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ethics, to constitute, to illuminate, harassment, legitimacy, whistle, bristle, governance, dimension, commitment, bribery, exploitation, vacuum, unethical, necessarily, legal – illegal – legality, mere, infallible, to occur, greed, desirable, anticipate, egoist, motto, tough, falsify, accumulate, auditor, inaccurate, to pursue, psychological, violate,
b) Read the following text and do the exercises after it.
Ethics is a discipline dealing with "good" or "bad"("right and wrong" or "fair and unfair" or "just and unjust") choices or behavior. This discipline involves questions of what constitutes moral responsibility (duties) and to whom the duties are owed. Most societies adopt a minimum code of ethics, that is, laws, for the purpose of governing relations among people as individuals, partnerships, corporations, and other groups.
Although the concept of ethics and ethical duties may seem abstract, in fact ethics plays an active role in our lives. It affects and gives meaning to the decisions we make. We constantly apply our values and moral convictions to our actions and decisions, frequently without being aware that we are doing so. The clothes we buy, the music we prefer, the way we treat our friends and families - these and other everyday activities and decisions relate to values and goals.
Business Ethics focuses on what constitutes right or wrong behavior in the world of business and on how moral principles are applied by business-persons to situations that arise in their daily activities in the workplace.
Some examples of the many business ethics questions illuminate the definition of business ethics. In the employment relationship, countless ethical issues concern the safety requirements, civil rights (such as equal treatment and freedom from sexual harassment), and the legitimacy of whistle blowing. In the relationship of business with its customers, ethical issues spread to marketing techniques, product safety, and consumer protection. The relationship between business and its owners bristles with ethical questions involving corporate governance and management's duties to the shareholders. The relationship among competing businesses involves numerous ethical matters, including fair competition and collusive conduct. The interaction between business and society at large has additional ethical dimensions: pollution of the environment, commitment to the community, and depletion of natural resources. Not only do all of these issues recur at the international level, but additional ones present themselves, such as bribery of foreign officials, exploitation of less developed countries, and conflicts among different cultures and value systems.
Law and Ethics
In all societies, ethics and law go hand in hand. Law can never operate in a vacuum. The law must reflect society's customs and values and reinforce principles of behavior that society deems right and just.
As the law reflects and codifies a society's ethical values, many of our ethical decisions are made for us by our laws. Nevertheless, simply obeying the law does not fulfill all ethical obligations. In the interest of preserving personal freedom, as well as for practical reasons, the law does not codify all ethical requirements. In the business world numerous actions might be unethical but not necessarily illegal: for example, failing to fulfill a promise that is not legally binding; exporting products banned in the USA to third world countries, where they are not prohibited; manufacturing and selling tobacco or alcohol products. The mere fact that these business practices are legal does not prevent them from being challenged on moral grounds.
Therefore, although legality is often a reliable guide to moral behavior, it cannot be relied upon blindly as an infallible standard for action. The individual must engage in independent determination of both the legal requirements and the moral requirements of a course of action.
Why ethical problems occur in business
Ethics problems in business appear in many different forms. While not common or universal, they occur frequently. Finding out just what is responsible for causing them is one step that can be taken toward minimizing their impact on business operations and on the people affected.
Personal Gain and Selfish Interest
Personal gain, or even greed, causes some ethical problems. Business sometimes employs people whose personal values are less than desirable. They will put their own welfare ahead of all others, regardless of the harm done to other employees, the company, or society. In the process of hiring employees there is an effort to weed out ethically undesirable applicants, but ethical qualities are difficult to anticipate and measure. The embezzler, the bribe taker, and other unethical persons can slip through. Lacking a perfect screening system, business is not likely to eliminate this kind of unethical behavior entirely.
A manager or an employee who puts his or her own self-interest above all other considerations is called an ethical egoist. Self-promotion, a focus on self-interest to the point of selfishness, and greed are traits commonly observed in an ethical egoist. Such a person tends to ignore ethical principles accepted by others. "Looking out for Number One" is the ethical egoist's motto.
Competitive Pressures on Profits
When companies are squeezed by tough competition, they sometimes engage in unethical activities in order to protect their profits. Research has shown that companies with lower profits, as compared with those with higher profits, are more prone to commit illegal and unethical acts. However, an unstable financial position is only one reason for illegal and unethical business behavior, because profitable companies also can act contrary to ethical principles. In fact, it may be simply a single-minded drive for profits, regardless of the company's financial condition, that creates a climate for unethical activity.
