions that balance costs & benefits among many, if not all stakeholders
	Orgs face conflicting demands & at times a socially responsible action puts the needs of one grp of stakeholders ahead of the needs of others , such as donating money to charity rather than giving stockholders a larger dividend or giving wkrs a raise
	Orgs make these difficult decisions based on past practices, policies, codes of conduct, ethical guidelines, & more
	WHILE SOC RESPONSIBILITY TOOK HOLD OF CORP AM IN THE 80s, IT'S ROOTS GO BACK TO THE EARLY INDL REV
	Ben Franklin may have been the first to advocate a socially responsible business
	Franklin believed that "public service & philanthropy were legitimate concerns... because it is god business to improve the health of the communities from which wealth is derived & because public problems can benefit from private solutions."
	Buchholz, 1989, expresses the need for businesses to act in a soc resp manner: 'corps are more than econ instit & have a resp to devote some of their resources to helping solve some of the pressing soc problems, many of which corps help to create'
	Haas, CEO of Levi Strauss notes that corps can be short sighted but believes corps will discover the price they pay for such behavior
	For Haas when corps ignore the needs of others, they are ignoring their own needs in the long run
	Corps may need the good will of a neighborhood to expand, they may need instits of higher learning to train wkrs, they may need adequate community health care to curb absenteeism, they may need fair taxes to build infrastructure & compete in the world econ

	SOC RESP STRATS INCLUDE DENIAL, RESISTANCE, REACTION, & ANTICIPATION
	Orgs adopt different strats & structures in relation to their goals, the env, their resources, & the demands placed upon them
	Some orgs vehemently resist the accommodation to societal needs, whereas others eagerly seek ways to accommodate societal needs
	Orgs can adopt any of three primary strats to manage the issue of social resp, ranging from resistance, to reaction, to anticipation
	Individual orgs may choose resistance, reaction, or anticipation from the days of their founding, or they may embrace one strat to find that another appears more suitable & thus shift such strats
	Some orgs may choose resistance, reaction, or anticipation for different parts of their op & thus appear to have inconsistencies
	Thus orgs may appear to be a complicated, chaotic conglomeration of strats related to soc resp; no one approach dominates today although the resistance strat appear to be losing momentum while anticipation strat has been gaining ground since the 1980s

	SOC RESPONSIBILITY IS ESSENTIALLY 'SELF REGULATION' W/ THE LAW & A CODE OF ETHICS AS THE STANDARDS OF REG
	Businesses can use ethical decision making to secure their businesses by making decisions that allow for government agencies to minimize their involvement with the corporation
	If an org is proactive & follows govt guidelines for a particular issue such as pollution or labor regs & even goes an extra step to get involved in the community & address those concerns that the public might have; they would be less likely to have the govt investigate them for these or any other concerns
	Soc Resp stresses "self regulation" rather than mkt or govt mechanisms for following the law & ethical, or responsible standards
	Most rules & regs are formed due to public outcry, if there is nt outcry there often will be limited reg

	CRITICS OF SOC RESP HOLD THAT: ORGS SHOULD PURSUE ONLY ECON GOALS; IT IS SUPERFICIAL; IT IS OBFUSCATING; IT IS AVOIDANCE OF REGS BY THE GOVT
	Critics of social responsibility argue that it distracts from the fundamental economic role of businesses & thus should be denied or avoided
	Critics of social responsibility argue that it is nothing more than superficial window dressing
	Critics of social responsibility argue that it is an attempt to pre empt the role of govts as a watchdog over powerful multinational corps though there is no systematic evidence to support these criticisms
	A significant number of studies have shown no negative influence on shareholder results from soc resp but rather, a slightly positive correlation w/ improved shareholder returns

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Outline on the Resistance Approach to Social Responsibility

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THE EARLY INDUSTRIAL REVOLUTION WAS CHARACTERIZED BY ORGS DOMINATING & EXPLOITING SOCIETY IN A MANNER THAT WAS RESISTIVE TO SOCIAL RESPONSIBILITY

Orgs adopt the resistance approach to soc response when they actively fight to eliminate, delay, or fend off the demands being made on them

