Daniels Ethics Case Competition
DESB Undergraduate Case Competition
2013-2014
Coaching Session
Dr. Abe Bakhsheshy
Daniels Professor of Ethics
Professor and Lecturer of Organizational Behavior
Learning objectives
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Levels at which Ethical Issues May
Be Addressed
Ethical Decision Making Model (1)
Ethical Decision Making Model(2)
Case in point
Summary
Levels at Which Ethical Issues
May Be Addressed
Personal
Level
Organizational
Level
Situations faced in our personal
lives outside the work context
Workplace situations faced as
managers and employees
Dr. Abe
Levels at Which Ethical Issues
May Be Addressed
Industry
Level
Societal and
Global Levels
Situations where a manager or
organization might influence
business ethics at the industry level
Local-to-global situations
confronted indirectly as a
management team
Dr. Abe
The Stakeholder View of the
Firm
5
Personal and Managerial
Ethics
Conventional
Conventional approach
approach
Resolving
Resolving
Ethical
Ethical
Conflicts
Conflicts
Principles
Principles approach
approach
Ethical
Ethical tests
tests approach
approach
Dr. Abe
Conventional Approach to
Business Ethics
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Conventional approach to business ethics
involves a comparison of a decision or
practice to prevailing societal norms
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Pitfall: ethical relativism
Decision or Practice
Prevailing Norms
7
Social, Ethical relativism
examples:
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If we don’t do it, someone else will.
That’s the way it has always been done.
We’ll wait until the lawyers tell us it’s wrong.
It doesn’t really hurt anyone.
The system is unfair.
I was just following orders.
Everybody else does it.
Personal and Managerial
Ethics
Principles Approach
Anchors decision making
on an ethical principle such as:
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Utilitarianism
Rights
Justice
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Caring
Virtue ethics
Servant leadership
Golden Rule
Personal and Managerial
Ethics
Principle of Utilitarianism focuses on an act
that produces the greatest ratio of good to
evil for everyone
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Consequentialist theory
Personal and Managerial
Ethics
Principle of Rights focuses on examining
and possibly protecting individual moral or
legal rights
Personal and Managerial
Ethics
Personal and Managerial
Ethics
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Principle of justice involves considering
what alternative promotes fair treatment of
people
Types of justice
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Distributive
Compensatory
Procedural
Rawlsim
Personal and Managerial Ethics
Rawls’ Justice
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Each person has an equal right to the most
basic liberties comparable with similar
liberties for others
Social and economic inequalities are
arranged so that they are both:
a)
b)
reasonably expected to be to everyone’s
advantage and
attached to positions and offices open to all
people
Personal and Managerial
Ethics
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Principle of caring focuses on a person as a
relational, caring and not as an individual
“Only a life lived for others worth living”
-A. Einstein
Virtue ethics focuses on individuals becoming
imbued with virtues
Personal and Managerial Ethics
Golden rule focuses on the premise that
you should do unto others as you would
have them do unto you
Personal and Managerial
Ethics
Ethics Test Approach
 Test of common sense
 Test of one’s best self
 Test of making something public
 Test of ventilation
 Gag test
Determine economic outcomes, legal requirements, and ethical duties
where problem lies and how solution meets all
Ethical Decision-Making
Identify decision you
are about to make
Articulate all dimensions
of proposed decision
Conventional Approach
Standards/Norms
-Personal
-Organizational
-Societal
-International
Principles Approach
Ethical Principles
-Justice
-Rights
-Utilitarianism
-Golden Rule
-Caring
- Virtue
- Servant Leadership
Course of action passes
ethics screen
Engage in course of
action
Ethical Tests Approach
Ethical Tests
-Common sense
-One’s best self
-Public disclosure
-Gag test . . .
Course of action fails
ethics screen
Do not engage in course
of action
Identify new course of
action
Analytical Process for the
Resolution of Moral Problems
Determine the
economic
outcomes
Understand all
moral standards
Define
complete
moral
problems
Recognize all
moral impacts:
Benefits to some
Harms to others
Rights exercised
Rights denied
Consider the
legal
requirements
Evaluate the
ethical duties
Propose
convincing moral
solution
April 20th, 2010
Deepwater Horizon‐Gulf of Mexico
BP Oil Spill
Eleven people lost their lives to the explosion of Deepwater Horizon:
What Does 184 Million Gallons of Oil Look Like?
There have been about 4.38 million barrels of oil spilled which would be enough to power 674,563 US homes for 1 year.
BP Oil Spill
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BP’s cost of dealing with the spill is up to
about $4 billion.
To date, BP has payed claims totaling $207
million to settle for damages (comprised of
67,500 payments).
The total economic impact of the spill
remains to be seen
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the tourism and fishing industries in the Gulf
states generate billions of dollars each year
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Several pre-explosion risks and problems
allegedly ignored by BP
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Problems w/ blow out preventer (BOP),
equipment readings, sudden gas release, etc.
BP appears to have chosen risky procedures
to save on time and money
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Using fewer liners/barriers than recommended,
using only 6 centralizers instead of 21, etc.
Who benefits?
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BP and its stockholders as long as nothing
catastrophic happens
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Oil consumers
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Can produce more oil with less expense
Can have more of what they want, quicker
Lawyers
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Get paid to represent the parties involved,
especially the defense in this case
Who was harmed?
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Gulf Coast Fishing Industry
Ecosystem of Gulf Coast
Tourism Industry in Florida, Alabama,
Mississippi, Louisiana
Victims of Deepwater Horizon explosion and
their families
Reputation of Materials Management Service
BP Stockholders
Residents of Gulf Coast States
Is it “Right,” “Just” and
“Fair?”
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Cutting preventive maintenance to gain more
uptime and more profits when the
repercussions of those actions could be
catestrophic?
Does BP have the right to do whatever it
wants if it has all of the necessary permits?
Rights of employees’ to a safe workplace?
Who is responsible or negligent? (Workers,
BP, the US government, and/or its citizens?)
Is it “Right,” “Just” and
“Fair?” cont’d
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Is it moral and ethical for a company to do
business in such a manner that there is a
chance that their catestrophic failure could
deny the rights and freedoms of others?
Whose rights were exercised?
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BP and its stockholders
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BP satisfied regulatory requirements
(MMS) to drill
Oil Consumers
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1/8 of all domestic oil comes from Gulf
wells
Helps alleviate dependence on foreign
oil
Whose rights were denied?
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Fishing industry
Tourism Industry
Gulf Coast Ecosystem
Family members of victims
Stakeholders of BP
US and Global Citizens
The Economics
-Oil is big money...3 out of 5 top
global corporations oil co. all 5 oil dependent.
top 40 if compared to GDP of countries
The Legal
- $75 million cap that must be paid towards
those affected by a spill that was set forth by the
Oil Pollution Act 1990
-BP has set aside voluntarily 20 billion.
-BP has lost over 70 billion in shareholder value
and has pledged 20 billion to clean up.
-Should a company be involved in a operation
where a negative externalities could cost society
-Was it worth the risk?
more than the value of the company?
“The true essence of humankind is kindness. There
are other qualities which come from education or
knowledge, but it is essential, if one wishes to be a
genuine human being and impart satisfying meaning
to one's existence, to have a good heart.”
“Leave this world a better place!”
-Tenzin Gyatso, The 14th Dalai Lama (b. 1935)