Price-fixing is a practice that often occurs when companies compete vigorously in a limited market. Besides being illegal, price-fixing is unethical behavior toward customers, who pay higher prices than they would if free competition set the prices. Companies fix prices to avoid fair competition and to protect their profits.
Price-fixing is not the only kind of unethical behavior that can occur. MiniScribe, a producer of computer disk drives, can be drawn as an example. Competitive pressures caused the company to falsify sales figures, accumulate defective drives that had been returned and then sell them again as new products, package bricks and ship them to distributors as disk drives, secretly break into auditors' files to change inventory figures on the auditor's reports, and file misleading and inaccurate financial reports. MiniScribe's top managers allegedly resorted to these tactics from 1985 to 1988 when the computer industry was suffering a general decline and after MiniScribe had lost IBM, one of its biggest customers.
Business Goals versus Personal Values
Ethical conflicts in business sometimes occur when a company pursues goals or uses methods that are unacceptable to some of its employees. "Whistle-blowing" may be one outcome, if an employee "goes public" with a complaint after failing to convince the company to correct an alleged abuse. Another recourse for employees caught in these situations is a lawsuit, as happened in the following case.
A pilot for Eastern Airlines charged in court that he had been given undesirable flight assignments and was suspended from work for insisting, without success, that certain safety improvements should be made on cockpit equipment that later was implicated in a fatal airplane crash.
The ethical dilemma here arose because the company's goals and methods required the employee to follow orders that he believed would harm himself, other employees, the company, and the general public. His own ethical compass was at odds with the goals and methods of the company.
Some of the knottiest ethical problems occur as corporations do business in other societies where ethical standards differ from those at home. Today, the policy-makers and strategic planners in all multinational corporations, regardless of the nation where they are headquartered, face this kind of ethical dilemma.
US sleepwear manufacturers discovered that the chemicals used to flameproof children’s pajamas might cause cancer if absorbed through the child’s skin. When these pajamas were banned from sale in the US, some manufacturers sold the pajama material to distributors in other nations where there were no legal restrictions against its use.
This episode raises the issue of ethical relativism. Should ethical principles take their meaning strictly from the way each society defines ethics? What or whose ethical standards should be the guide?
As business becomes increasingly global, and as more and more corporations penetrate overseas markets where cultures and ethical traditions vary, these questions will occur more frequently. Employees and managers need ethical guidance from clearly stated company policy if they are to avoid psychological stresses. A company must not use local custom as an excuse for violating laws of corporate policies; it should conduct its business according to a higher standard.
Some who study international business ethics say that such higher standards of ethics already exist. They point to numerous treaties and codes of conduct for regulating the activities of multinational corporations regarding environmental protection, equitable treatment of employees, laws against bribery, and protection of basic human rights in the workplace.
Focus on text comprehension
Focus on vocabulary
code of ethics, partnerships, moral conviction, values, employment relationship, sexual harassment, whistle blowing, product safety, fair competition, less developed countries, legally binding, infallible standard, personal gain, ethically undesirable applicants, embezzler, tough competition, profitable companies, price-fixing, limited market, competitive pressure, sales figures, alleged abuse, ethical relativism, overseas markets, multinational corporations
принимать минимальный этический кодекс, регулировать/определять отношения, требования по безопасности, гражданские права, равное отношение, отсутствие сексуального преследования, законность сообщения о фактах нелегальной деятельности, приемы маркетинга, безопасность товара, защита потребителя, изобиловать этическими вопросами, руководство компанией, честная конкуренция, заговорщическое поведение, обязательства по отношению к обществу, подкуп должностных лиц, эксплуатация развивающихся стран, укреплять принципы, подчиняться законам, юридически обязательный, запрещать, непогрешимый стандарт, уменьшить воздействие, удалить неподходящих кандидатов, взяточник, игнорировать этические принципы, вытеснять, быть склонным, нестабильное финансовое положение, фальсифицировать данные о продаже, проникать в файлы аудитора, подавать недостоверные и неполные финансовые отчеты, прибегать к чему-либо, претерпевать общий спад, преследовать цели, обнародовать информацию, якобы совершенное злоупотребление, расходиться в чем-либо, этическая относительность, проникать на внешние рынки, извинение за нарушение закона, транснациональная корпорация, справедливое отношение, основные права человека
case, bribery, minor offence, court, trial, charge, sentence, evidence, guilty, fine, jury
b) Fill in the blanks with the words mentioned above.