In the days of the Industrial Rev (circa 1700-1910) orgs were relatively unaffected by govt regs

Unions & the Labor Mvmt only emerged toward the end the Ind Rev & thus labor was cheap & easily exploited

Businesses did as they wanted, exerting tremendous influence over their wkrs, town, industries, & govts

The era of the Ind Rev is characterized by robber barons, 'the best of times.... the worst of times,' The Jungle, & no social responsibility

The early phase of ind development was marked by resistance to govt interference & active opposition to demands from those actors inside the org as well as those outside the org

The prevailing attitude was that mgrs owed their allegiance to owners only

In a 1919 decision, a Michigan court refused to let Henry Ford, the first, divert stockholder dividends to certain socially beneficial programs

The courts held that directors had an obligation to stockholders & could not renege on that duty

Govt regulatory agencies were virtually non existent & since the Labor Mvmt was just emerging there were no checks on the power of corps

No laws protected wkrs, consumers, the community, or the env & all suffered as a consequence

	MANY CORPS TODAY STILL EMBRACE THE RESISTIVE APPROACH TODAY BY OPPOSING GOVT REGS, COMMUNITY INVOLVEMENT, ORGANIZED LABOR, & ANY WKR EMPOWERMENT
	Many corps not only still embrace the resistance approach to soc resp today, they use all their power & influence to return society to that stage of dev by
	Resistive orgs oppose all regs in court & in reg agency rule writing, by lobbying for laws supporting no soc resp, by supporting politicians who advocate no soc resp, by funding ed against soc resp, & by funding research against soc resp, etc
	The societal, all encompassing conflict among those who oppose soc resp & those who support it results in inconsistency & stalemate in govt policy, law, & action & this conflict may be seen as indeed, one of the major conflicts of our times

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Outline on the Reactive Approach to Social Responsibility

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REACTIVE ORGS WAIT FOR DEMANDS & THEN CHOOSE WHETHER TO RESIST OR ACCOMMODATE, BASED ON VARIOUS CRITERIA OF EXPEDIENCY

Orgs taking the reactive approach wait for demands to be made & then respond to them by evaluating alternatives

In essence these orgs are taking the resistant approach, but then rather than standing on that principle, they find it expedient to move toward accommodation rather than resistance

The reactive org, embraces resistance, but when resistance seems futile, they embrace soc resp in a minimalist manner

THE MAJOR WEAKNESSES OF THE REACTIVE APPROACH ARE THAT IT IS SLOW TO REACT, & SLOW REACTIONS ARE OFTEN PERCEIVED BY THE PUBLIC AS RESISTANCE

Weakness of the reactive approach is that orgs often react too slowly & thus harm their own reputation

The weakness of a slow reaction to social demands is particularly detrimental to consumers; retail businesses may suffer a serious blow to their reputation, & this often translates into real declines in sales

	REACTIVE APPROACHES CAN RESULT IN POSITIVE OR NEGATIVE OUTCOMES
	In 1992 in Chicago's Lincoln Park area, neighbors complained about too many restaurants & bars in their neighborhood being open too late, & whose patrons repeatedly caused disturbances
	When complaints went unheeded by the business orgs, ie the resistance approach to soc resp, neighborhood grps petitioned to place a referendum on the ballot to ban the sale of alcohol
	The success of the petition drive caused the business orgs to resist soc resp by mounting their own campaign by going door to door to get people to remove their signatures from the petition
	Eventually a compromise was reach: the business orgs agreed to hire off duty police to patrol in the evening to curtail the problems
	It was not until it appeared that resistance was futile that these business orgs embraced the accommodation strat of soc resp

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Outline on the Proactive Approach to Social Responsibility

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THE PROACTIVE APPROACH HOLDS THAT IT IS ADVANTAGEOUS TO THE ORG, IT'S ACTORS, IT'S STAKEHOLDERS, & SOCIETY FOR ORGS TO BE SOCIALLY RESPONSIBLE

The proactive approach to soc resp holds that an org must exhibit orgl social responsibility

Soc resp is an umbrella term indicating that an ethical org must act as a responsible citizen of the communities in which it operates even at the cost of profits or other goals

