Managing Responsibly in a
Global Environment
Mary Runte
Divergent Viewpoints
 I am quite willing to pay a man an annual
salary of one million dollars, provided that
he knows how to glide over every moral
restraint with almost childlike disregard,
and be ready to kill off thousands of victims
without a murmur
John D Rockefeller
 Friendship, family, religion, these are the 3
demons you must slay if you want to
succeed in business
Monty Burns
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Corporate Responsibility Crisis...
 “Opinion polls now place business people
in lower esteem than politicians.”
-Jennifer Merritt (2002) “For MBAs, Soul Searching 101,” Business Week, Sept. 16, p. 64.
 “A W.S.J./NBC poll found that 57% of the
general public believed that standards &
values of corporate leaders & executives
had dropped in the last 20 years.”
-Eric Hellweg (2002) www.business2.0.com, Sept. 10.
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Corporate Responsibility Crisis...
 “An ABC News/Washington Post survey
indicated 63% of the public felt that
regulation of corporations is necessary to
protect the public.”
 “Seventy-five percent of those surveyed by
ABC expressed limited confidence in large
corporations.”
-Gary Langer (2002) “Confidence in Business: Was Low and Still Is,” www.abcnews.com, Sept.
10.
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Corporate Responsibility Crisis...
 “Suddenly, investors are obsessed with lies,
greed and dodgy accounting. It began with
the scandal that toppled Enron. Now it has
engulfed big and small companies, eroding
the markets, investor confidence and
America’s image as the economy to
emulate.”
-MSNBC “A Guide to Corporate Scandals: Companies Under the Microscope,”
http://www.msnbc.com/news/corpscandal_front.asp?odm=C2ORB. Accessed 9/24/2002.
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Developing Trust & Confidence
in Business...
 Individuals alone did not cause our current
crisis
 Many stakeholders were involved in
supporting deception, fraud & destruction
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Board members
Top management
Attorneys
Accounting firms
Securities analysts
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Regulators
Politicians
Mass media
Investors
Colleges of business
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How does ethical decision
making occur in organizations?
 The #1 influencer of ethical/unethical
behavior is the influence of significant others
& the corporate culture
 Business ethics in an organization relates to a
corporate culture of values, programs,
enforcement & leadership
 Stakeholders must support organizational
ethics initiatives—it’s good business
– Stop focusing on the short term!!!
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Companies Under the
Magnifying Glass…
 Livent
 Adelphia Comm.
 Arthur Andersen
 Bristol-Meyers
 Computer
Associates
 Dynegy
 Enron
 Global Crossing
 Halliburton
 ImClone Systems
 Merrill Lynch
 Qwest Comm.
 Tyco Intl.
 WorldCom
 Xerox
-MSNBC “A Guide to Corporate Scandals: Companies Under the Microscope,”
http://www.msnbc.com/news/corpscandal_front.asp?odm=C2ORB. Accessed 9/24/2002.
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What does fraud cost?
 Cost to corporations: > $400 billion a year
 Organizations lose $9/day/employee
 Median loss caused by males: $185,000
 Median loss caused by females: $48,000
“Fraud Group Warns of Theft,” Boston Sunday Globe, 2/3/2002.
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Other issues
 Environment
– Kyoto
 Wage equity
 Third world
…..
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Where did the Enron ‘infamous’
get their degrees?
 Ken Lay—bachelors and masters degree in
economics from University of Missouri
 Jeffrey Skilling—applied science from SMU
and MBA from Harvard
 Andrew Fastow—economics from Tufts and
MBA from Northwestern
 Robert K. Jaedicke (board member)—former
Dean of the Graduate School of Business,
Stanford University & Stanford graduate
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What are schools of business doing?
 Developing programs & courses to address
corporate responsibility
 Encouraging faculty to integrate ethics into
current curriculum
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This course
 This course will examine the forces shaping
management decision-making in an organizational
environment characterized by the process of
globalization. The interaction of the political,
legal, regulatory and social environments in which
an organization operates will be assessed in
relation to ethical decision-making, stakeholder
management, sustainability, and corporate
citizenship.
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In other words…
 a) Students will be able to identify and apply
ethical models to organizational decision
processes
 b) Students will demonstrate knowledge of the
legal, regulatory, political and social frameworks,
both domestic and international, within which
contemporary organizations operate
 c) Students will be able to critically evaluate the
changing roles and responsibilities of corporations
and other organizations in a globalized world.
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Why?
 Reasons for importance
 Business Demands it
– The role of trust
– Deterring government intervention
 Public demands it
• Ethical investment
• Human rights
• Environmentalism
– The Media Spotlight
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Firestone
Nike
Enron
Shell
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How
 Experiential activities
 Case studies
 Critical readings with focus on ideas and
concepts
 Independent learning
 Class discussion
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Assessment
 Ethics and CSR concept exam
 Case exam
 Participation
 Group Case
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Expectations
 Critical not CRITICAL
 Respect for differing views vs respect for
difference.
 Inclusive language
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For next week…
 Debate on the role of business
– A-L: “The role of business is solely to increase
profits for shareholders”
– M-Z: “The role of business is NOT solely to
increase profits for shareholders:
 Virtue Matrix
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