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Business Ethics: A New Style of Management and Investment

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Title: Business Ethics: A New Style of Management and Investment


1
Business EthicsA New Style of Managementand
Investment
  • Professor David M. Chen
  • 003924_at_mail.fju.edu.tw
  • Graduate Institute of Finance
  • Fu Jen Catholic University
  • Spring 2009

2
Purposes
  • To appreciate the essential of Business Ethics
    through five main faucets
  • Recognizing socially acceptable business conduct
    from the global perspectives
  • Embedding good business in treating people nice
    and fair
  • Reengineering corporate image
  • Enhancing professional ethics
  • Investing in sustainable and socially responsible
    corporations

3
  • Various global initiatives in areas related to
    corporate social responsibility (CSR) and their
    respective implementation guidance form the core
    of course materials.
  • Case Social, Environmental and Related Reporting
    of Inditex Group, 2006
  • The course will be held in English
  • Students are expected to communicate and present
    case studies or research reports in English (19
    in total).
  • English proficiency is emphasized as another main
    product of the course.

4
Content
  • Business Ethics as a Field of Study
  • Code of Ethics (Guardsmark-ethics06)
  • Code of Conduct (PwC-conduct05)
  • Caux Round Table Principles for Business
  • Nissans Approach to CSR (NissansApproachCSR)
  • Ethics Resource Center
  • National Business Ethics Survey 2005 (NBES-05)
  • Critical Elements of Organization Ethical Culture
    2006 (ERC-OrgEthicalCuture06)
  • Environmental Management Systems
  • ISO 14000
  • RoHS

5
  • Working environment
  • SA8000
  • The Switcher-Prem Group Experience in India
    (SwitcherPremIndia-02)
  • SA8000 Tool to Improve Quality of Life
    (ToolImporveQualityLife-02)
  • Business Principles for Countering Bribery
  • Transparency International (CorruptionPerceptionsI
    ndex-06, GlobalCorruptionBarometer-06,
    BribePayersIndex-06)
  • (ICC-CombatBribery)
  • NYSE/NASD IPO Advisory Committee
  • NYSE Hearing (StockRatingResearchConflict,
    GuaranteedRepurchase, PriceInfluencing)
  • Enron
  • SEC report (SEC-Enron-02)
  • TIAA CREF testimony (TIAA-CREF-Enron-02)

6
  • Policy for Managing Conflicts of Interest in
    Relation to Investment Research
  • Morgan Stanley
  • Investment research report disclosure
    requirements (GoldmanSach-Huandian)
  • Dow Jones Sustainable Index
  • (NewInvestmentStyle)
  • World Resources Institute (ChangingDrivers,
    OilGas)
  • Socially responsible investing (SRI)
  • Ethical Banking
  • Microcredit
  • Code of conduct for credit rating agency
  • (IOSCOCRA)

7
Business Ethics as a Field
  • Case
  • A newly hired salesman on training
  • His trainer is used to making up the differences
    in restaurant and golf bills for procurement
    agents (common courtesy?).
  • Being asked to add the extra expenses to cost of
    other items since no line on the form for this
    (yet the numbers dont add up).
  • Learned the differences between working directly
    with the federal government procurement agents
    and the companies with which his firm
    subcontracted (relay information).

8
  • Regulation
  • The Procurement Integrity Section of the Office
    of Federal Procurement Policy Act and the Federal
    Acquisition Regulation
  • Section 27(a)(2) forbidding agents to offer,
    give, or promise to offer or give, directly or
    indirectly, any money, gratuity, or other thing
    of value to any procurement officials of such
    agency or (3) solicit or obtain, directly or
    indirectly, from any officer or employee of such
    agency, prior to the award of a contract any
    proprietary or source selection information
    regarding such procurement.
  • Certificate of Procurement Integrity signed by
    procurement agents

9
  • Recognize deal with complex issues
  • Public outrage about deception and fraud
  • Enron, WorldCom, Arthur Andersen, Tyco
  • A crisis of confidence and trust accounting
    fraud, insider trading, falsifying documents,
    deceptive advertising, defective products,
    bribery, employee theft.
  • Integrate business ethics and corporate
    responsibility into all business decisions.
  • Business ethics
  • Deals with questions about whether specific
    business practices are acceptable.
  • Should a salesperson omit facts about a products
    poor safety record?
  • Should an accountant report inaccuracy discovered
    in an audit?