In the US & most other nations, corporate entities are legally treated as persons in some respects

Corps today can hold title to property, sue & be sued & are subject to taxation, although their free speech rights are limited

Advocates of the proactive approach can be interpreted to imply that they have independent ethical responsibilities

Duska argues that stakeholders have the right to expect a business to be ethical

PROACTIVE ORGS SCAN THEIR ENV TO FIND OPPORTUNITIES OF SOC RESPONSIBILITY

The proactive approach entails orgs continually looking to the needs of orgl stakeholders, ie the constituents

The proactively socially responsible org stays in touch, sensing the needs of the stakeholders, trying to find ways to assist them

Soc resp orgs assist ed w/ donated cash, services & goods

Southern CA ed

Just Desserts

Prudential Ins Co

The techniques used by soc resp orgs to understand the needs of stakeholders are the same techniques used in everyday ops; eg envl scanning, surveys, networking, meetings, etc

PROACTIVE ORGS INTEGRATE SOC RESP INTO THEIR STRAT, POLICIES, TACTICS & CULTURE

Orgs that proactively embrace soc resp typically have integrated related policy into their org from the strat level to day to day ops

Soc resp related policies often include an orgl discussion / statement of orgl ethics, a code of ethics written w/ the participation of all orgl actors, statements discussing & explaining the org's view of soc resp, participation in soc resp activities by org actors, etc

The proactive soc resp approach, as opposed to resistive or reactive approaches, looks to the advantages of soc responsibility such as community & customer good will, an expanded, friendly network, access to opportunities, teamwork w/ stakeholders, etc

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Outline on Organizational Actors

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Being 'social animals who prefer to run in packs,' humans naturally form into SIX basic types of human formations including:

1. Aggregate
2. Social Group
3. Formal Orgs

4. Institutions
5. Social Structures
6. Networks

Orgl actors is that set of human formations that exist in any type of human formation at or above the formal orgl type, thus org actors exist in formal orgs, institutions, social structures, & networks

Orgl actors as recognized by the people in the orgs include upper mgt, professionals, mid level mgt, lower level mgt, lower level employees, & others

a. Upper management

b. Professionals

c. Mid level management

d. Lower level management / supervisors

e. Lower level employees

Various social scientists have determined that it is useful to view orgl actors along various analytical dimensions thus viewing actors as including the dominant coalition, power brokers, cliques & coalitions, stakeholders, change agents, & others

a. The dominant coalition

b. Power brokers

c. Cliques & coalitions

d. Stakeholders

e. Change agents

The Amended Taft Hartley Act of 1974 definitions Employers, Employees, Supervisors, & Professionals as applied to union organizing

Orgl actors usually operate in a hierarchy, though some hierarchies are more closed than others

Orgl actors have social relations of both cooperation & conflict

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Outline on the Responsibilities to Stakeholders

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ORGS BEAR INHERENT OBLIGATIONS TO WKRS, OWNERS, STAKEHOLDERS, & SOCIETY

Orgs hold the best interests of their society in trust; society grants the right of enterprise to all orgs

Stakeholders are those who have an interest in or who are affected by how a business conducts its ops

Stakeholders in most businesses include their owners & stockholders, wkrs, customers, suppliers, & communities

Society as a whole can be considered a stakeholder as well if the business is large enough to affect people & en beyond its physical location

The new org is characterized as having stakeholders as opposed to the old org structure & strat that excluded a consideration of anyone but owners

Problems occur in new, changing orgs because they consist of multiple stakeholders carrying out multiple but overlapping activities

It is clear that the situation is not simply one of the soc resp firm deciding to embrace a broader array of stakeholders

The situation is that today more & more stakeholders are striving to be recognized as having legit connections to a wide range of orgs

Thus the rise of stakeholder power is an important factor in the development of the new org, the modern org, the soc resp org

Orgs & stakeholders are now keenly aware that any orgl change may or may not be compatible w/ the goals & needs of various stakeholders

For 'old orgs,' they had many SOP's that allowed them to maintain stability such as concentration, closed mkts, standardized tech, commitment of wkrs, stakeholders, et al

