INSEAD Library

Includes bibliographical references and index

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Business Ethics Managing Corporate Citizenship and Sustainability in the Age of Globalization Contents List of figures List of boxes Preface to the second edition Acknowledgements xiv xvi xviii xxiv PART A Understanding business ethics 1 Introducing business ethics What is business ethics? Business ethics and the law Defining morality, ethics, and ethical theory 3 4 5 8 Why is business ethics important? Globalization: a key context for business ethics? What is globalization? The relevance of globalization for business ethics 9 14 15 18 Sustainability: a key goal for business ethics? The triple bottom line Environmental perspectives Economic perspectives Social perspectives Implications of sustainability for business ethics 20 23 25 26 27 28 Europe: a key perspective for business ethics? What is Europe? European versus alternative approaches to business ethics Sources of difference between Europe and other regions Globalization and assimilation between Europe and other regions 28 29 30 32 33 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 1: McEUROPE: M c D O N A L D ' S RESPONDS TO ETHICAL CRITICISM I N EUROPE 34 35 35 36 36 2 Framing business ethics CORPORATE RESPONSIBILITY, STAKEHOLDERS, AND CITIZENSHIP 41 Towards a framework for business ethics What is a corporation? Key features of a corporation Can a corporation have social responsibilities? Can a corporation be morally responsible for its actions? 42 42 42 43 44 Corporate social responsibility Why do corporations have social responsibilities? What is the nature of corporate social responsibilities? CSR in an international context CSR and strategy -- corporate social responsiveness Outcomes of CSR: corporate social performance 45 47 49 51 53 56 Stakeholder theory of the firm Why stakeholders matter A new role for management Stakeholder thinking in a European context Different forms of stakeholder theory 57 61 62 62 63 Corporate accountability -- the firm as a political actor Governmental failure: 'risk society' and the institutional failure of politics Why do governments fail? Corporate power on the rise The problem of democratic accountability 64 65 65 66 67 Corporate citizenship Defining corporate citizenship: three perspectives Limited view of CC Equivalent view of CC An extended view of CC Assessing corporate citizenship as a framework for business ethics 70 71 71 73 74 78 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 2: THE 'ENGLISH PATIENT' AND THE CHINESE TAKEAWAY: EXAMINING SOCIAL RESPONSIBILITIES I N THE MG ROVER COLLAPSE 79 80 80 80 81 3 Evaluating business ethics NORMATIVE ETHICAL THEORIES 85 86 86 88 Introduction The role of ethical theory Normative ethical theories Traditional ethical theories Consequentialist theories Non-consequentialist theories Limits of traditional theories 90 91 97 107 Contemporary ethical theories Virtue ethics Feminist ethics Discourse ethics Postmodern perspectives on business ethics 110 110 111 113 115 Summary: towards a pragmatic use of ethical theory STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 3: BRITISH PETROLEUM AND THE BTC PIPELINE: TURKISH DELIGHT OR RUSSIAN ROULETTE? 119 122 122 123 123 4 Making decisions in business ethics DESCRIPTIVE ETHICAL THEORIES 127 Introduction What is an ethical decision? Models of ethical decision-making Stages in ethical decision-making Relationship with normative theory Influences on ethical decision-making Limitations of ethical decision-making models European perspective on ethical decision-making 128 129 130 130 131 132 133 135 Individual influences on ethical decision-making Age and gender National and cultural characteristics Education and employment Psychological factors Personal values Personal integrity Moral imagination 136 136 138 139 140 144 145 148 Situational influences on decision-making Issue-related factors Context-related factors 149 149 155 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 4: SCHOOL FOR SCANDAL? BUSINESS SCHOOLS TURN THEIR ATTENTION TO ETHICS E D U C A T I O N 162 163 163 163 164 5 Managing business ethics TOOLS AND TECHNIQUES OF BUSINESS ETHICS MANAGEMENT 169 170 170 171 171 174 Introduction What is business ethics management? Components of business ethics management Mission or values statements Evolution of business ethics management Setting standards of ethical behaviour: designing and implementing codes of ethics Prevalence of codes of ethics Content of codes of ethics Effectiveness of codes of ethics Global codes of ethics 175 176 177 180 181 Managing stakeholder relations Assessing stakeholder importance: an instrumental perspective Types of stakeholder relationship Problems with stakeholder collaboration 185 186 187 191 Assessing ethical performance Defining social accounting Why do organizations engage in social accounting? What makes for 'good' social accounting? 194 195 197 198 Organizing for business ethics management Formal ethics programmes Informal ethics management: ethical culture and climate Business ethics and leadership 202 202 204 205 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 5: SHELL SHOCKED: IS SHELL A CASE OF 'ETHICAL EPIPHANY' OR 'LESSONS NOT LEARNED'? 207 208 208 209 209 PART B Contextualizing business ethics The corporate citizen and its stakeholders 6 Shareholders and business ethics Introduction: reassessing the importance of shareholders as stakeholders Shareholders as stakeholders: understanding corporate governance Corporate governance: a principal-agent relation 217 218 218 220 Shareholders' relations with other stakeholders: different European frameworks of corporate governance 222 Ethical issues in corporate governance Executive accountability and control Executive remuneration Ethical aspects of mergers and acquisitions The role of financial markets and insider trading The role of accountants Reforming governance 225 228 229 230 232 237 239 Shareholders and globalization The Tobin Tax Combating global terrorism and money laundering 240 243 244 Shareholders as citizens of the corporation Shareholder democracy Shareholder activism Ethical investment 246 246 247 250 Shareholding for sustainability The Dow Jones Sustainability Group Index Rethinking sustainable corporate ownership: corporation or co-operation? 254 254 256 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 6: CORPORATE GOVERNANCE OF PROFESSIONAL FOOTBALL CLUBS: FOR PROFIT OR FOR GLORY? 