Business Ethics
Collection Editor:
William Frey
Business Ethics
Collection Editor:
William Frey
Authors:
Jose A. Cruz-Cruz
William Frey
Online:
CONNEXIONS
Rice University, Houston, Texas
©2008 William Frey
This selection and arrangement of content is licensed under the Creative Commons Attribution License:
http://creativecommons.org/licenses/by/2.0/
Table of Contents
1 Ethical Leadership
1.1 Theory Building Activities: Mountain Terrorist Exercise ..................................... 1
1.2 Theory-Building Activities: Virtue Ethics .................................................... 5
1.3 Moral Exemplars in Business and Professional Ethics ....................................... 11
1.4 Ethics of Team Work .......................................................................13
Solutions ........................................................................................??
2 Ethical Decision-Making
2.1 Ethical Rights for Working Engineers and Other Professionals .............................. 19
2.2 Three Frameworks for Ethical Decision Making and Good Computing Reports .............. 25
2.3 Values-Based Decision-Making in Gilbane Gold ............................................. 34
2.4 Socio-Technical Systems in Professional Decision Making ................................... 38
Solutions ........................................................................................??
3 CSR (Corporate Social Responsibility)
3.1 A Short History of the Corporation ......................................................... 47
3.2 Moral Ecologies in Corporate Governance .................................................. 55
3.3 Three Views of CSR (Corporate Social Responsibility) ...................................... 63
3.4 Theory Building Activities: "Responsibility and Incident at Morales" ....................... 73
3.5 Ethical Issues in Risk Management for Business ............................................81
Solutions ........................................................................................??
4 CG (Corporate Governance)
4.1 Different Approaches to Corporate Governance .............................................91
4.2 Developing a Statem ent of Values .........................................................103
4.3 Pirate Code for Engineering Ethics ........................................................111
4.4 Corporate Ethics Compliance Officer Report ...............................................118
4.5 Being an Ethical Job Candidate ...........................................................122
Solutions ........................................................................................??
5 Business Ethics Case Studies
5.1 Biomatrix Case Exercises - Student Module ................................. ............133
5.2 Gray M atters for the Hughes Aircraft Case ................................................149
5.3 Case Analysis M odule: Therac-25 .........................................................157
5.4 Toysmart Case Exercises - Student Module ................................................162
5.5 Ethics and Laptops: Identifying Social Responsibility Issues in Puerto Rico ................ 177
5.6 Case Analysis and Presentation: M achado .................................................179
Solutions ........................................................................................??
6 Business Ethics Bowl
6.1 Practical and Professional Ethics Bowl Activity: Follow-Up In-Depth Case Anal-
ysis ........................................................................................187
6.2 Ethics Bowl: Cases and Score Sheets ......................................................196
Solutions ........................................................................................??
7 Course Procedures
7.1 Rubrics for Exams and Group Projects in Ethics .....................................201
7.2 Integrating the Values of Responsibility and Honesty Into Class Attendance Mod-
ule..............................................................................204
Solutions ..............................................................................?
Index ........................................................................................209
Aittributions .................................................................................211
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Chapter 1
Ethical Leadership
1.1 Theory Building Activities: Mountain Terrorist Exercise1
1.1.1 Module Introduction
This module poses an ethical dilemma, that is, a forced choice between two bad alternatives. Your job is to
read the scenario and choose between the two horns of the dilemma. You will make your choice and then
justify it in the first activity. In the second activity, you will discuss your choice with others. Here, the
objective is to reach consensus on a course of action or describe the point at which your group's progress
toward consensus stopped. The Mountain Terrorist Exercise almost always generates lively discussion and
helps us to reflect on of our moral beliefs. Don't expect to reach agreement with your fellow classmates
quickly or effortlessly. (If you do, then your instructor will find ways of throwing a monkey wrench into the
whole process.) What is more important here is that we learn how to state our positions clearly, how to
listen to others, how to justify our positions, and how to assess the justifications offered by others. In other
words, we will all have a chance to practice the virtue of reasonableness. And we will learn reasonableness
not when it's easy (as it is when we agree) but when it becomes difficult (as it is when we disagree).
The second half of this module requires that you reflect carefully on your moral reasoning and that of
your classmates. The Mountain Terrorist Exercise triggers the different moral schemas that make up our
psychological capacity for moral judgment. Choosing one horn of the dilemma means that you tend to favor
one kind of schema while choosing the other horn generally indicates that your favor another. The dominant
moral theories that we will study this semester provide detailed articulations and justifications of these moral
schemas. Reflecting on your choice, the reasons for your choice, and how your choice differs from that of
your classmates will help you get started on the path of studying and effectively utilizing moral theory.
The following scenario comes originally from the philosopher, Bernard Williams. It is also presented in
introductory ethics textbooks (such as Geoffrey Thomas' An Introduction to Ethics). The first time this
module's author became aware of its use in the classroom was in a workshop on Agriculture Ethics led by
Paul Thompson, then of Texas A&M University, in 1992.
1.1.2 Moral Theories Highlighted
1. Utilitarianism: the moral value of an action lies in its consequences or results
2. Deontology: the moral value of an action lies, not in its consequences, but in the formal characteristics
of the action itself.
3. Virtue Ethics: Actions sort themselves out into virtuous or vicious actions. Virtuous actions stem from
a virtuous character while vicious actions stem from a vicious or morally flawed character. Who we
are is reveals through what we do.
I~i content is available online at .
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CHAPTER 1. ETHICAL LEADERSHIP
1.1.3 Mountain Terrorist Scenario
You are in a remote mountain village. A group of terrorists has lined up 20 people from the village; they
plan on shooting them for collaborating with the enemy. Since you are not from the village, you will not be
killed. Taking advantage of your position, you plead with the terrorists not to carry out their plan. Finally,
you convince the leader that it is not necessary to kill all 20. He takes a gun, empties it of all its bullets
except one, and then hands it to you. He has decided to kill only one villager to set an example to the rest.
As an honored guest and outsider, you will decide who will be killed, and you will carry out the deed. The
terrorists conclude with a warning; if you refuse to kill the villager, then they will revert back to the original
plan of killing all 20. And if you try any "funny business," they will kill the 20 villagers and then kill you.
What should you do?
Your Options
1. Take the gun, select a villager, and kill him or her.
2. Refuse the terrorists' offer and walk away from the situation.
Spanish Translation by Dr. Halley Sanchez
El Terrorista de la Montana Tn eres un antropologo que por un mes ha estado viviendo con y observando (o
sea, estudiando) a los residents de una aldea en una area remota montanoza de un pais en America Latina.
El dia que te dispone irte de la aldea, aprece un grupo de hombres armados que rennen a los aldeanos y
les anuncian que se han enterado de que ellos han estado cooperando con el gobierno represivo y que, como
leccion, han de ejecutar viente de ellos. El lider de los terroristas te mira y te dice que tn te puedes ir,
ya que no estis involucardo en la lucha patriotica y que ellos no estin en la costumbre de tomar rehenes
extranjeros. Debido a que te da la impresion de que el lider de los supuestos patriotas (terroristas?) es un
hombre educado, tn te atreves tratar de razonar con 6l. Le explica que llevas un mes en la aldea y que los
aldeanos no han cooperado de forma volutaria con el gobierno. Si, por supuesto, las tropas del gobierno
pasaron por la aldea y confiscaron algunas provisiones, pero los aldeanos no se las dieron libremente sino que
estaban indefenso y no podieron prevenir que le confiscaran las mismas. El lider piensa un tiempo y te dice
que por tn ser forastero y obviamente un antropologo estudioso, te va a dar el benificio de la duda, y que por
tanto no van a ejecutar viente aldeanos. Pero dado que la lucha patriotica esti en un proceso critico y que
la aldea si le provey6 provisiones al gobierno, por el bien de la lucha patriotica y el bien de la humanidad,
es menester darle una leccion a la aldea. Asi que tan solo han de ejecutar un aldeano. Mis, como huesped,
tn has de escoger quien ha de morir y tn has de matarlo tn mismo. Te da una pistola con una sola bala y te
dice que proceda, mientras que a la vez te advierte que de tratar algo heroico, te ejecutarin inmediatamente
y procederin a ejecutar a los viente aldeanos como dijeron al comienzo. Tn eres el antropologo. Qu6 haris?
Activity 1
In a short essay of 1 to 2 pages describe what you would do if you were in the position of the tourist. Then
justify your choice.
Activity 2
Bring your essay to class. You will be divided into small groups. Present your choice and justification to
the others in your group. Then listen to their choices and justifications. Try to reach a group consensus on
choice and justification. (You will be given 10-15 minutes.) If you succeed present your results to the rest of
the class. If you fail, present to the class the disagreement that blocked consensus and what you did (within
the time limit) to overcome it.
1.1.4 Taxonomy of Ethical Approaches
There are many ethical approaches that can be used in decision making. The Mountain Terrorist Exercise
is based on an artificial scenario designed to separate these theoretical approaches along the lines of the
different "horns" of a dilemma. Utilitarians tend to choose to shoot a villager "in order to save 19." In other
words they focus their analysis on the consequences of an action alternative and choose the one that produces
the least harm. Deontologists generally elect to walk away from the situation. This is because they judge an
action on the basis of its formal characteristics. A deontologist might argue that killing the villager violates
3
natural law or cannot be made into a law or rule that consistently applies to everybody. A deontologist
might say something like, "What right do I have to take another person's life?" A virtue ethicists might try
to imagine how a person with the virtue of courage or integrity would act in this situaiton. (Williams claims
that choosing to kill the villager, a duty under utilitarianism, would undermine the integrity of a person who
abhorred killing.)
Table Connecting Theory to Domain
1. Row 1: Utilitarianism concerns itself with the domain of consequences which tells us that the moral
value of an action is "colored" by its results. The harm/beneficence test, which asks us to choose the
least harmful alternative, encapsulates or summarizes this theoretical approach. The basic principle
of utilitarianism is the principle of utility: choose that action that produces the greatest good for the
greatest number. Cost/benefits analysis, the Pareto criterion, the Kalder/Hicks criterion, risk/benefits
analysis all represent different frameworks for balancing positive and negative consequences under
utilitarianism or consequentialism.
2. Row 2: Deontology helps us to identify and justify rights and their correlative duties The reversibility
test summarizes deontology by asking the question, "Does your action still work if you switch (=reverse)
roles with those on the receiving end? "Treat others always as ends, never merely as means," the
Formula of End, represents deontology's basic principle. The rights that represent special cases of
treating people as ends and not merely as means include (a) informed consent, (b) privacy, (c) due
process, (d) property, (e) free speech, and (f) conscientious objection.
3. Row 3: Virtue ethics turns away from the action and focuses on the agent, the person performing the
action. The word, "Virtue," refers to different sets of skills and habits cultivated by agents. These skills
and habits, consistently and widely performed, support, sustain, and advance different occupational,
social, and professional practices. (See Maclntyre, After Virtue, and Solomon, Ethics and Excellence,
for more on the relation of virtues to practices.) The public identification test summarizes this ap-
proach: an action is morally acceptable if it is one with which I would willingly be publicly associated
given my moral convictions. Individual virtues that we will use this semester include integrity, justice,
responsibility, reasonableness, honesty, trustworthiness, and loyalty.
Covering All the Bases
Ethical Dimension Covering Ethical Encapsulating Basic Principles Application or
Approach Ethical Test Bridging Tools
Consequences Utilitarianism Harm/Beneficence Principle of Util- Benefit & cost
(weigh harms ity: greatest good comparisonUtility
against benefits) for greatest num- Maximization
ber
Formal Character- Deontology (Duty- Reversibility (test Categorical Im- Free & Informed
istics of Act based, rights- by reversing roles perativeFormula Consent, Privacy,
based, natural between agent and of EndAutonomy Property, Due
law, social con- object of action) Process, Free
tract) Speech, Conscien-
tious objection
continued on next page
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CHAPTER 1. ETHICAL LEADERSHIP
Skills and habits Virtue Ethics Public Identifica- Virtues are means Integrity, justice,
cultivated by tion (impute moral between extremes responsibility, rea-
agent import of action to with regard to sonableness, hon-
person of agent) agent and ac- esty, trustworthi-
tionVirtues are ness, loyalty
cultivated disposi-
tions that promote
central community
values
Table 1.1
1.1.5 Comments on the Relation Between Ethical Approaches
The Mountain Terrorist Exercise has, in the past, given students the erroneous idea that ethical approaches
are necessarily opposed to one another. As one student put it, "If deontology tells us to walk away from
the village, then utilitarianism must tell us to stay and kill a villager because deontology and utilitarian-
ism, as different and opposed theories, always reach different and opposed conclusions on the actions they
recommend." The Mountain Terrorist dilemma was specially constructed by Bernard Williams to produce
a situation that offered only a limited number of alternatives. He then tied these alternatives to different
ethical approaches to separate them precisely because in most real world situations they are not so readily
distinguishable. Later this semester, we will turn from these philosophical puzzles to real world cases where
ethical approaches function in a very different and mostly complimentary way. As we will see, ethical ap-
proaches, for the most part, converge on the same solutions. For this reason, this module concludes with 3
meta-tests. When approaches converge on a solution, this strengthens the solution's moral validity. When
approaches diverge on a solution, this weakens their moral validity. A third meta-test tells us to avoid fram-
ing all ethical problems as dilemmas (=forced choices between undesirable alternatives) or what Carolyn
Whitbeck calls "multiple-choice" problems. You will soon learn that effective moral problem solving requires
moral imagination and moral creativity. We do not "find" solutions "out there" ready made but design them
to harmonize and realize ethical and practical values.
Meta-Tests
* Divergence Test: When two ethical approaches differ on a given solution, then that difference counts
against the strength of the solution. Solutions on which ethical theories diverge must be revised towards
convergence.
* Convergence Test: Convergence represents a meta-test that attests to solution strength. Solutions on
which different theoretical approaches converge are, by this fact, strengthened. Convergence demon-
strates that a solution is strong, not just over one domain, but over multiple domains.
* Avoid Framing a Problem as a Dilemma. A dilemma is a no-win situation that offers only two al-
ternatives of action both of which are equally bad. (A trilemma offers three bad alternatives, etc.)
Dilemmas are better dissolved than solved. Reframe the dilemma into something that admits of more
than two no-win alternatives. Dilemma framing (framing a situation as an ethical dilemma) discour-
ages us from designing creative solutions that integrate the conflicting values that the dilemma poses
as incompatible.
1.1.6 Module Wrap-Up
1. Reasonableness and the Mountain Terrorist Exercise. It may seem that this scenario is the last
place where the virtue of reasonableness should prevail, but look back on how you responded to those
of your classmates who chose differently in this exercise and who offered arguments that you had not
initially thought of. Did you "listen and respond thoughtfully" to them? Were you "open to new ideas"
5
even if these challenged your own? Did you "give reasons for" your views, modifying and shaping them
to respond to your classmates' arguments? Did you "acknowledge mistakes and misunderstandings"
such as responding critically and personally to a classmate who put forth a different view? Finally, when
you turned to working with your group, were you able to "compromise (without compromising personal
integrity)"? If you did any or all of these things, then you practiced the virtue of reasonableness as
characterized by Michael Pritchard in his book, Reasonable Children: Moral Education and Moral
Learning (1996, University of Kansas Press, p. 11). Congratulate yourself on exercising reasonableness
in an exercise designed to challenge this virtue. You passed the test.
2. Recognizing that we are already making ethical arguments. In the past, students have made
the following arguments on this exercise: (a) I would take the gun and kill a villager in order to
save nineteen; (b) I would walk away because I don't have the right to take another's life; (c) While
walking away might appear cowardly it is the responsible thing to do because staying and killing a
villager would make me complicit in the terrorists' project. As we discussed in class, these and other
arguments make use of modes of thought captured by ethical theories or approaches. The first employs
the consequentialist approach of utilitarianism while the second makes use of the principle of respect
that forms the basis of our rights and duties. The third works through a conflict between two virtues,
courage and responsibility. This relies on the virtue approach. One accomplishment of this exercise
is to make you aware of the fact that you are already using ethical arguments, i.e., arguments that
appeal to ethical theory. Learning about the theories behind these arguments will help you to makes
these arguments more effectively.
3. Results from Muddy Point Exercises The Muddy Point Exercises you contributed kept coming
back to two points. (a) Many of you pointed out that you needed more information to make a decision
in this situation. For example, who were these terrorists, what causes were they fighting for, and were
they correct in accusing the village of collaborating with the enemy? Your request for more information
was quite appropriate. But many of the cases we will be studying this semester require decisions in the
face of uncertainty and ignorance. These are unavoidable in some situations because of factors such as
the cost and time of gathering more information. Moral imagination skillfully exercised can do a lot
to compensate when all of the facts are not in. (b) Second, many of you felt overly constrained by the
dilemma framing of the scenario. Those of you who entered the realm of "funny business" (anything
beyond the two alternatives of killing the villager or walking away) took a big step toward effective
moral problem solving. By rejecting the dilemma framing of this scenario, you were trying to reframe
the situation to allow for more-and more ethically viable-alternatives. Trying to negotiate with the
Terrorists is a good example of reframing the scenario to admit of more ethical alternatives of action
than killing or walking away.
4. Congratulations on completing your first ethics module! You have begun recognizing and practicing
skills that will help you to tackle real life ethical problems. (Notice that we are going to work with
"problems" not "dilemmas".) We will now turn, in the next module, to look at those who managed
to do good in the face of difficulty. Studying moral exemplars will provide the necessary corrective to
the "no-win" Mountain Terrorist Exercise.
1.2 Theory-Building Activities: Virtue Ethics2
Based on material presented by Chuck Huff (St. Olaf College) and William Frey at the Association for
Practical and Professional Ethics in 2005 at San Antonio, TX. Preliminary versions were distributed during
this presentation.
2This content is available online at .
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CHAPTER 1. ETHICAL LEADERSHIP
1.2.1 Module Introduction
This module uses materials being prepared for Good Computing: A Virtue Approach to Computer Ethics,
to set up an exercise in which you will identify and spell out virtues relevant to your professional discipline.
After identifying these virtues, you will work to contextualize them in everyday practice. Emphasis will be
placed on the Aristotelian approach to virtues which describes a virtue as the disposition toward the mean
located between the extremes of excess and defect. You will also be asked to identify common obstacles
that prevent professionals from realizing a given virtue and moral exemplars who demonstrate consistent
success in realizing these virtues and responding to obstacles that stand in the way of their realization. In a
variation on this module you could be asked to compare the virtues you have identified for your profession
with virtues that belong to other moral ecologies such as those of the Homeric warrier.
1.2.2 Three Versions of Virtue Ethics: Virtue 1, Virtue 2, and Virtue 3
Virtue ethics has gone through three historical versions. The first, Virtue 1, was set forth by Aristotle in
ancient Greece. While tied closely to practices in ancient Greece that no longer exist today, Aristotle's
version still has a lot to say to us in this day and age. In the second half of the twentieth century, British
philosophical ethicists put forth a related but different theory of virtue ethics (virtue 2) as an alternative to
the dominant ethical theories of utilitarianism and deontology. Virtue 2 promised a new foundation of ethics
consistent with work going on at that time in the philosophy of mind. Proponents felt that turning from the
action to the agent promised to free ethical theory from the intractable debate between utilitarianism and
deontology and offered a way to expand scope and relevance of ethics. Virtue 3 reconnects with Aristotle
and virtue 1 even though it drops the doctrine of the mean and Aristotle's emphasis on character. Using
recent advances in moral psychology and moral pedagogy, it seeks to rework key Aristotelian concepts in
modern terms. In the following, we will provide short characterizations of each of these three versions of
virtue ethics.
1.2.3 Virtue 1: Aristotle's Virtue Ethics
" Eudaimonia. Happiness, for Aristotle, consists of a life spent fulfilling the intellectual and moral
virtues. These modes of action are auto-telic, that is, they are self-justifying and contain their own
ends. By carrying out the moral and intellectual virtues for a lifetime, we realize ourselves fully as
humans. Because we are doing what we were meant to do, we are happy in this special sense of
eudaimonia.
" Arete. Arete is the Greek word we usually translate as "virtue". But arete is more faithfully translated
as excellence. For Aristotle, the moral and intellectual virtues represent excellences. So the moral life
is more than just staying out of trouble. Under Aristotle, it is centered in pursuing and achieving
excellence for a lifetime.
" Virtue as the Mean. Aristotle also characterizes virtue as a settled disposition to choose the mean
between the extremes of excess and defect, all relative to person and situation. Courage (the virtue)
is the mean between the extremes of excess (too much courage or recklessness) and defect (too little
courage or cowardice). Aristotle's claim that most or all of the virtues can be specified as the mean
between extremes is controversial. While the doctrine of the mean is dropped in Virtue 2 and Virtue 3,
we will still use it in developing virtue tables. (See exercise 1 below.) You may not find both extremes
for the virtues you have been assigned but make the effort nonetheless.
* Ethos. "Ethos" translates as character which, for Aristotle, composes the seat of the virtues. Virtues
are well settled dispositions or habits that have been incorporated into our characters. Because our
characters are manifested in our actions, the patterns formed by these over time reveal who we are.
This can be formulated as a decision-making test, the public identification test. Because we reveal
who we are through our actions we can ask, when considering an action, whether we would care to
be publicly identified with this action. "Would I want to be publicly known as the kind of person
who would perform that kind of action? Would I, through my cowardly action, want to be publicly
7
identified as a coward? Would I, through my responsible action, want to be publicly identified as a
responsible person? Because actions provide others with a window into our characters, we must make
sure be sure that they portray us as we want to be portrayed.
* Aisthesis of the Phronimos. This Greek phrase, roughly translated as the perception of the morally
experienced agent, reveals how important practice and experience are to Aristotle in his conception
of moral development. One major difference between Aristotle and other ethicists (utilitarians and
deontologists) is the emphasis that Aristotle places on developing into or becoming a moral person.
For Aristotle, one becomes good by first repeatedly performing good actions. So morality is more
like an acquired skill than a mechanical process. Through practice we develop sensitivities to what is
morally relevant in a situation, we learn how to structure our situations to see moral problems and
possibilities, and we develop the skill of "hitting" consistently on the mean between the extremes. All
of these are skills that are cultivated in much the same way as a basketball player develops through
practice the skill of shooting the ball through the hoop.
* Bouleusis. This word translates as "deliberation." For Aristotle, moral skill is not the product of
extensive deliberation (careful, exhaustive thinking about reasons, actions, principles, concepts, etc.)
but of practice. Those who have developed the skill to find the mean can do so with very little thought
and effort. Virtuous individuals, for Aristotle, are surprisingly unreflective. They act virtuously
without thought because it has become second nature to them.
* Akrasia. Ross translates this word as "incontinence" which is outmoded. A better translation is
weakness of will. For Aristotle, knowing where virtue lies is not the same as doing what virtue demands.
There are those who are unable to translate knowledge into resolution and then into action. Because
akrasis (weakness of will) is very real for Aristotle, he also places emphasis in his theory of moral
development on the cultivation of proper emotions to help motivate virtuous action. Later ethicists
seek to oppose emotion and right action; Aristotle sees properly trained and cultivated emotions as
strong motives to doing what virtue requires.
* Logos Aristotle's full definition of virtue is "a state of character concerned with choice, lying in a
mean, i.e. the mean relative to us, this being determined by a rational principle, and by that principle
by which [a person] of practical wisdom would determine it." (Ross's translation in Nichomachean
Ethics, 1106b, 36.) We have talked about character, the mean, and the person of practical wisdom.
The last key term is "logos" which in this definition is translated by reason. This is a good translation
if we take reason in its fullest sense so that it is not just the capacity to construct valid arguments
but also includes the practical wisdom to assess the truth of the premises used in constructing these
arguments. In this way, Aristotle expands reason beyond logic to include a fuller set of intellectual,
practical, emotional, and perceptual skills that together form a practical kind of wisdom.
1.2.4 Virtue 2
* The following summary of Virtue 2 is taken largely from Rosalind Hursthouse. While she extensively
qualifies each of these theses in her own version of virtue ethics, these points comprise an excellent
summary of Virtue 2 which starts with G.E.M. Anscombe's article, "Modern Moral Philosophy," and
continues on into the present. Hursthouse presents this characterization of Virtue 2 in her book, On
Virtue Ethics (2001) U.K.: Oxford University Press: 17.
* Virtue 2 is agent centered. Contrary to deontology and utilitarianism which focus on whether
actions are good or right, V2 is agent centered in that it sees the action as an expression of the goodness
or badness of the agent. Utilitarianism focuses on actions which bring about the greatest happiness
for the greatest number; deontology seeks those actions that respect the autonomy of individuals and
carry out moral obligations, especially duties. These theories emphasize doing what is good or right.
Virtue 2, on the other hand, focuses on the agent's becoming or being good.
* Can Virtue 2 tell us how to act? Because V2 is agent-centered, critics claim that it cannot provide
insight into how to act in a given situation. All it can say is, "Act the way a moral exemplar would
act." But what moral standards do moral exemplars use or embody in their actions? And what moral
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CHAPTER 1. ETHICAL LEADERSHIP
standards do we use to pick out the moral exemplars themselves? Hursthouse acknowledges that this
criticism hits home. However, she points out that the moral standards come from the moral concepts
that we apply to moral exemplars; they are individuals who act courageously, exercise justice,
and realize honesty. The moral concepts "courage," "justice," and "honesty" all have independent
content that helps guide us. She also calls this criticism unfair: while virtue 2 may not provide
any more guidance than deontology or utilitarianism, it doesn't provide any less. Virtue 2 may not
provide perfect guidance, but what it does provide is favorably comparable to what utilitarianism and
deontology provide.
* Virtue 2 replaces Deontic concepts (right, duty, obligation) with Aretaic concepts (good,
virtue). This greatly changes the scope of ethics. Deontic concepts serve to establish our minimum
obligations. On the other hand, aretaic concepts bring the pursuit of excellence within the purview of
ethics. Virtue ethics produces a change in our moral language that makes the pursuit of excellence an
essential part of moral inquiry.
* Finally, there is a somewhat different account of virtue 2 (call it virtue 2a) that can be attributed to
Alisdair Maclntyre. This version "historicizes" the virtues, that is, looks at how our concepts of key
virtues have changed over time. (Maclntyre argues that the concept of justice, for example, varies
greatly depending on whether one views justice in Homeric Greece, Aristotle's Greece, or Medieval
Europe.) Because he argues that skills and actions are considered virtuous only in relation to a
particular historical and community context, he redefines virtues as those skill sets necessary to realize
the goods or values around which social practices are built and maintained. This notion fits in well
with professional ethics because virtues can be derived from the habits, attitudes, and skills needed to
maintain the cardinal ideals of the profession.
1.2.5 Virtue 3
Virtue 3 can best be outlined by showing how the basic concepts of Virtue 1 can be reformu-
lated to reflect current research in moral psychology.
1. Reformulating Happiness (Eudaimonia). Mihaly Csikcszentmihalyi has described flow experi-
ences (see text box below) in which autotelic activities play a central role. For Aristotle, the virtues
also are autotelic. They represent faculties whose exercise is key to realizing our fullest potentialities as
human beings. Thus, virtues are self-validating activities carried out for themselves as well as for the
ends they bring about. Flow experiences are also important in helping us to conceptualize the virtues
in a professional context because they represent a well practiced integration of skill, knowledge, and
moral sensitivity.
2. Reformulating Values (Into Arete or Excellence). To carry out the full project set forth by virtue
3, it is necessary to reinterpret as excellence key moral values such as honesty, justice, responsibility,
reasonableness, and integrity. For example, moral responsibility has often been described as carrying
out basic, minimal moral obligations. As an excellence, responsibility becomes refocused on extending
knowledge and power to expand our range of effective, moral action. Responsibility reformulated as
an excellence also implies a high level of care that goes well beyond what is minimally required.
3. De-emphasizing Character. The notion of character drops out to be replaced by more or less
enduring and integrated skills sets such as moral imagination, moral creativity, reasonableness, and
perseverance. Character emerges from the activities of integrating personality traits, acquired skills,
and deepening knowledge around situational demands. The unity character represents is always com-
plex and changing.
4. Practical Skill Replaces Deliberation. Moral exemplars develop skills which, through practice,
become second nature. These skills obviate the need for extensive moral deliberation. Moral exemplars
resemble more skillful athletes who quickly develop responses to dynamic situations than Hamlets
stepping back from action for prolonged and agonizing deliberation.
9
5. Greater Role for Emotions. Nancy Sherman discusses how, for Aristotle, emotion is not treated
as an irrational force but as an effective tool for moral action once it has been shaped and cultivated
through proper moral education. To step beyond the controvery of what Aristotle did and did not say
about the emotions (and where he said it) we place this enhanced role for emotions within virtue 3.
Emotions carry out four essential functions: (a) they serve as modes of attention; (b) they also serve
as modes of responding to or signaling value; (c) they fulfill a revelatory function; and (d) they provide
strong motives to moral action. Nancy Sherman, Making a Necessity of Virtue: Aristotle and
Kant on Virtue (1997), U.K.: Cambridge University Press: 39-50.
1.2.6 Flow Experiences
" The psychologist, Mihaly Csikszentmihalyi, has carried out fascinating research on what he terms "flow
experiences." Mike Martin in Meaningful Work (2000) U.K.: Oxford,: 24, summarizes these in the
following bullets:
" "clear goals as one proceeds"
" "immediate feedback about progress"
" "a balance between challenges and our skills to respond to them"
" "immersion of awareness in the activity without disruptive distractions"
" "lack of worry about failure"
" loss of anxious self-consciousness"
" time distortions (either time flying or timeslowing pleasurably)"
" the activity becomes autotelic: an end in itself, enjoyed as such"
1.2.7 Virtue Tables
The table just below provides a format for spelling out individual virtues through (1) a general description,
(2) the correlative vices of excess and defect, (3) the skills and mental states that accompany and support
it, and (4) real and fictional individuals who embody it. Following the table are hints on how to identify and
characterize virtues. We start with the virtue of integrity:
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CHAPTER 1. ETHICAL LEADERSHIP
Virtue Description Excess Defect Obstacles Moral Exem-
to realizing plar
the virtue in
professional
practices
Integrity A meta-virtue Excess: Defect: Wan- Individual Saint Thomas
in which the Rigidity- tonness. A corruption: In- More as por-
holder ex- sticking to condition dividuals can trayed in
hibits unity one's guns where one be tempted by Robert Bolt's
of character even when one exhibits no greed toward A Man for All
manifested is obviously stability or the vice of Seasons. More
in holding wrong(2,3) consistency in defect. Lack of refuses to take
together even character moral courage an oath that
in the face of can also move goes against
strong disrup- one to both the core be-
tive pressures extremes liefs in terms
or temptations of which he
defines himself.
Institutional
Corruption:
One may work
in an organi-
zation where
corruption
is the norm.
This generates
dilemmas like
following an
illegal order or
getting fired.
continued on next page
11
Table 1.2
1.2.8 Exercise 1: Construct Virtue Tables for Professional Virtues
1. Discuss in your group why the virtue you have been assigned is important for the practice of your
profession. What goods or values does the consistent employment of this virtue produce?
2. Use the discussion in #1 to develop a general description of your virtue. Think along the following
lines: people who have virtue X tend to exhibit certain characteristics (or do certain things) in certain
kinds of situations. Try to think of these situations in terms of what is common and important to your
profession or practice.
3. Identify the corresponding vices. What characterizes the points of excess and defect between which
your virtue as the mean lies?
4. What obstacles arise that prevent professionals from practicing your virtue? Do well-meaning profes-
sionals lack power or technical skill? Can virtues interfere with the realization of non-moral values like
financial values? See if you can think of a supporting scenario or case here.
5. Identify a moral exemplar for your virtue. Make use of the exemplars described in the Moral Exem-
plars in Business and Professional Ethics module.
6. Go back to task #2. Redefine your description of your virtue in light of the subsequent tasks, especially
the moral exemplar you identified. Check for coherence.
7. Finally, does your virtue stand alone or does it need support from other virtues or skills? For example,
integrity might also require moral courage.
1.2.9 Exercise 2: Reflect on these Concluding Issues
* Did you have trouble identifying a moral exemplar? Many turn to popular figures for their moral
exemplars. Movies and fiction also offer powerful models. Why do you think that it is hard to find
moral exemplars in your profession? Is it because your profession is a den of corruption? (Probably
not.) Do we focus more on villains than on heroes? Why or why not?
* What did you think about the moral leaders portrayed in the Moral Exemplars in Business and
Professional Ethics module?
* Did you have trouble identifying both vices, i.e., vices of excess and defect? If so, do you think this
because some virtues may not have vices of excess and defect? What do you think about Aristotle's
doctrine of the mean?
* Did you notice that the virtue profiles given by your group and the other groups in the class overlapped?
Is this a problem for virtue theory? Why do our conceptions of the key moral values and virtues overlap?
* Did you find the virtues difficult to apply? What do you think about the utilitarian and deontological
criticism of virtue ethics, namely, that it cannot provide us with guidelines on how to act in difficult
situations? Should ethical theories emphasize the act or the person? Or both?
* The most tenacious obstacle to working with virtue ethics is to change focus from the morally minimal
to the morally exemplary. "Virtue" is the translation of the Greek word, arete. But "excellence" is,
perhaps, a better word. Understanding virtue ethics requires seeing that virtue is concerned with the
exemplary, not the barely passable. (Again, looking at moral exemplars helps.) Arete transforms
our understanding of common moral values like justice and responsibility by moving from minimally
acceptable to exemplary models.
Moral Leaders3 The profiles of several moral leaders in practical and professional ethics. Computer Ethics
Cases4 This link provides several computer ethics cases and also has a description of decision making and
shttp: //www.onlineethics.org
4http: //www.computingcases.org
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CHAPTER 1. ETHICAL LEADERSHIP
socio-technical systems frameworks. Moral Exemplars in Business and Professional Ethics5 Profiles of several
moral leaders in practical and professional ethics.
1.3 Moral Exemplars in Business and Professional Ethics6
1.3.1 Module Introduction
Through the activities of this module you will learn to balance cautionary tales in business and professional
ethics with new stories about those who consistently act in a morally exemplary way. While cautionary
tales teach us what to avoid, narratives from the lives of moral exemplars show us how to be good. A study
of moral best practices in business and professional ethics shows that moral exemplars exhibit positive and
learnable skills. This module, then, looks at moral exemplars in business and the professions, outlines their
outstanding accomplishments, and helps you to unpack the strategies they use to overcome obstacles to
doing good.
You will begin by identifying outstanding individuals in business and associated practices who have
developed moral "best practices." Your task is look at these individuals, retell their stories, identify the skills
that help them do good, and build a foundation for a more comprehensive study of virtue in occupational
and professional ethics.
1.3.2 Exercise 1: Choose a moral exemplar
" Identify a moral exemplar and provide a narrative description of his or her life story.
" To get this process started, look at the list of moral exemplars provided in this module. The links in
the upper left hand corner of this module will help you to explore their accomplishments in detail. Feel
free to choose your own exemplar. Make sure you identify someone in the occupational and professional
areas such as business and engineering. These areas have more than their share of exemplars, but they
tend to escape publicity because their actions avoid publicity generating disasters rather than bring
them about.