Today in a climate of instability / change, commitments of customers, wkrs, & other stakeholders are fragile & short lived

	THE STAKEHOLDERS INCLUDE THE INTERNAL & EXTERNAL STAKEHOLDERS
	INTERNAL STAKEHOLDERS INCLUDE THE DOMINANT COALITION, PROFESSIONALS, CLIQUES, COALITIONS, LOWER LEVEL EMPLOYEES, & OTHERS
	The dominant coalition includes upper level mgrs, directors, major stockholders, & other powerful actors
	The ethical & soc resp needs of the dominant coalition primarily relates to econ goals of maximizing profits, but given their place of leadership, the dom coalition is responsible for directing the org to the ethical & soc resp needs of other internal & external actors as well as any favored needs of the dominate coalition itself
	Professionals in an org include those higher level employees who meet the general criteria of professionals including a high level education or specialized knowledge, autonomy, a unique evaluation (done by other professionals, not mgrs), high rewards sometimes unrelated to traditional measures of productivity, & membership in a prof assoc
	The ethical & soc resp needs of professionals relate to the large view of the org & society that they may often have, eg believe that the org should limit pollution even though it may lower profits, or even though the level or effects of the pollution is indeterminate
	Cliques & coalitions include any spontaneously formed subculture w/in an org such as women, the night shift, a group formed to deal w/ a safety issue, a party group, etc.
	The ethical & soc resp needs of cliques & coalitions can be as wide ranging as the types of cliques & coalitions
	The ethical & soc resp needs of cliques & coalitions might include activism in the org or community related to the knowledge, beliefs, values, & norms of the subculture at the center of the clique or coalition, eg women organizing around pay equity in the org or even the community
	Lower level employees usually include the vast majority of the actors in an org, but those actors have little authority, low pay, low status, & little chance for advancement
	The ethical & soc resp needs of lower level employees are often related to quality of work life in the org, job security, safety, respect, etc.
	The ethical & soc resp needs of lower level employees are often related to charitable work in the community such as clean up, feeding the poor, assisting the elderly, literacy, & more

	EXTERNAL STAKEHOLDERS INCLUDE CUSTOMERS, SUPPLIERS, COMMUNITIES, THE GOVT, & OTHERS
	The govt becomes a stakeholder in the sense that it is an independent actor who is charged w/ representing the legal rights as well as the ethical & soc responsibilities of other stakeholders
	The ethical & soc resp needs of external stakeholders, like lower level employees, are wide ranging, including activism in the org or community, quality of work life in the org, job security, safety, etc.

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Outline on the Responsibilities to Owners & Stockholders

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THE FIRST FUNCTION OF BUSINESS ORGS IS TO CREATE A PROFIT; & W/O PROFIT ALL OTHER SOC RESP GOALS WITHER

A business & its wkrs owe their best efforts to owners

Assets must be conserved & used effectively & efficiently

Wkrs must do their best to max the return on investments (ROI) & to generate profits

Owners & employers should have the right to hire, train, reward, promote, discipline, & remove employees in accordance w/ ethical, moral, & legal restraints

Owners & employers should have the right to expect ethical, moral, & legal conduct from their wkrs

The conflict among those who resist the soc resp approach & those who embrace a proactive soc response approach often has as a central pivot pt the duty of orgs related to profit generation

A MAJOR QUESTION REMAIN: HOW MUCH PROFIT; SOME SAY 'NO LIMIT' WHILE OTHERS MAINTAIN HIGH PROFITS MAY BE 'GOUGING,' ETC.

Authors such as Plunket & Attner continually emphasize that profits should be 'reasonable' but many business experts advocate that an org should, ie even has a duty to, generate the maximum amt of profits available

Perhaps one of the main voices in the conversation over profits & soc resp is noble prize willing economist Milton Friedman

Friedman resists all approaches for soc resp orgs, maintaining that orgs have a duty solely to generate max profits for owners

Friedman's view is popular w/ many corporatists, but is opposed by many new org leaders

Thus the range of opinion on the issue of profits & soc resp runs the gamut from max profits to reasonable profits

Even those who advocate reasonable profits fully understand that profitability is the life blood of an org

For the soc resp firm, a question that often becomes an important pt of discussion is what is a reasonable profit for owners & stockholders?