258 259 259 259 260 7 Employees and business ethics Introduction Employees as stakeholders Ethical issues in the firm--employee relation Management of human 'resources' ­ an ethical problem between rights and duties Discrimination Sexual and racial harassment Employee privacy Due process and lay-offs Employee participation and association Working conditions Fair wages Freedom of conscience and freedom of speech in the workplace The right to work 263 264 265 267 267 271 275 279 285 287 289 291 293 294 Employing people worldwide: the ethical challenges of globalization National culture and moral values Absolutism versus relativism 296 297 297 Some yardsticks for ethical decision-making The 'race to the bottom' The corporate citizen and employee relations in a varied European context Towards sustainable employment Re-humanized workplaces Wider employment Work-life balance Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 7: MAKING A LIVING OR WORKING YOURSELF TO DEATH? EXPLORING THE BRAVE NEW WORLD OF WORK 298 298 299 301 302 302 303 304 305 305 306 306 8 Consumers and business ethics Introduction Consumers as stakeholders The limits of caveat emptor Ethical issues, marketing, and the consumer Ethical issues in marketing management Ethical issues in marketing strategy Globalization and consumers: the ethical challenges of the global marketplace Reproduction of consumerism Dislocation of production and consumption Cultural homogenization New forms of resistance Consumers and corporate citizenship: consumer sovereignty and the politics of purchasing Consumer sovereignty Ethical consumption Sustainable consumption What is sustainable consumption? The challenge of sustainable consumption Steps towards sustainable consumption Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 8: BOYCOTTING THE 'BABY KILLERS'? NESTLE AND THE ONGOING INFANT FORMULA CONTROVERSY 311 312 313 314 316 316 331 335 336 337 338 338 339 339 341 346 347 347 348 351 352 353 353 353 9 Suppliers, competitors, and business ethics Introduction Suppliers and competitors as stakeholders Suppliers as stakeholders Competitors as stakeholders 357 358 359 359 359 Ethical issues and suppliers Misuse of power The question of loyalty Preferential treatment Conflicts of interest Gifts, bribes, and hospitality Ethics in negotiation 361 362 364 365 366 367 371 Ethical issues and competitors Problems of overly aggressive competition 'Dirty tricks' Problems of insufficient competition 372 373 377 378 Globalization, suppliers, and competitors: the ethical challenges of global business networks Different ways of doing business Impacts on indigenous businesses Differing labour and environmental standards Extended chain of responsibility 379 380 383 384 385 The corporate citizen in the business community: ethical sourcing and fair trade Ethical sourcing Ethical sourcing as business-business regulation Strategies of business-business regulation Fair trade 387 388 388 389 390 Sustainability and business relationships: towards industrial ecosystems? From supply chains to supply loops Industrial ecosystems 393 394 394 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 9: FAIR ENOUGH? BIG BUSINESS EMBRACES FAIR TRADE 396 397 397 398 398 10 Civil society and business ethics Introduction: what is civil society? Civil society organizations as stakeholders Ethical issues and CSOs Recognizing CSO stakes 403 404 407 413 413 CSO tactics Boycotts CSO accountability 415 421 426 Globalization and civil society organizations Engagement with overseas CSOs Global issues and causes Globalization of CSOs 428 429 429 433 Corporate citizenship and civil society: charity, collaboration, or regulation? Charity and community giving Business­CSO collaboration Civil regulation 434 435 436 441 Civil society, business, and sustainability Balancing competing interests Towards participation and empowerment 444 445 446 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 10: FROM CONFLICT TO COLLABORATION? GREEN PEACE'S GREENFREEZE CAMPAIGN 447 448 448 448 449 11 Government, regulation, and business ethics Introduction Government as a stakeholder Defining government, laws, and regulation Basic roles of government as a stakeholder Government as an elected representative of citizens' interests Government as an actor (or group of actors) with interests of its own 455 456 456 456 458 459 460 Ethical issues in the relation between business and government Identifying the basic problems and issues: legitimacy, accountability, and modes of influence Lobbying Party financing Overlap of posts between business and government: individual conflicts of interest State capture by business Ethical issues in the context of privatization and deregulation 463 463 466 470 471 473 475 Globalization and business­government relations From the traditional to the global context Shifting roles for business and government in a global context Business as an actor within the traditional context (Westphalian setting) Business as an actor in the global context (post-Westphalian setting) Business-government relations in the European Union 477 477 481 482 483 486 Corporate citizenship and regulation: business as key player in the regulatory game Governments as regulators (segment 1) Self-regulation by business (segment 2) Regulation involving business, governmental actors, and CSOs (segments 3, 4, and 5) 488 490 492 493 Governments, business, and sustainability Global climate change legislation and business responses: support versus obstruction Public support versus private pressure: a middle ground? Achieving sustainability: a necessary role for government? 499 500 501 503 Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS CASE 11: DISPENSING 'THE LESS ORTHODOX INDUCEMENTS' - BAE SYSTEMS AND THE GLOBAL DEFENCE INDUSTRY 503 504 504 505 505 12 Conclusions and future perspectives Introduction The nature and scope of business ethics? Globalization as a new context for business ethics Sustainabifity as a new goal for business ethics Business ethics in a European context Corporate citizenship as a new concept in business ethics The contribution of normative ethical theories to business ethics Influences on ethical decision-making The role of management tools in business ethics The role of different stakeholder constituencies in business ethics Tradeoffs and conflicts between different stakeholder groups Summary STUDY QUESTIONS RESEARCH EXERCISE KEY READINGS 509 510 510 511 512 512 514 515 516 516 517 518 521 521 522 522 References Subject index Authors index Countries and regions index Companies, organizations, and brands index 523 548 555 561 563