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BA342 Values based assessment framework for ethical decision making Overview: below is a framework to use in assessing any ethical issue, either on the job or in an ethics training session. When we individually or in a group seeitng consider an ethics issues many times feeling and emotion will rule. Using a decision making framework such as this 6 step process allows us to acknowledge the motion but work to overcome to a more values based decision. Ethical Deceison Making Process 1. Awareness - what are the ethical concerns or issues 2. Facts: what is knwon or unknown in this situation 3. Stakeholders: what individuals or groups are affect or will be affected? 4. Standards: are there any laws, policies or professional standareds that apply to this situation 5. Values: what personal or org values apply 6. options/action” what options do you have? What actions will you take? Trust = Value License plates and personal data  Costly  Privacy concerns  Marketing to the individual consumer  Video: news clip florida  Automatic license plate readers LPR  Crime fighting tools effective  Track cars and movement  Captures license plates  Coming to penn state Vigilant Solutions  Motorola solutions  Street level surveillance  Electronic frontier foundation  Makes the tech Government and technology Governemnt and technology  0.002% are actionable/crime  Track altimers patients  Missing kids  Bad people  Pricavy and security of data  Malls Cars collect multiple data points P35 2030 all cars will be fully connected  Eventually give up driving completely  Fully connected takes privacy away

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Will be a trillion dollar busines by 2030 Info sold to advertisers

Responsibility Responsibility is always personal and corporate A license to operate Intangibles: 53% of total value or about 24.27 Consumers: 85% reputation responsibility key competitiveness and marketing positioning Risk management: gove NGO’s legal Employees: 3 of 5 want to work for values companies Investors: 86% institutional investors OperationsL innovation, energy waste, water Adding value to the stakeholders who this we use resources efficiently Responsibility: ability Responsible leadership: making business decisions that takes into account stakeholders, such as workers clients suppliers the environment the community and future generations

Excellent Performance Academic Integrity Professional Behavior Ethics and Personal Business VUCA ENvironment Personal vs corporate Is personal life fair to judge in an employment situation Boeing 787 dreamliner Case - messing with contracts, spying on competition Boeing 787 Government puts boeing on probation Harry stonecipher comes in  Play ethically  Revenues skyrockets due to open space travel  Business is opened up by government Debby and Harry have an affair during/after corporate retreate  Affair continues, get caught on emails  Harry fired Should harry have lost his job? What are the issues to consider?  power dynamic  He was the ethics warrior  He has to clearand  TRUST = VALUE

John Reed- Citi Steve Wynn - Casinos Jack Welch - GE Mark Hurd - HP Avg Shoreholder Amazon CEO 2019 - Jeff bazos and mackenzie divorce Spiderman clip “with great power comes great responsibility Ethics is PONG Personal Organizational National Global Personal is most important because all of it is personal The invisible Hand 1700s Scottland 1723-1790  Moral philosopher  Economics  “The wealth of nations”  1776  Invisible hand  “The theory of moral sentiments  1759  US modernized capitalism Ethical issues and stakeholder analysis Stakeholder analysis - when presented with any positive/ negative situation, analyze individual groups, and categories, that are interested in this Responsibility today sandusky AD CFO coaches all fired Stakeholders (some)  Victimes  PSU  NCAA  Paterno family  Trustees Michigan state gymnastics and university scandal Larry nassar  In jail for abusing women  332 women 550 million settlement Stakeholders (some)  Women gymnastics program and community  Michigan state sports media  Layers students

COVID 19 Stakeholders (some)  Faculty and staff  Students  Parents  Admin  Trustees  Coaches  Doctors  Downtown  Town Corporations and ethics?  volkswagen  Fannie freddie  Enron  Tyco  Merrill lynch  Madoff  Jp morgan  Wells fargo