1.3.3 Moral Exemplars
* 1. William LeMesseur. LeMesseur designed the Citicorp Building in New York. When a student
identified a critical design flaw in the building during a routine class exercise, LeMesseur responded, not
by shooting the messenger, but by developing an intricate and effective plan for correcting the problem
before it issued in drastic real world consequences. Check out LeMesseur's profile at onlineethics and
see how he turned a potential disaster into a good deed.
* 2. Fred Cuny, starting in 1969 with Biafra, carried out a series of increasingly effective interventions
in international disasters. He brought effective methods to disaster relief such as engineering know-
how, political savvy, good business sense, and aggressive advocacy. His timely interventions saved
thousands of Kurdish refugees in the aftermath of the Persian Gulf War in 1991. He also helped design
and implement an innovative water filtration system in Sarajevo during the Bosnia-Serb conflict in
1993. For more details, consult the biographical sketch at onlineethics.
* 3. Roger Boisjoly worked on a team responsible for developing o-ring seals for fuel tanks used in the
Challenger Shuttle. When his team noticed evidence of gas leaks he made an emergency presentation
before officials of Morton Thiokol and NASA recommending postponing the launch scheduled for the
next day. When decision makers refused to change the launch date, Boisjoly watched in horror the next
day as the Challenger exploded seconds into its flight. Find out about the courageous stand Boisjoly
took in the aftermath of the Challenger explosion by reading the biographical sketch at onlineethics.
5http: //cnx.org/content/m14256/latest
6This content is available online at .
13
" 4. Muhammad Yunus won the Nobel Prize for Peace in 2006. His effort in setting up "micro-businesses"
funded through "micro-lending" has completely changed the paradigm on how to extend business
practices to individuals at the bottom of the pyramid. Learn about his strategies for creating micro-
businesses and how those strategies have been extended throughout the world, including Latin America,
by listening to an interview with him broadcast by the Online News Hour. (See link included in this
module.)
" 5. Bill Gates has often been portrayed as a villain, especially during the anti-trust suit against Mircosoft
in the mid 1990's. Certainly his aggressive and often ruthless business practices need to be evaluated
openly and critically. But recently Gates stopped participating in the day-to-day management of
his company, Microsoft, and has set up a charitable foundation to oversee international good works
projects. Click on the link included in this module to listen to and read an interview recently conducted
with him and his wife, Melinda, on their charitable efforts.
" 6. Jeffrey Skilling, former CEO of Enron, can hardly be called a moral exemplar. Yet when Enron was
at its peak, its CEO, Jeffrey Skilling, was considered among the most innovative, creative, and brilliant
of contemporary corporate CEOs. View the documentary, The Smartest Guys in the Room, read the
book of the same title, and learn about the configuration of character traits that led to Skilling's initial
successes and ultimate failure. A link included in this module will lead you to an interview with Skilling
conducted on March 28, 2001.
" Inez Austin worked to prevent contamination from nuclear wastes produced by a plutonium production
facility. Visit Online Ethics by clicking on the link above to find out more about her heroic stand.
" Rachael Carson's book, The Silent Spring, was one of the key events inaugurating the environmental
movement in the United States. For more on the content of her life and her own personal act of courage,
visit the biographical profile at Online Ethics. You can click on the Supplimental Link provided above.
1.3.4 Exercise Two: Moral Exemplar Profiles
" What are the positive and negative influences you can identify for your moral exemplar?
" What good deeds did your exemplar carry out?
" What obstacles did your moral exemplar face and how did he or she overcome them?
" What skills, attitudes, beliefs, and emotions helped to orient and motivate your moral exemplar.?
1.3.5 Exercise Three
Prepare a short dramatization of a key moment in the life of your group's moral exemplar.
1.3.6 Textbox: Two different Types of Moral Exemplar
" Studies carried out by Chuck Huff into moral exemplars in computing suggest that moral exemplars
can operate as craftspersons or reformers. (Sometimes they can combine both these modes.)
" Craftspersons (1) draw on pre-existing values in computing, (2) focus on users or customers who have
needs, (3) take on the role of providers of a service/product, (4) view barriers as inert obstacles or
puzzles to be solved, and (5) believe they are effective in their role.
" Reformers (1) attempt to change organizations and their values, (2) take on the role of moral crusaders,
(3) view barriers as active opposition, and (4) believe in the necessity of systemic reform
* These descriptions of moral exemplars have been taken from a presentation by Huff at the STS col-
loquium at the University of Virginia on October 2006. Huff's presentation can be found at the link
provided in the upper left hand corner of this module.
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CHAPTER 1. ETHICAL LEADERSHIP
1.3.7 Textbox: Characteristics and Skills Exhibited by Moral Exemplars
" Moral exemplars have succeeded in integrating moral and professional attitudes and beliefs into their
core identity. Going against these considerations for moral exemplars is tantamount to acting against
self.
" Moral exemplars are able to carry out their goals due to surrounding, supportive communities. They
do not act alone but within support groups.
" Moral exemplars often do not go through periods of intensive and prolonged deliberation in order to hit
upon the correct action. If we want a literary example, we need to replace the tortured deliberations
of a Hamlet with the quick and intuitive insight of an Esther Summerson. (Summerson is a character
in Charles Dickens' novel, Bleak House. See both William Shakespeare and Charles Dickens for more
examples of villains and exemplars.) This confirms Aristotle's view that virtues are dispositions that
have been carefully cultivated through moral education into habits that become "second nature" in
moral exemplars.
" Huff has identified four skill sets that aid moral exemplars in the expression of their virtues: (1) moral
imagination which consists of projecting oneself into the perspective of others, (2) moral creativity or
the ability to generate solutions to moral challenges while responding to multiple constraints, (3) rea-
sonableness which consists of gathering relevant evidence, listening to others, giving reasons, changing
plans/positions based on reasons, and (4) perseverance or planning moral action and responding to
unforeseen circumstances while keeping moral goals intact.
" For more detail on these items consult Huff's presentation found by clicking on the link above.
1.4 Ethics of Team Work?
" Ethics of Team Work
" William J. Frey (working with material developed by Chuck Huff at St. Olaf College
" Centro de la Etica en las Profesiones
" University of Puerto Rico - Mayaguez
1.4.1 Module Introduction
Much of your future work will be organized around group or team activities. This module is designed to
prepare you for this by getting you to reflect on ethical and practical problems that arise in small groups like
work teams. Four issues, based on well-known ethical values, are especially important. How do groups achieve
justice (in the distribution of work), responsibility (in specifying tasks, assigning blame, and awarding credit),
reasonableness (ensuring participation, resolving conflict, and reaching consensus), and honesty (avoiding
deception, corruption, and impropriety)? This module asks that you develop plans for realizing these moral
values in your group work this semester. Furthermore, you are provided with a list of some of the more
common pitfalls of group work and then asked to devise strategies for avoiding them. Finally, at the end of
the semester, you will review your goals and strategies, reflect on your successes and problems, and carry
out an overall assessment of the experience.
1.4.2 Module Activities
1. Groups are provided with key ethical values that they describe and seek to realize thorugh group
activity.
2. Groups also study various obstacles that arise in collective activity: the Abilene Paradox, Groupthink,
and Group Polarization.
7This content is available online at .
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3. Groups prepare initial reports consisting of plans for realizing key values in their collective activity.
They also develop strategies for avoiding associated obstacles.
4. At the end of the semester, groups prepare a self-evaluation that assesses success in realizing ethical
values and avoiding obstacles.
5. Textboxes in this module describe pitfalls in groups activities and offer general strategies for preventing
or mitigating them. There is also a textbox that provides an introductory orientation on key ethical
values or virtues.
1.4.3 Value Profiles for Professional Ethics
1. Definition - A value "refers to a claim about what is worthwhile, what is good. A value is a single word
or phrase that identifies something as being desirable for human beings." Brincat and Wike, Morality
and the Professional Life: Values at Work
2. Reasonableness - Defusing disagreement and resolving conflicts through integration. Characteristics
include seeking relevant information, listening and responding thoughtfully to others, being open to
new ideas, giving reasons for views held, and acknowledging mistakes and misunderstandings. (From
Michael Pritchard, Reasonable Children)
3. Responsibility - The ability to develop moral responses appropriate to the moral issues and problems
that arise in one's day-to-day experience. Characteristics include avoiding blame shifting, designing
overlapping role reponsibilities to fill responsibility "gaps", expanding the scope and depth of general
and situation-specific knowledge, and working to expand control and power.
4. Respect - Recognizing and working not to circumvent the capacity of autonomy in each individual.
Characteristics include honoring rights such as privacy, property, free speech, due process, and par-
ticipatory rights such as informed consent. Disrespect circumvents autonomy by deception, force, or
manipulation.
5. Justice - Giving each his or her due. Justice breaks down into kinds such as distributive (dividing
benefits and burdens fairly), retributive (fair and impartial administration of punishments), adminis-
trative (fair and impartial administration of rules), and compensatory (how to fairly recompense those
who have been wrongfully harmed by others).
6. Trust - According to Solomon, trust is the expectation of moral behavior from others.
7. Honesty - Truthfulness as a mean between too much honesty (bluntness which harms) and dishonesty
(deceptiveness, misleading acts, and mendaciousness).
8. Integrity - A meta-value that refers to the relation between particular values. These values are inte-
grated with one another to form a coherent, cohesive and smoothly functioning whole. This resembles
Solomon's account of the virtue of integrity.
1.4.4 Exercise 1: Developing Strategies for Value Realization
" Design a plan for realizing key moral values of team work. Your plan should address the following
value-based tasks
" How does your group plan on realizing justice? For example, how will you assign tasks within the
group that represent a fair distribution of the work load and, at the same time, recognize differences
in individual strengths and weaknesses? How does your group plan on dealing with members who fail
to do their fair share?
* How does your group plan on realizing responsibility? For example, what are the responsibilities that
members will take on in the context of collective work? Who will be the leader? Who will play devil's
advocate to avoid groupthink? Who will be the spokesperson for the group? How does your group
plan to make clear to each individual his or her task or role responsibilities?
* How does your group plan on implementing the value of reasonableness? How will you guarantee
that each individual participates fully in group decisions and activities? How will you deal with the
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CHAPTER 1. ETHICAL LEADERSHIP
differences, non-agreements, and disagreements that arise within the group? What process will your
group use to reach agreement? How will your group insure that every individual has input, that each
opinion will be heard and considered, and that each individual will be respected?
" How does your group plan on implementing the value of (academic) honesty? For example, how will
you avoid cheating or plagiarism? How will you detect plagiarism from group members, and how will
you respond to it?
" Note: Use your imagination here and be specific on how you plan to realize each value. Think preven-
tively (how you plan on avoiding injustice, irresponsibility, injustice, and dishonesty) and proactively
(how you can enhance these values). Don't be afraid to outline specific commitments. Expect some of
your commitments to need reformulation. At the end of the semester, this will help you write the final
report. Describe what worked, what did not work, and what you did to fix the latter.
1.4.5 Obstacles to Group Work (Developed by Chuck Huff for Good Computing:
A Virtue Approach to Computer Ethics)
1. The Abilene Paradox. The story involves a family who would all rather have been at home that ends
up having a bad dinner in a lousy restaurant in Abilene, Texas. Each believes the others want to go to
Abilene and never questions this by giving their own view that doing so is a bad idea. In the Abilene
paradox, the group winds up doing something that no individual wants to do because of a breakdown
of intra-group communication.
2. Groupthink. The tendency for very cohesive groups with strong leaders to disregard and defend
against information that goes against their plans and beliefs. The group collectively and the members
individually remain loyal to the party line while happily marching off the cliff, all the while blaming
"them" (i.e., outsiders) for the height and situation of the cliff.
3. Group Polarization. Here, individuals within the group choose to frame their differences as disagree-
ments. Framing a difference as non-agreement leaves open the possibility of working toward agreement
by integrating the differences or by developing a more comprehensive standpoint that dialectally synthe-
sizes the differences. Framing a difference as disagreement makes it a zero sum game; one's particular
side is good, all the others bad, and the only resolution is for the good (one's own position) to win out
over the bad (everything else).
4. Note: All of these are instances of a social psychological phenomenon called conformity. But there
are other processes at work too, like group identification, self-serving biases, self-esteem enhancement,
self-fulfilling prophecies, etc.
Best Practices for Avoiding Abilene Paradox
" At the end of the solution generating process, carry out an anonymous survey asking participants if
anything was left out they were reluctant to put before group.
" Designate a Devil's Advocate charged with criticizing the group's decision.
" Ask participants to reaffirm group decision-perhaps anonymously.
Best Practices for Avoiding Groupthink (Taken from Janis, 262-271)
* "The leader of a policy-forming group should assign the role of critical evaluator to each member,
encouraging the group to give high priority to airing objections and doubts."
* "The leaders in an organization's hierarchy, when assigning a policy-planning mission to a group, should
be impartial instead of stating preferences and expectations at the outset."
* "Throughout the period when the feasibility and effectiveness of policy alternatives are being sur-
veyed, the policy-making group should from time to time divide into two or more subgroups to meet
separately...."
17
" One or more outside experts or qualified colleagues within the organization who are not core members
of the policy-making group should be invited to each meeting ...and should be encouraged to challenge
the views of the core members."
" "At every meeting devoted to evaluating policy alternatives, at least one member should be assigned
the role of devil's advocate."
Best Practices for Avoiding Polarizatoin (Items taken from "Good Computing: A Virtue
Approach to Computer Ethics" by Chuck Huff, William Frey and Jose Cruz (Unpublished
Manuscript)
" Set Quotas. When brainstorming, set a quota and postpone criticism until after quota has been met.
" Negotiate Interests, not Positions. Since it is usually easier to integrate basic interests than
specific positions, try to frame the problem in terms of interests.
" Expanding the Pie. Conficts that arise from situational constraints can be resolved by pushing back
those constraints through negotiation or innovation..
" Nonspecific Compensation. One side makes a concession to the other but is compensated for that
concession by some other coin.
" Logrolling. Each party lowers their aspirations on items that are of less interest to them, thus trading
off a concession on a less important item for a concession from the other on a more important item.
" Cost-Cutting. One party makes an agreement to reduce its aspirations on a particular thing, and the
other party agrees to compensate the party for the specific costs that reduction in aspirations involves.
" Bridging. Finding a higher order interest on which both parties agree, and then constructing a
solution that serves that agreed-upon interest.
1.4.6 Exercise 2 - Avoiding the Pitfalls of Group Work
" Design a plan for avoiding the pitfalls of group work enumerated in the textbox above.
" How does your group plan on avoiding the Abilene Paradox?
" How does your group plan on avoiding Group Polarization?
" How does your group plan on avoiding Groupthink?
" Note: Use imagination and creativity here. Think of specific scenarios where these obstacles may arise,
and what your group can do to prevent them or minimize their impact.
1.4.7 Exercise 3: Prepare a Final, Group Self-Evaluation
* Due Date: One week after the last class of the semester when your group turns in all its materials.
* Length: A minimum of five pages not including Team Member Evaluation Forms
* Contents:
* 1. Restate the Ethical and Practical Goals that your group developed at the beginning of its formation.
* 2. Provide a careful, documented assessment of your group's success in meeting these goals. (Don't
just assert that "Our group successfully realized justice in all its activities this semester." How did
your group characterize justice in the context of its work? What specific activities did the group carry
out to realize this value? What, among these activities, worked and what did not work?)
* 3. Identify obstacles, shortcomings or failures that you group experienced during the semester. How
did these arise? Why did they arise? How did you respond to them? Did your response work? What
did you learn from this experience?
* 4. Assess the plans you set forth in your initial report on how you intended to realize values and avoid
pitfalls. How did these work? Did you stick to your plans or did you find it necessary to change or
abandon them in the face of challenges?
* 5. Discuss your group's procedures and practices? How did you divide and allocate work tasks? How
did you reach consensus on difficult issues? How did you ensure that all members were respected and
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CHAPTER 1. ETHICAL LEADERSHIP
allowed significant and meaningful participation? What worked and what did not work with respect
to these procedures? Will you repeat them in the future? Would you recommend these procedures as
best practices to future groups?
" 6. What did you learn from your experience working as a team this semester? What will require
further reflection and thought? In other words, conclude your self-evaluation with a statement that
summarizes your experience working together as a team this semester.
1.4.8 Wrap Up: Some further points to consider...
1. Don't gloss over your work with generalizations like, "Our group was successful and achieved all of its
ethical and practical goals this semester." Provide evidence for success claims. Detail the procedures
designed by your group to bring about these results. Are they "best practices"? What makes them
best practices?
2. Sometimes-especially if difficulties arose-it is difficult to reflect on your group's activities for the
semester. Make the effort. Schedule a meeting after the end of the semester to finalize this reflection.
If things worked well, what can you do to repeat these successes in the future? If things didn't work
out, what can you do to avoid similar problems in the future? Be honest, be descriptive and avoid
blame language.
3. This may sound harsh but get used to it. Self-evaluations-group and individual-are an integral part
of professional life. They are not easy to carry out, but properly done they help to secure success and
avoid future problems.
4. Student groups-perhaps yours-often have problems. This self-evaluation exercise is designed to help
you face them rather than push them aside. Look at your goals. Look at the strategies you set forth for
avoiding Abilene, groupthink, and group polarization. Can you modify them to deal with problems?
Do you need to design new procedures?
Chapter 2
Ethical Decision-Making
2.1 Ethical Rights for Working Engineers and Other Professionals1
2.1.1 Module Introduction
Preliminary Draft distributed at APPE, 2005 in San Antonio, TX
Engineers and other professionals work in large corporations under the supervision of managers who
may lack their expertise, skills, and commitment to professional standards. This creates communication
and ethical challenges. At the very least, professionals are put in the position of having to advocate their
ethical and professional standards to those who, while not being opposed to them, may not share their
understanding of and commitment to them.
This module is designed to give you the tools and the practice using them necessary to prevail in situations
that require advocacy of ethical and professional standards. In this module you carry out several activities.
(1) You will study the philosophical and ethical foundations of modern rights theory through a brief look at
Kantian Formalism. (2) You will learn a framework for examining the legitimacy of rights claims. (3) You
will practice this framework by examining several rights claims that engineers make over their supervisors.
This examination will require that you reject certain elements, rephrase others, and generally recast the
claim to satisfy the requirments of the rights justification framework. (4) Finally, in small groups you will
build tables around your reformulation of these rights claims and present the results to the class. This
module will help you to put your results together with the rest of your classmates and collectively assemble
a toolkit consisting of the legitimate rights claims that engineers and other professionals can make over their
managers and supervisors.
For more background on rights theory and the relation of rights and duties see (1) Henry Shue, Basic
Rights: Subsistence, Affluence, and U.S. Foreign Policy, 2nd edition, Princeton, 1980 and (2)
Thomas Donaldson, The Ethics of International Business, Oxford, 1989. This exercise has been used
in computer and engineering ethics classes at the University of Puerto Rico at Mayaguez from 2002 on to
the present. It is being incorporated into the textbook, Good Computing: A Virtue Approach to Computer
Ethics by Chuck Huff, William Frey, and Jose Cruz.
2.1.2 What you need to know...
Problematic Right Claims
1. El derecho para actuar de acuerdo a la conciencia etica y rechazar trabajos en los cuales exista una
variacion de opinones morales.
2. El derecho de expresar juicio profesional, y hacer pronunciamientos publicos que sean consistentes con
restricciones corporativas sobre la informacion propietaria.
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CHAPTER 2. ETHICAL DECISION-MAKING
3. El derecho a la lealtad corporativa y la libertad de que sea hecho un chivo expiatorio para catastrofes
naturales, ineptitud de administracion u otras fuerzas mas alla del control del ingeniero.
4. El derecho a buscar el mejoramiento personal mediante estudios postgraduados y envolverse en asocia-
ciones profesionales.
5. El derecho a participar en actividades de partidos politicos fuera de las horas de trabajo.
6. El derecho a solicitar posiciones superiores con otras companias sin que la companis en la que trabaje
tome represalias contra el ingeniero.
7. El derecho al debido proceso de ley y la libertad de que se le apliquen penalidades arbitrarias o despidos.
8. El derecho a apelar por revision ante una asociacion profesional, ombudsman o arbitro independiente.
9. El derecho a la privacidad personal.
10. These rights are taken from Etica en la Practica Profesional de la Ingenieria by Wilfredo Munoz
Roman published in 1998 by the Colegio de Ingenieros y Agrimensores de Puerto Rico and Universidad
Politecnica de Puerto Rico
Problematic Rights Claims (translated)
1. The right to act in accordance with one's ethical conscience and to refuse to work on projects that go
against one's conscience or personal or professional moral views.
2. The right to express one's professional judgment and to make public declarations as long as these do
not violate a corporation's rights to proprietary information.
3. The right to corporate loyalty and freedom from being made a scapegoat for natural catastrophes,
administrative ineptitude, and other forces that are beyond the control of the individual engineer.
4. The right to better oneself through postgraduate studies and through participation in one's professional
society.
5. The right to participate in political activities outside of work hours.
6. The right not to suffer retaliation from one's current employer when one seeks better employment
elsewhere.
7. The right to due process under the law and freedom from the application of artibrary penalties including
being fired at will without just cause.
8. The right to appeal judgments made against one before a professional association, ombudsman, or
independent arbitrator.
9. The right to personal privacy.
Kantian Formalism, Part I: Aligning the moral motive and the moral act
* Kant's moral philosophy has exercised substantial influence over our notions of right and duty. We
begin with a brief summary of this theory based on the work, The Foundations of the Metaphysics
of Morals.
* Kant states that the only thing in this world that is good without qualification is a good will. He
characterizes this will in terms of its motive, "duty for duty's sake."
* Consider the following example. You see a boy drowning. Even though the water is rough and the
current strong you are a good enough swimmer to save him. So while your inclination may be to give
way to fear and walk away, you are duty-bound to save the drowning boy.
* An action (saving or not saving the drowning boy) has moral worth depending on the the correct
correlation of right action and right motive. The following table shows this.
Duty for Duty's Sake
21
Motive Inclination (desire for Motive Duty
reward or fear)
Act Conforms to Duty You save the drowning boy for You save the drowning boy be-
the reward. Act conforms to duty cause it is your duty. Act con-
but is motivated by inclination. forms to duty and is for the sake
Has no moral worth. of duty. Your act has moral
worth.
Act violates a duty. You don't save the drowning boy You drown trying to save the
because you are too lazy to jump drowning boy. He also dies. Act
in. Act violates duty motivated fails to carry out duty but is mo-
by inclination. tivated by duty anyway. The act
miscarries but since the motive is
duty it still has moral worth.
Table 2.1
Part II of Kantian Formalism: Giving content to Duty for Duty's Sake
" Kant sees morality as the expression and realization of the rational will. The first formulation of this
rational will is to will consistently and universally.
" This leads to the Categorical Imperative: I should act only on that maxim (=personal rule or
rule that I give to myself) that can be converted into a universal law (a rule that applies
to everybody) without self-contradiction.
" This formulation is an imperative because it commands the will of all reasonable beings. It is categorical
because it commands without exceptions or conditions. The CI tells me unconditionally not to lie. It
does not say, do not like unless it promotes your self interest to do so.
" The following table shows how to use the Categorical Imperative to determine whether I have a duty
not to lie.
Applying the Categorical Imperative
1. Formulate your maxim (=personal rule) Whenever I am in a difficult situation, I should tell
a lie.
2. Universalize your maxim. Whenever anybody is in a difficult situation, he or
she should tell a lie.
3. Check for a contradiction (logical or practical) When I lie, I will the opposite for the universal law.
Put differently, I will that everybody (but me) be a
truth-teller and that everybody believe me a truth-
teller. I then make myself the exception to this
universal law. Thus my maxim (I am a liar) con-
tradicts the law (everybody else is a truth-teller)
Table 2.2
Kantian Formalism, Part III: The Formula of the End
* When I will one thing as universal law and make myself the exeception in difficult circumstances, I am
treating others, in Kantian terms, merely as means.
* This implies that I subordinate or bend them to my interests and projects without their consent. I
do this by circumventing their autonomy through (1) force, (2) fraud (often deception), or (3) manip-
ulation. Treating them with respect would involve telling them what I want (what are my plans and
projects) and on this basis asking them to consent to particpate and help me. The extreme case for
treating others merely as means is enslaving them.
22
CHAPTER 2. ETHICAL DECISION-MAKING
" We do on occasion treat others as means (and not as mere means) when we hire them as employees.
But this is consistent with their autonomy and rational consent because we explain to them what is
expected (we give them a job description) and compensate them for their efforts. For this reason there
is a world of difference between hiring others and enslaving them.
" The Formula of the End Act so as to treat others (yourself included) always as ends
and never merely as means.
Some Key Definitions for a Rights Framework
* Kantian formalism provides a foundation for respect for the intrinsic value of humans as autonomous
rational beings. Using this as a point of departure, we can develop a method for identifying, spelling out,
and justifying the rights and duties that go with professionalism. This framework can be summarized
in four general propositions:
* 1. Definition: A right is an essential capacity of action that others are obliged to recognize and
respect. This definition follows from autonomy. Autonomy can be broken down into a series of specific
capacities. Rights claims arise when we identify these capacities and take social action to protect them.
Rights are inviolable and cannot be overridden even when overriding would bring about substantial
public utility.
* 2. All rights claims must satisfy three requirements. They must be (1) essential to the autonomy
of individuals and (2) vulnerable so that they require special recognition and protection (on the part
of both individuals and society). Moreover, the burden of recognizing and respecting a claim as a
right must not deprive others of something essential. In other words, it must be (3) feasible for both
individuals and social groups to recognize and respect legitimate rights claims.
* 3. Definition: A duty is a rule or principle requiring that we both recognize and respect the legitimate
rights claims of others. Duties attendant on a given right fall into three general forms: (a) duties not
to deprive, (b) duties to prevent deprivation, and (c) duties to aid the deprived.
* 4. Rights and duties are correlative; for every right there is a correlative series of duties to
recognize and respect that right.
* These four summary points together form a system of professional and occupational rights and correl-
ative duties.
Right Claim Justification Framework
" Essential: To say that a right is essential to autonomy is to say that it highlights a capacity whose
exercise is necessary to the general exercise of autonomy. For example, autonomy is based on certain
knowledge skills. Hence, we have a right to an education to develop the knowledge required by au-
tonomy, or we have a right to the knowledge that produces informed consent. In general, rights are
devices for recognizing certain capacities as essential to autonomy and respecting individuals in their
exercise of these capacities.
" Vulnerable: The exercise of the capacity protected under the right needs protection. Individuals
may interfere with us in our attempt to exercise our rights. Groups, corporations, and governments
might overwhelm us and prevent us from exercising our essential capacities. In short, the exercise of
the capacity requires some sort of protection. For example, an individual's privacy is vulnerable to
violation. People can gain access to our computers without our authorization and view the information
we have stored. They can even use this information to harm us in some way. The right to privacy,
thus, protects certain capacities of action that are vulnerable to interference from others. Individual
and social energy needs to be expended to protect our privacy.
* Feasible: Rights make claims over others; they imply duties that others have. These claims must not
deprive the correlative duty-holders of anything essential. In other words, my rights claims over you
are not so extensive as to deprive you of your rights. My right to life should not deprive you of your
right to self-protection were I to attack you. Thus, the scope of my right claims over you and the rest
of society are limited by your ability to reciprocate. I cannot push my claims over you to recognize
and respect my rights to the point where you are deprived of something essential.
23
Types of Duty Correlative to a Right
* Duty not to deprive: We have a basic duty not to violate the rights of others. This entails that we
must both recognize and respect these rights. For example, computing specialists have the duty not
to deprive others of their rights to privacy by hacking into private files.
* Duty to prevent deprivation: Professionals, because of their knowledge, are often in the position
to prevent others from depriving third parties of their rights. For example, a computing specialist
may find that a client is not taking sufficient pains to protect the confidentiality of information about
customers. Outsiders could access this information and use it without the consent of the customers.
The computing specialist could prevent this violation of privacy by advising the client on ways to
protect this information, say, through encryption. The computing specialist is not about to violate the
customers' rights to privacy. But because of special knowledge and skill, the computing specialist may
be in a position to prevent others from violating this right.
* Duty to aid the deprived: Finally, when others have their rights violated, we have the duty to
aid them in their recovery from damages. For example, a computing specialist might have a duty to
serve as an expert witness in a lawsuit in which the plaintiff seeks to recover damages suffered from
having her right to privacy violated. Part of this duty would include accurate, impartial, and expert
testimony.
Application of Right/Duty Framework
1. We can identify and define specific rights such as due process. Moreover, we can set forth some of the
conditions involved in recognizing and respecting this right.
2. Due Process can be justified by showing that it is essential to autonomy, vulnerable, and feasible.
3. Right holders can be specified.
4. Correlative duties and duty holders can be specified.
5. Finally, the correlative duty-levels can be specified as the duties not to violate rights, duties to prevent
rights violations (whenever feasible), and the duties to aid the deprived (whenever is feasible).
24
CHAPTER 2. ETHICAL DECISION-MAKING
Example Rights Table: Due Process
Right: Due Pro- Justification Right- Correlative Duty- Duty Level
cess Holder:Engineer Holder: Engineer's
as employee and Supervisor, of-
member of profes- ficials in profes-
sional society. sional society.
Definition: The Essential: Due Professionals who Human Resources, Not to De-
right to respond Process is essential are subject to pro- Management, prive:Individuals
to organizational in organizations fessional codes of Personnel Depart- cannot be fired,
decisions that to prevent the ethics. Supports ment.(Individuals transferred, or
may harm one in deprivation of professionals who with duty to de- demoted without
terms of a serious other rights or are ordered to vi- sign, implement, due process
organizational to provide aid in olate professional and enforce a Prevent Depriva-
grievance proce- the case of their standards. due process pol- tion: Organiza-
dure.Necessary deprivation. icy) Corporate tions can prevent
Conditions:1. Vulnerable: directors have the deprivation by de-
Several levels of Rights in general duty to make sure signing and imple-
appeal.2. Time are not recognized this is being done. menting a compre-
limits to each in the economic hensive due pro-
level of appeal.3. sphere, especially cess policy.
Written notice in organizations.
of grievance.4. Aid the De-
Peer representa- Feasible: Orga- privedBinding
tion.5. Outside nizations, have arbitration and
arbitration. successfully im- legal measures
plemented due must exist to aid
process proce- those deprived of
dures. due process rights
Table 2.3
2.1.3 What you are going to do...
Exercise: Develop a Rights Table
1. You will be divided into small groups and each will be assigned a right claim taken from the above list.
2. Describe the claim (essential capacity of action) made by the right. For example, due process claims
the right to a serious organizational grievance procedure that will enable the right-holder to respond
to a decision that has an adverse impact on his or her interests. It may also be necessary in some
situations to specify the claim's necessary conditions.
3. Justify the right claim using the rights justification framework. In other words show that the right
claim is essential, vulnerable, and feasible.
4. Be sure to show that the right is essential to autonomy. If it is vulnerable be sure to identify the
standard threat. (A standard threat is an existing condition that threatens autonomy.)
5. Provide an example of a situation in which the right claim becomes operative. For example, an engineer
may claim a right to due process in order to appeal what he or she considers an unfair dismissal, transfer,
or performance evaluation.
6. Identify the correlative duty-holder(s) that need to take steps to recognize and respect the right. For
example, private and government organizations may be duty-bound to create due process procedures
to recognize and respect this right.
25
7. Further spell out the right by showing what actions the correlative duties involve. For example, a
manager should not violate an employee's due process right by firing him or her without just cause.
The organization's human resources department might carry out a training program to help managers
avoid depriving employees of this right. The organization could aid the deprived by designing and
implementing binding arbitration involving an impartial third party.
Be prepared to debrief on your right claim to the rest of the class. When other groups are debriefing, you are
free to challenge them on whether their claim is essential to autonomy, whether they have identified a valid
"standard threat," and whether the correlative duties are feasible or deprive others of something essential.
Your goal as a class is to have a short but effective list of rights that professionals take with them to the
workplace.
2.1.4 Conclusion
Conclusion: Topics for Further Reflection
" Not every claim to a right is a legitimate or justifiable claim. The purpose of this framework is to get
you into the habit of thinking critically and skeptically about the rights claims that you and others
make. Every legitimate right claim is essential, vulnerable, and feasible. Correlative duties are sorted
out according to different levels (not to deprive, prevent deprivation, and aid the deprived); this,
in turn, is based on the capacity of the correlative duty holder to carry them out. Finally, duties
correlative to rights cannot deprive the duty-holder of something essential.
" Unless you integrate your right and its correlative duties into the context of your professional or
practical domain, it will remain abstract and irrelevant. Think about your right in the context of
the real world. Think of everyday situations in which the right and its correlative duties will arise.
Invent cases and scenarios. If you are an engineering student, think of informed consent in terms of
the public's right to understand and consent to the risks associated with engineering projects. If you
are a computing student think of what you can do with computing knowledge and skills to respect or
violate privacy rights. Don't stop with an abstract accounting of the right and its correlative duties.
" Rights and duties underlie professional codes of ethics. But this is not always obvious. For example,
the right of free and informed consent underlies much of the engineer's interaction with the public,
especially the code responsibility to hold paramount public health, safety, and welfare. Look at the
different stakeholder relations covered in a code of ethics. (In engineering this would include public,
client, profession, and peer.) What are the rights and duties outlined in these stakeholder relations?
How are they covered in codes of ethics?
" This module is effective in counter-acting the tendency to invent rights and use them to rationalize
dubious actions and intentions. Think of rights claims as credit backed by a promise to pay at a later
time. If you make a right claim, be ready to justify it. If someone else makes a right claim, make them
back it up with the justification framework presented in this module.
2.2 Three Frameworks for Ethical Decision Making and Good Com-
puting Reports2
2.2.1 Module Introduction
In this module you will learn and practice three frameworks designed to integrate ethics into decision making
in the areas of practical and occupational ethics. The first framework divides the decision making process
into four stages: problem specification, solution generation, solution testing, and solution implementation.
It is based on an analogy between ethics and design problems that is detailed in a table presented below.
2This content is available online at .
26
CHAPTER 2. ETHICAL DECISION-MAKING
The second framework focuses on the process of solution testing by providing four tests that will help you to
evaluate and rank alternative courses of action. The reversibility, harm/beneficence, and public identification
tests each "encapsulate" or summarize an important ethical theory. A value realization test assesses courses
of action in terms of their ability to realize or harmonize different moral and nonmoral values. Finally,
a feasibility test will help you to uncover interest, resource, and technical constraints that will affect and
possibly impede the realization of your solution or decision. Taken together, these three frameworks will
help steer you toward designing and implementing ethical decisions the professional and occupational areas.