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Outline on the Responsibilities to Employees

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WKRS HAVE MANY RIGHTS ESTBED LARGELY BY THE LABOR MVMT, AS WELL AS NEWER RIGHTS ESTBED IN THE MODERN WKPLACE IN A CLIMATE OF SOC RESP

Employees should enjoy equal access to the rights, responsibilities & privileges afforded by employers

Wkrs need to receive fair & equitable compensation, to be dismissed only for just cause, & to be treated w/o discrimination

Wkrs should experience a quality of work life that provides satisfying jobs

Wkrs should receive competent guidance & direction in their work & be accorded due process in disputes

Wkrs hold certain rights to freedom of expression, safety, adequate info & privacy & confidentiality of personal info

An area of contention relates to what wkrs do off the job, such as: Should health practices such as smoking or obesity impact employability? Should credit worthiness impact employability? Should sexuality or sexual tastes, esp as displayed on social media impact employability? Should body art, eg tattoos, affect employability?

	JUST AS OWNERS HAVE A RIGHT TO PROFITS, WKRS HAVE A RIGHT TO A WAGE, BUT THE LEVEL OF A FAIR WAGE IS IN CONTENTION & CAN BE PROBLEMATIC IF IT IS NOT A LIVING WAGE, OR IF IT IS TOO EXORBITANT AS IT IS FOR SOME TOP MGT
	The rise of the Labor Mvmt in the late 1800s & following has created numerous wkr rights that are now mostly accepted by socially responsible orgs & other types of orgs
	One issue that has often been central to the Labor Mvmt & corps is the level of compensation
	While soc resp firms advocate reasonable compensation, ie fair & equitable, the issue of compensation often revolves around the two poles of the living wage & the exorbitant salary
	First is the idea of a living wage; does an org have a duty to pay only what the mkt will bear, or do they have the duty to provide compensation that allows one to live a mid class life style?
	The other pole of the compensation debate relates of exorbitant salaries & stock bonuses: whether one can be paid too much or not
	For some owners & even employees compensation may run into the millions or hundreds of millions of dollars
	Advocates of soc resp note that such exorbitant levels of compensation often breed corruption, or at the least, socially irresponsible behavior

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Outline on the Responsibilities to Customers

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WHILE CONSUMERS ARE MORE WELL PROTECTED THAN EVER BY CONSUMER PROTECTION LAWS, CONSUMER ADVOCATES & MANY CONSUMERS RECOGNIZE THAT MORE COULD BE DONE & THUS SOC RESP ORGS GO BEYOND THE LAW

Orgs, businesses, mgrs, & their wkrs owe fair & honest representation of their products & services to their customers

Such products & services should encompass quality of design, manufacture, distribution, & sales

Consumers have a right to be warned of any hazards they may encounter while using a product or receiving a service

Customers have a right to be treated fairly & w/ respect

Laws have been passed to protect consumers that include such protections as govt inspection of food, drugs, cosmetics, credit, product safety, warranty, & more

While consumer protection laws have been passed, the soc responsible org would go well beyond these laws since they set a minimum floor of consumer protection

A consumer protection agency was estbed by Obama in 2010 & many corps sought to block its creation

Because of irresponsible orgs & the weakness of consumer protection laws, our courts are flooded w/ consumer complaints

Many consumer complaints are mediated, yet corps choose to fight many more

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Outline on the Responsibilities to Suppliers

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A MAJOR RESPONSIBILITY TO SUPPLIERS IS TO RECOGNIZE THEIR DEPENDENCE ON THE ORG FOR ORDERS, & THUS JOBS

Suppliers & orgs should build relationships based on mutual trust

Suppliers deserve to receive needed info in time to render quality service & supplies

Like all parties to contracts, suppliers have the legal right to be treated according to the terms of their agreements

In 1993 GM signed a contract w/ suppliers to provide paid wkrs & leased factories for them to build parts with & savings from this initiative would be shared w/ the supplier corps & GM

