LectureTopicsPart.pptVIP

Topics 67 Part 2 Review Topics 6 7 deal with three separate, but related, matters: 1. Ethics – focus on (a) individual behaviour and (b) group behaviour; 2. The legal basis of ethical behaviour – duty of care; 3. CSR – focus on corporate strategy and individual behaviour. Review: The Business Case for an Ethical Strategy and Business Behavior Review Topics 6 7 deal with three separate, but related, matters: 1. Ethics – focus on (a) individual behaviour and (b) group behaviour; 2. CSR – focus on corporate strategy and individual behaviour. 3. The legal basis of ethical behaviour – duty of care; Review: Two aspects to business ethics Intended unethical conduct – eg fraud. (INDIVIDUAL) Avoiding responsibility for the unintended events which flow from management decisions. Example – oil spill/BP/Gulf of Mexico. (GROUP) Contingent strategy Contingent strategy is a strategy that is put into action by organisations/groups when unforeseen events happen. What kinds of events are these? ‘Black Swan’ events: any event which will have a catastrophic effect on the org. We focus on events within the control of the org. Contingent strategy The business ethical issue here is the way senior management behaves when these events occur. Do they take responsibility and act quickly (and effectively), or do they try their best to deny or minimise or shift the blame? Examples – BP oil spill/Exxon Valdez Some responses to Black Swan events Denial of the cause or causes Denial of responsibility Denial of liability Hiding or the destroying evidence Distortion of facts to create an appearance of no fault The creation of false scientific evidence Two problems of contingent strategy The effectiveness of contingent strategy is constrained by the quality of decision making. - comprehensive rationality - bounded rationality (See Study Guide, pp39-40) Two problems of contingent strategy 2. Contingent strategy is like buying