Two online resources provide more extensive background information. The first,
www.computingcases.org, provides background information on the ethics tests, socio-technical analy-
sis, and intermediate moral concepts. The second, http://onlineethics.org/essays/education/teaching.html,
explores in more detail the analogy between ethics and design problems. Much of this information will be
published in Good Computing: A Virtue Approach to Computer Ethics, a textbook of cases and decision
making techniques in computer ethics that is being authored by Chuck Huff, William Frey, and Jose A.
Cruz-Cruz.
2.2.2 Problem-Solving or Decision-Making Framework: Analogy between ethics
and design
Traditionally, decision making frameworks in professional and occupational ethics have been taken from
rational decision procedures used in economics. While these are useful, they lead one to think that ethical
decisions are already "out there" waiting to be discovered. In contrast, taking a design approach to ethical
decision making emphasizes that ethical decisions must be created, not discovered. This, in turn, emphasizes
the importance of moral imagination and moral creativity. Carolyn Whitbeck in Ethics in Engineering
Practice and Research describes this aspect of ethical decision making through the analogy she draws between
ethics and design problems in chapter one. Here she rejects the idea that ethical problems are multiple choice
problems. We solve ethical problems not by choosing between ready made solutions given with the situation;
rather we use our moral creativity and moral imagination to design these solutions. Chuck Huff builds on
this by modifying the design method used in software engineering so that it can help structure the process of
framing ethical situations and creating actions to bring these situations to a successful and ethical conclusion.
The key points in the analogy between ethical and design problems are summarized in the table presented
just below.
Analogy between design and ethics problem-solving
Design Problem Ethical Problem
Construct a prototype that optimizes (or satisfices) Construct a solution that integrates and realizes
designated specifications ethical values (justice, responsibility, reasonable-
ness, respect, and safety)
Resolve conflicts between different specifications by Resolve conflicts between values (moral vs. moral
means of integration or moral vs. non-moral) by integration
Test prototype over the different specifications Test solution over different ethical considerations
encapsulated in ethics tests
continued on next page
27
Implement tested design over background con- Implement ethically tested solution over resource,
straints interest, and technical constraints
Table 2.4
2.2.3 Software Development Cycle: Four Stages
(1) problem specification, (2) solution generation, (3) solution testing, and (4) solution implementation.
2.2.4 Problem specification
Problem specification involves exercising moral imagination to specify the socio-technical system (including
the stakeholders) that will influence and will be influenced by the decision we are about to make. Stating the
problem clearly and concisely is essential to design problems; getting the problem right helps structure and
channel the process of designing and implementing the solution. There is no algorithm available to crank out
effective problem specification. Instead, we offer a series of guidelines or rules of thumb to get you started
in a process that is accomplished by the skillful exercise of moral imagination.
For a broader problem framing model see Harris, Pritchard, and Rabins, Engineering Ethics: Con-
cepts and Cases, 2nd Edition, Belmont, CA: Wadsworth, 2000, pp. 30-56. See also Cynthia Brincat and
Victoria Wike, Morality and Professional Life: Values at Work, New Jersey: Prentice Hall, 1999.
Different Ways of Specifying the Problem
* Many problems can be specified as disagreements. For example, you disagree with your supervisor over
the safety of the manufacturing environment. Disagreements over facts can be resolved by gathering
more information. Disagreements over concepts (you and your supervisor have different ideas of what
safety means) require working toward a common definition.
* Other problems involve conflicting values. You advocate installing pollution control technology because
you value environmental quality and safety. Your supervisor resists this course of action because
she values maintaining a solid profit margin. This is a conflict between a moral value (safety and
environmental quality) and a nonmoral value (solid profits). Moral values can also conflict with one
another in a given situation. Using John Doe lawsuits to force Internet Service Providers to reveal
the real identities of defamers certainly protects the privacy and reputations of potential targets of
defamation. But it also places restrictions on legitimate free speech by making it possible for powerful
wrongdoers to intimidate those who would publicize their wrongdoing. Here the moral values of privacy
and free speech are in conflict. Value conflicts can be addressed by harmonizing the conflicting values,
compromising on conflicting values by partially realizing them, or setting one value aside while realizing
the other (=value trade offs).
* If you specify your problem as a disagreement, you need to describe the facts or concepts about which
there is disagreement.
* If you specify your problem as a conflict, you need to describe the values that conflict in the situation.
* One useful way of specifying a problem is to carry out a stakeholder analysis. A stakeholder is any
group or individual that has a vital interest at risk in the situation. Stakeholder interests frequently
come into conflict and solving these conflicts requires developing strategies to reconcile and realize the
conflicting stakes.
* Another way of identifying and specifying problems is to carry out a socio-technical analysis. Socio-
technical systems (STS) embody values. Problems can be anticipated and prevented by specifying
possible value conflicts. Integrating a new technology, procedure, or policy into a socio-technical
system can create three kinds of problem. (1) Conflict between values in the technology and those in
the STS. For example, when an attempt is made to integrate an information system into the STS of a
small business, the values present in an information system can conflict with those in the socio-technical
system. (Workers may feel that the new information system invades their privacy.) (2) Amplification
28
CHAPTER 2. ETHICAL DECISION-MAKING
of existing value conflicts in the STS. The introduction of a new technology may magnify an existing
value conflict. Digitalizing textbooks may undermine copyrights because digital media is easy to copy
and disseminate on the Internet. (3) Harmful consequences. Introducing something new into a socio-
technical system may set in motion a chain of events that will eventually harm stakeholders in the
socio-technical system. For example, giving laptop computers to public school students may produce
long term environmental harm when careless disposal of spent laptops releases toxic materials into the
environment.
" The following table helps summarize some of these problem categories and then outlines generic solu-
tions.
Problem Type Sub-Type Solution Outline
Disagreement Factual Type and mode of gathering information
Conceptual Concept in dispute and method for
agreeing on its definition
Conflict Moral vs. Moral Value Integrative Partially Value In- Trade Off
Non-moral vs. tegrative
moral
Non-moral vs.
non-moral
Framing Corruption Strategy for main- Strategy for Value integrative,
Social Justice taining integrity restoring justice design strategy
Value Realization
Intermediate Public Welfare, Realizing Value Removing value Prioritizing values
Moral Value Faithful Agency, conflicts for trade offs
Professional In-
tegrity, Peer
Collegiality
Table 2.5
2.2.5 Solution Generation
In solution generation, agents exercise moral creativity by brainstorming to come up with solution options
designed to resolve the disagreements and value conflicts identified in the problem specification stage. Brain-
storming is crucial to generating nonobvious solutions to difficult, intractable problems. This process must
take place within a non-polarized environment where the members of the group respect and trust one another.
(See the module on the Ethics of Group Work for more information on how groups can be successful and
pitfalls that commonly trip up groups.) Groups effectively initiate the brainstorming process by suspending
criticism and analysis. After the process is completed (say, by meeting a quota), then participants can refine
the solutions generated by combining them, eliminating those that don't fit the problem, and ranking them
in terms of their ethics and feasibility. If a problem can't be solved, perhaps it can be dissolved through
reformulation. If an entire problem can't be solve, perhaps the problem can be broken down into parts some
of which can be readily solved.
2.2.6 Solution Testing: The solutions developed in the second stage must be
tested in various ways.
1. Reversibility: Are they reversible between the agent and key stakeholders?
29
2. Harm/Beneficence: Do they minimize harm? Do they produce benefits that are justly distributed
among stakeholders?
3. Public Identification: Are these actions with which I am willing to be publicly identified? Does these
actions identify me as a moral person?
4. Value: Do these actions realize key moral values and instantiate moral virtues?
5. Code: A code test can be added that refers to a professional or occupational code of ethics. Do the
solutions comply with the professional's or practitioner's code of ethics?
6. The solution evaluation matrix presented just below provides a nice way of modeling and summarizing
the process of solution testing.
Solution/Test Reversibility Harm/ Benefi- Virtue Value Code
cence
Descrip-tion Is the solution Does the so- Does the so- Moral val- Does the so-
reversible with lution produce lution express ues realized? lution violate
stakeholders? the best bene- and integrate Moral values any code
Does it honor fit/harm ratio? key virtues? frustrated? provisions?
basic rights? Does the solu- Value conflicts
tion maximize resolved or
utility? exacerbated?
Best solution
Second Best
Worst
Table 2.6
2.2.7 Solution Implementation
The chosen solution must be examined in terms of how well it responds to various situational constraints
that could impede its implementation. What will be its costs? Can it be implemented within necessary time
constraints? Does it honor recognized technical limitations or does it require pushing these back through
innovation and discovery? Does it comply with legal and regulatory requirements? Finally, could the
surrounding organizational, political, and social environments give rise to obstacles to the implementation
of the solution? In general this phase requires looking at interest, technical, and resource constraints or
limitations. A Feasibility Matrix helps to guide this process.
The Feasibility Tests focuses on situational constraints. How could these hinder the implementation of
the solution? Should the solution be modified to ease implementation? Can the constraints be removed or
remodeled by negotiation, compromise, or education? Can implementation be facilitated by modifying both
the solution and changing the constraints?
Feasibility Matrix
Resource Constraints Technical Constraints Interest Constraints
Personalities
Time Organizational
Cost Applicable Technology Legal
Materials Manufacturability Social, Political, Cultural
30
CHAPTER 2. ETHICAL DECISION-MAKING
Table 2.7
Different Feasibility Constraints
1. The Feasibility Test identifies the constraints that could interfere with realizing a solution. This test also
sorts out these constraints into resource (time, cost, materials), interest (individuals, organizations,
legal, social, political), and technical limitations. By identifying situational constraints, problem-
solvers can anticipate implementation problems and take early steps to prevent or mitigate them.
2. Time. Is there a deadline within which the solution has to be enacted? Is this deadline fixed or
negotiable?
3. Financial. Are there cost constraints on implementing the ethical solution? Can these be extended
by raising more funds? Can they be extended by cutting existing costs? Can agents negotiate for more
money for implementation?
4. Technical. Technical limits constrain the ability to implement solutions. What, then, are the technical
limitations to realizing and implementing the solution? Could these be moved back by modifying the
solution or by adopting new technologies?
5. Manufacturability. Are there manufacturing constraints on the solution at hand? Given time, cost,
and technical feasibility, what are the manufacturing limits to implementing the solution? Once again,
are these limits fixed or flexible, rigid or negotiable?
6. Legal. How does the proposed solution stand with respect to existing laws, legal structures, and
regulations? Does it create disposal problems addressed in existing regulations? Does it respond to
and minimize the possibility of adverse legal action? Are there legal constraints that go against the
ethical values embodied in the solution? Again, are these legal constraints fixed or negotiable?
7. Individual Interest Constraints. Individuals with conflicting interests may oppose the implemen-
tation of the solution. For example, an insecure supervisor may oppose the solution because he fears
it will undermine his authority. Are these individual interest constraints fixed or negotiable?
8. Organizational. Inconsistencies between the solution and the formal or informal rules of an orga-
nization may give rise to implementation obstacles. Implementing the solution may require support
of those higher up in the management hierarchy. The solution may conflict with organization rules,
management structures, traditions, or financial objectives. Once again, are these constraints fixed or
flexible?
9. Social, Cultural, or Political. The socio-technical system within which the solution is to be imple-
mented contains certain social structures, cultural traditions, and political ideologies. How do these
stand with respect to the solution? For example, does a climate of suspicion of high technology threaten
to create political opposition to the solution? What kinds of social, cultural, or political problems could
arise? Are these fixed or can they be altered through negotiation, education, or persuasion?
2.2.8 Ethics Tests For Solution Evaluation
Three ethics tests (reversibility, harm/beneficence, and public identification) encapsulate three ethical ap-
proaches (deontology, utilitarianism, and virtue ethics) and form the basis of stage three of the SDC, solution
testing. A fourth test (a value realization test) builds upon the public identification/virtue ethics test by
evaluating a solution in terms of the values it harmonizes, promotes, protects, or realizes. Finally a code test
provides an independent check on the ethics tests and also highlights intermediate moral concepts such as
safety, health, welfare, faithful agency, conflict of interest, confidentiality, professional integrity, collegiality,
privacy, property, free speech, and equity/access). The following section provides advice on how to use these
tests. More information can be found at www.computingcases.org.
2.2.9 Setting Up the Ethics Tests: Pitfalls to avoid
Set-Up Pitfalls: Mistakes in this area lead to the analysis becoming unfocused and getting lost in irrelevancies.
(a) Agent-switching where the analysis falls prey to irrelevancies that crop up when the test application is
31
not grounded in the standpoint of a single agent, (b) Sloppy action-description where the analysis fails
because no specific action has been tested, (c) Test-switching where the analysis fails because one test is
substituted for another. (For example, the public identification and reversibility tests are often reduced
to the harm/beneficence test where harmful consequences are listed but not associated with the agent or
stakeholders.)
Set up the test
1. Identify the agent (the person who is going to perform the action)
2. Describe the action or solution that is being tested (what the agent is going to do or perform)
3. Identify the stakeholders (those individuals or groups who are going to be affected by the action), and
their stakes (interests, values, goods, rights, needs, etc.
4. Identify, sort out, and weigh the consequences (the results the action is likely to bring about)
2.2.10 Harm/Beneficence Test
" What harms would accompany the action under consideration? Would it produce physical or mental
suffering, impose financial or non-financial costs, or deprive others of important or essential goods?
" What benefits would this action bring about? Would it increase safety, quality of life, health, security,
or other goods both moral and non-moral?
" What is the magnitude of each these consequences? Magnitude includes likelihood it will occur (prob-
ability), the severity of its impact (minor or major harm) and the range of people affected.
" Identify one or two other viable alternatives and repeat these steps for them. Some of these may be
modifications of the basic action that attempt to minimize some of the likely harms. These alternatives
will establish a basis for assessing your alternative by comparing it with others.
" Decide on the basis of the test which alternative produces the best ratio of benefits to harms?
" Check for inequities in the distribution of harms and benefits. Do all the harms fall on one individual
(or group)? Do all of the benefits fall on another? If harms and benefits are inequitably distributed,
can they be redistributed? What is the impact of redistribution on the original solution imposed?
Pitfalls of the Harm/Beneficence Test
1. "Paralysis of Analysis" comes from considering too many consequences and not focusing only on those
relevant to your decision.
2. Incomplete Analysis results from considering too few consequences. Often it indicates a failure of moral
imagination which, in this case, is the ability to envision the consequences of each action alternative.
3. Failure to compare different alternatives can lead to a decision that is too limited and one-sided.
4. Failure to weigh harms against benefits occurs when decision makers lack the experience to make the
qualitative comparisons required in ethical decision making.
5. Finally, justice failures result from ignoring the fairness of the distribution of harms and benefits. This
leads to a solution which may maximize benefits and minimize harms but still give rise to serious
injustices in the distribution of these benefits and harms.
2.2.11 Reversibility Test
1. Set up the test by (i) identifying the agent, (ii) describing the action, and (iii) identifying the stake-
holders and their stakes.
2. Use the stakeholder analysis to identify the relations to be reversed.
3. Reverse roles between the agent (you) and each stakeholder: put them in your place (as the agent)
and yourself in their place (as the one subjected to the action).
4. If you were in their place, would you still find the action acceptable?
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Cross Checks for Reversibility Test (These questions help you to check if you have carried out
the reversibility test properly.)
* Does the proposed action treat others with respect? (Does it recognize their autonomy or circumvent
it?)
* Does the action violate the rights of others? (Examples of rights: free and informed consent, privacy,
freedom of conscience, due process, property, freedom of expression)
* Would you recommend that this action become a universal rule?
* Are you, through your action, treating others merely as means?
Pitfalls of the Reversibility Test
* Leaving out a key stakeholder relation
* Failing to recognize and address conflicts between stakeholders and their conflicting stakes
* Confusing treating others with respect with capitulating to their demands ("Reversing with Hitler")
* Failing to reach closure, i.e., an overall, global reversal assessment that takes into account all the
stakeholders the agent has reversed with.
2.2.12 Steps in Applying the Public Identification Test
* Set up the analysis by identifying the agent, describing the action, and listing the key values or virtues
at play in the situation.
* Association the action with the agent.
* Describe what the action says about the agent as a person. Does it reveal him or her as someone
associated with a virtue or a vice?
Alternative Version of Public Identification
* Does the action under consideration realize justice or does it pose an excess or defect of justice?
* Does the action realize responsibility or pose an excess or defect of responsibility?
* Does the action realize reasonableness or pose too much or too little reasonableness?
* Does the action realize honesty or pose too much or too little honesty?
* Does the action realize integrity or pose too much or too little integrity?
Pitfalls of Public Identification
* Action not associated with agent. The most common pitfall is failure to associate the agent and the
action. The action may have bad consequences and it may treat individuals with respect but these
points are not as important in the context of this test as what they imply about the agent as a person
who deliberately performs such an action.
* Failure to specify moral quality, virtue, or value. Another pitfall is to associate the action and agent
but only ascribe a vague or ambiguous moral quality to the agent. To say, for example, that willfully
harming the public is bad fails to zero in on precisely what moral quality this ascribes to the agent.
Does it render him or her unjust, irresponsible, corrupt, dishonest, or unreasonable? The virtue list
given above will help to specify this moral quality.
2.2.13 Code of Ethics Test
* Does the action hold paramount the health, safety, and welfare of the public, i.e., those affected by the
action but not able to participate in its design or execution?
* Does the action maintain faithful agency with the client by not abusing trust, avoiding conflicts of
interest, and maintaining confidences?
* Is the action consistent with the reputation, honor, dignity, and integrity of the profession?
* Does the action serve to maintain collegial relations with professional peers?
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2.2.14 Meta Tests
* The ethics and feasibility tests will not always converge on the same solution. There is a complicated
answer for why this is the case but the simple version is that the tests do not always agree on a
given solution because each test (and the ethical theory it encapsulates) covers a different domain or
dimension of the action situation. Meta tests turn this disadvantage to your advantage by feeding the
interaction between the tests on a given solution back into the evaluation of that solution.
* When the ethics tests converge on a given solution, this convergence is a sign of the strength and
robustness of the solution and counts in its favor.
* When a given solution responds well to one test but does poorly under another, this is a sign that the
solution needs further development and revision. It is not a sign that one test is relevant while the
others are not. Divergence between test results is a sign that the solution is weak.
2.2.15 Application Exercise
You will now practice the four stages of decision making with a real world case. This case, Risk Assessment,
came from a retreat on Business, Science, and Engineering Ethics held in Puerto Rico in December 1998. It
was funded by the National Science Foundation, Grant SBR 9810253.
Risk Assessment Scenario
Case Scenario: You supervise a group of engineers working for a private laboratory with expertise in nuclear
waste disposal and risk assessment. The DOE (Department of Energy) awarded a contract to your laboratory
six years ago to do a risk assessment of various nuclear waste disposal sites. During the six years in which
your team has been doing the study, new and more accurate calculations in risk assessment have become
available. Your laboratory's study, however, began with the older, simpler calculations and cannot integrate
the newer without substantially delaying completion. You, as the leader of the team, propose a delay to the
DOE on the grounds that it is necessary to use the more advanced calculations. Your position is that the
laboratory needs more time because of the extensive calculations required; you argue that your group must
use state of the art science in doing its risk assessment. The DOE says you are using overly high standards
of risk assessment to prolong the process, extend the contract, and get more money for your company. They
want you to use simpler calculations and finish the project; if you are unwilling to do so, they plan to find
another company that thinks differently. Meanwhile, back at the laboratory, your supervisor (a high level
company manager) expresses to you the concern that while good science is important in an academic setting,
this is the real world and the contract with the DOE is in jeopardy. What should you do?
Part One: Problem Specification
1. Specify the problem in the above scenario. Be as concise and specific as possible
2. Is your problem best specifiable as a disagreement? Between whom? Over what?
3. Can your problem be specified as a value conflict? What are the values in conflict? Are the moral,
nonmoral, or both?
Part Two: Solution Generation
1. Quickly and without analysis or criticism brainstorm 5 to ten solutions
2. Refine your solution list. Can solutions be eliminated? (On what basis?) Can solutions be combined?
Can solutions be combined as plan a and plan b?
3. If you specified your problem as a disagreement, how do your solutions resolve the disagreement? Can
you negotiate interests over positions? What if your plan of action doesn't work?
4. If you formulated your problem as a value conflict, how do your solutions resolve this conflict? By
integrating the conflicting values? By partially realizing them through a value compromise? By trading
one value off for another?
Part Three: Solution Testing
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1. Construct a solution evaluation matrix to compare two to three solution alternatives.
2. Choose a bad solution and then compare to it the two strongest solutions you have.
3. Be sure to avoid the pitfalls described above and set up each test carefully.
Part Four: Solution Implementation
1. Develop an implementation plan for your best solution. This plan should anticipate obstacles and offer
means for overcoming them.
2. Prepare a feasibility table outlining these issues using the table presented above.
3. Remember that each of these feasibility constraints is negotiable and therefore flexible. If you choose
to set aside a feasibility constraint then you need to outline how you would negotiate the extension of
that constraint.
Decision-Making Presentation
This is an unsupported media type. To view, please see http://cnx.org/content/m13757/latest/Decision
Making Manual V3.ppt
Figure 2.1: Clicking on this figure will allow you to open a presentation designed to introduce problem
solving in ethics as analogous to that in design, summarize the concept of a socio-technical system, and
provide an orientation in the four stages of problem solving. This presentation was given February 28,
2008 at UPRM for ADMI 6005 students, Special Topics in Research Ethics.
Decision Making Worksheet
This is an unsupported media type. To view, please see http://cnx.org/content/m13757/latest/Decision
Making Worksheet.docx
Figure 2.2: This exercise is designed to give you practice with the three frameworks described in this
module. It is based on the case, "When in Aguadilla."
2.3 Values-Based Decision-Making in Gilbane Gold3
2.3.1 Module Introduction
The Federal Sentencing Guidelines introduced in the early 1990's have transformed the way businesses
respond to ethics. Formerly, corporations relied on compliance measures which became activated only after
wrongdoing occurred. Violations occurred and compliance responses consisted of identifying and punishing
3This content is available online at .
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those responsible. But the Federal Sentencing Guidelines push corporations toward a much more proactive
stance; if a corporation is found guilty of law violation, its punishment is determined by the measures
the corporation has already implemented to prevent the crime as well as the measures the corporation
develops in response to the crime to mitigate it and prevent future reoccurrences. Working to prevent crime,
accepting responsibility for crimes that could not be prevented, and learning from past mistakes all serve to
"flag" corporate intention. In other words, corporations can demonstrate good intentions by documenting
measures implemented to prevent crime and by showing a "responsive adjustment" to crimes they could not
prevent.
It is in this new corporate context that corporations have begun to adopt values-based decision making.
Instead of setting forth rules that outline minimum levels of forced compliance, they now ask employees
to work beyond the moral minimum and seek occasions to actually realize or enhance moral value. In the
decision making context, employees ask: (1) What can I do to make this a more just environment? (2)
How do I go about respecting my co-workers? and (3) How do I identify and carry out my responsibilities,
including social responsibilities, in my daily work?" These questions, representing instances of values-based
decision-making, serve to change your focus from getting by with the moral minimum to realigning your
moral and workplace efforts toward moral excellence.
In this module you will learn about ethical leadership, ethical decision-making, corporate social responsi-
bility, and corporate governance. The occasion for this learning is the classical ethics video, "Gilbane Gold."
You will view the video and practice values-based decision-making from within the role of David Jackson,
the young engineer around whom the narrative of this video is built. To get you started, you will use the
values portrayed in the University of Puerto Rico's College of Business Administration Statement of Val-
ues. Module sections will outline what you will be doing and what you need to know as well as provide
opportunities for you to reflect on what you have learned upon completion of this module.
2.3.2 What you need to know...
Value-Based Decision Making
In value-based decision-making, you use moral values to pose problems and solutions. For example, problems
can be posed as conflicts between values (moral vs. non-moral or moral vs. moral), lack of information
about how to realize or maintain values, and situations where key values need to be defended. The point in
value-based decision making is to design solutions that realize the maximum number of values possible by
integrating them, drawing successful compromises between them, or choosing to act upon the most important
value given the situation. In this module, you will be working from within David Jackson's position to design
a solution to his problem that best responds to the value needs in his situation.
Gilbane Gold
* You are David Jackson a young engineer working for the computer manufacturer, Z-Corp. Your studies
into the waste emissions of Z-Corp indicate that they are a little bit over the boarderline of what is
legally acceptable in the Gilbane metropolitan area. Two further issues complicate your findings. (1)
Gilbane draws sludge from the river and sells it to farmers to cover their fields; if heavy metals are
present in this sludge, they will be passed on to consumers who eat the vegetables grown in fields covered
with this "Gilbane Gold." This could produce long and short term health problems for the Gilbane
community. (2) Z-Corp has just entered into a new agreement with a Japanese company that will
produce a five-fold increase in demand for their product. While this will also increase their emissions
of heavy metals into the water supply by the same amount, it will not violate city regulations because
these regulations only take into account the concentration of heavy metals in each discharge. Z-Corp
merely dilutes the heavy metals dumped into Gilbane's water supply to reflect acceptable concentration
levels. David Jackson holds that this loophole in environmental regulations could endanger the health
and safety of the citizens in the Gilbane. But he has trouble sharing these concerns with his supervisors,
Diane Collins, Phil Port, and Frank Seeders.
* David (you) has made several efforts to make his concerns known to Z-Corp officials, including Phil
Port, Frank Seeders, and Diane Collins. Their response is that spending money on increased pollution
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control measures will threaten Z-Corp's thin profit margin. Diane puts the issue even more strongly
when she says that Z-Corp's social responsibility is to provide the Gilbane community with good jobs
and to obey local environmental regulations. If the city wants stricter regulations, then they need to
pass them through the legislative process. But taking proactive measures on this count goes far beyond
Z-Corp's ethical and social responsibilities to the Gilbane community.
" You are David. What values do you see involved in this situation? Design a solution that best preserves
and integrates them.
Partial List of Characters
1. David Jackson: Young engineer whose measurements show that Z-Corp's emissions into the Gilbane
water supply barely exceed local standards. He expresses concern to his supervisors on the impact on
the safety and health of the local community.
2. Diane Collins: David's supervisor who is under strong pressure to maintain the Z-Corp Gilbane
plant's thin profit levels. She is concerned about environment responsibility but defines it as staying
within the limits of the law as put forth by the Gilbane community. Gilbane sets for the law and
Z-Corp is responsible for staying within its limits. If the law is inadequate, then Gilbane is responsible
for changing it.
3. Tom Richards: Environmental engineer hired to measure Z-Corp's heavy metal emissions into the
Gilbane water supply. Richards warns David that he bears ultimate responsibility for Z-Corp's emisions
into the Gilbane water supply.
4. Phil Port: Z-Corp's official in charge of the company's compliance with environmental regulations.
He calls David during the TV documentary to claim that it portrays him as an "environmental rapist."
5. Frank Seeders: Frank is the point man on helping to gear up Z-Corp's operations to meet the
new demand created by their recent venture with a Japanese company. He asks David to help him
streamline Z-Corp's manufacturing process.
6. Maria Renato: Local reporter who produces documentary exposing Z-Corp's potentially dangerous
emissions. She has prepared her report based on documentation provided by David Jackson.
Statement of Values List
1. Justice / Fairness: Be impartial, objective and refrain from discrimination or preferential treatment
in the administration of rules and policies and in its dealings with students, faculty, staff, administra-
tion, and other stakeholders.
2. Responsibility: Recognize and fulfill its obligations to its constituents by caring for their essential
interests, by honoring its commitments, and by balancing and integrating conflicting interests. As
responsible agents, the faculty, employees, and students of the college of business Administration are
committed to the pursuit of excellence, devotion to the community's welfare, and professionalism.
3. Respect: Acknowledge the inherent dignity present in its diverse constituents by recognizing and
respecting their fundamental rights. these include rights to property, privacy, free exchange of ideas,
academic freedom, due process, and meaningful participation in decision making and policy formation.
4. Trust: Recognize that trust solidifies communities by creating an environment where each can ex-
pect ethically justifiable behavior from all others. While trust is tolerant of and even thrives in an
environment of diversity, it also must operate within the parameters set by established personal and
community standards.
5. Integrity: Promote integrity as characterized by sincerity, honesty, authenticity, and the pursuit of
excellence. Integrity shall permeate and color all its decisions, actions and expressions. It is most
clearly exhibited in intellectual and personal honesty in learning, teaching, mentoring and research.
2.3.3 What you are going to do...
1. Watch the video and make sure you understand the situation from David's point of view. At the end
David makes his decision. You should be open to the possibility that there may be other decisions that
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can be taken in this situation that may be better from a moral point of view.
2. What is David's problem? Try formulating it in terms of values that are under threat and conflicts
between values. You may even want to identify information needs relevant to solving this problem?
3. What solutions do different individuals in the video recommend to David? How good are they in terms
of realizing or protecting key moral values? Does David (and the video) pay sufficient attention to
these different recommendations? Does he miss better value-integrative solutions?
4. Make your decision. Defend it in terms of key moral values. Use the values provided above in the
UPRM College of Business Administration's Statement of Values.
5. Give special attention to the links provided in this module. Are there solutions to David's problem
not mentioned in the video?
2.3.4 Conclusion
More and more, business ethics is concentrating on four general themes or issues. In this section, you will
use the video, "Gilbane Gold," to reflect on these different themes. Consider this your first incursion into
business ethics. Most important, remember that ethics forms a central part of everyday business practice
and is essential to good business.
Ethical Leadership: In terms of the values mentioned in the SOV, discuss and rate the following
characters in terms of the leadership skills and qualities they exhibit:
* Diane Collins
* David Jackson
* Phil Port
* Tom Richards
* Frank Seeders
Social Responsibility:
David reminds Diane that corporations like Z-Corp are responsible for the health and safety impacts of
their operations. Diane disagrees placing more emphasis on following the law and serving the community
by creating economic opportunity and jobs. Who sets for the better argument? Using these positions as a
springboard, set forth your own conception of corporate social responsibility.
Corporate Governance:
Toward the end of the video, David goes to local reporter, Maria Renato, and provides her with inside
information on his and Tom Richards's environmental and safety concerns. Was this a necessary action?
Did David have other options which would have allowed him to work within Z-Corp for an effective response
to his concerns? How do engineers advocate within for-profit corporations for including ethical values into
corporate decisions? What do real world corporations do to recognize and respond to dissenting professional
opinions held by their employees?
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Values in Gilbane Gold Handout
This is an unsupported media type. To view, please see http://cnx.org/content/m15783/latest/Values in
Gilbane Gold Handout.doc
Figure 2.3: This handout for students provides exercises based on Gilbane Gold that introduces the
three AACSB business ethics themes: ethical leadership, ethical decision-making, and social responsibil-
ity.
Virtues for ADMI 3405
This is an unsupported media type. To view, please see http://cnx.org/content/m15783/latest/Virtues for
ADMI 3405.pptx
Figure 2.4: Clicking on this file are the virtues worked out in the previous module. Use these to carry
out the values-based decision making exercise in Gilbane Gold.
2.4 Socio-Technical Systems in Professional Decision Making4
2.4.1 Module Introduction
Milagro Beanfield War
Joe Mondragon has created quite a stir in Milagro, a small village in New Mexico. He has illegally diverted
water from the irrigation ditch to his field to grow beans. Access to scarce water in New Mexico has created
sharp political and social disputes which have reached a crises point in Milagro. Competing with traditional
subsistence farmers like Joe is the profitable recreation industry. Ladd Devine, a wealthy developer, has joined
with the state government in New Mexico to build a large recreational center consisting of a restaurant, travel
lodge, individual cabins and a lavish golf course. Since there is not enough water to cover both recreational
and agricultural uses and since Ladd Devine's project promises large tax revenues and new jobs, the state
government has fallen behind him and has promised to give to the recreational facilities all the water it
needs. Hence, the problem created by Mondragon's illegal act. You work for Ladd Devine. He has asked
you to look into local opposition to the recreational facility. Along these lines, you attend the town meeting
scheduled by Ruby Archuleta in the town's church. You are concerned about Charlie Bloom's presentation
and the impact it may have on the local community. Prepare a STS analysis to test Bloom's assertions and
better prepare Ladd Devine for local opposition to his facility.
Incident at Morales
Fred is a chemical engineer hired by Phaust Corporation to design and make operational a new chemical plant
for the manufacture of their newly redesigned paint thinner. Under financial pressure from the parent French
4This content is available online at .
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company, Chemistre, they have decided to locate their new plant in Morales, Mexico to take advantage of
lower costs and more flexible government regulations. You are well on the way toward designing this new
plant when news comes from Chemistre that all budgets are being cut 20% to finance Chemistre's latest
takeover acquisition. You are Fred and are now faced with a series of difficult financial-engineering decisions.
Should you hold out for the more expensive Lutz and Lutz controls or use the cheaper ones produced
locally? Should you continue with the current plant size or cut plant size and capacity to keep within
budgetary constraints? You have also been made aware of the environmental and health risks associated
with not lining the waste ponds used by the plant. Do you advocate lining the ponds or not, the latter being
within compliance for Mexican environmental and health regulations. Prepare a STS analysis to help you
make and justify these decisions. Make a series of recommendations to your supervisors based on this study.
Puerto Rican Projects
" Your company, Cogentrix, proposes a cogeneration plant that uses coal, produces electricity, and creates
steam as a by-product of electricity generation process. Because the steam can be sold to nearby tuna
canning plants, your company wishes to study the feasibility of locating its plant in or near Mayaguez,
Puerto Rico. (Co-generation technology has become very popular and useful in some places.) Carry
out a STS analysis to identify potential problems. Make a recommendation to your company. If your
recommendation is positive, discuss how the plant should be modified to fit into the Mayaguez, Puerto
Rico STS.
" Your company, Southern Gold Resources, is interested in mining different regions in central Puerto
Rico for copper and gold. But you know that twenty years earlier, two proposals by two international
mining companies were turned down by the PR government. Carry out a STS study to examine the
feasibility of designing a different project that may be more acceptable to local groups. What does your
STS analysis tell you about social and ethical impacts, financial promise, and likely local opposition.
Can profitable mining operations be developed that respect the concerns of opposed groups? What is
your recommendation based on your STS analysis?
" Windmar, a company that manufactures and operates windmills for electricity generation has proposed
to locate a windmill farm in a location adjacent to the Bosque Seco de Guanica. They have encountered
considerable local opposition. Carry out a STS analysis to understand and clarify this opposition. Can
the concerns of local stakeholders be addressed and the windmill farm still remain profitable? How
should the windmill project be modified to improve its chances of implementation?
2.4.2 Things to Know about STSs
What is a Socio-Technical System? (STS)
A socio-technical system (=STS) is a tool to help a business anticipate and successfully resolve interdisci-
plinary business problems. "Interdisciplinary business problems" refer to problems where financial values
are intertwined with technical, ethical, social, political, and cultural values. (Reference: Chuck Huff, Good
Computing: A Virtue Approach to Computer Ethics, draft manuscript for Jones and Bartlett Publishers)
Four Things to Know About STSs
1. Socio-Technical Systems are first and foremost systems: their components are interrelated
and interact so that a change in one component often produces changes in the other
components and in the system as a whole. Bringing about good changes and preventing bad
ones requires adjusting the different elements in relation to one another to maintain or strengthen key
values embedded in the system.