10
  • By its nature, the field of business ethics is
    controversial and there is no universally
    accepted approach for resolving its issues.
  • The goal is to help one understand and use ones
    current values and convictions when making
    business decisions so that you think about the
    effects of those decisions on business and
    society.
  • Neither to moralize by telling you what is right
    or wrong on specific situation, nor to prescribe
    any one philosophy or process as best or most
    ethical.
  • Focus on how organizational ethical decisions are
    made and on ways companies can improve their
    ethical conduct.

11
  • Definition
  • Ethics
  • Tayor
  • An inquiry into nature and grounds of morality
    where the term morality is taken to mean moral
    judgments, standards and rules of conduct.
  • The American Heritage Dictionary
  • The study of the general nature of morals and of
    specific moral choices moral philosophy and the
    rules or standards governing the conduct of the
    members of a profession.
  • Distinction from ordinary decisions
  • Alderson Lies in the point where the accepted
    rules no longer serve, and the decision maker is
    faced with the responsibility for weighing values
    and reaching a judgment in a situation which is
    not quite the same as before.

12
  • The amount of emphasis decision makers place on
    their own values relative to accepted practices
    within their company.
  • Business ethics
  • Comprises the principles and standards that guide
    behavior in the world of business.
  • Profit not realized through misconduct.
  • Balance the desires for profits against the needs
    and desires of society.
  • Right or wrong, ethical or unethical, is often
    determined by investors, employees, customers,
    interest groups, the legal system, and the
    community (they are not necessarily right, but
    their judgments influence societys acceptance).
  • Hence, it is important to understand business
    ethics and recognize ethical issues.

13
  • Reasons for studying
  • Business ethics is not merely an extension of an
    individuals own personal ethics.
  • An individuals personal values and moral
    philosophies are only one factor in the ethical
    decision-making process.
  • Normally a business does not establish rules or
    policies on personal ethical issues such as sex
    and the use of alcohol outside the workplace (may
    even be illegal).
  • Only when a persons preferences or values
    influence job performance do an individuals
    ethics play a major role.
  • A high level of personal moral development may
    not prevent an individual from violating the law
    in a complicated organizational context.

14
  • E.g., there is considerable debate over what
    constitute antitrust, deceptive advertising, and
    violation of Foreign Corrupt Practices Act, even
    experienced lawyers debate the exact meaning.
  • Because organizations are culturally diverse and
    personal values must be respected, ensuring
    collective agreement on organizational ethics is
    as vital as any other effort.
  • Many business ethics decisions are close calls.
  • Studying business ethics will help to identify
    ethical issues when they arise and recognize the
    approaches available for resolving them.
  • Learn more about the ethical decision-making
    process and about ways to promote ethical
    behavior within the organization.
  • Begin to understand how to cope with conflicts
    between personal values and those of the
    organization.

15
  • Development
  • Before 1960
  • The 1920s
  • The Progressive Movement attempted to provide
    citizens with a living wage, defined as income
    sufficient for education, recreation, health, and
    retirement.
  • Businesses were asked to check unwarranted price
    increases and any other practices that would hurt
    a familys living wage.
  • The 1930s
  • Came the New Deal which specifically blamed
    business for the countrys economic woes.
  • Business was asked to work more closely with the
    government to raise family income.
  • Check whether you can rent the movie The Reds
    from any store or buy it.

16
  • The 1950s
  • The New Deal had evolved into the Fair Deal by
    Harry S. Truman.
  • This program defined such matters as civil rights
    and environmental responsibility as ethical
    issues that businesses had to address.
  • Overall
  • Ethical issues related to business were often
    discussed within the domain of theology or
    philosophy.
  • Religious leaders raised questions about fair
    wages, labor practices, and the morality of
    capitalism.
  • Catholic colleges and universities began to offer
    courses in social ethics.
  • Each religion applied its moral concepts not only
    to business but also to government, politics, the
    family, personal life, and all other aspects of
    life.