Like many issues of social responsibility, relationships w/ suppliers should go beyond the legal minimums

One important issue for suppliers is job security & the continuation of services in that what appears to be a simple changing of suppliers to the parent corp, may prove devastating to the supplier org

Parent corps can work w/ suppliers treating them more as part of the org than as a disposable workforce

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Outline on the Responsibilities to Communities

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ORGS HAVE COSMETIC RESPONSIBILITIES TO COMMUNITIES, ESP RELATED TO POLLUTION, WASTE, TRASH, APPEARANCE, ETC

Those environments & their govts that are affected by an org's ops constitute it's community

The quality of life in a community, it's air, land water, flora, fauna, it's specific needs can all be impacted by the op of a org or business in the area

All an org's constituents, many of who may be customers & workers in a community, deserve ethical, legal & moral treatment

Pollution & toxic waste are growing concerns around the world & thus there is mounting pressure to produce green products which minimize energy consumption & pollutive by products

Auto makers, as pushed by higher govt fuel standards, develop more fuel efficient & cleaner burning engines

Most fed regs on mileage & auto emissions have been pushed by CA's regs which were the toughest in the nation

CA's regs were the impetus for the Clean Air Act of 1990 & the latest CAFE (Corp Average Fleet Economy) standards by the Obama Admin in 2010

The music recording industry once packaged CDs in oversize containers to prevent shop lifting, but after pressure from env grps, they agreed to package all CDs in the smaller 'jewel box'

McDonald's reduced it's packaging for all it's food products & switch from toxic styrofoam to biodegradable cardboard

	ORGS HAVE ECON RESPONSIBILITIES TO COMMUNITIES, ESP JOBS & THE USE OF LOCAL SUPPLIES, RESOURCES, & UTILITIES, & INFRASTRUCTURE
	Often the relationship that overshadows all others btwn orgs & communities is jobs for local wkrs
	The issue of jobs is closely related to the usage of local supplies & resources since these also provide jobs & income for the community
	Another job related issue that affects communities is that of the tax base: communities receive tax income from wkrs as well as directly from orgs in the form of property & other types of taxes
	The magnitude of the econ relationships btwn orgs & communities can result in 'company towns' which are characterized by the communities willingness to do almost anything to support & keep the org
	The company town is an example of 'organization capture' whereby an org controls other orgs or entities almost as if they were part of the org
	The soc resp org avoids org capture of communities, w/ it's paternalistic overtones, & establishes an equitable relationship btwn orgs & communities
	Orgs can put a burden on a community in the form of the provision of utilities & infrastructure
	When communities put up the capital to supply utilities & infrastructure, they are hurt if an org simply closes up & moves on

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Outline on the Public Policy Process

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- Project: Policy Actors

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- Project: The Public Policy Process, Domhoff's Analysis, & Reform of Campaign Financing & Lobbying

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SUMMARY

Industry & interest group lobbying has influence at all stages of the public policy process, & beyond

Congress passes laws

Lobbyists, industry, government agencies, the Public, et al offer "advice" ( lobbying & influence )

The prospective law is signed or vetoed, or line item vetoed by the President

The law given to the appropriate government agency for implementation

Agencies make draft rules which are printed in Federal Register for public approval

Agencies review public comments & write final rules

Agencies implement rules

During implementation, rules must be interpreted & decisions must be made

Courts interpret laws & rules

THE UPPER CLASS

The upper class directly shapes govt policy by impacting the public policy process

Govt. policy & the public policy process is the least recognized by the general public, but it is the area where the public could have great influence

Several types of policy are "routine" in that they are specified in the Constitution or law & occur regularly

FISCAL POLICY

Fiscal policy is perhaps the most visible govt policy

Fiscal policy is the most open to the democratic process & thus highly influenced by the upper class, the corporate class & the upper middle class

Fiscal Policy includes primarily fed law on taxing & spending

MONETARY POLICY

Monetary policy is "insulated from politics" which results in almost no input from the general public & great power by the President

Broad monetary policy issues include unemployment & interest rates which are “insulated from politics” by independent boards