2. STS have different components which interact with one another. Some of these are described
just below. They include business projects/processes, physical surroundings, stakeholders, procedures,
laws and regulations, financial and market systems, information systems, and environmental systems.
The first part of a STS analysis is to identify these components and further describe them so as to
include what makes each system special and unique.
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3. Socio-Technical systems embody values which can be located in the system's components
and throughout the system as a whole. (a) These values may be vulnerable, under attack, or at
risk. For example, the way a company stores employee data makes make it vulnerable to unauthorized
access. This would endanger the value of privacy. (b) These values may come into conflict with one
another so that resolving these conflicts may require adjusting the entire system. (c) The system and
its components may change in such a way as to produce significant risks or harms.
4. STSs change, and this change displays a trajectory or path. Frequently this trajectory is brought
about by the power exercised by entrenched interests. Ladd Devine, as a wealthy business person, is
able to exercise considerable over state policies regarding the distribution of water. His exercise of this
power sets the community of Milagro on a trajectory of change away from agriculture and more toward
the recreation industry.
2.4.3 Constituents
1. Technology including hardware, software, designs, prototypes, products, or services. Examples of
engineering projects in Puerto Rico are provided in the PR STS grid. In the Therac-25 case, the
hardware is the double pass accelerator, in Hughes the analogue-to-digital integrated circuits, and in
Machado the UNIX software system and the computers in the UCI laboratories that are configured by
this system. Because technologies are structured to carry out the intentions of their designers, they
embed values.
2. Physical Surroundings. Physical surroundings can also embed values. Doors, by their weight,
strength, material, size, and attachments (such as locks) can promote values such as security. Physical
surroundings promote, maintain, or diminish other values in that they can permit or deny access,
facilitate or hinder speech, promote privacy or transparency, isolate or disseminate property, and
promote equality or privilege.
3. People, Groups, and Roles. This component of a STS has been the focus of traditional stakeholder
analyses. A stakeholder is any group or individual which has an essential or vital interest in the
situation at hand. Any decision made or design implemented can enhance, maintain, or diminish this
interest or stake. So if we consider Frank Saia a decision-maker in the Hughes case, then the Hughes
corporation, the U.S. Air Force, the Hughes sub-group that runs environmental tests on integrated
circuits, and Hughes customers would all be considered stakeholders.
4. Procedures. How does a company deal with dissenting professional opinions manifested by employees?
What kind of due process procedures are in place in your university for contesting what you consider to
be unfair grades? How do researchers go about getting the informed consent of those who will be the
subjects of their experiments? Procedures set forth ends which embody values and legitimize means
which also embody values.
5. Laws, statutes, and regulations all form essential parts of STSs. This would include engineering
codes as well as the state or professional organizations charged with developing and enforcing them
6. The final category can be formulated in a variety of ways depending on the specific context. Computing
systems gather, store, and disseminate information. Hence, this could be labeled data and data
storage structure. (Consider using data mining software to collect information and encrypted and
isolated files for storing it securely.) In engineering, this might include the information generated as
a device is implemented, operates, and is decommissioned. This information, if fed back into refining
the technology or improving the design of next generation prototypes, could lead to uncovering and
preventing potential accidents. Electrical engineers have elected to rename this category, in the context
of power systems, rates and rate structures.
2.4.4
Ethics of STS Research
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" Right of Free and Informed Consent: This is the right of participants in a research project to
know the harms and benefits of the research. It also includes the right not to be forced to participate
in a project but, instead, offer or withdraw voluntarily their consent to participate. When preparing
a STS analysis, it is mandatory to take active measures to facilitate participants's free and informed
consent.
" Any STS analysis must take active measures to recognize potential harms and minimize or eliminate
them. This is especially the case regarding the information that may be collected about different
individuals. Special provisions must be taken to maintain confidentiality in collecting, storing, and
using sensitive information. This includes careful disposal of information after it is no longer needed.
2.4.5 Participatory Observation
" As we said above, a socio-technical system (STS) is "an intellectual tool to help us recognize patterns
in the way technology is used and produced." Constructing these tools requires combining modes of
analysis that are ordinarily kept separate. Because STSs embed values, they are normative. These
values can help to chart out trajectories of change and development because they outline values that
the system needs to realize, maintain, or even enhance. In this way, the study of STSs is normative and
a legitimate inquiry for practical and professional ethics. On the other hand, STS analysis requires
finding out what is already there and describing it. So STS analysis is descriptive as well. In this
textbox, we will talk briefly about the descriptive or empirical components of STS analysis. This
material is taken from the draft manuscript of Good Computing: A Virtue Approach to Computer
Ethics and has been developed by Chuck Huff.
" Interviews: Semi-Structured and Structured Interviews conducted with those familiar with a given
STS provide an excellent source of information on the constituents of a given STS and how these fit
together into an interrelated whole. For example, the STS grid on power systems was put together
by experts in this area who were able to provide detailed information on power rates and protocols,
software used to distribute energy through the gridlines, and different sources (representing both hard
and soft technologies) of power generation.
" Field Observation: Those constructing a STS analysis go directly to the system and describe it in
its day-to-day operation. Two books provide more information on the types and techniques of field
observation: 1. David M. Fetterman, Ethnography: 2nd Edition, Applied Social Research Methods
Series, Vol 17. London, UK.: Sage Publishers, 1998 and 2. James P. Spradley, Participant Observation.
New York, Harcourt, 1980. The data collected in this method can also be used to construct day-in-
the-life scenarios that describe how a given technology functions on a typical day. These scenarios
are useful for uncovering value conflicts and latent accidents. See James T. Reason, Human Error,
Cambridge, UK.: Cambridge University Press, 1990 for information on latent accidents, how they are
detected, and how they are prevented.
" Questionnaires: Questionnaires are useful for gathering general information from large numbers of
people about a STS. Constructing good questionnaires is a difficult process that requires patience as
well as trial and error. (Trying out questions on classmates and friends is the best way to identify
unclear or misleading questions.) Avoiding complex, overly leading, and loaded questions represent a
few of the challenges facing those who would construct useful questionnaires.
" Archival and physical trace methods: Looking at user manuals provides insight into how a system
has been designed and how it works. Studying which keys are worn down on computer keyboards
provides information on the kind of work being done. Comparing how a system is intended to work
with how it is in fact being used is also illuminating, especially when one is interested in tracing the
trajectory of a STS. Working with archival and physical trace methods requires critical thought and
detective work.
* None of the above methods, taken in isolation, provides complete information on a STS. Triangulation
represents the best way to verify data and to reconcile conflicting data. Here we generate evidence and
data from a variety of sources then compare and collate. Claims made by interviewees that match direct
42
CHAPTER 2. ETHICAL DECISION-MAKING
on-site observations confirm one another and indicate data strength and veracity. Evidence collected
through questionnaires that conflicts with evidence gathered through archival research highlights the
need for detective work that involves further observation, comparison, interpretation, and criticism.
* Developing STS analyses bears a striking resemblance to requirements analysis. In both cases, data
is collected, refined, and put together to provide an analysis. A key to success in both is the proper
combination of normative and descriptive procedures.
2.4.6 Exercise 1: Make a Table that Describes the Socio-Technical System
Directions: Identify the constituents of the Socio-Technical System. Use the broad categories
to prompt you.
1. What are the major hardware and software components?
2. Describe the physical surroundings.
3. What are the major people groups or roles involved?
4. Describe any procedures in the STS.
5. Itemize the laws, statutes, and regulations.
6. Describe the data and data structures in your STS. Use the two templates below that fill in this table
for energy generation systems and for engineering ethics in Puerto Rico.
Socio Technical System Table
Hard- Software Physical People, Procedure Laws Data
ware Sur- Groups, and Data
round- Roles Struc-
ings tures
Table 2.8
2.4.7 Exercise 2: Identify Value Mismatches in the STS
Directions: identify the values embedded in the STS. Use the table below to suggest possible
values as well as the locations in which they are embedded.
1. Integrity: "Integrity refers to the attributes exhibited by those who have incorporated moral values
into the core of their identities. Such integration is evident through the way values denoting moral ex-
cellence permeate and color their expressions, actions, and decisions. Characteristics include wholeness,
stability, sincerity, honesty to self and others, suthenticity, and striving for excellence.
2. Justice: Justice as fairness focuses on giving each individual what is his or her due. Three senses of jus-
tice are (1) the proper, fair, and proportionate use of sanctions, punishments and disciplinary measures
to enforce ethical standards (retributive justice), (2) the objective, dispassionate, and impartial distri-
bution of the benefits and burdens associated with a system of social cooperation (distributive justice),
(3) an objectively determined and fairly administered compensation for harms and injustices suffered
by individuals (compensatory justice), and (4) a fair and impartial formulation and administration of
rules within a given group.
43
3. Respect: Respecting persons lies essentially in recognizing their capacity to make and execute decisions
as well as to set forth their own ends and goals and integrate them into life plans and identities. Respects
underlies rights essential to autonomy such as property, privacy, due process, free speech, and free and
informed consent.
4. Responsibility: (Moral) Responsibility lies in the ability to identify the morally salient features of a
situation and then develop actions and attitudes that answer to these features by bringing into play
moral and professional values. Responsibility includes several senses: (1) individuals are responsible in
that they can be called upon to answer for what they do; (2) individuals have responsibilities because
of commitments they make to carrying out the tasks associated with social and professional roles; (3)
responsibility also refers to the way in which one carries out one's obligations (This can range from
indifference to others that leads to minimal effort to high care for others and commitment to excellence)
5. Free Speech: Free Speech is not an unlimited right. Perhaps the best place to start is Mill's argument
in On Liberty. Completely true, partially true, and even false speech cannot be censored, the latter
because censoring false speech deprives the truth of the opportunity to clarify and invigorate itself by
defending itself. Mill only allows for a limitation of free speech based on harm to those at which the
speech is directed. Speech that harms an individual (defamatory speech or shouting "fire" in a crowded
theatre) can be censored out of a consideration of self-defense, not of the speaker, but of those who
stand to be harmed by the speech.
6. Privacy: If an item of information is irrelevant to the relation between the person who has the infor-
mation and the person sho seeks it, then that information is private. Privacy is necessary to autonomy
because control over information about oneself helps one to structure and shape one's relations with
others.
7. Property: According to Locke, we own as property that with which we have mixed our labor. Thomas
Jefferson argues that ideas are problematic as property because, by their very nature, they are shared
once they are expressed. They are also nonrivalrous and nonexclusive.
Drawing Problems from Embedded Values
* Changes in a STS (e.g., the integration of a new technology) produce value mismatches as the values
in the new component conflict with those already existing within the STS. Giving laptops to children
produces a conflict between children's safety requirements and the safety features embedded in laptops
as designed for adults.
* Changes within a STS can exaggerate existing value conflicts. Using digitalized textbooks on laptop
computers magnifies the existing conflict concerning intellectual property; the balance between copy-
rights and educational dissemination is disrupted by the ease of copying and distributing digitalized
media.
* Changes in STS can also lead to long term harms. Giving laptops to children threatens environmental
harm as the laptops become obsolete and need to be safely disposed of.
44
CHAPTER 2. ETHICAL DECISION-MAKING
Values Embedded in STS
Hard- Software Physical People, Procedure Laws Data
ware Sur- Groups, and Data
round- Roles Struc-
ings tures
Integrity
Justice
Respect
Responsibility
for
Safety
Free
Speech
Privacy
Intellectual
Property
Table 2.9
2.4.8 Using Socio-Technical System Grids for Problem Specification
The activity of framing is a central component of moral imagination. Framing a situation structures its
elements into a meaningful whole. This activity of structuring suggests both problems and solutions. Framing
a situation in different ways offers alternative problem specifications and solution possibilities. Since skillful
framing requires practice, this part of the module suggests how socio-technical system tables can help provide
different frames for problem specification and solution generation.
Different Problem Frames
* Technical Frame: Engineers frame problems technically, that is, they specify a problem as raising a
technical issue and requiring a technical design for its resolution. For example, in the STS grid appended
below, the Burger Man corporation wishes to make its food preparation areas more safe. Framing this
technically, it would be necessary to change the designs of ovens so they are more accident-proof.
* Physical Frame: How can the Burger Man corporation redesign its restaurants as physical facilities
to make them more accessible? One way is to change the access points by, say, designing ramps to
make restaurants wheel chair accessible. Framing this as a physical problem suggests solutions based
on changing the physical structure and arrangement of the Burger Man STS.
* Social Frame: Burger Man as a corporation has stakeholders, that is, groups or individuals who have
an essential interest at play in relation to the corporation. For example, framing the problem of making
Burger Man more safe as a social problem might suggest the solution of integrating workplace safety
into worker training programs and conducting regular safety audits to identify embedded risks.
* Financial or Market-Based Frames: Burger Man is a for-profit corporation which implies that
it has certain financial responsibilities. Consequently, Burger Man should be concerned with how to
provide safe, child-proof chairs and tables that do not cut unduly into corporate profits. But like the
legal perspective, it is necessary to conduct ethical and social framing activities to compensate for the
one-sidedness of financial framing.
* Managerial Frame: Many times ethical problems can be framed as managerial problems where the
solution lies in changing managerial structures, reporting relations, and operating procedures. For
example, Burger Man may develop a specific procedure when a cashier finishes a shift and turns over
45
the cash register and its contents to another cashier. Burger Man may develop cleaning procedures
and routines to minimize the possibility of serving contaminated or spoiled food to customers.
* Legal Frame: Burger Man may choose to frame its environmental responsibilities into developing
effective procedures for complying with OSHAA and EPA regulations. Framing a problem legally
certainly helps to identify effective and necessary courses of action. But, because the ethical and social
cannot be reduced to the legal, it is necessary to apply other frames to uncover additional risks not
suggested by the legal framing.
* Environmental Framing: Finally, how does Burger Man look from the environmental standpoint?
Does it consider environmental value (environmental health, safety, and integrity) as merely a side
constraint to be addressed only insofar as it interferes with realizing supposedly more important values
such as financial values? Is it a value to be traded off with other values? (For example, Burger Man
may destroy the local environment by cutting down trees to make room for its latest restaurant but
it offsets this destruction through its program of planting new trees in Puerto Rican tropical rain
forests.) Framing a problem as an environmental problem puts the environment first and sets as a goal
the integration of environmental values with other values such as worker safety and corporate profits.
Burger Man Socio-Technical System Table
This media object is a downloadable file. Please view or download it at
Figure 2.5: Clicking on this figure will open as a Word file a STS table based on the fictional corporation,
Burger Man. Below are a list of problems suggested by the STS analysis.
2.4.9 Media File Uplinks
This module consists of two attached Media Files. The first file provides background information on STSs.
The second file provides two sample STS grids or tables. These grids will help you to develop specific STSs
to analyze cases in engineering, business, and computer ethics without having to construct a completely new
STS for each case. Instead, using the two tables as templates, you will be able to zero in on the STS that
is unique to the situation posed by the case. This module also presents background constraints to problem-
solving in engineering, business, and computer ethics. These constraints do not differ absolutely from the
constituents of STSs. However, they pose underlying constraints that outline the feasibility of an ethical
decision and help us to identify obstacles that may arise when we attempt to implement ethical decisions.
Socio-Technical Systems
This media object is a downloadable file. Please view or download it at
Figure 2.6: Socio-Technical Systems: Constituents, Values, Problems, and Constraints.
46
CHAPTER 2. ETHICAL DECISION-MAKING
STS Templates
This media object is a downloadable file. Please view or download it at
Figure 2.7: Two STSs, Power Engineering and the Puerto Rican Context of Engineering Practice.
References
1. Brincat, Cynthia A. and Wike, Victoria S. (2000) Morality and the Professional Life: Values at Work.
Upper Saddle River, NJ: Prentice Hall.
2. Huff, Chuck and Jawer, Bruce, "Toward a Design Ethics for Computing Professionals in Social Issues
in Computing: Putting Computing in its Place, Huff, Chuck and Finholt, Thomas Eds. (1994)
New York: McGraw-Hill, Inc.
3. Solomon, Robert C. (1999) A Better Way to Think About Business: How Personal INtgrity Leads to
Corporate Success. Oxford, UK: Oxford University Press.
4. Wike, Victoria S. (2001) "Professional Engineering Ethics Bahavior: A Values-based Approach," Pro-
ceedings of the 2001 American Society for Engineering Education Annual Conference and
Exposition, Session 2461.
Bibliographical Information on Power STS
1. Acceptable Evidence: Science and Values in Risk Management, edited by Deborah G. Mayo and
Rachelle D. Hollander. London, UK: Oxford University Press, 1991.
2. K. S. Shrader-Frechette. "Ethics and Energy" in Earthbound: New Introductory Essays in Environ-
mental Ethics, 1st Edition, edited by Tom Regan. NY, NY: Random House, 1984.
3. Nancy G. Leveson. Safeware: System Safety and Computers. NY, NY: Addison-Wesley Publishing
Company, 1995.
4. Charles Perrow. Normal Accidents: Living with High Risk Technologies. North America, Basic Books,
1984.
5. Malcolm Gladwell. "Blowup" in The New Yorker, January 22, 1996: 32-36.
6. James Reason. Human Error. Cambridge, UK: Cambridge University Press. 1990.
7. Mark Sagoff. The Economy of the Earth: Philosophy, Law, and the Environment. Cambridge, UK:
Cambridge University Press, 1988.
Chapter 3
CSR (Corporate Social Responsibility)
3.1 A Short History of the Corporation1
NOTE:
Word Version of this Template
This is an unsupported media type. To view, please see http://cnx.org/content/m17314/latest/ EAC TK
STD TEMPLATE.doc
Figure 3.1: This is an example of an embedded link. (Go to "Files" tab to delete this file and replace
it with your own files.)
3.1.1 Introduction
In this module you will learn about the history of corporations. Antecedants of the modern corporation
can be found in the Middle Ages, the Renaissance, and in the Industrial Revolution in Great Britain and
the United States. Corporations have evolved into their present form as the synthesis of discrete solutions
to specific historical problems that have arisen in the practice of business. This module has been designed
for courses in (1) business, society, and government, (2) business ethics, (3) corporate governance, and (4)
corporate social responsibility.
3.1.2 What you need to know ...
3.1.2.1 The History of the Corporation
This historical process has produced five functions that characterize the modern corporation.
Corporations have emerged as...
iThis content is available online at .
47
48
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
1. "Passive devices" that hold property
2. Structures designed to exert monopoly control over and regulate a domain of specialized knowledge
and skill
3. Means designed to pool capital and resources including human resources
4. A legal shield that protects owners and investors from liability and helps to spread and distribute
financial, moral, and legal risk
5. Organizational decision-making structures that subordinate and synthesize the actions of human agents
to bring about collective goals such as building a railroad, designing and manufacturing automobiles,
and pursuing legitimate business ventures.
3.1.2.1.1 Passive Devices that hold property
When the abbot of a medieval monastery died, public officials had difficulty determining to whom its property,
wealth, and resources passed. While this is hard to conceptualize from a modern standpoint, during the
Middle Ages, no legal distinction could be made between (1) managing property owned by others, (2)
exercising stewardship over property owned by others, and (3) owning property. Moreover, the concept and
practice of owning property is complex. "Property" in its modern sense has been spelled out as a bundle
of distinct rights including "the right to possess, control, use, benefit from, dispose of and exclude others
from the property." (DesJardins: 37) These distinct rights are not given as entailments of a natural concept
of property but represent legally endowed capacities designed to respond to specific practical problems. So,
to return to the problem created by the death of the abbot, a legal entity (called the church) was created
and endowed with the one of the bundled rights accompanying the notion of property, namely, the right to
possess and hold property (Stone 1974: 11)
3.1.2.1.2 Structures that exert monopoly control and regulate a domain of specialized
Those familiar with European history know that the university came from student guilds. Students banded
together to hire noted scholars willing to teach their research. Other guilds were formed around practical
occupations as butchering or shoe making. Eventually, guilds evolved to address a series of practical problems:
(1) how to educate individuals concerning the skills and knowledge required by the practice, (2) how to
identify those responsible for the improper practice of the craft, (3) how to control who could and could
not participate in (and profit from) the craft, and (4) how to regulate the craft to promote the interests of
its practitioners and its beneficiaries or clients. Guilds became responsible for controlling the privileges of
a trade, establishing rules and standards of practice, and holding courts to adjudicate grievances between
participants. (Stone: 11-13)
3.1.2.1.3 A set of means specially designed to pool capital and resources including human
resources.
As business ventures became more ambitious, their successful execution required raising considerable funds
and capital along with the coordination of the activities of diverse human agents. Organizational structures
were created slowly over time to raise money, acquire capital, and manage these complex ventures. This
included creating roles that were coordinated through complex organizational systems. The distinction
between the owner and manager functions, so crucial to the structure of the modern corporation, emerged
slowly during this period. Owners provided money and capital and determined the overall goals pursued
by the organization. Managers carried out administrative tasks concerned with day to day operations; their
moral and legal duty was to remain faithful to the aims and interests of the owners. Unchartered joint stock
companies served as proto-corporations that generated capital, protected monopolies of trade and craft, and
managed complex ventures such as importing spices and tea from the Orient. As these structures evolved,
they increasingly embodied the important distinction between the ownership and management functions.
49
3.1.2.1.4 Providing a legal shield to limit owner and operator liability
Scandals in 18th century Great Britain revealed another set of problems besetting the emerging corporation.
When the unchartered joint stock company, the South Sea Company, went bankrupt, all the investors
and owners found themselves responsible for covering the huge debt created when risky investments and
questionable ventures went sour. This debt went well beyond resources of the investors destroying their
personal fortunes and placing many of them in debtor's prison. (This and other fiascoes were dramatized by
Charles Dickens in his novel, Little Dorrit.) The specter of unlimited liability scared off potential investors
and set back the development of the corporation. It became necessary to endow joint stock companies with
powers and devices that limited and distributed financial, moral, and legal risk. (Both owners and managers
required protection although in different ways.) Individuals would invest in joint stock companies only when
the associated risks became manageable and widely distributed.
3.1.2.1.5 Organizational structure that subordinate and synthesize the actions of human agents
Negatively, the development of the modern corporation was facilitated by creating a shield that limited the
liability of owners and managers. Liability for owners was limited legally to the amount invested. Liability
for managers required proving that they failed to remain faithful to the interests of the stockholders, the
principals or originators of their actions. This broke down into demonstrating failure to exercise "sound
business judgment" by, among other things, allowing outside, competing interests to corrupt their business
judgment. Positively, the corporation emerged out of a series of legal innovations designed to establish and
then control the collective power of corporate organizations. Complex organizational structures were created
that designed differentiated roles filled by employees. These structures served to channel the activities of
employees toward corporate ends. The investor role stabilized into that of stockholders who owned or held
shares of the corporation. To promote their interests and to establish the cardinal or fundamental objectives
of the corporation, the stockholders elected representatives to serve on a board of directors. The directors
then appointed managers responsible for running the corporation and realizing the interests and objectives of
the stockholders. Managers, in turn, hired and supervised employees who executed the company's day to day
operations (line employees) and provided expert advice (staff employees). These roles (and the individuals
who occupied them) were related to one another through complex decision-making hierarchies. Davis (1999)
in his discussion of the Hitachi Report shows how many modern companies have dropped or deemphasized
the staff-line distinction. Others (Stone, Nader) cite instances where managers have become so powerful that
they have supplanted the directorial role. (They hand pick the directors and carefully filter the information
made available to stockholders.) But these two distinctions (staff v. line and owner v. operator) remain
essential for understanding and classifying modern corporations. (See Fisse, Stone, and Nader.)
3.1.2.1.6 Profile of the Modern Corporation
Corporations became full blown legal persons. They acquired legal standing (can sue and be sued), have
been endowed with legal rights (due process, equal protection, and free speech), and have acquired legal
duties (such as tax liabilities). (See table below for the common law decisions through which these corporate
powers and rights have been established.) The powers of the corporation were regulated by the state through
founding charters which served roughly the same function for a corporation as a constitution did for a state.
Initially, charters limited corporate powers to specific economic activities. Railroad companies, for example,
had charters that restricted their legitimate operations to building and operating railroads. When they
sought to expand their operations to other activities they had to relate these to the powers authorized in
the founding charter. If a charter did not specifically allow an operation or function, then it was literally
ultra vires, i.e., beyond the power of the corporation (Stone: 21-22). This method of control gradually
disappeared as states, competing to attract business concerns to incorporate within their boarders, began to
loosen charter restrictions and broaden legitimate corporate powers in a process called "charter mongering."
Eventually charters defined the legitimate powers of corporations so broadly that they ceased to be effective
regulatory vehicles.
50
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
Given this vacuum, governments have had to resort to other measures to control and direct corporations
toward the public good. The practice of punishment, effective in controlling human behavior, was extended
to corporations. But Baron Thurlow (a British legal theorist) framed the central dilemma in corporate
punishment with his oft quoted comment that corporations cannot be punished because they have "no soul
to damn" and "no body to kick." The unique attributes of corporations has given rise to creative options for
corporate control and punishment: fining, stock dilution, court-mandated changes in corporate structure,
adverse publicity orders, and community service. (See Fisse) Most recently, Federal Sentencing Guidelines
have sought to provide incentives for corporations to take preventive measures to avoid wrongdoing by
developing ethics compliance programs. These guidelines adjust punishments in light of ethics programs
that the corporations have designed and implemented to prevent wrongdoing. Corporations found guilty of
wrongdoing would still be punished. But punishments can be reduced when guilty corporations show that
they have developed and implemented compliance programs to promote organizational ethics and to prevent
corporate wroingdoing. These include compliance codes, ethics training programs, ethics risk identification
measures, and corporate ethical audits.
History of Corporation
Problem Solution Organizational Form
Successfully transferring stew- Create a "passive device to hold Proto-corporation
ardship over church holdings to property"
new abbot
Control over and regulation of a Create a device to (a) hold Medieval guilds that evolve into
practice or skill the privileges of some partic- regulated companies.
ular trade, (b) establish rules
and regulations for commerce,
and (c) hold courts to adjudicate
grievances among members.
Pooling capital and resources and Create a device (a) to hold provi- Unchartered joint stock compa-
directing complex ventures leges of trade, (b) where investors nies
provide capital, and (c) that del-
egates operations to managers
Limiting investor liability, limit- Corporation evolves into a legal Limited corporation whose oper-
ing manager liability, and balanc- person with (a) legal rights and ations are defined in and limited
ing the two duties, (b) owned by sharehold- by the charter
ers, (c) run by managers, (d) reg-
ulated through state charter
continued on next page
51
Ultra Vires (charter prevents Granted broad powers through Full Blown Corporation
growth) and Charter Mongering more broadly defined charters
Finding agent responsible for (a) Due process, equal protec- Corporation as Legal Person
wrongdoing tion, and free speech rights, (b)
legal duties, (c) legal standing,
(d) Federal Sentencing Guide-
lines, and Sarbanes-Oxley Act
Table 3.1: Modified from Christopher Stone, Where the Law Ends
Options for Corporate Punishment (Fisse and French)
DescriptionExample Target of Deterrenc Non- Responsive Interferen
Punish- Trap financial Adjust- with
ment Avoided? Values ment Cor-
Ad- porate
dressed? Black
Box
Monetary Fines Pentagon Harms in- Fails to Few or None No inter-
Exaction Procure- nocent Escape None ference
ment Targeted
Scandals
Stock Di- Dilute Stockholder Escapes Few or Limited No inter-
lution Stock and (Not nec- by attack- None ference
award to essarily ing future
victim guilty) earnings
Probation Court SEC Vol- Corporation Escapes Focuses on Passive Substantial
orders untary and its since it manage- adjust- entry into
internal Disclosure Members mandates ment and ment since and in-
changes Program organi- subgroup imposed terference
(special zational values from with cor-
board changes outside porate
appoint- black box
ments)
continued on next page
e
52
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
Court Court English Targets Escapes Loss of Active ad- No direct
Ordered orders Bread corporate (although prestige / justment inter-
Adverse corpora- Acts (Hes- image adverse Corporate triggered ference
Publicity tion to ter Prynne publicity shame / by shame (corpo-
publicize shame in indirectly Loss of ration
crime Scarlet attacks Face/Honor motived
Letter) financial to restore
values) itself)
CommunityCorporatio Allied RepresentativEscapes Adds Passive None
Service performs chemical groups/indivisliuas value to or no ad-
Orders services (James from cor- targets commu- justment:
mandated River poration non- nity sometimes
by court Pollution) financial public
values does rec-
ognize
that cs is
punish-
ment
Table 3.2
Requirements of Sarbanes-Oxley (Summarized by Dyrud: 37)
"
0
0
0
0
0
0
Provide increased protection for whistle-blowers
Adhere to an established code of ethics or explain reasons for non-compliance
Engage in "full, fair, timely and understandable disclosure"
Maintain "honest and ethical" behavior.
Report ethics violations promptly
Comply with "applicable governmental laws, rules, and regulations"
Dyurd cites: ELT, Ethics and Code of Conduct, n.d.; http://www.elt-inc.com/solution/ethics
andcodeofconduct training obligations.html
Amended Federal Sentencing Guidelines (Taken from Dyrud: 37)
1. Establishing standards and procedures to prevent and detect criminal conduct
2. Promoting responsibility at all levels of the program, together with adequate program resources and
authority for its managers
3. Exercising due diligence in hiring and assigning personnel to positions with substantial authority
4. Communicating standards and procedures, including a specific requirement for training at all levels
5. Monitoring, auditing, and non-internal guidance/reporting systems
6. Promiting and enforcing of compliance and ethical conduct
7. Taking reasonable steps to respond appropriately and prevent further misconduct in detecting a vio-
lation
3.1.2.2 Legal Trail Toward Corporate Moral Personhood: A Table Summary
53
Date Decision Legal Right Affirmed
1889 Minneapolis and St. L. R. Co. v. Right for judicial review on state
Beckwith legislation
1893 Noble v. Union River Logging R. Right for judicial review for
Col, rights infringement by federal leg-
islation
1906 Hale v. Henkel Protection "against unreasonable
searches and seizures (4th)
1908 Armour Packing C. v. United Right to trial by jury (6th)
States
1922 Pennsylvania Coal Co. V. Mahon Right to compensation for gov-
ernment takings
1962 Fong Foo v. United States Right to freedom from double
jeopardy (5th)
1970 Ross v. Bernhard Right to trial by jury in civil case
(7th)
1976 Virginia Pharmacy Board v. Vir- Right to free speech for purely
ginia Consumer Council) commercial speech (1st)
1978 First National Bank of Boston v. Right to corporate political
Bellotti speech (1st)
1986 Pacific Gas and Electric Com- Right against coerced speech
pany v. Public Utility Commn (1st)
of California
Table 3.3: From Ritz, Dean. (2007) "Can Corporate Personhood Be Socially Responsible?" in eds. May,
S., Cheney, G., and Roper, J., Oxford, UK: Oxford University Press: 194-195.
3.1.2.3
3.1.3 What you will do ...
3.1.3.1 Exercise One: Other People's Money
Watch the shareholder's meeting in the movie, " Other People's Money." Then answer the
questions below. Think generally about what the manager of a corporation should do with
the money its stakeholders have invested in it.
" What is Larry the Liquidator's basic argument? What is Andrew Jorgensen's basic argument?
" What is Larry the Liquidator's conception of the nature and value of the corporation? What is Andrew
Jorgensen's conception of the nature and value of the corporation?
" What is the social responsibility of a corporation according to Larry the Liquidator? What is it
according to Andrew Jorgensen?
* Write a paragraph on which argument you find most persuasive, that of Larry or that of Andrew.
Explain why you find it persuasive.
54
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
3.1.3.2 Exercise Two: How to punish Arthur Andersen
Watch the documentary, "The Smartest Guys in the Room," paying special attention to the
role played in the Enron fiasco by the accounting firm, Arthur Andersen. Then answer the
following questions.
* How important should AA's former, excellent reputation have been in determining how to punish it in
the role it played in the Enron case? Explain your answer.
* Enron was only the last of a series of ethics scandals that AA had fallen into. How should it have
adjusted to prior scandals? (Are the Federal Sentencing Guidelines of any help here?)
* Consider that Sarbanes-Oxley was passed largely in response to Enron. Do its provisions go far enough
to prevent future Enrons? Do they go too far?.
* Using the table that summarizes punishment options provided by French and Fisse, how would you
construct a punishment for Arthur Andersen? Who should be targeted? Should the company's black
box be left alone? Is it better to attack financial or non-financial values? Should Arthur Andersen and
other corporate offenders be encouraged to reform themselves or should those reforms be designed and
directed from the outside?
3.1.3.3
3.1.4 What did you learn?
Peter French speculates on the possibility that a corporation could consist of nothing more than a sophis-
ticated software program. He also holds forth the notion of corporate moral personhood (as opposed to
natural personhood). Now that you have had an opportunity to study the history of and structure of the
modern corporation, what do you think about the nature of corporations?
3.1.5 Appendix
3.1.5.1 Bibliography
1. Stone, C. D. (1975) Where the Law Ends: The Social Control of Corporate Behavior.
Prospectr Heights, IL: Waveland Press, INC: 1-30.
2. Des Jardins, J.R. (1993) Environmental Ethics: An Introduction to Environmental Philoso-
phy. Belmont, CA: Wadsworth Publishing Company: 37.
3. Clarke, T. (2004) "Introduction: Theories of Governance-Reconceptualizing Corporate Governance
Theory After the Enron Experience," in Theories of Corporate Governance: The Philosophical
Foundations of Corporate Governance, ed. Thomas Clarke. New York: Routledge: 1-30.
4. French, P.A. (1984) Collective and Corporate Responsibility. New York: Columbia University
Press..
5. French, P.A. (1997) "Corporate Moral Agency" in Werhane, P.H., and Freeman, R.E. Blackwell
Encyclopedic Dictionary of Business Ethics. Oxford, UK: Blackwell: 148-151.
6. May, L. (1987) The Morality of Groups: Collective Responsibility, Group-Based Harm, and
Corporate Rights. Notre Dame, IN: University of Notre Dame Press.
7. Werhane, P. H. (2008) "Mental Models: Moral Imagination and System Thinking in the Age of Glob-
alization," in Journal of Business Ethics, 78: 463-474.
8. Werhane, P. (2007) "Corporate Social Responsibility/Corporate Moral Responsibility: Is There a
Difference and the Difference It Makes," in eds., May, S., Cheney, G., and Roper, J., The Debate
over Corporate Social Responsibility. Oxford, UK: Oxford University Press: 459-474.
9. Fisse, B. and French, P.A., eds. (1985) Corrigible Corporations and Unruly Law. San Antonio,
TX: Trinity University Press.
10. Nader, R. and Green, M.J., eds. (1973) Corporate Power in America. New York: Grossman.
11. Nader,, R. Green, M. and Seligman, J. (1976) Taming the Giant Corporation. New York: Norton.
55
12. Davis, M. (1998) Thinking Like an Engineer: Studies in the Ethics of a Profession. Oxford,
UK: Oxford University Press: 119-156.