17
  • The 1960s
  • American society turned to causes.
  • An antibusiness attitude developed as many
    critics attacked the so called military-industrial
    complex.
  • The decay of inner cities and the growth of
    ecological problems such as pollution and the
    disposal of toxic and nuclear wastes.
  • The rise of consumerism (Consumers Bill of
    Rights) John F. Kennedy delivered a Special
    Message on Protecting the Consumer Interest,
    which outlined four basic consumer rights
    safety, informed, choose, and to be heard.

18
  • Ralph Naders Unsafe at Any Speed, 1965, which
    criticized the auto industry as a whole, and GM
    in particular, for putting profit and style ahead
    of lives and safety.
  • Consumer activist also helped secure the passage
    of several consumer protection laws, such as the
    Wholesome Meat Act of 1967, the Radiation Control
    for Health and Safety Act of 1968, the Clean
    Water Act of 1972, and the Toxic Substance Act
    of 1976.
  • Lyndon B. Johnson and the Great Society (national
    capitalism) the U.S. governments responsibility
    was to provide the citizen with some degree of
    economic stability, equality, and social justice.
    Activities that could destabilize the economy or
    discriminate against any class of citizens began
    to be viewed as unethical and unlawful.

19
  • The 1970s
  • Business ethics began to develop as a field of
    study.
  • Business professors began to teach and write
    about corporate social responsibility
    organizations obligation to maximize its
    positive impact on stakeholders and to minimize
    its negative impact.
  • Philosophers applied ethical theory and
    philosophical analysis to structure the
    discipline of business ethics.
  • Companies became more concerned with their public
    images.
  • The Nixon administrations Watergate scandal
    focused public interest on the importance of
    ethics in government.

20
  • The Foreign Corrupt Practices Act was passed
    during Jimmy Carters administration illegal for
    U.S. businesses to bribe government officials of
    other countries.
  • A number of major ethical issues had emerged,
    such as bribery, deceptive advertising, price
    collusion, product safety, and the environment.
  • The 1980s
  • Business ethics acknowledged as a field of study.
  • Business ethics organizations grew to include
    thousands of members.
  • Many of leading companies established ethics and
    social policy committees.
  • The Defense Industry Initiative on Business
    Ethics and Conduct (DII) was developed to guide
    corporate support for ethical conduct (18 defense
    contractors drafted principles in 1986).

21
  • Six principles
  • DII supports codes of conduct and their
    widespread distribution. Must be understandable
    and provide details on more substantive areas.
  • Member companies (50) are expected to provide
    ethics training for their employees as well as
    continuous support between training periods.
  • Defense contractors must create an open
    atmosphere in which employees feel comfortable
    reporting violations without fear of retribution.
  • Companies need to perform extensive internal
    audits and develop effective internal reporting
    and voluntary disclosure plans.

22
  • DII insists that member companies preserve the
    integrity of the defense industry.
  • Member companies must adopt a philosophy of
    public accountability.
  • Reagan/Bush eras
  • Self-regulation, rather than regulation by
    government, was in the publics interest.
  • Many tariffs and trade barriers were lifted, and
    business merged and divested within an
    increasingly global atmosphere.
  • Corporations that once were nationally based
    began operating internationally and found
    themselves mired in value structures where
    accepted rules of business behavior no longer
    applied.

23
  • The 1990s
  • Bill Clinton continued to support self-regulation
    and free trade.
  • Unprecedented government action to deal with
    health-related social issues such as teenage
    smoking (restricting cigarette advertising,
    banning vending machine sales, and ending the use
    of cigarette logos in connection with sports
    events).
  • SEC Chairman Arthur Levitt unsuccessfully pushed
    for many reforms that could have prevented the
    accounting ethics scandals.
  • Federal Sentencing Guidelines for Organizations
  • FSGO approved by Congress in Nov. 91.
  • Based on the six principles of the DII.

