Chapter 4 Summary
Moral Analysis and Ethical Duties
Moral problems arise when financial performance and social performance are in conflict. Financial performance is easy to measure by revenues, cost, and profits generated by the firm. Social performance is difficult to measure, but represents overall wellbeing and general satisfaction on population. Results of these situations having some form of obligation are going to be hurt or harmed in ways out of their own control while others are going to be benefited and helped, hurt, impose rights of and expand rights of stakeholders. ** Key point is to find an equitable balance between financial and social performance, and logically convince others to accept the balance. As we become global economy, effectively resolving moral problems grow in importance because stakeholders are more diverse impossible to avoid all harms or rights ignored It is important to find equitable balance; three evaluative methods (study economic outcomes, legal requirements, and ethical duties) are used. 1. Economic outcomes. Base on impartial market choices managers should produce with the least wanted (cheapest) resources to produce the most wanted (highest price) goods. Theoretical problem: “optimal benefits for all can occur only if a. All input factor and output factor markets are truly competitive b. All suppliers and all customers with in those markets are fully informed c. All external costs are totally included
2. Legal requirements. Based upon participative social and political process
Ethical duties essentially the belief that a manager should always act in accordance with a set of objective norms of behavior or universal statements of belief that are "right" and "just" and "fair" in, of, and by themselves. Universal Principal rules for decisions or action: 1. Not limited to a cultural, religious, economic, or social situation 2. Thought to lead to overall...
Please join StudyMode to read the full document