13. Jackall, R. (1988) Moral Mazes: The World of Corporate Managers. Oxford, UK: Oxford
University Press.
14. Carol, A. B., "Social Responsibility," in Werhane, P., and Freeman, R. E., eds. (1997, 1998) Blackwell
Encyclopedic Dictionary of Business Ethics. Oxford, UK: Blackwell Publishers, INC: 593-595.
15. Dyrud, M.A. (2007) "Ethics, Gaming, and Industrial Training," in IEEE Technology and Society
Magazine. Winter 2007: 36-44.
16. Ritz, Dean. (2007) "Can Corporate Personhood Be Socially Responsible?" in eds. May, S., Cheney,
G., and Roper, J., Corporate Governance. Oxford, UK: Oxford University Press: 194-195.
3.1.6 EAC ToolKit Project
3.1.6.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License2 regarding permission to reuse this material.
3.1.6.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
3.2 Moral Ecologies in Corporate Governance3
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3.2.1 Two Thought Experiments
The Ring of Gyges (Plato's Republic II, S359)
Gyges a poor shepherd is tending his flock when there is an earthquake. A hugh crack opens in the earth to
expose a sarcopagus. Gyges reaches in and takes the ring that draws his attention. Later, when he is talking
among friends, he notices that he becomes invisible when he turns the ring in toward himself. He tries this
out a few times and then forms his plans. Invisible, he gains entry to the king's castle and rapes the queen.
Drawing her into his nefarious plan, they kill the king and take over the kingdom. Gyges marries the queen
and becomes ruler of a large and wealthy kingdom. Somehow it doesn't seem fit to say that he lives "happily
ever after." But, since he is never caught, it doesn't follow that his ill-gotten gain has made him miserable.
Before finding his ring, Gyges was, at least outwardly, a well-behaved, just citizen. But the combination
of vast power and no accountability drew Gyges over to the dark side. Does the human character, like that
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3This content is available online at .
56
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
of Gyges, dissolve in the face of temptation and lack of accountability? Is the threat of punishment necessary
to keep individuals moral? Is visibility and the threat of punishment all that stands between an individual
and a life of injustice?
The Milgram Experiments
From 1960 until 1963, Stanley Milgram, a social psychologist, carried out a series of experiments on around
1000 subjects. Each experiment brought together three participants, a subject (or teacher), a learner, and
an experimenter. In the initial orientation, the experimenter told the subject/teacher and the learner that
they were about to participate in an experiment designed to measure the influence of punishment (in the
form of electrical shocks) on learning. The learner was presented with information. The teacher then asked
questions based on this information. If the learner answered correctly, then they went on to the next question.
If the learner answered incorrectly, then he was given an electrical shock by the teacher. With each missed
question the intensity of the shock increased. The experiment continued until all the questions were asked
and answered.
However, these instructions constituted a deception brought upon the teacher/subject by the secret
collaboration of the experimenter and the learner. The real purpose of the experiment was to determine
how far individuals would go in turning against their moral views on the basis of an external authority. The
learner feigned pain and suffering because there was no actual electrical shock. And the learner deliberately
missed most of the questions in order to force the teacher to progress to higher and what appeared to be
life-threatening levels of shock. While teachers were not physically forced to continue the experiment over
the feigned protests of the learners, whenever they tried to stop it, they were told by the experimenter that
they had to continue to the end.
Before the Milgram experiments were carried out, a group of psychogists were asked to predict how
many teachers/subjects would go all the way to the end and give the learner what they thought were life-
threatening and highly painful shocks. The consensus was that most would stop the experiment early on
when the learner first began to protest. But the actual results were quite "shocking." Nearly 60 percent of
the teachers went all the way and gave the learner the maximum shock. You can read more about these
experiments and how they have been interpreted by reading Milgram 1974 and Flanagan 1991. You Tube
has several video vignettes on the Milgram Experiments. Simply type "Milgram Experiments" in the search
window and browse the results.
Can authority and environment override our everyday moral beliefs as well as the characters constructed
from them? Is character robust and "trans-situational?" Or is it radically dependent on situation and
environment? Can normally decent and well-behaved individuals turn into moral monsters given the right
external conditions?
From Gyges and Milgram to Moral Ecology
Both of these thought experiments raise the question of the influence of environment on character. This
module is designed to help increase the strength of moral character by identifying different organizational
environments (called "moral ecologies") and having you developing strategies to resist their pressures and
maintain integrity.
3.2.2 Introduction
Corporate governance is defined in the Blackwell Encyclopedic Dictionary of Business Ethics as "concerned
with those decisions made by the senior executives of a firm and the impacts of their decisions on various
stakeholder groups." (EBE 147) This module turns corporate governance inside-out and looks at it from the
perspective of the governed, that is, from the directors, managers, and employees subject to the structures
and strategies of corporate governance. Corporate environments function as "moral ecologies," that is,
"the somewhat stable, but constantly negotiated set of values, practices, and influences within societies,
organizations, professions, and work groups." (Huff et. al., 2008) The thrust of this module is to help you
begin to strategize on how to develop sustainable moral careers within different moral ecologies. You will
study different kinds of moral ecologies using a taxonomy developed from the research of Michael Davis in
Thinking Like an Engineer and Robert Jackall in Moral Mazes. Huff (2008) provides some generic
strategies for individuals to pursue within in these organizational environments. But the exercises included
57
in this module will encourage you to expand upon this list. Working through this module will help you to
view corporate governance from within from the micro perspective of the individual. Another module will
allow you to see corporate governance from the outside from the macro point of view.
3.2.3 What you need to know ...
3.2.3.1 Three Moral Ecologies
Summary Table
Type / Char- Managers Centrality of Allocation of Withholding Treatment of
acteristics and engi- ethics and praise and information dissent and
neers: role values blame DPOs
and partici-
pation
Finance- Managers Ethics and Allocated Managers "Shoot the
Driven play line values are side according withhold to messenger!"
role (=make constraints to hierarchi- control and Dissent
decisions) En- dealt with cal position: protect secrets. disloyalty and
gineers provide when they op- praise goes Engineers betrayal.
technical infor- pose financial up and blame withhold bad
mation (=staff considerations goes down. news to avoid
role) blame.
Customer- Managers Ethics and Praise and Information Differences oc-
Driven make decisions values are not blame are not withheld cur but engi-
on financial central but are fairly allo- but gaps arise neers are ex-
matters. En- still important. cated based because or role pected to advo-
gineers "go to on assigned differences. cate their per-
the mat" on responsibility spective in de-
engineering and contribu- cision making
matters. tion. process.
Quality- Manager and Ethics and Praise and Open consen- Engineers
Driven engineering values are con- blame are sus process and managers
distinction stitutive of the attributed to ensures that work toward
drops out. organization's group and needed in- consensus by
Interdisci- identity. distributed formation is gathering more
plinary work to individ- integrated information,
teams are em- uals within into decision continuing the
powered and according to making discussion, and
responsible contribution. (as last resort)
postponing the
decision until
consensus is
reached.
Table 3.4
Breakdown of Table
* Moral ecologies can be categorized according to a series of considerations. The table above focuses on
five.
58
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
" First, managers and engineers occupy distinct roles and participate differently in the decision making
process. Managers play the line role. They collect information to make decisions that govern the day
to day operations of the corporation. Engineers are hired as staff employees. They provide technical
information to decision makers but do not participate directly in the decision making process. This
raises difficulties when engineers, for technical or ethical reasons, disagree with the decisions taken by
their managers. The line and staff roles channel decision making and constrain dissent.
" Moral ecologies can also be typed according to the centrality of ethical considerations in the corpora-
tion's goals, charter, operations, and even identity. Ethical considerations can range from (1) playing
a central role, (2) to playing an important but subordinate role, (3) to being marginalized as irrele-
vant side constraints. The importance a corporation places on ethics colors all the other categories
mentioned in the table above. If ethics is central to a corporation then it plays a central role in the de-
cision making process, guides the allocation of praise and blame, determines the nature and amount of
information shared in the decision making process, and determines how an organization treats dissent
and disagreement.
" A corporation's conception of responsibility is revealed through the ways in which it allocates praise
and blame. Significant differences arise between the way finance companies assign praise and blame
and the ways these are allocated in quality or customer driven companies. Again, this related to the
roles played by engineers and managers and the centrality of ethics in the corporation's governance.
" Ethical problems arise when crucial information is withheld from the decision making process. Hence,
the flow of communication and the kinds of situations in which communication flow is disrupted helps
to characterize a moral ecology. For example, the Hitachi report asserts that communication between
managers and engineers breaks down predictably within finance-driven companies. This breakdown is
grounded in the characteristics of the finance-driven moral ecology, especially in differences between
the managerial and engineering roles and the extent to which managers and engineers participate in
decision making.
" Finally, moral ecologies can be classified according to how they treat dissent and dissenting professional
opinions. Dissent is less likely in quality than in finance-driven companies. While finance-driven
companies treat dissent as disloyalty, quality- and customer-driven driven companies treat dissent as
a stage in the process of reaching consensus.
Finance-Driven Companies
1. Finance-driven companies place financial objectives at the very heart of their constitutive objectives
and corporate identity. For example, such companies are focused on maximizing returns for investors.
2. Manager and Engineer Roles and Participation in Decision Making Process: Managers play
the line role in that they make the decisions that drive the day to day operations of the corporation.
They bear responsibility for the consequences of their decisions and they are also responsible as the
faithful agents of the company's directors. Being a faithful agent requires that one treat another's
interests as one's own, maintain confidentialities, and avoid interests that conflict with the director.
Engineers play the staff role, that is, they answer questions put to them by managers and are responsible
for providing competent technical information. However, they do not participate directly in the decision
making process, nor do they bear responsibility for the results of their manager's decisions.
3. Centrality of ethics and values in the corporations decision making process: Ethical consid-
erations play only the role of side constraits in the setting of corporate policity and in the formulation
and execution of its decisions. This means that ethical considerations are important only if they
promote or interfere with the central, financial objectives. If appearing philanthropical is good for a
corporation's image (and generates customers and profits) then the corporation appears philanthropic.
If the corporation is likely to get caught in an ethical violation (excessive pollution) and this negative
publicity will lower its prestige (and profits) then the corporation will not commit the violation. But
in each case, the end is the promotion of financial objectives and the means are appearing ethical.
4. Allocating Praise and BlameJackall goes into detail on how finance-driven corporations (and bu-
reaucracies in general) assign praise and blame. The crucial factor is one's position in the corporate
59
hierarchy. Praise works its way up the corporate ladder. If engineer Smith saves the company from a
sever financial loss, then Smith's supervisor (or his supervisor's supervisor) gets the credit. However,
if Smith's supervisor messes up, the blame passes down the corporate ladder to Smith. Praise moves
up the corporate hierarchy, blame down.
5. Information Exchange between Engineers and Managers: In finance driven companies, man-
agers withhold information from the engineers under their supervision for a variety of reasons. For
example, if it is proprietary information, the manager may withhold all or part to prevent engineers
from leaving the firm and revealing its secrets to a competitor. Managers may also use information
to wield power and authority. By keeping engineers in the dark (like mushrooms) they effectively
maintain authority and prevent dissent. On the other hand, engineers withhold bad news from their
managers to avoid blame as well as the "shoot the messenger" syndrome. (When the incompetent
general receives bad news from a soldier, he shoots the soldier rather than respond to the news.)
6. Handling Dissenting Professional Opinions: Dissent is interpreted as disloyalty in finance-driven
companies. This organizational habit (maintained by managers to hold on to their authority) will
even undermine DPO (dissenting professional opinion) procedures that look good on paper. A good
DPO procedure communicates the opinion to several levels of supervisor, allows for the independent
investigation of the merits of the opinion, and prevents retaliation against the professional asserting the
opinion. But ruthless managers find ways to undermine such a procedure at all levels. Engineers may
claim the right not to be held as scape goats to administrative incompetence. (See the Theory Building
Activities: Rights module) This right may be supported on paper by a detailed DPO procedure. But
it also has to be implemented at all levels and continually monitored.
Customer-Driven Companies
* Customer-driven companies focus on customer satisfaction. If the customer asks for or is satisfied with
a lower quality product, then this is an acceptable result for this type of company as opposed to a
quality driven company which would stand fast with the higher quality product.
* Managers and engineers: roles and participation: Managers make decisions on financial matters.
But engineers are expected to "go to the mat" for engineering standards when these form all or part of
the decision. Hence the distinction between managers (playing the line role) and engineers (playing the
staff role) weakens, and engineers play a much more active role (advocates for engineering standards)
in decision making. (Engineering standards include engineering ethics standards.)
* Centrality of Ethics and Values: While customer satisfaction plays the central role, ethical consid-
erations are still important, especially regarding the ethical treatment of customers and reflecting the
ethical values held by the customers. In many cases, it is difficult to distinguish quality and customer
driven companies as the role ethical standards play gets closer to a central, constitutive one.
* Allocation of Praise and Blame: Responsibility in customer driven companies is tied closely to
individual performance and contribution. This is because customer satisfaction is a more objective
criterion than the internal political standards that dominate finance driven companies. Responsibility
is closely alligned with contribution.
* Withholding Information: Information enhances control and responsibility. (The more you know,
the more reponsibly you can act.) Since praise and blame are allocated according to contribution,
there is less incentive to withhold information. If communication gaps arise between engineers and
managers, these are much more likely to hinge on disciplinary differences. Engineers may have trouble
communicating technical information to managers, or appear condescending by "dumbing down" the
information. Managers may have difficulties communicating financial constraints to engineers who
focus on quality standards. But these are minor, resolvable gaps.
* Treatment of Dissent: Dissent and disagreement are not only tolerated but actually expected.
Managers expect engineers to advocate for issues in their sphere as they pertain to the decision making
process. This process itself is adversarial because it is assumed that this is the best way to get all the
information out on the table. Bad news and professional dissenting opinions are not interpreted as
disloyalty; in fact, disloyalty lies in refusing to expose flaws in the choices proposed by one's supervisor.
60
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
Managers expect their engineers to "go to the mat" when advocating technical positions based on their
professional judgment.
Quality-Driven Companies
* Quality-driven companies stand out for the emphasis they place on achieving high engineering standards
and on elevating the participation of the engineer in the decision making process. As is implied by
the name, the central focus of these corporations is the achievement of high quality in products and
services.
* Managers and Engineers: Role and Participation: In quality-driven companies, the distinction
between the manager and engineering roles drops out. For example, while engineers play the staff
role and provide expert engineering advice, they also participate fully in the decision making process.
The locus of decision making moves from individual managers to small interdisciplinary groups. These
groups, in turn, carry out consensus-based decision making procedures.
* Centrality of Ethics and Values: In quality-driven companies, ethics and values are central to the
organization's objectives, charter, and identity. This has a decisive impact on the role of the engineer
in the decision-making process. In customer driven companies, engineers are expected to advocate
engineering and ethical standards precisely because these are not central to the organization's identity.
But the centrality of ethical concerns in quality driven companies changes the engineer's role from
advocacy to channeling technical expertise toward realizing ethical value.
* Allocation of praise and blame: In customer-driven companies, blame avoidance procedures no
longer dominate the decision making process. In quality driven companies they disappear completely.
Decisions are made by interdisciplinary groups in which engineers and managers participate fully and
equally. Responsibility (praise and blame) then is allocated to the group. If it is distributed to members
inside the group it is done so on the basis of contribution. But the primary target of responsibility
ascriptions is the group, not the individual. And the response to untoward happenings is not targeting
individuals and groups for blame but taking measures to learn from mistakes and avoiding them in the
future.
* Withholding Information: The open, consensus-based decision process ensures that the needed
information is brought forth and integrated into the decision. This results from removing a primary
motivation to withholding information, namely, blame avoidance. Quality-driven corporations aggres-
sively move to prevent untoward occurrences and, should prevention fail, make adjustments to ensure
they do not reoccur. The motive to withhold information does not arise in this moral ecology.
* Treatment of Dissent and DOPs (dissenting professional opinions): Engineers and managers
work toward consensus by gathering information, discussing the problem and continuing the discussion
until consensus is reached. Thus, dissent does not stand alone but is considered to be an essential
and healthy component to the decision-making process. When consensus is not immediately reached,
participants seek more information. If consensus is still not reached, the decision is postponed (if this
is possible). The most viable strategy to reach consensus is to continue the discussion. For example, an
engineer and manager might approach a supervisor; in this way they bring a new perspective into the
decision-making process. They might consult other experts. The crucial point here is that disagreement
(really non-agreement) is not a bad thing but a necessary stage in the process of reaching agreement
and consensus.
Skill Sets
* The four skills described below are derived from studying the moral expertise displayed by moral
exemplars. Each moral ecology will require the exercise of each of the skills described below. However,
each skill has to be contextualized into the moral ecology. For example, reasonableness should not be
exercised in the same way in a finance-driven company as it should be exercised in a quality-driven
company. The reasonable exercise of dissent is manifested differently in an environment where dissent
is equated with disloyalty than in one in which dissent is embraced as a necessary part of the consensus-
reaching process. So your job, in constructing your moral careers within these different moral ecologies,
61
is to contextualize the skill, that is, describe specifically how each skill should be practiced in each
particular moral ecology.
* Moral imagination consists of projecting oneself into the perspective of others. It also includes
multiple problem definitions and the ability to distance oneself from the decision situation to gain
impartiality.
* Moral creativity is the ability to generate non-obvious solutions to moral challenges while responding
to multiple constraints.
* Reasonableness consists of gathering relevant evidence, listening to others, giving reasons for one's
own positions (arguments and evidence), and changing plans/positions only on the basis of good
reasons.
* Perseverance involves planning moral action and responding to unforeseen circumstances while keep-
ing moral goals intact.
Personality Traits
* Extraversion: Extraversion, which is paired with its opposite, introversion, has also been called
confident self-expression, assertiveness, social extraversion, and power. An individual in whom this
trait dominates tends to be assertive and out-going.
* Conscientiousness: Individuals with this trait are successful in carrying out tasks because they can
discipline themselves to stay focused on a task. They are successful in the right moral ecology and tend
to conform to the basic norms of their environment. This trait can lead to bad results if not guided by
moral considerations.
* Neuroticism: This trait indicates a lack of emotional stability. According to Huff et al., "it is
correlated with less effective coping and depression." Neuroticism has also been shown to interfere
with the exercise of moral skills. Is there a particular moral ecology that can heighten the negative
impacts of this personality trait?
* Agreeableness: According to Huff et al, this trait has also been called "social adaptability, likability,
friendly compliance, and love." Again think about how this trait would operate within a finance-driven
moral ecology as opposed to a quality-driven one.
Two Kinds of Moral Expertise
* Studies carried out by Chuck Huff into moral exemplars in computing suggest that moral exemplars
can operate as craftspersons or reformers. (Sometimes they can combine both these modes.)
* Craftspersons (1) draw on pre-existing values in computing, (2) focus on users or customers who have
needs, (3) take on the role of providers of a service/product, (4) view barriers as inert obstacles or
puzzles to be solved, and (5) believe they are effective in their role.
* Reformers (1) attempt to change organizations and their values, (2) take on the role of moral crusaders,
(3) view barriers as active opposition, and (4) believe in the necessity of systemic reform
* These descriptions of moral exemplars have been taken from a presentation by Huff at the STS collo-
quium at the University of Virginia on October 2006.
3.2.4 What you will do ...
In this section, you will learn about this module's activities and/or exercises. You will also find step by step
instructions on how to carry them out.
Exercise 1: What we do when nobody is looking
* You will be asked either to defend or criticize the following position on the nature and
function of punishment
62
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
" Entiendo que ser castigado es una manera de educar a la persona a cometio la falta y a la sociedad
en general para que comprendan y entiendan que su conducta es una falta y afecta a la sociedad. En
conclusion es una solucion viable hasta el memento bastante efectiva siempre y cuando el castigo sea
ejecutado de una manera prudente, saludable y dentro de lo que las leyes permiten.
" Restate this argument in your own words. (Try to shorten it by summarizing its key points.) Then
discuss and clarify its key terms. Offer ethical and practical considerations in its defense.
Exercise 2: Milgram and Business
" Continuing with the task in part one, you will be asked to either defend or criticize the
following position on the meaning that the results of the Milgram experiments have for
business administration
" The Milgram experiments teach us that under the right conditions, anyone is capable of committing
immoral activities. If a strong, dominant boss exists and has a weak, dependable employer, then the
employer will out of necessity do whatever the boss wants.
" Many people are willing to commit immoral acts even though they know it is wrong if they know they
are not being watched.
" It teaches us that many employees tend to do illegal works just because their managers ask them to so
they assume they will be taking full responsibility for the situation even though it is unethical.
Exercise 3: Commentary Groups
" Your job is to evaluate the arguments made by the teams debating in parts one and two.
Be sure to focus on the argument and not the content of the position. Listen to their
statements.
" Do they base these on sound statements?
" What kind of ethical and practical principles (or values) do they use to make their case?
" Do their frame their position broadly or narrowly?
Exercise 4: Closure Groups
" After listening to the debate and commentary, recap what has happened and discuss
whether there are any conclusions that can be drawn from this activity
" Do people agree or disagree about these 2 issues?
" If there is agreement, why does it exist?
" If there is disagreement, why does it exist?
" Is agreement possible? Why or why not?
3.2.5 What did you learn?
This module was designed to help you visualize how to realize a moral career within three dominant moral
ecologies. Apply these matters to yourself. Which moral ecology would be best for you? Of the two moral
careers mentioned above, reformer and helper, which best fits your personality? Why? In other words, begin
the process of visualizing and planning your own moral career.
3.2.6 Appendix
References
1. Davis, M. (1998) Thinking Like an Engineer: Studies in the Ethics of a Profession. Oxford,
UK: Oxford University Press: 117-156.
2. Doris, J.M. (2002) Lack of Character: Personality and Moral Behavior. New York: Cambridge
University Press.
63
3. Flanagan, O. (1991) Varieties of Moral Personality: Ethics and Psychological Realism. Cam-
bridge, Mass: Harvard University Press: 293-314.
4. Harris, C.E., Pritchard, M.S., and Rabins, M.J. (1999) Engineering Ethics: Concepts and Cases,
2nd Ed. New Jersey: Wadsworth: 181-188.
5. Huff, C., Barnard, L. and Frey, W. (2008) "Good Computing: A Pedagogically focused model of virtue
in the practice of computing, Part II," in The Journal of Information, Communication and
Ethics in Society. (Under Review)
6. Jackall,R. (1983). "Moral Mazes: Bureaucracy and Managerial Work," in Harvard Business Re-
view: Sept and Oct 1983.
7. Jackall, R. (1988) Moral Mazes: The World of Corporate Managers. Oxford, UK: Oxford
University Press.
8. Mannix, E., and Neale, M.A. (2005) "What Differences Make a Difference?: The Promise and Reality
of Diverse Teams in Organizations," in American Psychological Society, 6(2): 31-49.
9. Milgram, S. (1974) Obedience to Authority. New York: Harper Perennial.
10. Solomon, R.C. (2003) "Victims of Circumstances?: A Defense of Virtue Ethics in Business," in Busi-
ness Ethics Quarterly. Volume 13, Issue 1: 43-62.
This optional section contains additional or supplementary information related to this module. It could
include: assessment, background such as supporting ethical theories and frameworks, technical information,
discipline specific information, and references or links.
3.2.7 EAC ToolKit Project
3.2.7.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License4 regarding permission to reuse this material.
3.2.7.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
3.3 Three Views of CSR (Corporate Social Responsibility)5
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64
CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
- The first two links to this module are to sample corporate social
responsibility statements put out by McDonalds and Starbucks. These
will help you to benchmark your own efforts both in the fictional
Burger Man case and in your efforts to develop CSR reports for real
companies.
- The other link is a story from reporter, Paul Solomon, that reports on
the annual Business for Social Responsibility conference. This story,
first broadcast on December 23, 2004 reports on outstanding and suc-
cessful efforts on CSR. Its title is "Good Business Deeds" and it was
accessed for this module on August 17, 2008 at the following URL:
http://www.pbs.org/newshour/bb/business/july-dec04/corporate_12-23.html
3.3.1 Introduction
This module will introduce you to the theme of corporate social responsibility. Three representative cases
will help to pose the central problems and basic issues of CSR. Then you will work on developing a social
contract between the business corporation and society to articulate the interests, goods, and rights at stake in
CSR. Three different approaches dominate this field: the shareholder approach set forth by Milton Friedman,
the stakeholder approach articulated by Evan and Freeman, and Patricia Werhane's alliance model. Finally,
you will work on developing a CSR program for the hypothetical corporation, Burger Man. This will be
based on a shareholder meeting that consists of six or seven stakeholder presentations. (You will play the
role of one of the stakeholders.) Your CSR program will address and integrate the needs and interests of the
Burger Man stakeholders.
Three CSR Challenges
Patricia Werhane discusses how six corporate organizations deal with three CSR challenges: (1) carrying out
oil drilling in a corrupt political environment, (2) working with suppliers who impose sweatshop conditions
on employees, and (3) addressing the HIV/AIDS challenge in Africa. Each challenge elicits two corporate
responses, one from a shareholder or stakeholder perspective, the other from an alliance perspective. Shell
Oil's response to political corruption in Nigeria will be compared with Exxon/Mobile's response in Chad
and Cameroon. Nike's answer to public criticism of the employment practices of its third world suppliers
will be compared to Wal Mart's reputedly heavy-handed treatment of its employees and suppliers. Finally,
while the pharmaceutical industry has developed an expensive drug cocktail to treat HIV/AIDS in patients
in developed nations, the NGO (Non Government Organization), the Female Health Company, has designed
a program to distribute of condoms to prevent infection in the first place. These paired corporate responses
to CSR challenges are not provided in support of the position that the superiority of the alliance approach
is a "no-brainer." Instead, they provide you with a menu of CSR strategies that you will evaluate using the
CSR framework you will develop out of the social contract that between business and society. These three
CSR challenges come from Werhane (2007)
Operating in a Corrupt Environment
* A big challenge facing multinational corporations is how they should respond to local corruption. Both
Shell Oil and Exxon/Mobile sought to carry out drilling operations at sites plagued by corrupt local
and national governments.
* Shell took a shareholder approach arguing that their primary CSR was to their stockholders and that
involvement in corrupt local politics would be tantamount to paternalism.
* Exxon/Mobile, on the other hand, adopted a more active approach. They took expensive measures to
mitigate the environmental impact of their operations. They also hired and provided technical training
to local residents. Finally, they worked to ensure that the revenues they introduced into the local
communities were not lost through political and business corruption.
65
* What are the CSRs of multinational corporations that operate in corrupt local environments? Are
these fashioned around the minimal obligation of creating no additional harm? Or should they expand
to preventing harm (if possible) that others are about to inflict? To move even further up the ladder of
responsibility, do multinational corporations have positive, supererogatory responsibilities that consist
of adding value to the communities they do business in?
Vicarious CSR: Responding to Supplier Sweatshops
" Vicarious responsibility occurs when one agent accepts responsibility for actions executed by another.
For example, under agency theory, the principal bears overall moral and legal responsibility for the ac-
tion since he or she has originated it. Although the agent executes the action, he or she is responsibility
only for executing the action faithfully and treating the principal's interests as his or her own.
" In this context, can we hold corporations such as Nike and Wal Mart vicariously responsible for the
morally questionable actions of their suppliers? If so, then under what conditions?
" Nike fell under siege when the press found out that its suppliers based in the third world imposed
harsh, sweatshop conditions on their employees, including child labor. Nike could have argued that
this was beyond the scope of their repsonsibility. How could they be held vicariously responsible
for the actions of another? Their job was to produce shoes at the lowest possible price to deliver an
affordable quality product to customers and to maximize shareholder value. But Nike went beyond this
minimal responsibility to carefully vet suppliers and to work with them to improve working conditions.
Thus, they expanded the scope of their CSR to include improving working conditions for, not only
their employees, but also the employees of their suppliers.
" Wal Mart has been identified by Collins and Porras (Built to Last) as a highly successful and visionary
company. It has certainly led the way in providing consumers with high quality products at surprisingly
low prices. But the savings it provides to customers and the high returns it guarantees investors are
purchased at a high price. Wal Mart prevents its employees from joining unions which has lowered
their wages and restricted their health and retirement benefits. Wal Mart employees are also expected
to work long hours for the company. While it provides cheap, high quality products to its customers,
Wal Mart pushes suppliers narrowing their profit margin and placing upon them the responsibility of
supplying product just-in-time to meet demand.
" In its earlier days, Wal Mart targeted small towns. Their competitive practices forced less aggressive,
local business to leave. While they have brought considerable benefits to these communities, they have
also seriously changed established business and social structures.
" Finally, Wal Mart, like Nike initially, exercises minimal supervision over their suppliers many of whom
are oversees. Wal Mart suppliers also have been known to impose harsh working conditions on their
employees.
Some CSR Questions for Nike and Wal Mart
1. From a broader CSR perspective, is Nike maximizing stakeholder value? Is it redistributing burdens
and costs from customers and investors to its suppliers and their employees? Does CSR allow this
redistribution of the corporate wealth form the shareholders to other stakeholders? (Think about
Friedman's arguments here.
2. If it is necessary to trade off stakeholder stakes as both Wal Mart and Nike do, which trade off is
more just? Nike's distribution of its wealth from its stockholders to the needy manifested in its efforts
to improve the working conditions and income of the employees of its suppliers? Or Wal Mart's
distribution of benefits to its stockholders and its comparatively prosperous customers?
3. Which model would Friedman prefer under the his version of the shareholder view of CSR? Explain
and evaluate.
4. Which model would be preferable by Evan and Freeman under the stakeholder view? Who are Nike
and Wal Mart's stakeholders? What are their stakes? How should the wealth produced by these two
corporations be distributed among their stakeholders?
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5. Werhane, in her alliance model, argues for the importance of a CSR model that decentralizes the
corporation and facilitates morally imaginative solutions. Why does she argue that Nike's program is
than Wal Mart's from this perspective? What could Wal Mart do to improve its CSR on the alliance
view?
Facing the AIDS Challenge in Africa
* The widespread and devastating effects of the AIDS epidemic in Africa are well known. But what are
the responsibilities of corporations in the face of this terrible CSR challenge? Should they do business
as usual and allow others who are perhaps more qualified respond to this pervasive social problem? Or
should they recognize a broader responsibility to channel their wealth, knowledge and expertise toward
mitigating this social problem?
* Pharmaceutical corporations invest huge amounts of money in research and development. The market
place is a good place for both encouraging this necessary risk and for distributing it among several
groups and interests. Developing new medicines requires costly research. So Friedman's question
is highly pertinent here: does imposing CSR on a corporation do more harm than good because it
interferes with the delicate mechanism of the market?
* At any point along the way, the product may not meet expectations, a competitor may beat the
pharmaceutical to the market, the regulatory process may delay or even prevent sale, and so on. The
rewards from patenting a successful medicine are astoundingly high. But heavy, possibly devastating
losses are also possible. Adding CSR to the mixture may be the formula for corporate disaster.
* Pharmaceutical corporations also face daunting challenges from regulatory agencies such as the Food
and Drug Administration. New products must be exhaustively and painstakingly tested to avoid
problems that have arisen in the past such as the Dalkon Shield and Thalidomide. Again, considerable
effort must be expended in exploring the middle and long term consequences accompanying product
and drug use, and all of this before the product can be marketed and profits made. Government
regulation also raises another problem. Is government prodding necessary to force corporations into
a proper CSR posture? Or should corporations be allowed to develop voluntarily their own CSR
responses?
* In the case at hand, pharmaceutical companies have invested considerable resources to carry out
research into medicines that control HIV infection and prevent it from developing into full-blown
AIDS. But these treatments are very expensive and bring with them considerable side effects. An anti-
AIDS chemical cocktail can cost patients in developed nations between 15 and 20 thousand dollars
per patient per year. This is far beyond the financial resources available to a typical HIV/AIDS
patient in Africa. Some NGOs and critics of the pharmaceutical industry accuse the latter of gouging
victims and drawing excess profits from the misfortune of others. A spokesperson for "Doctors Without
Borders," for example, claims that the AIDS treatment "cocktail" that costs U.S. patients 15 to 20
thousand dollars could be made available to Africans at less than 300 dollars per patient per year.
Pharmaceuticals, according to their critics, need to rethink their CSR, cease operating as for-profit
businesses, and make these drugs available to third world sufferers at cost.
* What are the CSRs of multinational pharmaceutical corporations for making HIV/AIDS drugs available
to victims in the poverty-stricken nations of Africa? Are they responsible for charging what the
market will bear? Assuming they have the right to recoup their heavy investment in research, should
governments, recognizing the necessity of compensating drug companies for their research, buy these
drugs and redistribute them at little or no cost to those who can't afford them? Or should the
pharmaceuticals charge more to those who can pay and less to those who cannot? (This redistributes
the burden of cost from the haves to the have nots.)
* Many NGOs have taken the stance that their responsibility lies in pressuring drug companies to do
the right thing and donate medicines to patients who cannot pay. This is their corporate social
responsibility, and the pharmaceutical industry certainly has enough money to do this.
* But others have tried to reframe this issue using moral imagination. Treating individuals for HIV
infection once they have contracted it is expensive no matter how you look at it. But, redefining the
67
problem, can moderate and affordable measures be taken to prevent the spread of the disease?
" This is the imaginative approach taken by the Female Health Company which has initiated a widespread
effort to distribute condoms to those at risk for contracting AIDS.
" How does the approach of the FHO exemplify Werhane's alliance model? How should pharmaceutical
companies respond to this kind of initiative? Is it necessary to frame the relation between the phar-
maceutical industry and NGOs as an adversarial relation or should broader alliances be formed that
coordinate the efforts of these groups?
3.3.2 The Social Contract between Business and Society
Every contract is built on the basis of three conditions (1) free and informed consent, (2) a
quid pro quo, and (3) the rational self interest of the contracting parties.
" Free and Informed Consent: No contract is legitimate that is based on force, fraud or deception.
The parties must enter into this agreement freely and without compulsion. They must understand
the terms of the contract which excludes deception and fraud. In short, the contract presupposes the
uncoerced participation of all the parties. To enter into the contract they must understand all the key
issues and consent to the constitutive exchange.
" Quid Pro Quo: Quid Pro Quo literally means something in exchange for something. Every contract
is built around a mutually beneficial exchange. I give you my baseball cap in exchange your ice cream.
Most exchanges are simultaneous. But some are what Hobbes calls "covenants." Here I give you my
baseball cap with the understanding that later this afternoon you will pass by your refrigerator, get
my ice cream cone and give it to me. I give you my part now and trust you to carry out your part
later.
" Rational Self Interest: Each of us should know the value of the items to be exchanged. (That
is one reason why a contract requires free and informed consent.) This knowledge is determined, in
part, by the preference schedules that we have developed as rationally self-interested beings. So a
legitimate contract assumes that I have interests, that I am capable of determining what promotes
these interests, and that I am rational enough to determine means to promote them and avoid other
means that interfere with them.