24
  • Codifying into law incentives to reward
    organizations for taking action to prevent
    misconduct, such as developing effective internal
    legal and ethical compliance programs.
  • Mitigate penalties for businesses that strive to
    root out misconduct and establish high ethical
    and legal standards.
  • If a company lacks an effective ethical
    compliance program and its employees violate the
    law, it can incur severe penalties
    (carrot-and-stick).
  • Focus on firms taking action to prevent and
    detect business misconduct in cooperation with
    government regulation.
  • A mechanical approach using legislative logic
    will not suffice to avert serious penalties. Must
    develop corporate value, enforces its code of
    ethics, and strive to prevent misconduct.

25
  • The twenty-first century
  • Falsifying financial reports and reaping
    questionable benefits had become part of the
    culture of many companies.
  • Dennis Kozlowski, former CEO of Tyco, was
    indicted on 38 counts of misappropriating 170m
    of Tyco funds and netting 430m from improper
    sales of stock.
  • Allegedly used the funds to purchase many
    personal luxuries, including a 15m vintage yacht
    and a 3.9m Renoir painting and to throw a 2m
    party for his wifes birthday.
  • Arthur Andersen was convicted of obstructing
    justice after shredding documents related to its
    role as Enrons auditor.

26
  • Also faced questions surrounding its audits of
    other companies that were charged with employing
    questionable accounting practices, including
    Halliburton, WorldCom, Global Crossing, Dynegy,
    Qwest, and Sunbeam.
  • Congress passed the Sarbanes-Oxley Act
  • in 2002, the most far-reaching change in
    organizational control and accounting regulations
    since the Securities and Exchange Act of 1934.
  • Made securities fraud a criminal offense and
    stiffened penalties for corporate fraud.
  • Created an accounting oversight board that
    requires corporations to establish codes of
    ethics for financial reporting and to develop
    greater transparency in financial reports to
    investors and other interested parties.

27
  • Requires top executives to sign off on financial
    reports (risk fines and long jail sentences if
    misrepresented).
  • Requires executives to disclose stock sales
    immediately and prohibits companies from giving
    loans to top managers.
  • Current trend
  • From legally based ethical initiatives to
    cultural or integrity-based initiatives that make
    ethics a part of core organizational values.
  • NYSE requires all member companies to have code
    of ethics.
  • Many firms now have ethics officers, and some
    firms, including UPS, Raytheon, and Baxter
    International, take ethics seriously enough to
    have their ethic officers report directly to
    senior management or boards of directors.

28
  • The growth of the Ethic Officer Association (EOA)
    to 850 members, representing 420 companies,
    highlights the increasing importance of this
    position (considering launching an ethics
    certification program).
  • Global development
  • Businesses are working more closely together to
    establish standards of acceptable behavior.
  • Some companies will not do business with
    organizations that do not support and abide by
    these standards.
  • The Caux Round Table is a group of businesses,
    political leaders, and concerned interest groups
    that desire responsible behavior in the global
    community.

29
  • Benefits
  • Building an ethical reputation among employees,
    customers, and the general public pays off.
  • Increased efficiency in daily operation, greater
    employee commitment, increased investor
    willingness to entrust funds, improved customer
    trust and satisfaction, and better financial
    performance.
  • Many believe a particular course of action is
    simply the right thing to do as a responsible
    member of society (feeling good is also a good
    business).

30
  • Employee commitment
  • Comes from employees who believe their future is
    tied to that of the organization and their
    willingness to make personal sacrifices for it.
  • Safe work environment, competitive salaries, and
    the fulfillment of all contractual obligations
    toward employees.
  • Work-family programs and stock ownership plans to
    community service.
  • Productivity and teamwork share a common vision
    of trust within and between departments make
    individuals more willing to rely and act on the
    decisions and actions of their coworkers.
  • Trusting relationships (honesty and respect)
    contribute to greater decision-making
    efficiencies.

31
  • Investor loyalty
  • Social responsible mutual funds and asset
    management firms.
  • Investors recognize that an ethical climate
    provides a foundation for efficiency,
    productivity, and profits. Negative publicity,
    lawsuits, and fines can lower stock prices,
    diminish customer loyalty, and threaten a
    companys long-term viability.
  • Customer satisfaction
  • Almost 60 of people focus on social
    responsibility ahead of brand reputation or
    financial factors when forming impressions of
    companies (boycott the company).
  • May avoid the products of companies that are
    perceived as treating their employees unfairly
    (sweatshop and abuses in subcontracting, SA 8000
    industry code of conduct).