to deal with sth, to constitute moral responsibility, to adopt a minimum code of ethics, to govern relations among people, to seem abstract, to affect sth, to apply sth to sth, to relate to values and goals;
to focus on sth, right or wrong behaviour, , employment relationship, to concern the safety requirements, the legitimacy of whistle blowing, to spread to sth, to involve corporate governance, duties to sb, fair competition and collusive conduct, to have additional ethical dimensions, to recur at the international level, bribery of foreign officials, exploitation of less developed countries;
To reflect and codify a society’s ethical values, to fulfil ethical obligations, to preserve personal freedom, to be legally binding, to export products to third world countries, to be challenged on moral grounds, to blindly rely upon sth, to engage in sth;
Example: Ethical conflicts in business sometimes occur when a company pursues goals or uses methods that are unacceptable to some of its employees.
Stella McCartney (join) the troubled Paris fashion house Chloé barely a year ago. It (take) her just one year to reverse its fortune. Previously Chloé (be) virtually invisible as a major force in the world of fashion. But almost single-handedly she (transform) Chloé into the most talked about fashion brand in the world. She (increase) sales fivefold. Paris (not see) anything like it since the young Yves St Laurent (take) the city by storm 30 years ago.
When she (be appointed) it (be) clear she (know) what she (have) to do. “I want to bridge the gap between the consumer and the press. At the moment fashion is just sort of stuck in the middle.
So far, Stella (stick) to her philosophy of avoiding outrageous and uncommercial catwalk creations. She (keep) to the simple philosophy of designing clothes that she or her friends would want to wear.
Example: Opposition parties are threatening to bring down the government.
Focus on speaking
Unit 5 Corporate crime
corporate – corporation, to offend – offender – offence, conceit, primary, jurisdiction, industrial, espionage, insider, to distort – distortion, negotiate, bribe – bribery, budgetary, narcotics, smuggler, to organize – organization, to extort – extortion, illegitimate, nepotism, cronyism, North Korea, Syria, to embezzle – embezzler – embezzlement, minor, sophisticated, to falsify – falsification, phantom, audit, strategy, to misappropriate – misappropriation, to recruit – recruit, tour
b) Read the following text and do the exercises after it.
Corporate crime refers to crimes committed either by a corporation or by individuals that may be identified with a corporation or other business entity.
In law, corporations can commit the same offences as natural persons. The majority of crimes are committed because the offender simply sees the chance and thinks that he or she will be able to commit the crime and not be detected. For the most part, greed, rather than conceit, is the motive. And the corporation is the vehicle for the crime. This may be a short-term crime, i.e., the corporation is set up as a shell to open credit trading accounts with manufacturers and wholesalers, trades for a short period of time and then disappears with the revenue and without paying for the inventory. Alternatively and most commonly, the primary purpose of the corporation is as a legitimate business, but criminal activity is secretly intermixed with legal activity to escape detection. To achieve a suitable level of secrecy, senior managers will usually be involved.
Examples of criminal behavior in most jurisdictions include: corruption and related types of abuse, industrial espionage, insider trading, etc
Corruption and related types of abuse
One of the main problems in the developed world is corruption. It undermines economic development by generating considerable distortions and inefficiency. In the private sector, corruption increases the cost of business through the price of illicit payments themselves, the management cost of negotiating with officials, and the risk of breached agreements or detection. Although some claim corruption reduces costs by cutting red tape, the availability of bribes can also induce officials to contrive new rules and delays. Openly removing costly and lengthy regulations is better than covertly allowing them to be bypassed by using bribes. Where corruption inflates the cost of business, it also distorts the playing field, shielding firms with connections from competition and thereby sustaining inefficient firms.
Corruption also generates economic distortions in the public sector by diverting public investment into capital projects where bribes and kickbacks are more plentiful. Officials may increase the technical complexity of public sector projects to conceal or pave way for such dealings, thus further distorting investment. Corruption also lowers compliance with construction, environmental, or other regulations, reduces the quality of government services and infrastructure, and increases budgetary pressures on government.
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