Social Contracts
A social contract differs from other contracts because it is hypothetical. Business and Society have never
sat down in a room and hammered out a contract outlining their relation. But this hypothetical contract
provides a good means of making sense out of the relation that has gradually evolved between society and
business. Forget for a moment the historical details of the relation between business and society. If this
relation is summarized as a contract, what does society give to business? What does business give to society?
Do these two institutions trust one another or do they each adopt means to monitor and control the other?
What are these means? Treating the relation between business and society as a contract between two
mutually consenting agents or actors does get some of the facts wrong. But it provides a useful "heuristic"
device, i.e., a framework that will help us to summarize, structure, and, in a work, make sense of the relation
between the two. Moving from the terms of this "contract" you will be able to develop a framework for
understanding the social responsibilities of business corporations. This, in turn, will help you to understand
the CSR challenges presented above and the CSRs of the fictional but realistic Burger Man corporation.
Exercise 1: In small groups, spell out the social contract between society and business.
* How can the absence of force, deception, and fraud be guaranteed in this contract? How should each
side hold the other accountable? (This is especially the case where one side delivers at one time and
the other side is trusted to deliver later.)
* What benefits can busines bring to society? How can society benefit business. Develop a table with one
column listing what business has to contribute to society and the other what society has to contribute
to business. This table is the heart of your social contract.
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CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
" Assume that society and business are rationally self interested. How does this effect the formulation of
the goods of the exchange? How does this enforce the terms of the contract? Are these self interests
divergent? (Then each side must monitor the other to prevent the corruption of the contract.) Are
these interests convergent? (Then the contract consists largely in building social capital and trust
between the contracting parties.)
" Donaldson, 1993 uses social contract theory to account for the rights and duties of multinational
corporations
Exercise 2: CSR and STS
Choose one of the CSR challenges above and construct a socio-technical table around it
STS Table
ComponertTechnolog Technology Physical StakeholderProcedure Laws Informatic
/ Em- (Hard- (Soft- Sur- and
bedded ware) ware) round- Infor-
Value ings mation
Systems
Justice
Free
Speech
Property
Privacy
Safety
Table 3.5
3.3.3 Three CSR Frameworks
Shareholder View
From Milton Friedman, "The Social Responsibility of Business is to Increase Its Profits." "But the doctrine
of "social responsibility" taken seriously would extend the scope of the political mechanism to every human
activity. It does not differ in philosophy from the most explicitly collectivist doctrine. It differs only by
professing to believe that collectivist ends can be attained without collectivist means. That is why, in my
book Capitalism and Freedom, I have called it a "fundamentally subversive doctrine" in a free society,
and have said that in such a society, "there is one and only one social responsibility of business-to use its
resources and engage in activities designed to increase its profits so long as it stays wihtin the rules of the
game, which is to say, engages in open and free competition without deception or fraud." 1970 by New York
Times Company
Stakeholder View
* A stakeholder must be distinguished from a stockholder. The latter owns a share of the corporation.
On the other hand, a stakeholder is any group or individual that has a vital interest in the doings of
the corporation. Hence the stockholder is a stakeholder of the corporation whose vital interest at play
is the share owned of the corporation and the money invested in this share.
* There are several other stakeholders of the corporation. These include (1) employees, (2) customers, (3)
suppliers, (4) local community, (4) surrounding governments, (5) the surrounding human and natural
environment, and (6) the corporation's managers. (In some situations there are other stakeholders
such as competitors.)
n
69
" Stakeholder theory requires that the corporation recognize and respect the vital interests of each of
its surrounding stakeholders. This frequently issues in proposing stakeholder rights and assigning to
others correlative duties to recognize and respect these rights.
" Stakeholder theory also requires that the corporation integrate interests where possible, mediate or
broker conflicts between interests, and only trade off competing interests when absolutely necessary
and when more conciliatory efforts have already been made and have failed.
" See Evan and Freeman 1988
Werhane's Alliance Approach
" Werhane's alliance approach is similar to the stakeholder approach in that it recognizes several groups
that surround the corporation and have vital interests that depend on the doings of the corporation.
These surrounding groups are more or less the same as those in the stakeholder approach: owners,
managers, employees, customers, suppliers, local communities, governments, the environment, etc.
" But Werhane makes two significant departures from the stakeholder approach. First, she uses moral
imagination to distance the corporation from the problem solving process; the lens of problem solving
refocuses on each of the other stakeholders. Whereas for stakeholder theory the corporation is the center
of analysis and is visualized as surrounded by its stakeholders, the alliance approach decentralizes the
corporation and alternatively visualizes each stakeholder as the center for the purpose of framing
problems and generating solutions.
" Second, the alliance approach sees the corporation as a part of a system of interrelated and interde-
pendent parts. Hence, each problem situation presents a system formed of the corporation, owners,
managers, employees, suppliers, customers, local communities, and governments. Problems emerge
from value conflicts within and between the constituent parts of the system. They are solved through
the cooperation of the different constituencies of the alliance.
" While this approach does not lend itself to algorithms or rules, it does promise solutions by highlighting
and facilitating moral imagination both in the framing of problems (problems are posed in terms of
framings from multiple perspectives) and in terms of the generation of solutions (multiple problem-
framings help us to visualize new solution horizons).
" See Werhane, 2007 and 2008.
3.3.4 What you will do ...
Module Activities
1. Examine the CSR challenges presented above. Compare the two responses to each challenge.
2. Learn about three models of corporate social responsibility.
3. Develop a fully articulated social contract between business and society. Use this contract to understand
the basic CSRs of business corporations.
4. Prepare a Social Impact Analysis on the fictional firm, Burger Man.
5. Prepare for and participate in a board meeting for Burger Man to examine ethically its practices and
develop for it a viable and sustainable program of corporate social responsibility. This requires that
you give a short presentation on the interests of a particular Burger Man stakeholder
6. Develop a full blown CSR program for Burger Man that carries out the responsibilities of this company
to its stakeholders.
3.3.5 Burger Man Stakeholders
The author became aware of the Burger Man exercise when participating in an Ag-Sat broadcast course in
Agricultural Ethics in 1992. The exercise was created by the leader of the course, Dr. Paul Thompson.
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Burger Man Profile
Burger Man is a franchise that began by selling the fast food staples of hamburgers, french fries, and milk
shakes. As the company has matured and faced other competitors in this market niche, it has, of course,
developed a more sophisticated set of products and services. But it has also been challenged on various
issues related to corporate social responsibility. Groups representing the rights and interests of animals
have criticized the agribusiness methods used by its suppliers. Recently, public interest groups have blamed
Burger Man and its competitors for encouraging unhealthy dietary habits among its customers and the public
in general. Shareholders, of course, are concerned that the company continue to be profitable and provide
them with a good return on investment. Governmental regulatory agencies such as the EPA (Environmental
Protection Agency) and OSHA (Occupational Safety and Health Administration) wish to hold Burger Man
accountable for conforming to its regulations. In short there are several stakeholder groups surrounding this
corporation, each vying for its particular interest. In this exercise, you will play two roles. First you will
be assigned a role as one of Burger Man's stakeholders and make a presentation of your group's interest
in mock shareholder meeting that will be held in class. Then you will switch to the role of Burger Man
management. Here your assignment will be to articulate the different stakeholder interests and integrate
them into a coherent CSR plan for your company.
Burger Man Customers
* Burger Man customers are the consumers who go to its restaurant and enjoy its food services. In
preparing your board meeting presentation you need to explore Burger Man's social responsibilities to
its customers.
* Are these reducible to providing them an enjoyable product at a reasonable price? Or does BM's social
responsibilities go beyond this?
* Burger Man has extensive interactions with its suppliers that include meat packing corporations and
agri-business concerns. How should Burger Man choose its suppliers? How carefully should it monitor
their activities. To what extent is Burger Man responsible for the untoward activities of these groups?
* How responsible is Burger Man for shaping the dietary habits of its customers? Does it bear respon-
sibility for the health problems that its public develops from bad dietary practices?
Burger Man Shareholders
* Burger Man shareholders are investors who have purchased shares of Burger Man's publicly traded
stock.
* What are their stakes?
* What are their responsibilities? For example, how closely should shareholders monitor the actions of
their agents, i.e., Burger Man's managers? Are shareholders responsible for holding Burger Man to
certain standards of corporate social responsibility? What are these standards and how do they stand
in relation to the different models of social responsibility?
* Prepare your presentation around these issues. Address shareholder interests (stakes) and responsibil-
ities.
Burger Man Managers
* Burger Man managers are the agents of the shareholders/owners responsible for overseeing the day-to-
day operations of the corporation.
* What are the manager's stakes? What role do they play in the different models of social responsibility?
(Classical, stakeholder, and alliance views?)
* Agency theory argues that the primary corporate governance problem is overseeing and controlling the
actions of managers. How closely should shareholders and their board of directors oversee corporate
managers? Are managers self-interested agents or stewards of the corporation?
* What are managerial responsibilities vis a vis corporate social responsibility? Should they uncover
illegal actions? Should they implement an audit process that assess the corporation's success in carrying
out its social responsibilities? Should these responsibilities go beyond the legal minimum?
71
" Should managers go beyond the legal minimum in monitoring and carrying out corporate social re-
sponsibilities?
" Are corporate managers responsible only to shareholders or do their responsibilities extend to other
stakeholders? If the latter, how do they balance conflicting stakes?
" Structure your presentation around outlining managerial stakes and roles. Choose a model of corporate
social responsibility and argue for its appropriateness to Burger Man.
Government Regulatory Agencies: OSHA and EPA
" OSHA is in charge of regulating workplace safety. EPA is in charge of setting, monitoring, and enforcing
standards concerning the environment. (For example, they establish acceptable air emission and water
discharge standards.)
" What are the stakes of government regulatory agencies? What is their role in the context of the Burger
Man corporation?
" Write your position paper outlining your group's stakes and roles in the context of establishing Burger
Man's corporate social responsibility procedures. What would you recommend? How should you back
up or enforce these recommendations?
Animal Rights Activists
" Burger Man serves hamburgers, chicken sandwiches, and dairy products. These involve animals. As
animal rights activists, you are concerned with steering Burger Man and its suppliers toward morally
acceptable treatment of animals.
" What are your group's stakes in this board meeting? What kind of role should you play?
" State your policy on animal treatment? Is it a position of animal welfare based on utilitarian consider-
ations? (Peter Singer provides such a position.) Is it a deontological position based on the assertion of
animal rights that impose correlative duties on humans? (Tom Regan takes this position.) Or should
you base your arguments on anthropocentric issues such as human health?
" Write a position paper that responds to these questions for presentation in the Burger Man board
meeting.
Town X Committee for Economic Development
" Your town, Town X, has three Burger Man franchises. Representatives from the town council are
participating in the board meeting in order to ensure that Burger Man's policies on corporate social
responsibility enhance the town's economic welfare and development.
" What are your stakes? What are your roles and responsibilities?
" What kind of services and products do you provide for Burger Man? What benefits do your community
draw from Burger Man? How can Burger Man activities and policies promote or demote your town's
interests and stakes?
" Develop a position paper for the board meeting that addresses these issues? Pay special attention to
the goods and risks that your town exchanges with Burger Man.
Insert paragraph text here.
Exercises in CSR
* Participate in the Burger Man Stakeholder Meeting
* Take your assigned stakeholder group and prepare a short presentation(five minutes maximum) on
your stakeholder's interests, rights, needs, and vulnerabilities.
* Listen to the stakeholder presentations from the other groups. Try to avoid a competitive stance.
Instead, look for commonalities and shared interests. You may want to form coalitions with one or
more of the other groups.
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CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
" Switch from the stakeholder role to that of Burger Man management. You are responsible for developing
a comprehensive corporate social responsibility program for Burger Man. You job is to integrate the
concerns expressed by the stakeholders in their presentation and form your plan around this integration.
" Try to resolve conflicts. If you cannot and are forced to prioritize, then you still must find a way of
recognizing and responding to each legitimate stakeholder stake. You may want to refer to the "Ethics
of Team Work" module (m13760) to look for time-tested methods for dealing with difficult to reconcile
stake. These include setting quotas, negotiating interests, expanding the pie, nonspecific compensation,
logrolling, cost-cutting and bridging. You should be able to establish beyond a shadow of a doubt that
you have made every attempt to recognize and integrate every legitimate stakeholder stake.
3.3.6 What did you learn?
This module and two others (A Short History of the Corporation and Corporate Governance) are designed to
help you understand the corporate context of business. In this section, you should reflect on three questions:
(1) What have you learned about the social responsibilities of corporations? (2) What still perplexes you
about the social responsibilities of corporations. (3) Do you find one model of CSR better than the others?
(4) Can these models of CSR be combined in any way?
3.3.7 Appendix
Rubric for Partial Exam on CSR
This is an unsupported media type. To view, please see
http://cnx.org/content/m17318/latest/PERubric_ CLSR_F08.docx
Figure 3.4: This file contains the rubric to be used on the partial exam for Corporate Leadership and
Social Responsibility, ADMI 3405, Fall 2008"
Corporate Social Responsibility Frameworks: Seminal Papers
1. Friedman, M. (1970) "The Social Responsibility of Business Is to Increase Its Profits," in New York
Times Magazine, September 13, 1970.
2. Evan, W.M. and Freeman, E. (1988) A Stakeholder Theory of the Modern Corporation: Kantian
Capitalism" in Beauchamp and Bowie 1988.
3. Friedman 1970 and Evan and Freeman 1988 can be found in: Beauchamp, T.L. and Bowie, N.E.,
editors. (1988) Ethical Theory and Business, 3rd Edition. New Jersey: Prentice Hall: 87-91 and
97-106.
4. See Werhane 2007 and 2008 below
References
1. Collins, J.C., Porras, J. I. (1994) Built To Last: Successful Habits of Visionary Companies.
New York: Harper Collins Publishers.
2. Stone, C. D. (1975) Where the Law Ends: The Social Control of Corporate Behavior. Prospectr
Heights, IL: Waveland Press, INC: 1-30.
3. Des Jardins, J.R. (1993) Environmental Ethics: An Introduction to Environmental Philosophy. Bel-
mont, CA: Wadsworth Publishing Company: 37.
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4. Clarke, T. (2004) "Introduction: Theories of Governance-Reconceptualizing Corporate Governance
Theory After the Enron Experience," in Theories of Corporate Governance: The Philosophical Foun-
dations of Corporate Governance, ed. Thomas Clarke. New York: Routledge: 1-30.
5. Donaldson, T. (1993) The Ethics of International Business. New York: Oxford University Press.
6. French, P.A. (1984) Collective and Corporate Responsibility. New York: Columbia University Press.
7. French, P.A. (1997) "Corporate Moral Agency" in Werhane, P.H., and Freeman, R.E. Blackwell Ency-
clopedic Dictionary of Business Ethics. Oxford, UK: Blackwell: 148-151.
8. May, L. (1987) The Morality of Groups: Collective Responsibility, Group-Based Harm, and Corporate
Rights. Notre Dame, IN: University of Notre Dame Press.
9. Werhane, P. H. (2008) "Mental Models: Moral Imagination and System Thinking in the Age of Glob-
alization," in Journal of Business Ethics, 78: 463-474.
10. Werhane, P. (2007) "Corporate Social Responsibility/Corporate Moral Responsibility: Is There a
Difference and the Difference It Makes," in eds., May, S., Cheney, G., and Roper, J., The Debate over
Corporate Social Responsibility. Oxford, UK: Oxford University Press: 459-474.
11. Fisse, B. and French, P.A., eds. (1985) Corrigible Corporations and Unruly Law. San Antonio, TX:
Trinity University Press.
12. Nader, R. and Green, M.J., eds. (1973) Corporate Power in America. New York: Grossman.
13. Nader,, R. Green, M. and Seligman, J. (1976) Taming the Giant Corporation. New York: Norton.
14. Davis, M. (1998) Thinking Like an Engineer: Studies in the Ethics of a Profession. Oxford, UK:
Oxford University Press: 119-156. Jackall, R. (1988) Moral Mazes: The World of Corporate Managers.
Oxford, UK: Oxford University Press.
15. Carol, A. B., "Social Responsibility," in Werhane, P., and Freeman, R. E., eds. (1997, 1998) Blackwell
Encyclopedic Dictionary of Business Ethics. Oxford, UK: Blackwell Publishers, INC: 593-595.
16. Dyrud, M.A. (2007) "Ethics, Gaming, and Industrial Training," in IEEE Technology and Society
Magazine. Winter 2007: 36-44.
17. Ritz, Dean. (2007) "Can Corporate Personhood Be Socially Responsible?" in eds. May, S., Cheney,
G., and Roper, J., Corporate Governance. Oxford, UK: Oxford University Press: 194-195.
3.3.8 EAC ToolKit Project
3.3.8.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License6 regarding permission to reuse this material.
3.3.8.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
3.4 Theory Building Activities: "Responsibility and Incident at
Morales"7
3.4.1 Module Introduction
3.4.1.1 Getting Started...
Manuel, plant manager at the Phaust chemical plant in Morales, Mexico, has just died. While he was
babysitting the process of manufacturing Phaust's new paint remover (monitoring on site temperature and
6http: //creativecommons.org/licenses/by/2 .0/
7This content is available online at .
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CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
pressure conditions) an explosion occurred that killed him instantly. The Mexican government has formed
an independent commission to investigate this industrial accident.
This commission (headed by your instructor) has ordered key participants to testify on their role in the
accident in a public hearing. Your job is to present before this commission from a stakeholder point of view.
You will be divided into groups to role play the following stakeholder perspectives:
* Fred, the chief engineer involved in designing the plant,
* plant workers,
* officials from Mexican government regulatory agencies,
* Phaust management,
* representatives from the parent French company,
* officials presiding over an engineering professional society.
You will be assigned roles and given class time to prepare presentations for the commission. Then the class
will enact the public hearing by having each group give a presentation from the perspective of its assigned
role. Following these presentations, groups will answer questions from the investigating commission. Finally,
you will work through debriefing activities to help solidify your practical understanding of the module's
chief concepts. Background materials designed to help you with your presentations include sketches of moral
responsibility, links to the "Incident at Morales" Case, tasks to help structure your role-playing, and activities
to debrief on this exercise. This module is designed to help you learn about moral responsibility by using
responsibility frameworks to make day-to-day decisions in a realistic, dynamic, business context.
3.4.1.1.1 Before You Come to Class...
1. Visit the link to the National Institute for Engineering Ethics. Look at the study guide and download
the script for the video, "Incident at Morales." You want to have some idea of what happens in the
video before you watch it.
2. Read the module. Pay special attention to the section on "What you need to know." Here you will
read summaries of three senses of moral responsibility: blame responsibility, sharing responsibility,
and responsibility as a virtue. Your goal here is not to understand everything you read but to have a
general sense of the nature of moral responsibility, the structure of the responsibility frameworks you
will be using in this module, and the difference between moral and legal responsibility. Having this
background will get you ready to learn about moral responsibility by actually practicing it.
3. Come to class ready to watch the video and start preparing for your part in the public hearing. It is
essential that you attend all four of these classes. Missing out on a class will create a significant gap
in your knowledge about and understanding of moral responsibility.
3.4.2 What you need to know...
"Responsibility" is used in several distinct ways that fall under two broad categories, the reactive and the
proactive. Reactive uses of responsibility refer back to the past and respond to what has already occurred.
(Who can be praised or blamed for what has occurred?) Proactive uses emerge through the effort to extend
control over what happens in the future. An important part of extending control, knowledge, and power
over the future is learning from the past, especially from past mistakes. But proactive responsibility also
moves beyond prevention to bringing about the exemplary. How do occupational and professional specialists
uncover and exploit opportunities to realize value in their work? Proactive responsibility (responsibility as a
virtue) explores the skills, sensitivities, motives, and attitudes that come together to bring about excellence.
3.4.2.1 Different meanings of Responsibility
Reactive Senses
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1. Causal Responsibility refers to prior events (called causes) which produce or prevent subsequent
events (called effects). Cheap, inacurate sensors (cause) required that Manual be present on the scene
(effect) to monitor the high temperatures and pressures required to correctly prepare Phaust's paint
stripper.
2. Role Responsibility delineates the obligations individuals create when they commit to a social or
professional role. When Fred became an engineer he committed to holding paramount the health,
safety and welfare of the public. (See NSPE code of ethics)
3. Capacity Responsibility sets forth those conditions under which someone can be praised or blamed
for their actions. Praise and blame associate an agent with an action. Excuses are based on means for
separating or disassociating an agent from their actions. Capacity responsibility helps us determine
whether there are any legitimate excuses available for those who would disassociate themselves from
untoward, harm-causing actions.
4. Blame Responsibility determines when we can legitimately praise or blame individuals for their
actions.
Proactive Senses
1. Sharing Responsibility extends the sphere of responsibility to include those to whom one stands in
internal relations or relations of solidarity. Shared responsibility includes answering for the actions of
others within one's group. It also includes coming to the moral aid of those within one's group who
have gone morally astray; this involves bringing to their attention morally risky actions and standing
with them when they are pressured for trying to uphold group values. While sharing responsibility
entails answering for what members of one's group have done, it does not extend to taking the blame
for the untoward actions of colleagues. Sharing responsibility does not commit what H.D. Lewis calls
the "barbarism of collective responsibility" which consists of blaming and punishing innocent persons
for the guilty actions of those with whom they are associated.
2. Preventive Responsibility: By using knowledge of the past, one can avoid errors or repeat successes
in the future. Peter French calls this the "Principle of Responsive Adjustment." (One adjusts future
actions in response to what one has learned from the past.) According to French, responsive adjustment
is a moral imperative. If one fails to responsively adjust to avoid the repetition of past untoward results,
this loops back into the past and causes a revaluation of the initial unintentional action. The benefit
of the doubt is withdrawn and the individual who fails to responsively adjust is now held responsible
for the original past action. This is because the failure to adjust inserts the initial action into a larger
context of negligence, bad intentions, recklessness, and carelessness. Failure to responsively adjust
triggers a retroactive attribution of blame.
3. Responsibility as a Virtue: Here one develops skills, acquires professional knowledge, cultivitates
sensitivies and emotions, and develops habits of execution that consistently bring about value realiza-
tion and excellence. One way of getting at responsibility as an excellence it to reinterpret the conditions
of imputability of blame responsibility. An agent escapes blame by restricting the scope of role respon-
sibility, claiming ignorance, and citing lack of power and control. In responsibility as a virtue, one goes
beyond blame by extending the range of role responsibilities, seeking situation-relevant knowledge, and
working to skillfully extending power and control.
3.4.2.2 Blame Responsibility
To hold Fred responsible for the accident at Morales, we need to...
1. Specify his role responsibilities and determine whether he carried them out
2. Identify situation-based factors that limited his ability to execute his role responsibilities (These are
factors that compel our actions or contribute to our ignorance of crucial features of the situation.)
3. Determine if there is any moral fault present in the situation. For example, did Fred act on the basis
of wrongful intention (Did he intend to harm Manuel by sabotaging the plant?), fail to exercise due
care, exhibit negligence or recklessness?
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4. If Fred (a) failed to carry out any of his role responsibilities, (b) this failure contributed to the accident,
and (c) Fred can offer no morally legitimate excuse to get himself off the hook, then Fred is blameworthy.
Fred, and other Incident at Morales stakeholders, can escape or minimize blame by establishing morally
legitimate excuses. The following table associates common excuses with the formal conditions of imputability
of blame responsibility. (Conditions of imputability are those conditions that allow us to associate an action
with an agent for purposes of moral evaluation.)
Excuse Table
Excuse Source (Capacity Responsibility) Excuse Statement
Conflicts within a role responsibility and be- I cannot, at the same time, carry out all my con-
tween different role responsibilities flicting role responsibilities
Hostile Organizational Environment which The environment in which I work makes it impos-
routinely subordinates ethical to financial consid- sible to act responsibly. My supervisor routinely
erations. overrules my professional judgment, and I can do
nothing about it.
Overly determining situational constraints: finan- I lack the time and money to carry out my respon-
cial and time sibility.
Overly determining situational constraints: techni- Carrying out my responsibility goes beyond techni-
cal and manufacturing cal or manufacturing limits.
Overly determining situational constraints: per- Personal, social, legal or political obstacles prevent
sonal, social, legal, and political. me from carrying out my responsibilities.
Knowledge Limitations Crucial facts about the situation were kept from me
or could not be uncovered given even a reasonable
effort.
Table 3.6
3.4.2.3 Proactive Responsibility
Preventive Responsibility: Responsive Adjustment
* Responsibility to adjust future actions in response to what has been learned from the past
* Scenario One: Past actions that have led to untoward results. Failure here to adjust future actions to
avoid repetition of untoward results leads to reassessing the original action and retrospectively blaming
the agent.
* Scenario Two: Past actions have unintentionally and accidentally led to positive, value-realizing
results. Here the agent responsively adjusts by being prepared to take advantage of being lucky. The
agent adjusts future actions to repeat past successes. In this way, the agent captures past actions (past
luck) and inserts them into the scope of praise.
* Nota Bene: The principle of responsible adjustment sets the foundation for responsibility in the sense
of prevention of the untoward.
Responsibility as a Virtue or Excellence
1. Virtues are excellences of the character which are revealed by our actions, perceptions, beliefs, and
attitudes. Along these lines, responsibility as a virtue requires that we reformulate responsibility
from its reactive, minimalist sense (where it derives much of its content from legal responsibility) to
responsibility as an excellence of character.
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2. Aristotle situates virtues as means between extremes of excess and defect. Can you think of examples of
too much responsibility? (Does Fred try to take on too much responsibility in certain situations?) Can
you think of anyone who exhibits too little responsibility. (Does Fred take on too little responsibility
or shift responsibility to others?) For Aristotle, we can have too much or too little of a good thing.
From the "too much" we derive vices of excess. from the"too little" we derive the vices of defect.
3. Virtues are more than just modes of reasoning and thinking. They also consist of emotions that clue
us into aspects of the situation before us that are morally salient and, therefore, worthy of our notice
and response. Two emotions important for responsibility are care and compassion. Care clues us into
aspects of our situation that could harm those who depend on our actions and vigilance. Do Wally
and Fred pay sufficient attention to the early batch leakages in the Morales plant? If not, does this
stem from a lack of care ("Let operations handle it") and a lack of compassion ("Manuel can take care
of himself")? Care and compassion help to sensitize us to what is morally salient in the situation at
hand. They also motivate us to act responsibility on the basis of this sensitivity.
4. Responsibility as a virtue manifests itself in a willingness to pick up where others have left off. After
the Bhopal disaster, a worker was asked why, when he saw a cut-off valve open, he didn't immediately
close it as safety procedures required. His response was that shutting off the value was not a part of
his job but, instead, the job of those working the next shift. This restriction of responsibility to what
is one's job creates responsibility gaps through which accidents and other harms rise to the surface.
The worker's lack of action may not constitute moral fault but it surely signifies lack of responsibility
as a virtue because it indicates a deficiency of care and compassion. Those who practice responsibility
as a virtue or excellence move quickly to fill responsibility gaps left by others even if these tasks are
not a part of their own role responsibilities strictly defined. Escaping blame requires narrowing the
range of one's role responsibilities while practicing responsibility as a virtue often requires effectively
expanding it.
5. Finally, responsibility as an excellence requires extending the range of knowledge and control that one
exercises in a situation. Preventing accidents requires collecting knowledge about a system even after
it has left the design and manufacturing stages and entered its operational life. Responsibility requires
that we search out and correct conditions that could, under the right circumstances, produce harmful
accidents. Moreover, responsibility is a function of power and control. Extending these and directing
them toward good results are clear signs of responsibility as a virtue.
Reponsibility as Virtue
* The Incident at Morales provides us with a look into a fictionalized disaster. But, if it is examined
more carefully, it also shows opportunities for the exercise of responsibility as a virtue. The following
table will help you to identify these "responsibility opportunities" and allow you to imagine counbter-
factuals where had individuals acted otherwise the "incident" could have been avoided and moral value
could have been realized.
* Think of virtuous or even heroic interventions that could have prevented the accident. These represents,
from the standpoint of the film, lost opportunities for realizing responsibility and other virtues.
Responsibility as a Virtue: Recovering Lost Opportunities
Characteristic Relevance to Incident at Morales
Change goal from avoiding blame to pursuing pro- Could this have led participants to look for more
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Develop a flexible conception of your role responsi- Could this have structured differently the re-
bilities and move quickly to extend it to fill respon- lation between those responsible for plant de-
sibility gaps left by others. sign/construction and those responsible for its op-
eration?
Extend the scope and depth of your situational Would this have led to further follow-up on the early
knowledge, especially regarding accumulating infor- signs of leakage of the couplings?
mation on the operational history of newly imple-
mented technologies.
Extend control and power. This includes finding Could Fred have handled more proactively the last
ways of more effectively communicating and advo- minute change in the chemical formulation of the
cating ethical and professional standards in the con- paint remover?
text of group-based decision-making.
Table 3.7
Section Conclusion
Integrate the retroactive and proactive senses of responsibility into your group's presentation for the public
hearing. Don't just work on the reactive approach, i.e., try to avoid blame and cast it on the other stakeholder
groups. Think proactively on how to prevent future problems, respond to this accident, and turn the events
into positive opportunities to realize value.
Questions to Get Started
" Is Fred (blame) responsible for the accident and even Manuel's death? (Use the conditions of im-
putability and the excuse table to get started on this question.)
" Did Wally and Chuck evade their responsibility by delegating key problems and decisions to those, like
plant manager Manuel, in charge of operations? (Start the answer to this question by determining the
different role responsibilities of the stakeholders in this situation.)
" What kind of responsibility does the parent French company bear for shifting funds away from Phaust's
new plant to finance further acquisitions and mergers? (Looking at the modules on corporate social
responsibility and corporate governance will help you to frame this in terms of corporate responsibility.)
" Do engineering professional societies share responsibility with Fred? (The CIAPR and NSPE codes
of ethics will help here. Try benchmarking corporate codes of ethics to see if they provide anything
relevant.
" Look at the positive, proactive moral responsibilities of professional societies. What can they do to
provide moral support for engineers facing problems similar to those Fred faces? Think less in terms
of blame and more in terms of prevention and value realization.
3.4.3 What you are going to do...
In this module, you will...
1. apply and integrate the concept of moral repsonsibility (blame responsibility, sharing responsibility,
responsibility as a virtue) to situations that arise in the video, "Incident at Morales."
2. learn the basic facts, character profiles, and decision-situations portrayed in the video, "Incident at
Morales." You will see the video in class and examine the script and Study Guide at the NILE website.
3. work in groups to develop and play a stakeholder role in a fictional public hearing. Your group's
specific tasks are outlined below in one of the group profiles provided. In general, you will prepare
a statement advancing your group's interests and points of view. The responsibility frameworks will
help you anticipate questions, prepare responses, and defend your role against those in other roles who
may try to shift the blame your way. But most important, this module provides tools to help you go
beyond the reactive, blame standpoint.
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4. participate in a mock public hearing by playing out your group's assigned role.
5. work with the other groups to debrief on this activity. The public hearing will generate a lot of
information, ideas, and positions. Debriefing will help you to structure and summarize this material.
The objective here is to learn by doing. But to truly learn from what you have done, you need to
reflect carefully.
3.4.3.1 Stakeholder Roles
Mexican Government Regulatory Agencies
" Look at OSHA regulations on safety. Do any of these apply to the incident at morales. Pay particular
attendion to responsibilities for providing safe working conditions and to mandated procedures for
accident prevention. How as a government agency can you encourage companies to take active and
positive measures to increase workplace safety and prevent accidents?
" Look at EPA or JCA for ideas on environmental issues. What are Phaust's responsibilities regarding
local environmental conditions? (Should the Mexican government require lining waste water ponds?)
" As an official representing Mexican government regulatory agencies, how do you balance the safety and
environmental needs of Mexican citizens and workers with the need to attract foreign companies and
investors to Mexico to promote economic development. Should safety and environmental values ever
be traded off to promote economic development?
Workers at Morales Plant
" Manuel, your plant manager, has just died. You and your co-workers are concerned about the safety
of this new plant. Can you think of any other issues that may be of concern here?
" Develop a statement that summarizes your interests, concerns, and rights. Are these being addressed
by those at Phaust and the parent company in France?
" The Mexican Commission established to investigate this "incident" will ask you questions to help
determine what cause it and who is to blame. What do you think some of these questions will be?
How should you respond to them? Who do you think is to blame for the incident and what should be
done in response?
Designing Engineer: Fred
" Examine Fred's actions and participation from the standpoint of the three responsibilty frameworks
mentioned above.
" Develop a two minute position paper summarizing Fred's interests, concerns, and rights.
" Anticipate questions that the Commission might raise about Fred's position and develop proactive and
effective responses..
" Be sure to use the three responsibility frameworks. Is Fred to blame for what happened? In what
way? What can professional societies do to provide moral support to members in difficult situations?
How can interested parties provide moral support? Finally, what opportunities arose in the video
practicing moral responsibility as a virtue? (Think about what an exemplary engineer would have
done differently.)
Phaust Management: Wally and Chuck
* Chuck and Walley made several decisions reponding to the parent company's budget cuts that placed
Fred under tight constraints. Identify these decisions, determine whether there were viable alternatives,
and decide whether to justify, excuse,or explain your decisions.
* Develop a two minute position paper that you will present to the commission.
* Anticipate Commission questions into your responsibility and develop effective responses to possible
attempts by other groups to shift the blame your way.
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Corporate Governance: French Parent Company
" You represent the French owners who have recently required Phaust Chemical. You have recently
shifted funds from Phaust operations to finance further mergers and acquisitions for your company.
" What are your supervisory responsibilities in relation to Phaust?
" Develop a preliminary two minute presentation summarizing your position and interests.
" Anticipate likely commission questions along with possible attempts by other groups to shift the blame
your way.
Engineering Professional Society
" You represent the professional engineering society to which Fred belongs.
" Develop a two minute presentation that outlines your group's interests and position.
" Anticipate possible Commission questions, develop responses, and anticipate attempts by other groups
to shift the blame your way.
" Respond to whether your professional society should extend moral support to engineers in difficult
positions like Fred's. Should they clarify code provisions? Provide legal support and counseling? Make
available a professional/ethical support hotline?
Investigative Commission
This role will be played by your instructor and other "guests" to the classroom. Try to anticipate the
commissions questions. These will be based on the conditions of blame responsibility, the principle of
responsive adjustment, and responsibility as a virtue.
3.4.3.2 Module Time Line
" Module Preparation Activities: Read module and visit niee.org to get general orientation to "Incident
at Morales"
" Class One: Watch Video. Receive group role. Begin preparing your group role.
" Class Two: Work within your group on preparing your group's statement, anticipating questions, and
developing responses.
" Class Three: Participate in the Public Hearing. The group representing the Mexican Commission
will convene the public hearing, listen to the group's statements, ask questions, and prepare a brief
presentation on the Commission's findings
" Class four: Class will debrief on the previous class's public hearing. This will begin with the Com-
mission's findings
3.4.4 What have you learned?
Listen to the findings of the Mexican Government Commision. Write a short essay responding
to the following questions. Be prepared to read parts of your essay to your professor and to
your classmates.