Global ethics Data  website : for ethics  Trust = value  Ethics = compliance  Compliance = rules  GDS report o Stable orgs: ⅓ see misconduct o Slightly unstable: 66% o Unstable: 80%  22% feel pressure to comply  weak leadership = more misconduct What makes an ethically helathy org?  Previous ECI research indicates that an ethically healthy organization is one where o Few employees fell pressure to compromise org ethical standards o Misconduct is rare o Observations of misconduct are reported o Reports of misconduct are appropriately addressed o Employees who report misconduct do not experiences retalliations Eci research on misconduct Global business ethics 2020 report #1  Ethics.org

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Scroll read the GBES report Scroll own and select Interactive map on ethics data

Global business ethics survey top misconduct categories  Bribes and corruption  Employee abuse  fraud/lying and theft  Regulatory violation  Contracts misconduct 2013 nation business ethics survey  Short term gains of losing trust ECG report large companies p47

5 principles of a high quality ethican and compliance program  Ethical central to business strat  Ethicas and compliance risks are identifies owned managed and mitigated  Leaders build/sustain a culture of integrity  The org values reporting of concerns and suspected wrongdoing  Org takes action and holds itself accountable Is there such thing as right and wrong Have you heard it said that ethics is  Situational  Relative  Contextual  Cultural  It all depends  These are the wrong places to go GLOBAL STEAL TV EXAMPLE There are morals/valued ethics shared around the world John Q video Sons about to die Dad will kill himself to have the son Does bieng right and wrong work the same in very country? International business ethics

Book page 318-328 Cultural relativism vs ethical imperialism Customs vs culture Cultural relativism  Adhere to the culture that i am currently in Ethical imperialism  Bring my culture where i go Hyper norms  Values shared across cultures/nations Can you teach ethics or make someone ethical Ethical decision making 1. Ethical awareness 2. Ethical judgement 3. Ethical behavior Business ethics:  Concerned with hte morality and fairness in behavior, actions, policies, and practices that take place within a business context Ethics  A set of principles or  Right conduct based on  Underlying values Penn State PRRIDE  P o Penn state community  R o Responsibility  R o Respect  I o Integrity  D o Discovery  E o Excellence

Bounded ethicality We are ethical… but bounded Situational  We are rational thinkers  We rarely think rationally  Situational > dispoisitional  Bounded rational = bounded ethical  You have your own thics Economics

 Bounded rationally Ethical  Bounded ethicallity Millenials and ethics  Lots of posting about work/coworkers on social media  Penn State students are good o Thon o Recruiting in smeal o Bus core office o Ethics o Diversity  Penn State students are bad o Cheating o Bullying o Plagiarism o Selling intellectual property o Alcohol and drugs o Discriminiaiton Values framework and responsibility  Structured way to address an ethical situation Ethical decision making assessment framework  Awareness  Facts  Stakeholders  Standards  Values  Actions Drug use in the workplace CASE P57 As the weed spreads Driviers marijuana in the workpalce Should we leaglize marijuana Marijuana Cost to employers issues to address Lost productivity 200B Absent 75-78% higher costs accident s 55% more Injuries up 85% Litigation generagles acorss states Personal costs Short term memory Impared thinking etc Corporate dilemma

Ethics in the media Loss of trust and value

Enron leadership team Aug 2001 Classic case  Cook the books  Made fake companies to offload debt and earnings  30k employees down and broke  Author anderson went down too  Smartest guys in the room  Whistle blower accounting firm Sherron watkins  Whistles blower  Author anderson lost the big 5 Bad ratings Gallo psurvey business are low on honestly according to population High according to business people (true part) Business leaders grade ethics and honesty higher than the public P63 Media and ethics Wall street trailer Greed is good Office News -if it bleeds it leads We bleed so we lead Study of prime time television Businesses are th villains in movies Advertising  Business arnt great but not bad, honest  They reinforce stereotypes  Commercial dominoes where the lady is cooking Social media  Bad look  More exposure Surveyed high school kids and they think business leaders  Falsify documents  Secret meetings  Blackmail  Sabotage competitors