32
  • When an organization has a strong ethical
    environment, it usually focuses on the core value
    of placing customers interest first.
  • Companies convicted of misconduct (failure to act
    responsibly toward various stakeholders)
    experience a significantly lower return on assets
    and on sales.

33
  • Ethics Resource Center, ERC (reading)
  • www.ethics.org
  • National Business Ethics Survey, NBES
  • "Ethics and compliance programs can and do make a
    difference. However, their impact is related to
    the culture in which they are situated." 2005
    NBES Summary
  • Misconduct any behavior that violates the law or
    organizational ethics standards.
  • 21 observed abusive or intimidating behavior
    towards employees.
  • 19 observed lying to employees, customers,
    vendors, or the public.
  • 18 observed a situation that places employee
    interests over organizational interests.
  • 16 observed violations of safety regulations.

34
  • 16 observed misreporting of actual time worked.
  • 12 observed discrimination on the basis of race,
    color, gender, age or similar categories.
  • 11 observed stealing or theft.
  • 9 observed sexual harassment.
  • The six elements of a formal ethics and
    compliance program are based upon suggestion by
    the FSGO
  • Written standards of conduct
  • Training on ethics
  • Mechanisms to seek ethics advice or information
  • Means to report misconduct anonymously
  • Discipline of employees who violate ethical
    standards
  • Evaluation of employees performance based on
    ethical conduct 

35
  • The NBES defines risk factors as
  • Employee's exposure to circumstances that invite
    misconduct.
  • Employee's recognition of those situations as
    misconduct.
  • Pressure to compromise the standards of the
    organization.
  • Preparedness of employees to respond to these
    situations.
  • www.workingvalues.com
  • www.complianceweek.com
  • www.ama-assn.org
  • www.aacsb.edu

36
  • Every Guardsmark crest (reading)
  • is emblazoned with our company core values
    Truth, Courage, Judgment.
  • Our business success and ethical commitment are
    indivisible.
  • Guardsmark was founded on the pillars of quality,
    excellence, diversity, opportunity, and doing the
    right thing from day one, we wanted to work with
    individuals who had intellect, work ethic, and
    honesty.
  • Every single member of our organizationfrom the
    security officer to the corporate executiveis
    committed to demonstrating our values and
    principles at all times.
  • Through our Code of Ethics, the people of
    Guardsmark pledge to work always to strengthen
    our weaknesses and build on our strengths and to
    lead by example.

37
  • The Guardsmark Code of Ethics
  • All Guardsmark employees subscribe to our
    comprehensive Code of Ethics, which is a product
    of top-down commitment and bottom-up involvement.
    First developed in 1980, this living document is
    revised annually by the entire workforce.
  • The Code sets impeccable standards of behavior
    for employee conduct across
  • Employee relations
  • Our commitment to excellence
  • Professionalism in the industry
  • Employee wellness
  • Vendor relations
  • Community and government relations
  • Industry commitment
  • Information technology

38
  • Ensuring understanding by employees, visitors and
    vendors
  • Our code appears in our employment application,
    where it must be signed by every applicant. It is
    always available to our employees as a
    stand-alone document and promoted in
  • Our orientation handbook
  • Periodic educational publications
  • Employee manuals
  • Placards in all offices
  • To make the principles of this important document
    accessible to each Guardsmark team member,
    Guardsmark maintains an ethics committee and a
    dedicated ethics officer who can be reached
    through a toll-free number. We take every ethics
    concern or issue seriously and provide assistance
    about applying principles to any given situation.