1. Do you agree with the Commissions findings? Why or why not? Be sure to frame your arguments in
terms of the responsibility frameworks provided above.
2. Were there any opportunities to offer Fred moral support by those who shared responsibility with him?
What were these opportunities. How, in general, can professional societies support their members
when they find themselves in ethically difficult situations?
3. What opportunities arise for exercising resonsibility as an excellence? Which were taken advantage of?
Which were lost?
4. Finally, quickly list themes and issues that were left out of the public hearing that should have been
included?
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References
1. F. H. Bradley (1962) Ethical Studies, Essay I. Oxford, UK: Oxford University Press.
2. Herbert Fingarette. (1967) On Responsibility. New York: Basic Books, INC: 3-16.
3. Larry May (1992) Sharing Responsibility. Chicago: University of Chicago Press.
4. Larry May (1996) The Socially Responsive Self: Social Theory and Professional Ethics. Chicago:
University of Chicago Press: 28-46.
5. Michael Pritchard (2006) Professional Integrity: Thinking Ethically. Lawrence,KS: University of
Kansas Press.
6. Lawrence Blum (1994) Moral Perception and Particularity. Cambridge, UK: Cambridge University
Press: 30-61
7. Aristotle. Nichomachean Ethics, Book 3, Chapters 1-3.
8. Edmund L. Pincoffs (1986) Quandaries and Virtues: Against Reductivism in Ethics. Lawrence, KS:
University of Kansas Press.
9. W.H. Walsh (1970) "Pride, Shame and Responsibility," The Philosophical Quarterly, Vol 20, no 78,
January 1970: 1-13.
10. Albert Flores and Deborah G. Johnson (1983) "Collective Responsibility and Professional Roles" in
Ethics April 1983: 537-545.
3.5 Ethical Issues in Risk Management for Business
NOTE: These links will help you to explore different topics related to this module's contents.
- Epidemological studies are "natural" experiments. But allowing
naturally occurring harms to continue without abatement and withholding
information from risk bearers creates serious ethical problems.
Read the Tuskegee case as presented at the Western Michigan University
Ethics Center to learn about a nororious case in which
patient rights were egregiously violated for the sake of "continuing
the experiment."
- Risk has meaning only in relation to the socio-technical system
in which it operates. Click on the link above to find out more
about STS analysis and how it can be used to anticipate problems.
- Informed consent is a fundament right in the responsible
management of risk. Click on the link to the Belmont Report to
find out more about this right and its historical importance.
- The Online Ethics Center's definition of informed consent
includes the conditions necessary for fulfilling this right.
8This content is available online at .
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it with your own files.)
3.5.1 Introduction
Tilting at Windmills in Puerto Rico
The company, Windmar, has purchased land adjacent to the Bosque Seco de Guanica in Puerto Rico. Their
plan is to build a small windmill farm to generate electricity that can be sold to the public utility, the
Autoridad de Energia Electrica. Windmill technology is considered desirable because wind is an abundant,
clean, and renewable resource. But local opposition has stalled this effort. Concerned citizens object, first
of all, to being excluded from the public hearings that were held to assess Windmar's windmill project.
Opponents also claim that windmill technology can kill birds on the endangered species list and damage the
fragile ecosystems protected in the Boseque Seco de Guanica, an important nature preserve in Puerto Rico.
They also suspect that the windmill project has the ulterior motive of attracting industrial development
into southern Puerto Rico. What risks accompany windmill technology, and how can they be dealt with
ethically?
The real price of cell phones
Recently, a series of microwave antennas have been built in Puerto Rico in the Atalaya hills between the
western cities of Mayaguez and Moca. Different kinds of antennas serve different purposes; some provide
citizens with cell phone service while others make it possible to track hurricanes and other weather devel-
opments. The problem is the impact on the people who live in the surrounding areas. Many antennas have
been built within five hundred yards of private residences with some as close as one hundred yards. Local
residents were not consulted when the decision was made to build them. They claim that they have suffered
a disproportionate number of health problems caused by the EMFs (electro-magnetic fields) generated by
the antennas. Construction and repair activities occur at all hours, day and night, disrupting sleep and
other normal activities. How should the cell phone companies, government agencies, and other stakeholders
respond to these health and safety concerns? How should the possible risks to health and safety associated
with antennas be assessed and communicated?
No Copper Mines in Puerto Rico
Starting in the mid-1950's, several international mining companies have attempted to receive permission from
the Puerto Rican government to construct mines for gold and copper. Orebodies located in the mountainous
central region of the island, have attracted several proposals for mining projects ranging from large to small
scale. Concerns about water pollution (produced by tailings or mining waste products), air pollution
(accompanying the proposed copper smelting plants), and disruption of the agrarian lifestyle still alive
in central Puerto Rico became focused into considerable political and environmental opposition. Several
mining proposals were defeated as citizens' interest groups formed and intensively lobbied the government
not to permit mining. One mining site, located in the Cala Abajo region, has been reclassified as a nature
preserve to block further attempts at mining. Mining could benefit the areas around the proposed mining
sites by generating much needed jobs and tax revenue. But these benefits come accompanied by increased
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risks to the environment as well as public safety and health. How should these risks be assessed? Under
what conditions, if any, could they be deemed acceptable? What processes should be set into place by the
government to ensure adequate public participation in determining whether these risks are acceptable? How
should risk information be communicated to a public which is isolated and still largely illiterate?
"No" to the Coal Plant
In the early to mid-1990's, a consortium of U.S. and Spanish power generation companies proposed an
electricity-generating plant for the Mayaguez area that employed co-generation technology fueled by coal.
Not only would this privately owned plant sell the electricity it produced to the Autoridad de Energia de
Electrica; it would also sell the steam by-product to the two local tuna canning plants that had been operating
in the area since the 1960s. But local opposition arose to derail the project. Coal is a non-renewable resource
that produces noxious by-products that contribute to acid rain and global warming. Geologists pointed out
that the plant would be located dangerously close to an active earthquake fault. Environmental groups
raised concerns about water pollution, especially further deterioration of the already endangered coral reef
in the Mayaguez Bay due to the discharge of the heated water employed to cool the components of the
proposed plant. In televised public hearings, company engineers testified on design modifications to keep
endangered species such as manatee from being sucked into the plant through water intake pipes. On the
other side of the debate, the Puerto Rico energy utility, the Authoridad de Energia Electrica, predicted
energy shortages beginning around the year 2000. (These warnings have been vindicated by the frequent
brown-outs and black-outs that residents currently suffer through.) They also argued that the western part
of the island needed its own energy-generating facilities to hold onto crucial industries like the textile and
tuna canning plants located in the area. Finally, they turned to the use of coal to generate electricity as an
effective substitute for petroleum which is used to generate most of the electricity used by Puerto Ricans.
Since the rejection of the project, the textile industry has all but disappeared and one of the two tuna
canning plants has relocated to Taiwan. Can government play the role of "honest broker" between private
industry and a suspicious public? Should public utilities contract with private industry to meet energy and
other infrastructure needs? What are the environmental risks of co-generating technology? How can these
be responsibly communicated to the public? How should all stakeholders weigh environmental, safety, and
health risks against infrastructure expansion and economic development?
Ethical Issues in Risk Management for Business
Each of these cases raises risk issues that cannot be settled by process alone but require substantive debate
focusing on the fragile ethical values embedded in the surrounding socio-technical system. The stakeholders
have at times worked together but more often engage in conflict over seemingly incompatible yet essential
interests. Private industry has designed these projects to respond to real, market-based needs. For example,
Puerto Rico desparately needs clean, renewable and sustainable sources of energy to protect its fragile
environment and reduce its dependency on foreign oil. Yet other stakeholders, especially a public with
complex and vital interests, have banded together to oppose these and other initiatives. Local residents
demand a right to a livable environment, raise health and safety concerns, and assert civil rights based on
distributive justice, free and informed consent, and due process. Past experiences with ambitious but poorly
designed and executed business and government projects have consumed social capital and undermined public
trust. Continuing development under these conditions has proven difficult. The Puerto Rican government
has consistently been in the middle attempting to mediate between these contending parties. Can government
play the role of "honest broker" and help lead conflicting stakeholders to political and social consensus? Can
government lead the substantive ethical debate into applications of distributive justice, informed consent,
and sustainable environmental value? Or should it step out of the way and let the public and private industry
fight it out on their own? What role do free (or semi-controlled) markets have to play in mediating this
conflict? This module will help you explore these problems through the prism of risk. You will study the
different aspects of risk and learn about their ethical and social implications. The final objective is to help
you manage risk ethically through responsible assessment, perception and communication.
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3.5.2 What you need to know ...
Working responsibly with risk requires careful integration of substantive ethical issues, distinguishing different
senses of risk, and mastering the skills required in morally responsible risk communication. In other words, it
is more than just implementing a mechanical process that imposes unwanted consensus on disparate groups
and individuals. (See Sandel for an argument that past ethical controversies such as slavery had to be
settled by means of substantive debates rather than procedural maneuvers.) Ethics is important to risk
because scientific risk assessment is value-laden. Values permeate decisions such as choice of method as well
as decisions on how to distribute the burden implied by the uncertainty involved in risk assessment and
management. This section will introduce you to basic moral concepts involved in risk and offer information
on how risk is assessed, managed, perceived, and communicated.
Responsible Risk Management: Associated Basic Moral Concepts
1. Right: A capacity of action that others are obliged to recognize and respect. A key right in the context
of risk is free and informed consent. (See below)
2. Duty: The obligation to recognize and respect the essential capacities of actions of others. Duties are
correlative to rights. For example, the duty to avoid paternalism in the management and communica-
tion of risk is correlative to the right of free and informed consent.
3. Virtue: Responsible risk management can also be formulated as a virtue. Virtues are traits that extend
"deep down" into an individual's character. They include an orientation toward excellence in decision
and execution, perceptual sensitivities that help to uncover moral relevance, and emotions/attitudes
that help motivate decisions and actions oriented toward achieving excellence. For example, a respon-
sible risk communicator has curiosity that drives understanding and appreciating risk, a concern for
the well being of the risk bearer, and a strong desire to communicate risk information truthfully and
clearly.
4. Justice: Justice can be generally defined as giving each his or her due. Distributive justice, in
the context of risk, prescribes a fair distribution of the benefits and harms associated with taking
a certain risk. Ideal pattern approaches argue that distribution should conform to a pattern such
as equality (equal shares to everyone), need (greatest share to those with the greatest needs), and
merit (greatest share to those who demonstrate superior merit). Ideal pattern approaches require
continual redistribution by government through measures such as a progressive income tax. Historical
process approaches prefer maintaining current patterns of distribution provided the historical process
leading to them has been free of force or fraud. Justice in the context of risk lies in determining how
the benefits and harms associated with risk are distributed, and how the uncertainty that permeates
the risk assessment and management process is distributed among those involved.
5. Responsibility: Herbert Fingarette defines responsibility (in the context of criminal insanity) as
(moral) response to (moral) relevance. Different senses of responsibility include causal, legal (vs.
moral), role, capacity, and blame. Responsibility can be reactive when it focuses on the past and the
assigning of praise and blame; or it can be proactive when it turns to preventing harm (minimizing
risk) and realizing value.
6. Trust: The expectation of moral behavior on the part of others. Trust is built out of the social capital
accumulated through successful interactions with others. It is consumed or undermined by those who
choose to free ride on social cooperation, i.e., compete while others are cooperating. The prisoner's
dilemma (see link above) provides a simplified model to show the fragility of trust (m17367).
Key Terms in Risk Practices
1. Safety: "A thing is safe if, were its risks fully known, those risks would be judged acceptable in light
of settled value principles." (ILL 108)
2. Risk: "A risk is the potential that something unwanted and harmful may occur." (ILL 108)
3. NIMBY: This acronym stands for "Not in my backyard." Citizens often find the risks associated
with a project or product acceptable only if these are located somewhere else, i.e., in another person's
85
backyard. NIMBY has made it next to impossible for the U.S. DOE (Department of Energy) to find
an acceptable permanent storage facility for nuclear waste.
4. Free and Informed Consent: The right to decide if a risk is acceptable based on access to pertinent
information and absence of compulsion. The Belmont Report defines informed consent in the fol-
lowing way: "[that] subjects, to the degree that they are capable, be given the opportunity to choose
what shall or shall not happen to them. This opportunity is provided when adequate standards for
informed consent are satisfied." The Online Ethics Center spells out conditions necessary for fulfilling
informed consent: (a) disclosure (of information to the patient/subject); (b)comprehension (by
the patient/subject of the information being disclosed); (c) voluntariness (of the patient/subject in
making his/her choice); (d) competence (of the patient/subject to make a decision); and (e) consent
(by the patient/subject).
5. Paternalism: Often experts are tempted to act as overly concerned parents and take over the decision-
making perogatives of the public because they (the experts) "know better." Paternalism, while well
motivated, is based on the misconception that the public doesn't understand risk because it often
reaches different conclusions on the acceptability of a given risk than the expert. But the public
often appreciates risk from a broader, richer standpoint, especially if the expert has properly and
clearly communicated it. As will be seen below, the public perception of risk is rational because it is
predictable.
Dimensions of Risk
* Risk Assessment: The process of determining the degree of risk associated with a certain product
or process using scientific methods such as epidemological study or animal bioassay. While using
scientific procedures to gain a measure of exactness, risk assessment still brings with it a remainder of
uncertainty that cannot be eliminated. A risk assessment issues into two uncertainties, the uncertainty
as to whether the harm will occur and the uncertainty as to who (out of the many exposed) will be
harmed. Ethics enters into the picture as stakeholders negotiate how to deal with and distribute this
uncertainty. Responsible risk practice requires integrating the conflicting values and interests of the
involved stakeholders in assessing, communicating, perceiving, and managing risk. It also requires a
basis of trust that is difficult to build up given the diverse players that make up the risk taking and
bearing situation.
* Risk Management: The political/social/ethical process of determining if a risk of a certain degree
is acceptable given the settled value principles generally held in the community of the risk bearers.
Responsible risk management requires (a) assessing harm through the responsible exercise of scientific
method and (b) communicating the assessed risk to those likely to bear it. Responsible risk management
(i) honors rights such as free and informed consent and due process, (ii) avoids conflicts of interests in
determining and communicating risk, (iii) conscientiously works toward a just distribution of risks and
benefits, and (iv) avoids paternalism.
* Risk Perception: How people perceive risk differs from the strict, scientifically determined degree of
risk. For example, risk perception factors in voluntariness, control, expected benefits, lack of knowledge,
and dread of adverse consequences in working toward a judgment on the acceptability of a given risk
by the community of risk bearers. Because the public perceives risk over this broad background
of scientific, social, political, and ethical factors, it frequently arrives at conclusions at odds with
judgments reached using strictly scientific methods. Those taking a paternalistic attitude toward the
public take this difference as evidence of the irrationality of the public and the need for the experts to
taken things into their own hands. However, the public attitude toward risk is intelligible and rational
when this broader, risk perception perspective is taken into account.
* Risk Communication: This dimension focuses on how to communicate risk information to risk
bearers in order to facilitate distributive justice, free and informed consent, and due process. Respon-
sible risk communication requires translating scientifically determined information into a non-technical
vocabulary. Analogies and comparisons help as does the use of concrete language and commonly un-
derstood images. But improper use of comparisions and analogies confuses the public and undermines
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CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
trust.
* Public: "those persons whose lack of information, technical knowledge, or time for deliberation renders
them more or less vulnerable to the powers an engineer wields on behalf of his client or employer" Davis
Assessing Risk
" Epidemiological Studies: We are constantly exposed to different risks that have become inherent
in our socio-technical circumstances. These ongoing, unintentional experiments are exploited through
epidemiological studies which are designed to measure the correlation between exposure to risk factors
and the occurrence of harm. For example, are those living close to EMFs (electro-magnetic fields
generated by technologies like electrical power lines) susceptible to certain harms like leukemia? An
epidemiological study would compare incidents of this disease occurring in a population exposed to
EMFs with incidents of this disease occurring in a population, unexposed to EMSs. If there were a
significant risk ratio (usually set at three times the incidents of the harm in the unexposed, control
group) then this provides evidence that exposure to EMFs somehow causes leukemia. (Further study
would be required to confirm this hypothesis and uncover the causal mechanism by which exposure
produces the harm.) Epidemiological studies are difficult to carry out and are always accompanied
by uncertainty due to the limitations of the methods employed. Typically, the harm may take years
to become manifest after exposure. Finding a population stable enough to determine the effects of
long term exposure is difficult because individuals frequently move from place to place. Such natural
experiments also bring with them a great deal of "noise"; factors other than EMFs could be causing
leukemia or EMFs could be interacting with other elements in the environment to cause the harm.
Finally, there is the Tuskegee factor. In the notorious Tuskegee experiment, doctors refused to treat
African Americans for syphilis in order to study the long term progression of the disease. Exposing
a population to a risk factor without informing them of the potential harm in order to gain scientific
information violates the right of free and informed consent and the duty not to harm.
" Animal Bioassays: Risk information can often be obtained by exposing animals to the risk factor
and checking for emerging harms. While useful, animal bioassays are subject to several problems.
Experimenting on animals raises many of the same ethical concerns as experimenting on humans.
Utilitarians argue that animals merit moral consideration because they are sentient and can suffer.
Animal experiments are thus subject to the three Rs: reduce, refine, and avoid replication. (See
Bernard Rollins) Second, these experiments create two kinds of uncertainty. (a) Projections from
animal to human physiology can lead researchers astray because of the differences between the two;
for example, animals are more sensitive to certain harms than humans. (b) Projecting the results from
intensive short term animal exposure into the long term can also introduce errors and uncertainty.
Thus, as with epidemiological studies, there are uncertainties inherent in animal bioassays.
" Risk assessment, while useful, is burdened with uncertainty due to the limits of what we know, what
we can know, and what we are able to learn within the ethical parameters of human and animal
experimentation. Crucial ethical issues arise as we decide how to distribute this uncertainty. Do we
place its burden on the risk taker by continuing with a project until it is proven unsafe and harmful?
Or do we suspend the activity until it is proven safe and harm-free. The first gives priority to advancing
risky activities. The second gives priority to public safety and health, even to the point of suspending
the new activities under question.
Risk Perception
* The framework from which the public perceives risk is broader and richer than that of risk assessment.
The following five factors influence how the public judges the acceptability of a risk assessed at a given
magnitude.
* Voluntariness: A risk that is voluntarily taken is more acceptable than a risk of the same magnitude
that taken involuntarily. Thus, driving one's car to a public hearing on the risks of a proposed nuclear
power plant may be riskier than living next to the plant. But driving to the public hearings is done
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voluntarily while living next to the plant is suffered involuntarily. According to studies, a voluntary
risk is as much as 1000 times more acceptable than an involuntary risk of the same magnitude.
* Control: Closely related to voluntariness is control. A risk under one's control (or under the control
of someone trusted) is more acceptable than a risk of the same magnitude that is not under control.
Charles Perrow, in Normal Accidents argues against nuclear energy technology because its design
allows for components that are tightly coupled and interact with nonlinear patterns of causality. These
two characteristics make it possible for small events to start chain reactions that issue into large scale
disasters. Because these small events cannot be isolated (they are "tightly coupled") and because they
interact unpredictably (they display nonlinear causality), they escape control and lead to unacceptable
risks.
* Perceived/Expected Benefits: A risk of a given magnitude is more acceptable if it comes accompa-
nied with substantial expected benefits. One takes the risk of driving to the hearings on the proposed
nuclear plant because the benefits of getting crucial information on this project outweigh the risks of
having a car accident. Riding a motorcycle is a risky venture. But the benefits received from this
activity in the form of enjoyment make the risk more acceptable than a risk of the same magnitude
accompanied with less benefits.
* Unknown Factors: A risk that is not understood is less acceptable than one that is well understood.
Riding a bicycle is a risky venture but, because its risks are well known, it is more acceptable than
other activities accompanied by risks of similar magnitudes. This factor is highly pertinent to EMFs
(electro-magnetic fields). While EMFs are associated with certain illnesses like leukemia, their effects
are not well known and are not understood by the public. This unknown element makes living near
EMF producing technologies less acceptable.
* Dread Factors: A risk may be known and its causal relation to certain illnesses well understood.
Nevertheless it may be less acceptable because the condition it causes is one that is highly dreaded.
EMFs, because they have been associated with leukemia in children, are much less acceptable because
of this "dread factor." The causes of radiation sickness are well known as are the stages of the illness.
But because this kind of illness is highly dreaded, accompanying risks are less acceptable than other
risks of the same magnitude with less of the dread factor. Again, compare crashing on a bicycle with
coming down with cancer to get an idea of how dread permeates the perception of risk.
* Against Paternalism: Consider the possibility that predictability is one component of rationality.
Then test this hypothesis in the cases presented at the beginning of this module. Can the risks posed by
each project be examined in terms voluntariness, susceptibility to control, expected benefits, unknown
factors, and dread factors? If so, then the public perception of this risk is rational because it can be
predicted and understood. Thus, even though members of the public might find other risks of the
same-or even greater-magnitude more acceptable, these perceptual factors would render the public's
judgment intelligible and predictable. If all of this is so (and you will be testing this hypothesis in the
exercises below) then paternalism on the part of the expert would not be justified. Furthermore, these
insights into how risk is perceived by the public should provide you with valuable insight into how to
communicate risk to the public.
Responsible Risk Communication
* Telling the Truth: Certainly, responsible risk communication should start with the commitment to
tell the truth. But the virtue of truthfulness is more complicated than it might seem at a first glance.
For example, were an expert to tell nonexperts the whole truth this might confuse them, especially if
the account is loaded with complex technical explanations and jargon. Truthfulness might require some
simplification (holding some things back or putting them in different terms), judicious comparisons,
and the use of concrete images. Thus, the virtue of truthfulness requires (a)understanding the audience
and (b) outlining their perceptions, concerns, feelings, and needs. With this in mind, here are some
factors that are useful in communicating risk responsibly and truthfully.
* Know the audience: What is their level of understanding, their needs, and their perceptions. For
example, do they perceive the risk as voluntary, under control, accompanied with substantial benefits,
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CHAPTER 3. CSR (CORPORATE SOCIAL RESPONSIBILITY)
accompanied by effects that are well known, and of a low dread factor? The risk perception framework
described above will help you to communicate risk in a helpful and responsible manner.
* Take measures to avoid deceiving the audience: The gap between the expert (those in the know)
and the public is sometimes quite large. This creates the temptation to fill that gap with less then
truthful content. Avoiding deception requires more than just refraining from telling outright lies. It
also requires taking measures to avoid subtle manipulation and unintentional deception.
* Guard against unintentional deception: (a) Be careful when using rhetorical devises. (b) Use risk
comparisons and analogies to provide the public with benchmarks, not to persuade them that because
they accept risk X they should accept risk Y. (c) Be sure to point out the limits of comparisons
and analogies. (Driving to the public hearing is a risk of a greater magnitude than living next to
a nuclear plant but this does not include key factors such as voluntariness, control, and expected
benefits. (d) Avoid conflicts of interest. In exercise one below, you will be looking at an example of
risk communication taken from the movie Silkwood. Think about whether this communication is
reponsible and honest. Do the interests of the risk communicators coincide with those of the audience?
Do the interests of the communicators bias the content of the communication in any way? (For example,
does the upcoming vote to keep the union play a role in this risk communication act?)
3.5.3 What you will do ...
In this section, you will practice managing and communicating risk information. In managing risk informa-
tion, you will practice how to empower, inform, and involve the risk-bearing public. In communicating risk,
you will practice different ways of helping the public to deliberate on the acceptability of certain risks.
Exercise One
* Listen to the doctors communicating the risks associated to exposure to plutonium while working in
the Kerr-McGee plant in the movie, Silkwood. How effective is this communicative act? (Explain
your assertion.) How truthful is this communicative act? (Is truth about risk value-free scientific
information or do values play a crucial role in our deliberations on risk? What kind of values are at
stake here?)
* Listen to Charlie Bloom's presentation to the Milagro citizens' meeting on the economic and social risks
associated with the Devine Recreational Center. Describe in detail the audience's reaction. Analyze
both the content and style of Bloom's short speech. Does he facilitate or impede the process and
substance of deliberation over risk? Rewrite Bloom's speech and deliver it before the class as if they
were citizens of Milagro.
* Paul Slovic pictures a part of the risk perception process in terms of unknown and dread factors. In
general, the higher the dread and unknown factors, the less acceptable the risk. Other factors that
enter into the public perception of risk are voluntariness, control, expected benefits, and the fairness
of the distribution of risks and benefits. Given this depicting of the public's perception of risk, how do
you expect the Kerr McGee employees to react to the risk information being presented by the doctors?
How will the citizens of Milagro react to the risk information they are receiving on the ethical, social,
and economic impacts of the Devine Recreational Project?.
Exercise Two: Risk Perception
* Choose one of the cases presented above in the Introduction to this module.
* Describe those who fall into the public stakeholder group in this case. (See the above definition of
"public")
* Identify the key risks posed in your case..
* Describe how the public is likely to perceive this risk in terms of the following: voluntariness, perceived
benefits, control, unknown factors and dread factors.
* Given this perception of the risk, is the public likely to find it acceptable?
89
Exercise Three: Risk Communication
" You are a representative from one of the private business involved in the above case
" Your job is to communicate to the public (whose risk perception you studied in exercise two) the risk
assessment data you have collected on the project in question
" Develop a strategy of communication that is based on (a) legitimate risk comparisons and analogies, (b)
that is non-paternalistic, (c) that responds to the manner in which the public is likely to perceive the
risk(s) in question, and (d) is open to compromise based on legitimate public interests and concerns.
Exercise Four (optional)
" Carry out exercises two and three using either the Milagro Beanfield War town meeting or the
union meeting from Silkwood.
" Pretend you are Charlie Bloom and are charged with outlining the various risks that accompany the
Devine Recreational Facility. The rest of the class, your audience, will play the role of the differ-
ent stakeholders. These could include the (1) townspeople (owners of local businesses such as Ruby
Archuleta's car body shop and the general store owner, Nick Real), (2) farmers (such as Joe Mon-
dragon), (3) local and state law enforcement officers (such as Bernabe Montoya and Kyril Montona),
(4) Ladd Devine Recreation Center employees (such as Horsethief Shorty who leads the construction
crew), (5) local government officials (such as mayor Sammy Cantu) and state government officials
(including the governor), and Ladd Devine himself.
" Give a short presentation. Then respond to questions and commentaries from your classmates who are
working with the different roles outlined above.
" Take a vote on whether to go ahead with the Ladd Devine project.
3.5.4 What did you learn?
Business and Risk
You are a Corporate Ethics Compliance Officer developing an ethics program for your organization. How
should your program respond to the ethics of risk issues discussed in this module? How should your corpo-
ration go about identifying and communicating risk factors to employees? How should your corporation go
about identifying and communicating risk factors to other stakeholders such as customers, local community,
and government agencies?
3.5.5 Appendix
Bibliography
1. Covello, V.T., Sandman, P.M. and Slovic, P. (1991) "Guidelines for Communicating Information About
Chemical Risks Effectively and Responsibly," in Acceptable Evidence: 66-92.
2. Cranor, C.F. (1993) Regulating Toxic Substances: A Philosophy of Science and the Law.
Oxford University Press: London.
3. Fingarette, H. (1971) Criminal Insanity. University of California Press, Berkeley, CA: 171.
4. Mayo, D.G., Hollander, R.D., Editors. (1991) Acceptable Evidence: Science and Values in Risk
Management. Oxford University Press: London.
5. Mayo, D.G. (1991) "Sociological Versus Metascientific Views of Risk Assessment," in Acceptable
Evidence. Oxford University Press: London: 249-280.
6. Slovic, P. (1991) "Beyond Numbers: A Broader Perspective on Risk Perception and Risk Communica-
tion," in Acceptable Evidence: 48-65.
7. Perrow, C. (1984) Normal Accidents: Living with high-risk technologies. Basic Books, NY,NY.
8. Reason, J. (1990/1999) Human Error Cambridge University Press: London.
9. Sagoff, M. (1985) Risk-Benefit Analysis in Decisions Concerning Public Safety and Health.
Kendall/Hunt: Dubuque, Iowa.
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10. Sagoff, M. The Economy of the Earth: Philosophy, Law, and the Environment. Cambridge
University Press: London.
11. Sandel, M.J. (1982/1998) Liberalism and the Limits of Justice, 2nd Ed. Cambridge University
Press, London.
12. Shrader-Frechette. (1991) "Reductionist Approaches to Risk," in Acceptable Risk. 218-248.
13. Thompson, P.B., (1999) "The Ethics of Truth-Telling and the Problem of Risk." Science and Engi-
neering Ethics 5(4): 489-510.
14. "Glossary" Online Ethics Center for Engineering 1/31/2006 6:57:46 PM National Academy of Engi-
neering Accessed: Saturday, December 27, 2008 www.onlineethics.org/CMS/glossary.aspx
This optional section contains additional or supplementary information related to this module. It could
include: assessment, background such as supporting ethical theories and frameworks, technical information,
discipline specific information, and references or links.
3.5.6 EAC ToolKit Project
3.5.6.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License9 regarding permission to reuse this material.
3.5.6.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
9http://creativecommons.org/licenses/by/2.0/
Chapter 4
CG (Corporate Governance)
4.1 Different Approaches to Corporate Governance1
-The first link refers to a news story on Dunn's resignation from the Hewlett-Packard board.
It is taken from PBS's Online NewsHour in a report delivered by Margaret Warner on September 22, 2006.
-The second link provides background information on the Hughes Aircraft case profiled just below.
NOTE:
Arthur Andersen
Once a highly respected company, Arthur Andersen no longer exists having gone bankrupt in the wake of the
Enron disaster. Arthur Andersen provided Enron with consulting and accounting services. The consulting
division was more successful but the accounting division, with its long tradition of outstanding ethical service,
was the corporation's backbone. Arthur Andersen signed off on Enron's use of mark-to-market accounting
which allowed Enron to project optimistic earnings from their deals and then report these as actual profits
years before they would materialize (if at all). They also signed off on Enron's deceptive use of special
purpose entities (SPE) to hide debt by shifting it from one fictional company to another. With Arthur
Andersen's blessing, Enron created the illusion of a profitable company to keep stock value high. When
investors finally saw through the illusion, stock prices plummeted. To hide their complicity, Arthur Andersen
shredded incriminating documents. For federal prosecutors this was the last straw. The Justice Department
indicted the once proud accounting firm convinced that this and previous ethical lapses (Sunbeam and Waste
Management) showed a pattern of unabated wrongdoing. Arthur Andersen was conficted of obstructing
justice on June 15, 2002 and closed its doors shortly after.
AA Timeline (Taken from Smartest Guys in the Room)
" 1913-Founded by Arthur Andersen: "think straight, talk straight"
" Stood up to Railroad company in early years. When asked to change accounting standards, Andersen
said, "There is not enough money in the city of Chicago [to make AA give into client demands]"
" 1947-1963-Leonard Spacek became president of AA succeeding Arthur Andersen.
" Spacek helped motivate the formation of the Financial Accounting Standards Board. AA also served
as conscience of accounting profession criticizing the profession and the SEC (Securities and Exchange
Commission) for "failing to square its so-called principles with its professional responsibility to the
public."
" 1963-1989-Slow erosion of standards and development of competition between accounting and consult-
ing divisions. (Consulting division was developed to take advantage of a profitable direction in the
financial induistry.)
i~i content is available online at .
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* 1989-Consultants achieve relative autonomy as "separate business unit." (McLean: 144)
* 1997-Consultants break from firm.
* 1988-1991-Arthur Andersen receives 54 million in fees from Enron
" 2000-Enron pays AA 52 million. The lion share of this was for consulting fees.
" June 15, 2002-AA found guilty of obstruction of justice. "Today's verdict is wrong....The reality here
is that this verdict represents only a technical confiction." (McLean: 406)
Hughes Aircraft
Howard Hughes founded this company at the beginning of the twentieth century. Hughes became a regular
supplier of military hardware to the U.S. military. In the 1980's this included parts for surface to air misiles
and fighter aircraft. One division specialized in computer chips designed to convert analogue information to
digital for use in guidance systems and decision support systems. For example, these chips interacted with
radar to help pilots of fighter aircraft avoid enemy missiles and also served as an essential component for
missile guidance systems, the so-called smart bombs. Hughes had won the competitive bids for these highly
profitable military projects but they had also committed themselves to tight delivery schedules with inflexible
deadlines. And on top of this, the U.S. Airforce demanded that these computer chips and the systems that
integrated them be rigorously tested to show that they could withstand the severe environmental stresses
of battle. Hughes soon fell behind on the delivery of these computer chips causing a chain reaction of other
delays both within the company and between the company and other links in the military supply chain.
The environmental tests carried out by quality control under the supervision of Frank Saia had worked
hard to complete the time-consuming tests and still remain on schedule with deliveries; hot parts (parts
in high demand) were pulled to the front of the testing line to keep things running but soon even this
wasn't enough to prevent delays and customer complaints. Giving way to these pressures, some Hughes
supervisors pushed employees to pass chips without testing and even to pass chips that had failed tests.
Margaret Gooderal and Ruth Ibarra resigned from the company and blew the whistle on these and other
ethical failings that had become rampant in Hughes. So the corporate social responsibility question becomes
how to change this culture of dishonesty and restore corporate integrity to this once innovative and leading
company. (Background information on Hughes can be found at computingcases.org.)
Patricia Dunn v. Tom Perkins on Corporate Governance
When Patricia Dunn became a "non-executive" chairman of Hewlett-Packard's board on February 7, 2005,
she brought with her an outstanding reputation in corporate governance. Her top priorities were to oversee
the election of a new CEO after the firing of Carly Fiorina whose management of the recent acquisition of
Compaq had lost her the HP board's support. Dunn also was determined to stop leaks to the press from
high-level HP officials. She viewed the latter task as a fundament component of the post-Enron corporate
governance approach she felt was needed as Hewlett-Packard moved into the 21st century. But her formal
take on CG was at odds with powerful board member and successful venture capitalist, Tom Perkins. In his
opinion, too strict an approach to CG stood in the way of HP culture and took focus away from competing
with Dell and IBM as well as staying on the cutting edge in the development of new technology. As the leaks
continued, Dunn's investigation into their source (most likely a discontented HP board member) became
more active and rigorous. And the disagreements between her and board member Perkins deepened; their
incompatible views on CG (and other disagreements) led to Perkins's resignation from the HP board. Things
became critical when Perkins received a letter from A.T. and T. informing him that an account had been
established in his name (but without his knowledge or consent) using the last 4 digits of his social security
number and his private phone number. During the HP-led investigation into the press leaks, a private
investigation firm used an illegal technique known as "pretexting" to obtain confidential information about
HP board members and news reporters including private phone and social security numbers. Perkins reported
this to the SEC, and Patricia Dunn, as chairman and de facto head of the leak investigation, was indicted
on four criminal charges including identity theft.