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Injure and harm others to advance self

Corporate media and dilemmas Madoff - check open notes not from packet

Amoral  Dont consider ethics in business  Not tuned into ethics, but into business Dominoes commercial  Women in kitchen  Amoral is always unintentional  Plays off gender sterotypes  30 mins or free Vlaues framework Moral  Being right, and going above and beyond Merck  River blindness the 1987 decision  2.5 billion pills for free  Ken frazier keeps that promise today KOLBERG 209-212 6 stages

Organizational and personal ethics

Tylenol deaths Mary kellerman - chiago  Takes tylnol dies almost instantly  All these people have similar deaths  Cyinide poision in tablets  1982  Someone injected the tylenol  CEO announces first ever major recall of a product  Pull everything  Now has triple safety seal  Rebuilt brand safely  Follow creddo  JOHNSON AND JOHNSON VIDEO  Had a 3rd party buyout of bad product  Feds forced recall

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JNJ brings in sandi peterson

Three approaches to ethical decision making Teleolgical  Consequences or results  Utitarianism  Greatest ration of good to evil Deontological  Dues to society  Kant  Act is if you will its a universal law \ Trolly problem Applying ethical principles to decisons Kan rawls locke Aristotle plato Duties, rights/justice, consequences and results, virtue PAGE 79 True autonomous driving The ethics of self driving cas How do you program ethics

Sexual harassment hostile workplace - suggestive comments/jokes, intrusive unwanted questions unwanted staring/touching Quid pro quo - do this favor (probaly sexual) and ill give you a riase/promotion

1. Go get help 2. You are 100% involved the moment you hear/talk 3. Follow up Ethical tests

P 82 Ford GM Volkswagen Going public  Common sense  Best self  Venting others  Purified idea  Gag test  Big four Big four  Greed  speed  Laziness haziness Fraud triangle  Type of ethical test  Opportunity we control this one  Rationalization  Motivation P85

Horses and fraud Dixon illinois Rita crundwell comptroller store millions from the town Wells fargo, creating an ethical culture

Culture  Shape attitudes  Reinforce beliefs  Direct behavior  Set expectations Factors influencing employee unethical behavior 1. Behavior of superiors most important 2. Behavior of peers 3. Industry ethical practices 4. Soceities moral climate 5. Policy (or lack thereof) 6. Personal financial need What impact manager sna employees morality  Society moral climate o Business moral climate

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Industry moral climate  Oranization moral climate  Your personal situation

Ethical culture  Linda trevino VIDEO Corporations strong vs weak ethical culture  Theme o ⅓ weak leaning o ⅔ strong ethics culture Ethics culture best practices  Lockheed o Website o Strong ethical culture

Exam video  Why take BA 342 o Its cool to be young and responsible  Theme of the class o Responsibility  Leadership competencies o Ethical issues in business o Sustainability o Diversity and inclusion o Corporate social responsibility o Responsible leadership  Warren buffet quote o “In looking for people to hire, you look for three qualities  Integrity  Intelligence  Energy  And if they dont have the first the other two will kill you”  Smeal strategic plan  Provide extraordinary education  Highest quality research  Build culture of  Integrity

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 Diversity  Service  Sustainability Snapshot cases  Playing sports  Basketball out of bounds video clip  License platse  Privacy and security issues  Crime rates go down  Could use for commercial business  Volkswagen  “Dieselgate”  Said they had clean diesel but the cars could indicate when they were being tested  52B fine  Nations states and regions sue  Graveyard  Wells fargo  Fake accounts to hold up with the high pressure sales culture  Unrealistic expectations  John sump left 2018  Moral value and economic value Trust = value Personal and corporate focused  Individual personal  Organizational corporate License to operate (data on responsibility)  What is it stakeholder  PAGE 37 packet  Car data Responsibility and responsible leadership definitions  Responsibility  Ability or authority to act or decide on ones own without supervision  Responsible leadership  Making business decisions that takes into account stakeholders such as workers clientes suppliers the environment the community and future generations Smeal honor code  “We, the Smeal College of Business community, aspire to the

highest ethical standards and will hold each other accountable to them. We will not engage in any action that is improper or that creates the appearance of impropriety in our academic lives, and we intend to hold to this standard in our future careers.” 