39
  • Understand our ethical foundation
  • A true understanding of Guardsmark's commitment
    can only come from reviewing our Code of Ethics
    in its entirety.
  • Guardsmark exceeds the requirements of the
    Sarbanes-Oxley Act of 2002 that mandates the
    disclosure by public companies of whether they
    have adopted written codes of ethics to deter
    wrongdoing and to promote honest and ethical
    conduct.
  • Although a private company such as Guardsmark is
    not subject to the requirements of this bill, the
    organization publicly releases its Code of
    Ethics, which was established in 1980 and is
    rewritten annually with input from its employees
    and applies to all team members, without
    exception.
  • www.guardsmark.com

40
  • PricewaterhouseCoopers (reading)
  • is one of the worlds pre-eminent professional
    services organisations.
  • As professional advisers we help our clients
    solve complex business problems and aim to
    enhance their ability to build value, manage risk
    and improve performance.
  • As business advisors we play a significant role
    in the operation of the worlds capital markets.
  • We take pride in the fact that our services add
    value by helping to improve transparency, trust
    and consistency of business processes.

41
  • In order to succeed, we must grow and develop,
    both as individuals and as a business.
  • Our core values of Excellence, Teamwork and
    Leadership help us to achieve this growth.
  • As a result, we also have a Code of Conduct for
    all PwC people and firms.
  • This Code is based on our values and it takes
    them to the next level - demonstrating our values
    in action.
  • The Code also provides a frame of reference for
    PwC firms to establish more specific supplements
    to address territorial issues.
  • www.pwc.com

42
Ethics Statements
  • One of BellSouth's greatest assets is our
    reputation. 
  • One of the key factors that contribute to our
    reputation and good name is our long-standing
    tradition of ethics -- a tradition which has
    built solid trust between us and our customers,
    our employees, our shareholders, and our
    communities. 
  • As we work to maximize shareholder value, we will
    not waver in maintaining our tradition of ethics.

43
  • BellSouth's ethical culture is rooted in our
    values.  It is these values that guide our
    actions and relationships with each other, with
    our customers, and with our investors.
  • While our values describe who we are and what we
    are about, it is our actions that make these
    values meaningful. Every action we take shapes
    the ethical character of BellSouth. That
    character is at the heart of our reputation and
    ultimately sets us apart in the marketplace.
  • We understand each individual employee's actions
    contribute to the trust we have earned.  We offer
    our employees a variety of resources to help them
    make ethical decisions and maintain the highest
    level of integrity. 

44
  • BellSouth's Office of Ethics Compliance is
    available to answer questions concerning ethics,
    or take reports of possible ethical violations. 
  • Employees and other concerned individuals can
    contact Ethics by completing this online form or
    by calling the Ethicsline at 1-800-664-4231.
  • Both these methods are available 24 hours a day,
    7 days a week  You may remain anonymous if you
    prefer, but this sometimes limits the
    investigation due to insufficient information.
  • www.ethics.bellsouth.com

45
  • Texas Instruments
  • Employees placed their personal imprint on the
    ethics of the company, more than 60 years ago.
  • They chose to conduct themselves to the highest
    standards of personal integrity, and they
    demanded the same of others.
  • Today, those principles and values still permeate
    all of TI's actions and decisions.
  • As TI grew, management recognized a need to
    formalize and communicate company standards.
  • In 1961, TI published its first written code of
    ethics, a booklet titled "Ethics in the Business
    of TI."

46
  • Though it has been revised several times to
    reflect changes in the business environment, the
    basic message contained in that first booklet has
    never changed, nor has TI's emphasis on
    maintaining a track record of ethics and
    integrity.
  • About 20 years ago, an increasing number of
    difficult issues, challenges and close calls in
    modern business were recognized, but clear
    choices of action did not always exist.
  • Employees and their business associates needed to
    better understand TI's expectations and where
    they could go for help if they had a question or
    a concern.
  • TI believes maintaining the highest ethical
    standards requires a partnership between
    employees and employers.

47
  • The employer proactively supports employees by
    communicating values and giving individual
    guidance, while empowered employees participate
    actively in problem-solving.
  • In 1987, TI decided to actively support employees
    by establishing a TI Ethics Office and appointing
    a TI Ethics Director.
  • The TI Ethics Office has three primary functions
  • Ensure that business policies and practices
    continue to be aligned with ethical principles
  • Clearly communicate ethical expectations
  • Provide multiple channels for feedback through
    which people can ask questions, voice concerns
    and seek resolution to ethical issues.

