Discussion Board 1 – Questions 3 and 5
3) What is the difference between unethical and unlawful behavior? Please provide examples for both behaviors in your discussion.
Ethics refers to a set of principles of right conduct. It is also defined as the rules or standards governing the conduct of a person or members of an organization. Kaptien (2011) defines unethical behavior as the behavior in and by organizations that violates generally accepted norms of behavior. Unethical behavior may not be unlawful but does cause harm to one or more parties directly or indirectly (Kaptien. 2011).
Unlawful behavior in business is that which is prohibited by law, it is illegal or criminal. It is behavior that breaks the clearly set down rules or laws that govern business. Author Salvatore (2007) provided an example with a case of selling a product abroad that has been found to be harmful to health and is not allowed to be sold in the United States. In this case, it is unethical to sell the product abroad but not unlawful. However it is unlawful in the United States where a product is considered to be harmful. Another instance of unethical behavior was during the dot com bursts where CEOs of Enron and WorldCom had cooked their accounting books to show false transactions thereby exaggerating the stock price (Eaglesham, 2011).
Another example of unlawful behavior is agreements on price. Agreements about price or price-related matters such as credit terms potentially are the most serious. That's because price often is the principal way that firms compete. A "naked" agreement on price where the agreement is not reasonably related to the firms' business operations is illegal. Hard core, clear or blatant price fixing is subject to criminal prosecution.
5) According to Milton Friedman, “Business has only one social responsibility – to make profits (as long as it stays within the legal and moral rules of the game established by society). Few...