The Federal Reserve Board's members appointed for 7 yr. terms during which they set major interest rates & the money supply

Federal Reserve Board members are very difficult to remove, so a President picks them carefully

DOMHOFF ON GOVERNMENT POLICY

1. Domhoff believes that the upper class, the corporate class & the upper middle class provide most of the money in the political process

2. Domhoff believes that the upper class, the corporate class & the upper middle class provide most of the money to fund think tanks, foundations, university research, etc

3. Domhoff believes that the info from think tanks, foundations, university research, etc. is funneled into the policy process as evidence/data

4. Domhoff believes that the info from think tanks, foundations, university research, etc. is funneled directly to the government to influence the policy making process

5. Domhoff believes that the info from think tanks, foundations, university research, etc. is funneled directly to the media to influence policy & public opinion

The policy formation process is seen as increasingly important in our information age society

THE ACTORS IN THE POLICY FORMATION PROCESS

There are many "players' or actors in the policy formation process, that lobby & produce policy documents, including:

1. corporations
2. the upper class (i.e. those w/ personal fortunes)
3. foundations
4. universities ( granting agencies )
5. policy planning groups ( think tanks )

6. govt. commissions, councils, etc.
7. national news media
8. executive agencies, president, congressional committees, courts
9. social movements (conservative, liberal, centrist, etc.)

Each of the players in the policy formation process has a direct role in making policy, & lobbying the other players

Miscellaneous interest groups (e.g. environmental groups, gun groups, anti- & pro- abortion, etc.) & the general public (& organized publics) have input into the public policy process through letters, phone, email, direct contact: spontaneous or "solicited"

Interest groups & the general public (& organized publics) sometimes produce policy documents as do the "players" discussed above, but more often they simply lobby by voicing their opinion

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See Also: Policy Formation Process ( Making Law )

See Also: Participants in the Env Debate

EXAMPLES OF POLICY PLANNING GROUPS

Brookings Institute

American Enterprise Institute

Cato Business Council

Heritage

Council on Foreign Relations

Committee on Economic Development

RAND Corporation

University boards are influenced & staffed by members of the upper class

Profs & other researchers understand that there are political implications to their work & that policy planning grps will line up for or against them

Blue ribbon panels are "independent," temporary committees which are tasked w/ examining special problems such as riots, the CIA, energy, corruption, accidents, etc

The media is often said to be liberal, but it is becoming increasingly focused on info-tainment, centralized, controlled by major corps, & big money oriented

Turner vs. Murdock; Time, Newsweek, US News & World Report

MONEY & POLICY FORMATION

There are many processes for transferring money in the policy formation process, including:
a. gifts ( donations to politicians & the other players, gifts to universities, etc. )
b. endowments
c. grants
d. contracts
e. direct financing of projects

INFORMATION TRANSFER

There are many process for transferring information in the policy formation process, including:

1. research findings
2. personal research reports
3. policy recommendations

4. reports & news items
5. govt. reports
6. think tank reports

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Outline on the Govt Regs & Soc Responsibility

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SUMMARY: SOCIETY DEVELOPED A REGULATORY FRAMEWORK/STATE CAPITALISM IN RESPONSE TO ORGL ABUSE/MKT FAILURE
1. REGS PREVENT ABUSE BY ORGS
2. ORG ABUSE IS A BY PRODUCT OF CAPITALISM / MKT FAILURES
SOCIETY HAS CONTROLLED MKT FAILURE BY THE DEVELOPMENT OF STATE CAPITALISM & THUS REGS
3. TODAY'S CORPS HAVE COSTS ON SOCIETY WHICH MUST BE REGULATED/CONTROLLED
4. REGS, IE COMPULSORY OBEDIENCE, HAS HIGH COSTS
5. SOCIETY IS DEVELOPING PROCESSES OF VOLUNTARY COMPLIANCE

1. LAWS, & THE REGS THEY CREATE, HELP PREVENT & PUNISH ABUSE BY ORGS

Govt regs are formed as a result of laws passed by Congress & signed by the President

Regs are formulated by mostly executive branch govt agencies ranging from the Dept of Ag to the Commerce Dept

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