48
  • A reputation and track record for ethics and
    integrity is vital for establishing the trust
    that is the basis for all successful business
    relationships. All people associated with
    TIemployees, customers, suppliers, governments
    and communitiesneed to understand and appreciate
    the importance of these principles.
  • TI has strong documented requirements for ethical
    business practices
  • TI Standard Policies and Procedures
  • The TI Commitment
  • "The Values and Ethics of TI" booklet
  • The direction is clear, and the message is firmly
    and credibly supported by our highest levels of
    management and by our Board of Directors.
  • www.ti.com

49
  • HCA announced the development
  • of the Ethics, Compliance and Corporate
    Responsibility Department in Oct. 1997.
  • Alan Yuspeh was named Senior Vice President for
    Ethics, Compliance and Corporate Responsibility. 
  • The department oversees the development and
    implementation of a comprehensive corporate
    Ethics and Compliance Program.
  • Articulating standards of compliance and ethical
    conduct through a Code of Conduct and a series of
    company Policies and Procedures.
  • Creating awareness of these standards among
    everyone in the company through high quality
    ethics training, compliance training, and other
    ongoing communication efforts.

50
  • Providing a means to report exceptions (i.e.,
    possible misconduct). We maintain an Ethics Line
    (1-800-455-1996) to receive reports from anyone
    who is aware of a violation of our Code of
    Conduct or Policies and Procedures.  This line is
    answered at all times.
  • Monitoring and auditing performance in areas of
    compliance risk to ensure that established
    policies and procedures are being followed and
    are effective.
  • Establishing organizational supports, including
    necessary committees, responsible executives and
    facility ethics and compliance officers, for this
    entire effort.
  • Overseeing implementation of and adherence to a
    Corporate Integrity Agreement.
  • And undertaking other efforts, such as clinical
    ethics and pastoral care services.
  • hcahealthcare.com

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  • Starbucks Its the way we do business
  • Contributing positively to our communities and
    environment is so important
  • that its a guiding principle of our mission
    statement.
  • We jointly fulfill this commitment with partners
    (employees), at all levels of the company, by
    getting involved together to help build stronger
    communities and conserve natural resources.
  • In our communities Starbucks has many community
    building programs
  • that help us be good neighbors and contribute
    positively to the communities where our partners
    (employees) and customers live, work and play.

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  • We encourage and reward volunteerism and
    participation in organizations that are important
    to our partners, including local schools,
    literacy programs, walk-a-thons and Earth Day
    activities.
  • Environmental Affairs
  • Starbucks integrates policies and programs
    throughout all aspects of operations to minimize
    our environmental impact.
  • From promoting conservation in coffee growing
    countries to recycling, Starbucks is committed to
    contributing positively to the environment.
  • Supplier Diversity
  • By working with qualified diverse suppliers,
    Starbucks has regularly met and exceeded its
    goals for purchases with women and minority-owned
    suppliers. Embracing diversity is our foundation
    for providing a world-class supplier program that
    supports our Mission Statement.

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  • Mission Statement
  • Establish Starbucks as the premier purveyor of
    the finest coffee in the world while maintaining
    our uncompromising principles while we grow. Six
    guiding principles
  • Provide a great work environment and treat each
    other with respect and dignity.
  • Embrace diversity as an essential component in
    the way we do business.
  • Apply the highest standards of excellence to the
    purchasing, roasting and fresh delivery of our
    coffee.
  • Develop enthusiastically satisfied customers all
    of the time.
  • Contribute positively to our communities and our
    environment.
  • Recognize that profitability is essential to our
    future success.

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  • Committed to a role of environmental leadership
    in all facets of our business.
  • Understanding of environmental issues and sharing
    information with our partners.
  • Developing innovative and flexible solutions to
    bring about change.
  • Striving to buy, sell and use environmentally
    friendly products.
  • Recognizing that fiscal responsibility is
    essential to our environmental future.
  • Instilling environmental responsibility as a
    corporate value.
  • Measuring and monitoring our progress for each
    project.
  • Encouraging all partners to share in our mission.
  • www.starbucks.com

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The Caux Round Table Business Principles of Ethics
  • Introduction
  • CRT principles are rooted in two basic ethical
    ideals kyosei and human dignity.
  • The Japanese concept of kyosei means
  • living working together for the common good
    enabling cooperation and mutual prosperity to
    coexist with healthy and fair competition.
  • Human dignity refers to the sacredness or value
    of each person as an end, not simply as a mean to
    the fulfillment of others' purposes or even
    majority prescription.