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EAP  Excellent performance  Academic integrity  Professional behavior Boeing case (personal life fiar game or not)  Harry stonecipher and his affair  At first harry plays ethically but then has afair

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 Power dynamic Video spiderman quote PONG Adam smith  2 books  Economics and ethics  Invisible hand and the theory of moral sentiments  Stakeholder exercise (analysis)  Sandusky Michigan state stakeholder example  Lary nassar COVID 19 and PSU stakeholders  Page 44 ECI data - global business ethics surveys  3 graphs (themes) page 45   What makes an ethically helathy organization (5 elements) 45  Few employees feel pressure to compromise org ethics standards  Misconduct is rare  Observations of misconduct are reported  Reports of misconduct are appropriately addressed  Employees who report miscondcut do not experience retaliation Poor ethics vs good ethic culture (theme) Global Business ethics - BIG 5 misconducts 46 Poor (weak) and good (strong) ethics culture  Pie charts 4 components  47 Right and wrong excercise and discussion (where to start with ethics) Ethics definition (3 part in class and book definition)

Penn State Values o PRRIDE  Cultural Relativsm/Moral Absolutism (chapter 10)  Hyper norms (that cross al cultures) o Employees and customers  Millennials and ethics (social networks sight)  Bounded ethicality  Moral engagement/disengagement overview and exercise o Where penn state students do well and not  Values framework o Know 6 parts  Durg use on job case o Lockheed martin  Marijuana issues for employers and people  Marijuana know data themes only  Marijuana videos (california weed, laywer advice, 2020)  Corporate dilemma (enron case) (figure 7.1)

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Survey stats on how business viewed (themes) Media dilemma wall street and office videos Media influence 6 types Media data surveys (gallop and marist) Conventional ethics (first of three ways to assess ethics) Descriptive vs normative (values framework) Phantom expenses case (book 668) Models of management Know all three (sections 7.4) Madoff case (ponzi scheme) Imporal management Domino’s case know (values framework application) Football Amoral Merck and river blindness moral mangagemtn Moral Three approaches to ethics (know the big three) Ethics econ and law model p 197 Kohlberg - levels and stages (moral judgement) (section 7.6 Sources of values p213 Elements of judgment (7.7) Tylenol cases (1982 and today) 1982 did well Today not so well at first then leading to today that made a comeback Teleological and deontological Book Trolley illustration (applied to principles) Ethical principles (duties, rights/justics, utilitarian, virtue ethics) Know how to run the chart Trolley JNJ sexual harrassment driverless cars Driveless cars and ethical decisions Rights -types (see book fig 8.1) Sexual harassment case (using values framwork) 3 keys when facing this type of case for managers Ethical tests (7 from book) For GM volkswagen Moments of truth video clip Apply ethical tests Fraud triangle(horse bus case) another ethical test Article (the fraud triangle and what you can do about it Article “creting an ethical culture” Strong vs weak cultures - note data themes Org ethics components slides/book 7 elements (reading starting on pp240 managing org ethics Culture best practices example lockheed martin Website 5 elements of training (class slide) Influences on behavior fig 8.4 Compliance vs values

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Compliance = rules Values = ethics Behavior ethics (connects to bounded ethicality p262 264 Moral decisions, moral managers and moral orgs 264 Bribery know for, against and costs FCPA 1977 (bribe vs grease payments) know what this is all about Fig 10-2 and 10-3 review) Cultural relativism and ethical imperialism Hyper norms...