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  • The document owes a substantial debt to The
    Minnesota Principles, a statement of business
    behavior developed by the Minnesota Center for
    Corporate Responsibility. The Center hosted and
    chaired the drafting committee, which included
    Japanese, European, and United States
    representatives.
  • CRT principles offer a foundation for dialogue
    and action for business leaders worldwide and
    affirm the necessity for moral values in business
    decision-making. Without moral values, stable
    business relationships and a sustainable world
    community are impossible. 

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Competitors
Responsibilities
Suppliers
Communities
Economic social impact
Owner/investors
CRT Business Principles of Ethics
Business behavior
Employees
Respect for rules
Customers
Respect for the environment
Support for multilateral trade
Avoidance of illicit operations
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  • Principle 1. The responsibilities
  • Beyond shareholders toward stakeholders
  • The value of a business to society is the wealth
    and employment it creates and the marketable
    products and services it provides to consumers at
    a reasonable price commensurate with quality.
  • To create such value, a business must maintain
    its own economic health and viability, but
    survival is not a sufficient goal.
  • Businesses have a role to play in improving the
    lives of all their customers, employees, and
    shareholders by sharing with them the wealth they
    have created.

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  • Suppliers and competitors as well should expect
    businesses to honor their obligations in a spirit
    of honesty and fairness.
  • As responsible citizens of local, national,
    regional, and global communities in which they
    operate, businesses share a part in shaping the
    future of those communities.
  • Principle 2. The economic and social impact
  • Toward innovation, justice, and world community
  • Businesses established in foreign countries to
    develop, produce, or sell should also contribute
    to the social advancement of those countries by
    creating productive employment and helping to
    raise the purchasing power of their citizen.

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  • Businesses also should contribute to human
    rights, education, welfare, and vitalization of
    the countries in which they operate.
  • Businesses should contribute to economic and
    social development not only in the countries in
    which they operate, but also in the world
    community at large, through effective and prudent
    use of resources, free and fair competition, and
    emphasis upon innovation in technology,
    production methods, marketing, and
    communications.
  • Principle 3. Business behavior
  • Beyond the letter of law toward a spirit of trust
  • Accepting the legitimacy of trade secrets,
    businesses should recognize that sincerity,
    candor, truthfulness, the keeping of promises,
    and transparency contribute not only to their own
    credibility and stability but also to the
    smoothness and efficiency of business
    transactions, particularly on the international
    level.

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  • Principle 4. Respect for rules
  • To avoid trade friction
  • and to promote free trade, equal conditions for
    competition, and fair and equitable treatment for
    all participants, business should respect
    international and domestic rules.
  • In addition, they should recognize that some
    behavior, although legal, may still have adverse
    consequences.
  • Principle 5. Support for multilateral trade
  • Should support the multilateral trade systems
  • of the GATT/World Trade Organization and similar
    international agreements.
  • They should cooperate in efforts to promote the
    progressive and judicious liberalization of
    trade, and to relax those domestic measures that
    unreasonably hinder global commerce, while giving
    due respect to national policy objectives.

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  • Principle 6. Respect for the environment
  • Should protect and, where possible,
  • improve the environment, promote sustainable
    development, and prevent the wasteful use of
    natural resources.
  • Principle 7. Avoidance of illicit operations
  • Should not participate in or condone bribery,
  • money laundering, or other corrupt practices
    indeed, should seek cooperation with others to
    eliminate them.
  • Should not trade in arms or other materials used
    for terrorist activities, drug traffic, or other
    organized crime.
  • Principle 8. Customers
  • We believe in treating all customers with dignity
  • irrespective of whether they purchase our
    products and services directly from us or
    otherwise acquire them in the market.

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  • We therefore have a responsibility to
  • provide our customers with the highest quality
    products and services consistent with their
    requirements
  • treat our customers fairly in all aspects of our
    business transactions, including a high level of
    service and remedies for their dissatisfaction
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