Dunn focused on incompatible views of corporate governance as one of the causes of the rift that had
developed between her and Perkins's: "Tom's model of governance may be appropriate in the
world of venture capital, but it is outmoded and inappropriate in the world of public company
governance." (Stewart, 165) She also made clear her strong views on board members leaking confidential
93
information shared during board meetings to the press: "The most fundamental duties of a director-
the duties of deliberation and candor-rely entirely upon the absolute trust that each director
must have in one another's confidentiality. This is true for trivial as well as inmportant
matters, because even trivial information that finds its way from the boardroom to the press
corrodes trust among directors. It is even more critical when discussions can affect stock
prices....Leaking "good" information is as unacceptable as leaking "bad" information-no one
can foretell how such information may advantage or disadvantage one investor relative to
another." (Stewart, 156)
Questions
How can successful corporate governance programs be integrated into companies with free-wheeling, inno-
vative cultures without dampening creative and imaginative initiatives? How does one make sense of the
fundamental irony of this case, that a conscientious pursuit of corporate governance (attacking violations of
board confidentiality) can turn into violation of corporate governance (violation of the privacy and persons
of innocent board members)?
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it with your own files.)
4.1.1 Introduction
James B. Stewart, in a New Yorker article about Patricia Dunn and Hewlett-Packard, describes corporate
governance as "a term that technically refers to all aspects of running a corporation but in recent years
has come to emphasize issues of fairness, transparency, and accountability." This module looks at corporate
governance from the macro perspective, (1) examining the management strategies adopted by a firm to
ensure compliance and pursue excellence and (2) from the standpoint of government as it seeks to minimize
unethical corporate behavior and to maximize the corporation's contribution to social welfare.
4.1.2 What you need to know ...
4.1.2.1 Prisoner's Dilemma: Cooperation or Competition?
Scholarly debates on corporate governance have turned on the advocacy of different approaches, many of
which can be modeled mathematically. Two approaches are based on the concepts of agency and stewardship.
(See Davis et. al. in Clarke 2004) To enter into this debate, you will reenact the "Prisoner's Dilemma."
Imagine that two patriotic spies, A and B, have just been captured by the enemy. Both are placed in separate
interrogation cells and are being pressured to confess and provide details about their spying activities. A and
B would like to coordinate their actions but the enemy has kept them apart to prevent this. Their objective
is to pit A against B another in order to get the desired information. To do this, they have set forth the
following systems of motivations, i.e., punishments and rewards.
Options for the Prisoners
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" If both A and B confess. A and B are put in jail for five years each. The net loss in this scenario
is 10. This is the least desirable alternative from the collective standpoint.
" If one confesses and the other does not. The confessor is released immediately while the non-
confessor gets seven years in prison. This maximizes the confessor's self interest but severaly punishes
the patriotic, non-confessor. Net loss is 7.
" If both do not confess. After six months of half-hearted interrogation (most of this time is for
processing the prisoners' release), both are set free for lack of evidence. While not maximizing self
interest (this lies in confessing while the other remains silent) this does maximizes overall welfare by
producing a net loss of only 1.
Prisoner Dillema Options Summarized
Prisoner A / Prisoner B Confess Not Confess
Confess Both go to jail for 5 years (Net A goes to jail for 7 years. B is
loss is 10) released. (Net loss is 7)
Not Confess B goes to jail for 7 years. A is Both held for six months, then re-
released (Net loss is 7) leased. (Net los is 1.0)
Table 4.1
Assumptions in the Prisoner Dilemma
" Cooperation produces the best collective option and the second best individual option. This, in turn,
assumes that cooperation produces more social welfare than competition.
" Free riding (competing) on the cooperation of others produces the most individual gains (for the free
rider) but the second worst collective results. Society suffers loses from the harm done to the trusting,
non-confessor and from the overall loss of trust caused by unpunished free-riding.
" Unlimited, pure competition (both prisoners confess) produces the worst collective results and the
second worst individual results.
" Multiple iterations of the prisoner's dilemma eventually lead to cooperative behavior. But what causes
this? (1) The trust that emerges as the prisoners, through repeated iterations, come to rely on one
another? Or (2) the fear of "tit-for-tat" responses, i.e, that free riding on the part of one player will
be punished by free riding on the part of the other in future iterations?
" Does the Prisoner's Dilemma assume that each player is a rational, self-interest maximizer? Are the
players necessarily selfish in that they will seek to maximize self interest even at the expense of the
other players unless rewards and punishments are imposed onto the playing situation from the outside?
The Prisoner's Dilemma is designed to model the reality of corporate governance where the directors/owners
of a corporation delegate responsibility for the corporation's operations to managers who are charged with
pursuing, not their own interests, but those of their directors. The problem of corporate governance is how
this cooperative arrangement is institutionalized. Can managers be left alone and trusted to pursue the best
interests of the corporation? This is implied in stewardship theory. Or is it necessary to design a system
of controls to keep the managers from diverting the operations of the corporation toward their exclusive,
self-interests? This is the approach taken in agency theory. Modeling this in terms of repeated iterations
of the prisoner's dilemma, does cooperation emerge as the most reliable strategy in the long run? Or does
it need to be manufactured by introducing a system of incentives such as fear of tit-for-tat strategies? The
Prisoner's Dilemma models the central problems of corporate governance by asking whether cooperation
naturally emerges between managers and directors or whether it needs to be manufactured through a system
of punishments and rewards.
95
4.1.2.2 A Short Footnote on Human Nature
" One important means for classifying different approaches to corporate governance is to reflect on the
associated account of human nature. This is a very complex issue but, fortunately, political philosophy
provides us with some useful insights.
" Thomas Hobbes in the Leviathan presents a comprehensive psychological analysis of human nature
based on seventeenth century physics. The focal point of this analysis is the human individual's
unlimited pursuit of desire. Without external checks (primarily the threat of punishment imposed
by a powerful sovereign) the State of Nature (where human individuals pursue self interest without
external checks) is identical to a State of War. This war of all against all is "solitary, poore, nasty,
brutish, and short."
" Hobbes's view has been characterized by C.B. Macphearson as "possessive individualism" which por-
trays the self as the possessor of its own attributes including the property acquired through its actions.
This leads to a view called atomic individualism which is based on the claim that the self has its
characteristics and determinate structure prior to and independently of any social interaction.
" Jean-Jacques Rousseau offers a brilliantly original criticism of Hobbes' conception of human nature
in his Second Discourse, the Discourse on the Origin of Inequality. According to him, Hobbes's
characterization of human nature in the State of Nature is actually a description of the human corrupted
by society and the acquisition of property. "The first person who, having enclosed a plot of
land, took it into his head to say this is mine and found people simple enough to believe
him, was the true founder of civil society. What crimes, wars, murders, what miseries
and horrors would the human race have been spared, had someone pulled up the stakes
or filled in the ditch and cried out to his fellow men: "Do not listen to this imposter.""
Rousseau argues that before the notion of property, the human's desire to preserve self was balanced
by the social feeling of pity brought forth by the suffering of others. Only the unchecked pursuit of
property (seen in terms of exclusive possession) would bring the motive of self-interest into conflict
with natural pity.
" In opposition to Hobbes's atomic and individualistic self, a group of political philosophers, beginning
with Aristotle, see the self as primarily social. Aristotle characterizes the human as a political animal
(a being who naturally constructs a social organism called the "polus"). Sandel describes a "thick self"
constructed out of familial, social and political content; this content is integrated into the core of the
self. Werhane's description of this "social animal" is worth quoting in full: "In that socialization
process, we develop a number of interests, roles, memberships, commitments, and values
such that each individual is an historical, cultural, and social product, a pluralistic bundle
of overlapping spheres of foci, a thick self or selves.... [T]here is no self as precritical,
transcendental subject, totally ideal spectator or dispossessed subject.
" Thus a series of views of human nature emerge that are instrumental in forming different approaches to
corporate governance. Hobbes's atomistic individualism will favor the compliance approach mandated
by agency theory as directors set up external checks to self-serving managers. Rousseau's more nuanced
view would require structures to hold the pursuit of self-interest in check while strengthening the equally
natural impulses toward socializability and cooperation. The social conception of the self would treat
the corporation as an environment where managers, as stewards, recruit employees who will quickly
commit to the central corporate values and then develop supporting structures and procedures to help
their colleagues find meaningful work while fulfilling social, corporate objectives.
4.1.2.3 Approaches to Corporate Governance
Summary Table
96
CHAPTER 4. CG (CORPORATE GOVERNANCE)
(1,1) Description(1, )Theory of Owner Manager Corporate
Human Na- Role(1,4) Role(1,5) Ethics Fo-
ture(1,3) cus(1,6)
Agency The- Managers act Managers are Owners are Managers are Compliance
ory(2,1) as agents of rational, but principals, agents, that focus uses
the corpora- self-interested that is, they is, responsible (1) rule-based
tion fulfilling beings who originate the for acting in codes, (2)
the goals es- must be action and the interest systems of
tablished by controlled bear primary of the princi- monitoring,
the owners / from the moral respon- pals who hire and (3) pun-
directors(2,2) outside(2,3) sibility.(2,4) them. Faith- ishments and
ful agency rewards to
implies avoid- motivate com-
ing conflicts pliance from
of interests outside.(2,6)
and main-
taining confi-
dences. (2,5)
Stockholder Corporation Stockholders Owners invest Managers are Stockholders
Ap- is property of pursue self in corporation responsible direct compli-
proach(3,1) stockholders interest. They and seek a for ensuring ance toward
who dispose of are rational return (profit) that owners manager
it as they see (instrumen- on their invest- get maximum control and
fit.(3,2) tal), economic ment.(3,4) return on in- external con-
self-interest vestment. (3,5) formity to
maximiz- laws. (3,6)
ers. (3,3)
Stakeholder Owners drop Groups have Owners drop Managers (4,6)
Ap- out of center special in- to one of a are meta-
proach(4,1) focus. Corpo- terests but group of equal stakeholders.
ration is run recognize the stakeholders. They treat
for the sake of need to inte- Still advocate stakeholders
its stakehold- grate these. their finan- and stakes
ers.(4,2) Humans pos- cial interests equally and
sess capacity but not to integrate
for procedural exclusion of these to the
reasoning. (4,3) other stake- fullest extent
holders.(4,4) possible. (4,5)
continued on next page
97
Stewardship Managers act Desire and Owners still Managers are Value-based:
Model(5,1) as stewards for self interest set cardinal stewards exer- (1) identify
absentee own- are balanced objectives but cising care over and formu-
ers; oversee out by social they also are the property of late common
the operations motives such responsible the owners in standards of
of corporation as Rousseau's for providing their absence. excellence,
and exercise pity and managers with Stewardship (2) develop
care over them. Aristotle's a meaningful is based on training pro-
Emotion (care) virtues. (5,3) work environ- internally gen- grams to foster
plays an equal ment.(5,4) erated and pursuit of
role with in- self-imposed these excel-
strumental ra- motives toward lences, and
tionality. (5,2) care.(5,5) (3) develop
support struc-
tures to help
reduce value
"gaps."(5,6)
Table 4.2
Agency Theory
1. In agency theory, the owners/directors set the central objectives of the corporation. Managers, in turn,
are responsible for executing these objectives in the corporation's day-to-day operations. Corporate
governance consists of designing structures and procedures to control management, i.e., to keep their
actions in line with director-established objectives.
2. Managers cannot be trusted to remain faithful agents, i.e., to stay faithful to the interests and goals
of the owners/directors. This presupposes a particular view of human nature. Humans are rational,
egoists. They have desires and use reason to devise means to realize them. Since one desire can be
checked only by another desire, this egoism is potentially without limit. Agency theory assumes that
managers will divert corporate resources to pursue their own selfish ends unless checked by some system
of external controls. Thus, another key element of corporate governance under agency theory is to find
the most efficient systems of controls to keep manager egoism in check.
3. The owners/directors play the role of principal in agency theory. The principal originates the action
and bears primary moral and legal responsibility for it. Most of the time the principal of an action is
also its executor. But there are times when the principal lacks the knowledge and skill necessary for
executing the objectives he or she originates. In this case, the principal contracts with an agent. The
principal authorizes the agent to act on his or her behalf. This requires that the agent remain faithful
to the goals and interests of the principal. See Hobbes's Leviathan, Chapter 16 for an important
historical account of the agent-principal relation.
4. Managers are agents. Their primary responsibility is to serve as faithful executors of the goals and
interests of the principals. This requires, first, that, managers are responsible for exercising their pro-
fessional judgment in a competent way. Managers are also responsible for remaining faithful to the
interests of their principals. To do this they must avoid conflicts of interests and maintain confiden-
tialities (i.e., keep secrets). Agent can also range from being free (unguided by principals) to bound
(tightly monitored and controlled by principals).
5. How does ethics enter into corporate governance under agency theory? Primary emphasis is placed
on compliance, i.e., enforced conformity to rules that constitute minimum thresholds of acceptable
behavior. Compliance approaches develop (1) rule based codes, (2) systems of monitoring to detect
violations, and (3) punishments and rewards to deter non-compliance and reward compliance. Trevino
and Weaver provide an empirical analysis to the goals achieved through compliance ethics: "[4] the
perception that better decisions are made because of the ethics program [5] ethical advice seeking, [6]
98
CHAPTER 4. CG (CORPORATE GOVERNANCE)
decreased unethical behavior in the organization... [7] ethical awareness." (Weaver and Trevino, 1999:
333.)
Stockholder Theory
1. The stockholder approach is quite similar to that set forth in agency theory. The difference is that it
views the corporation as the property of its owners (stockholders) who may dispose of it as they see
fit. Most of the time this involves using it to receive maximum return on investment.
2. Stockholders are oriented toward self-interest, so stockholder theory, along with agency theory, takes
an egoistic/Hobbesian view of human nature. Humans are rational, self-interest maximizers. Owners
should expect this from the corporation's managers and employees. They should integrate procedures
and controls that channel the corporation and its members in the direction of their (owners) self-
interest.
3. The owners invest in the corporation and seek a return (profit) on this investment. But this narrow
role has been expanded into overseeing the operations of the corporations and its managers to ensure
that the corporation is in compliance with ethical and legal standards set by the government. Just as
the master, under tort law, was responsible for injury brought about by the negligence of a servant, so
also are directors responsible for harm brought about by their property, the corporation.
4. Managers are role-responsible for ensuring that investors get maximum return on their investment.
This includes exercising good business judgment and avoiding conflicts of interests and violations of
confidences.
5. Like corporations operating within agency theory, stockholder corporations focus on compliance strate-
gies to monitor managers and make sure they remain faithful agents. However, directors under the
stockholder approach also take seriously oversight responsibility which include ensuring corporate com-
pliance with laws such as Sarbanes-Oxley and the Federal Sentencing Guidelines.
Stakeholder Theory
1. Owners drop out of the center of attention in this approach to become one of several, equal stakeholders.
A stakeholder is any group or individual that has a vital interest, right, good, or value in play or at
risk. (A gambler's stake is the money on the table in play as the roulette wheel turns. Depending
on the outcome of the situation, the gambler either keeps or loses the stake.) Examples of corporate
stakeholders include stockholders, employees, customers, suppliers, local community, and government.
The corporation on this view exists for the sake of its stakeholders, not stockholders.
2. The stakeholder view can be closely tied to egoism if it is assumed that the different stakeholder groups
exist to maximize their selfish interests. But the stakeholder approach to corporate governance goes
beyond the egoistic account of human nature. The corporation (and its managers) become responsible
for mediating between these different, often conflicting, stakeholder interests, always keeping in mind
that all stakeholders deserve equal respect. If stakeholders have any solidarity with one another, it
is because the interest set of each includes the interests of the others. (This is how Feinberg defines
solidarity.) The ability to envision the interests of each stakeholder and to work toward integrating
these must be built on a view of human nature that is as altruistic as egoistic. While not embracing the
social view of human nature outlined above, the stakeholder view assumes that stakeholders are capable
and willing to negotiate and bargain with one another. It begins, in other words, with enlightened and
long term self interest.
3. The first feature of the owner role is the reduction in centrality mentioned just above. They advocate
their interests in the same arena as the other stakeholders, but they also must work to make their
interests compatible with the other stakeholders. This requires integrating interests when possible and
drawing integrity-preserving compromises when necessary. (See Benjamin 1990).
4. Managers play an important meta-role here. They are faithful agents but of all stakeholders, not just
stockholders. Thus, they becomes referees or (to switch metaphors) brokers between stakeholders. They
oversee the generation of expansive corporate values capable of absorbing and integrating narrower
stakeholder interests.
99
5. Stakeholder approaches combine compliance and value-based approaches. In compliance, corporate
officers define a moral and legal minimum; this consists of the minimum set of rules necessary for
stakeholder coexistence. Beyond this, value-based approaches seek to create common, broader objec-
tives, aspirations that can unite the different stakeholders in the pursuit of excellence. Stakeholder
approaches need both; the compliance approach gets things started and the values-based approach sets
them on the path to excellence.
Stewardship Theory
* Managers and employees can be trusted to act as stewards or guardians of the corporation. This means
that while they do not own the corporation's resources, they will safeguard these for the owners. A
steward is a caretaker who looks after the owner's property and interests when the owner is absent
* This approach definitely makes use of the social approach to human nature. Humans, naturally and
spontaneously, realize their innermost natures by forming social unions. The corporation, under this
view, is such an organization. While taking on the characteristics of a social contract with the other
approaches, especially agency theory, the corporation under the stewardship view is more of a coopera-
tive, collaborative enterprise. Humans can act and find meaning in interests and concerns well beyond
the confines of the ego. In fact, to organize the corporation around egoistic assumptions does harm to
those capable of action on altruistic motives. The emphasis here is on building trust and social capital
to strengthen the social potentialities of human nature.
* Owners still establish the cardinal objectives for the sake of which the corporation exists. But they are
also responsible for providing managers with an environment suitable developing human potentialities
of forming societies to collaborate in meaningful work.
* Managers act as stewards or caretakers; they act as if they were owners in terms of the care and
concern expressed for work rather than merely executors of the interests of others. In other words, the
alienation implied in agency theory (acting not out of self but for another), disappears as the managers
and employees of the corporation reabsorb the agent function.
* Stewardship approaches are primarily value-based. They (1) identify and formulate common aspira-
tions or values as standards of excellence, (2) develop training programs conducive to the pursuit of
excellence, and (3) respond to values "gaps" by providing moral support.
4.1.2.4 External Controls: Fining, Stock Dilution, Changing Internal Governance, Court Or-
dered Adverse Publicity, and Community Service
Classifications of Corporate Punishments
Descriptio Example Target of Deterrenc Non- Responsive Interferen
Punish- Trap financial Adjust- with
ment Avoided? Values ment Cor-
Ad- porate
dressed? Black
Box
continued on next page
e
100
CHAPTER 4.
CG (CORPORATE GOVERNANCE)
Monetary Fines Pentagon Harms in- Fails to Few or None No inter-
Exaction Procure- nocent Escape None ference
ment Targeted
Scandals
Stock Di- Dilute Stockholder Escapes Few or Limited No inter-
lution Stock and (Not nec- by attack- None ference
award to essarily ing future
victim guilty) earnings
Probation Court SEC Vol- Corporation Escapes Focuses on Passive Substantial
orders untary and its since it manage- adjust- entry into
internal Disclosure Members mandates ment and ment since and in-
changes Program organi- subgroup imposed terference
(special zational values from with cor-
board changes outside porate
appoint- black box
ments)
Court Court English Targets Escapes Loss of Active ad- No direct
Ordered orders Bread corporate (although prestige / justment inter-
Adverse corpora- Acts (Hes- image adverse Corporate triggered ference
Publicity tion to ter Prynne publicity shame / by shame (corpo-
publicize shame in indirectly Loss of ration
crime Scarlet attacks Face/Honor motived
Letter) financial to restore
values) itself)
CommunityCorporatio Allied RepresentativEscapes Adds Passive None
Service performs chemical groups/indivislinahs value to or no ad-
Orders services (James from cor- targets commu- justment:
mandated River poration non- nity sometimes
by court Pollution) financial public
values does rec-
ognize
that cs is
punish-
ment
Table 4.3
Requirements of Sarbanes-Oxley (From Dyrud: 37)
" Provide increased protection for whistle-blowers
" Adhere to an established code of ethics or explain reasons for non-compliance
" Engage in "full, fair, timely and understandable disclosure"
" Maintain"honest and ethical" behavior.
* Report ethics violations promptly
* Comply with "applicable governmental laws, rules, and regulations"
* Dyurd cites: ELT, Ethics and Code of Conduct, n.d.; http://www.elt-inc.com/solution/ethics
_and_code_of_conduct_training obligations.html
Ammended Federal Sentencing Guidelines (Dyrud 37)
* Establishing standards and procedures to prevent and detect criminal conduct
101
" Promoting responsibility at all levels of the program, together with adequate program resources and
authority for its managers
" Exercising due diligence in hiring and assigning personnel to positions with substantial authority
" Communicating standards and procedures, including a specific requirement for training at all levels
" Monitoring, auditing, and non-internal guidance/reporting systems
" Promiting and enforcing of compliance and ethical conduct
" Taking reasonable steps to respond appropriately and prevent further misconduct in detecting a vio-
lation
4.1.3 What you will do ...
Module Activities
" Study the Prisoner's Dilemma to help you formulate the central challenges of corporate governance.
" Study four different approaches to corporate governance, (1) agency theory, (2) the stockholder ap-
proach, (3) the stakeholder approach, and (4) stewardship theory.
" Examine corporate governance from the macro level by (1) looking at the structural changes a company
can make to comply with legal and ethical standards and (2) examining the balances that government
must make to control corporate behavior and yet preserve economic freedom.
" Design a corporate governance program for an actual company that you and your group choose. It
should be a company to which you have open access. You will also be required to take steps to gain
the consent of this company for your study.
" Reflect on how to integrate this module's macro description of corporate governance with the micro
perspective presented in the module on moral ecologies and corporate governance.
Corporate Governance Plans
" A corporate code of ethics that responds to the specific ethical problems uncovered by your profile of
the corporation you are studying.
" A corporate ethics training program designed to acquaint employees, owners, and managers with the
company's value aspirations and compliance objectives.
" A Corporate Ethics Audit designed to identify and minimize ethical risks.
" A comprehensive ethics compliance program that responds to the requirements set forth in Sarbanes
and Oxley as well as the Federal Sentencing Guidelines.
" A program in corporate excellence designed to articulate and realize the core values that define your
company's identity and integrity.
4.1.4 What did you learn?
This material will be added later. Students will be given an opportunity to assess different stages of this
module as well as the module as a whole.
4.1.5 Appendix
Bibliography
1. Benjamin, M. (1990) Splitting the difference: Compromise and Integrity in Ethics and Pol-
itics. Lawrence, KS: University of Kansas Press.
2. Carol, A. B., "Social Responsibility," in Werhane, P., and Freeman, R. E., eds. (1997, 1998) Blackwell
Encyclopedic Dictionary of Business Ethics. Oxford, UK: Blackwell Publishers, JNC: 593-595.
102
CHAPTER 4. CG (CORPORATE GOVERNANCE)
3. Clarke, T. (2004) "Introduction: Theories of Governance-Reconceptualizing Corporate Governance
Theory After the Enron Experience," in Theories of Corporate Governance: The Philosophical
Foundations of Corporate Governance, ed. Thomas Clarke. New York: Routledge: 1-30.
4. Davis, J.H., Schoorman, D., and Donaldson, L. "Toward a Stewardship Theory of Management,"in
Theories of Corporate Governance: The Philosophical Foundations of Corporate Gover-
nance, ed. Thomas Clarke. (2004) New York: Routledge: 1-30.
5. Dyrud, M.A. (2007) "Ethics, Gaming, and Industrial Training," in IEEE Technology and Society
Magazine. Winter 2007: 36-44.
6. Feinberg, J. (1970) "Collective Responsibility" in Doing and Deserving: Essays in the Theory
of Responsibility. Princeton, NJ: Princeton University Press: 234.
7. Fisse, B. and French, P.A., eds. (1985) Corrigible Corporations and Unruly Law. San Antonio,
TX: Trinity University Press.
8. French, P.A. (1984) Collective and Corporate Responsibility. New York: Columbia University
Press..
9. Hobbes, T. (1651, 1968) Leviathan. Middlesex, England: Penguin Books: 186.
10. Macpherson, C.B. (1962) The Political Theory of Possessive Individualism: Hobbes to Locke.
London, UK: Oxford University Press: 3.
11. May, L. (1987) The Morality of Groups: Collective Responsibility, Group-Based Harm, and
Corporate Rights. Notre Dame, IN: University of Notre Dame Press.
12. McLean, B., and Elkind, P. (2003) The Smartest Guys in the Room: The Amazing Rise and
Scandalous Fall of Enron. New York: Portfolio: 141-149.
13. Paine, L.S. (1994) "Managing for Organizational Integrity," in Harvard Business Review,
March/April 1994.
14. Rousseau, J.J. (1987) Jean-Jacques Rousseau: The Basic Political Writings Translated by
Donald A. Cress. Indianapolis, IN: Hackett Publishing Company: 60.
15. Stewart, J.B. (2007) "The Kona Files: How an obsession with leaks brought scandal to Hewlett-
Packard," in The New Yorker, February 19 and 26, 2007: 152-167.
16. Stone, C. D. (1975) Where the Law Ends: The Social Control of Corporate Behavior.
Prospectr Heights, IL: Waveland Press, INC: 1-30.
17. Swartz, M., Watkins, S. (2003) Power Failure: The Inside Story of the collapse of Enron. New
York: Doubleday: 356.
18. Weaver, G.R. and Trevino, L.K. (1999) "Integrated and decoupled social performance: Management
commitments, external pressures, and corporate ethics practices." The academy of Management
Journal, 42: 539-552.
19. Werhane, P.H. (1999) Moral Imagination and Management Decision Making. Oxford, UK:
Oxford University Press: 39.
20. Werhane, P. H. (2008) "Mental Models: Moral Imagination and System Thinking in the Age of Glob-
alization," in Journal of Business Ethics, 78: 463-474.
21. Werhane, P. (2007) "Corporate Social Responsibility/Corporate Moral Responsibility: Is There a
Difference and the Difference It Makes," in eds., May, S., Cheney, G., and Roper, J., The Debate
over Corporate Social Responsibility. Oxford, UK: Oxford University Press: 459-474.
4.1.6 EAC ToolKit Project
4.1.6.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License2 regarding permission to reuse this material.
2http: //creativecommons.org/licenses/by/2 .0/
103
4.1.6.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
4.2 Developing a Statement of Values3
4.2.1 Module Introduction
Codes of ethics evoke opposite reactions from people who teach, do research in, or are practitioners of
occupational and professional ethics. Some hold that teaching codes of ethics is essential to preparing students
for their future careers. Corporations, for example, have come to view codes as the cornerstone of a successful
compliance program. Professional societies, such as the Puerto Rico State Society of Professional
Engineers and Land Surveyors, also make the drafting, revising, and disseminating professional codes
of ethics a central part of practicing professional engineering ethics. But many strongly opppose codes
because they promote the wrong sorts of attitudes in those who would be influenced by them. As you will
see below, philosophical ethicists raise objections to codes because they undermine moral autonomy, lead to
uncritical acceptance of authority, and replace moral motives with fear of punishment. These polar stances
are grounded in the very different perspectives from which different groups approach codes. But they are
also grounded in the fact that codes take many different forms and serve distinct functions. For example,
consider the introductory considerations presented in the following:
Codes: Introductory Considerations
" Managers and administrators have used them to maintain positions of control and authority.
" Professional societies use codes to communicate and enforce minimum standards of acceptable behavior.
" Codes can be used to support those who would be ethical in the face of difficulties. For example,
codes that uphold public welfare can be used as "clear mandates of public policy" in a legal defense
created to support those who suffer organizational retaliation for refusing to carry out illegal or immoral
directives.
" This leads to an important fact about codes of ethics: they serve several different functions such
as educating, fostering dialogue, disciplining unethical behavior, encouraging and supporting ethical
behavior, articulating values and aspirations, and even presenting a group in a favorable way to the
general public.
" This module has been designed to get you to recognize these different functions at play in codes of
ethics.
Difficulties With Codes
" The following objections lead many to omit teaching codes in practical and professional ethics classes.
" Codes can undermine moral autonomy by habituating us to act from motives like deference to
external authority and fear of punishment.
" Codes take on more than they can handle when they purport to provide us guidance for complex situ-
ations. The ineliminable gap between rules (which are general and abstract) and action-situations
(which are particular and concrete) leads to serious application problems.
" Codes fail to provide guidance in complex situations that present new and unexpected challenges.
Arguing that codes should provide action-recipies for all situations neglects the fact that effective moral
action requires more than just blind obedience to rules.
" Codes of ethics can encourage a legalistic attitude that turns us away from the pursuit of moral
excellence toward just getting by or staying out of trouble. Compliance codes are most effective when
they establish minimum standards of acceptable behavior. They break down when they turn to more
elevated standards that reflect aspirations rather than minimum thresholds. Thus, compliance codes
habituate individuals to the idea that morality can be reduced to carrying out minimal standards of
moral decency.
3This content is available online at .
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CHAPTER 4. CG (CORPORATE GOVERNANCE)
This module is designed to steer you through these complex issues by having you draft a Statement of
Values for students at your university. As you work through your Statement of Values, you will learn that
codes have strengths and weaknesses, serve different functions, and embody values. To get you started in
this process, you will study a defective code, the Pirate Credo. A quick glance is all that is needed to see
that codes are "all too human" and need to be approached critically. In a second activity you will identify
the values embedded in professional, corporate, and academic codes. Working with these values, you will
develop a list upon which your group will build its own Statement of Values in a third activity. Finally, you
will construct value profiles that include a general description, sample provisions, value-based challenges,
and value principles. These will all contribute to motivating those in your community to commit to and
work in concert to realize these values.
4.2.2 A Failure and a Success Story
A Cautionary Tale
The faculty of the Arts and Sciences College of University X decided to form a committee to write a code
of ethics. This committee met several times during the course of an academic semester to prepare the first
draft. When they finished, they circulated copies throughout the college. Then they held a series of pubic
hearings where interested members of the College could criticize the code draft. These were lightly attended
and those attending had only a few suggestions for minor changes. However, when the code was placed
before the faculty for approval, considerable opposition emerged. For example, a provision discouraging
faculty from gossiping was characteized by opponents as an attempt by a hostile College administration,
working through the committee, to eliminate faculty free speech. Several opponents expressed opposition to
the very idea of a code of ethics. "Does the administration think that our faculty is so corrupt," they aked,
"that the only hope for improvement is to impose upon them a set of rules to be mindlessly followed and
ruthlessly enforced?" At the end of this debate, the faculty overwhelmingly rejected the code.
Reflections on "A Cautionary Tale"
" Why do you think this university faculty failed to adopt, or even consider, the draft code?
" What leads different members of a group to view the same code provisions in different, and even
opposed, ways? What considerations guide individuals as they interpret codes of ethics?
" Can codes of ethics be used by those in positions of power to strengthen that power and extend control?.
A Success Story
" Three years later at the same university, another faculty group set out to construct a code of ethics in
order to respond to accreditation requirements. They began with the idea of constructing a stakeholder
code.
" First, they identified the stakeholders of the college's activities, that is, groups or individuals who had
a vital interest in that community's actions, decisions and policies.
" Second, they identified the goods held by each of these stakeholders which could be vitally impacted
by the actions of the college. For example, education represented the key good held by students that
could be vitally impacted by the activities and decisions of the College.
" Working from each stakeholder relation and the good that characterized that relation, members of the
college began crafting code provisions. Some set forth faculty duties such as keeping regular office
hours, grading fairly, and keeping up to date in teaching and research. Others emphasized student
duties such as working responsibly and effectively in work teams, adhering to standards of academic
honesty, and attending classes regularly.
Because stakeholder codes embody a community's values, the individuals in charge of drafting the code
decided that a more direct approach would be to identify the embodied values and refine them into a
Statement of Values. This formal statement could later be developed in different directions including a more
detailed compliance code.
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Turning their efforts toward preparing a Statement of Value Process, the Business Administration com-
munity went through the following steps:
1. They discussed a flawed document, the Pirate Credo. This brought about three positive results:
participants came to see how codes embody values, that codes serve different functions, and that codes
clarify relations between the insiders and outsiders of a community.
2. Participants examined "bona fide" codes of ethics such as academic codes, codes of honor, corporate
codes, and professional codes. Since codes embody values, they developed lists of the values these
codes embodied.
3. The sample provisions crafted in the earlier stakeholder code effort were presented so that participants
could identify the values these embodied. Previous efforts in developing a stakeholder code could be
benchmarked against the codes studied in the previous step. Convergences and divergences were noted
and used to further characterize the college's community in terms of its similarities and differences
with other communities.
4. In this step, faculty members were asked to reduce the values list to a manageable number of five to
seven. This led to the most contentious part of the process. Participants disagreed on the conception
of value, the meaning of particular values like justice, and on whether rights could be treated as values.
5. To resolve this disagreement, discussion leaders proposed using ballots to allow participants to vote
on values. This process was more than a simple up or down vote. Participants also ranked the values
under consideration.
6. After the top five values were identified, efforts were made, in describing each of the remaining values,
to find places to include at least components of the values left out. For example, while confidentiality
was not included in the final value list, it was reintegrated as a component of the more general value
of respect. Thus, the final values list could be made more comprehensive and more acceptable to the
faculty community by reintegrating some values as parts of other, more general values. Another way
of picking up values left behind in the voting process was to combine values that shared significant
content. Values that did not make it into the final list were still noted with the provision that they
could be integrated into subsequent drafts of the Statement of Values.
7. A committee was formed to take each value through a value template. After describing the value,
they formulated a principle summarizing the ethical obligations it entailed, crafted sample provisions
applying the value, and posed different challenges the value presented to help guide a process of
continuous improvement.
8. The committee presented its results to the faculty who approved this first draft Statement of Values
9. The faculty then developed a schedule whereby the Statement of Values would be revisited, expanded,
revised, and improved.
4.2.3 Textbox 1: Responding to the Federal Sentencing Guidelines
Recent efforts to develop ethics codes in the academic context for both students and faculty may, in part,
stem from the success of ethics compliance programs developed in business and industry in response to
the Federal Sentencing Guidelines. Organizational codes of ethics have been integrated alongside other
compliance structure and activities to prevent criminal behavior, to detect criminal behavior, and to ensure
prompt and effective organizational response once such behavior has been detected.
The following section contains short exerpts from the Federal Sentencing Guidelines. For more
details consult the materials referenced in note 5 below.
* "The hallmark of an effective program to prevent and detect violations of law is that the organization
exercised due diligence in seeking to prevent and detect criminal conduct by its employees and other
agents. Due giligence requires at a minimum that the organization must have taken the following types
of steps:
* The organization must have established compliance standards and procedures to be followed by ite
employees and other agents that are reasonably capable of reducing the prospect of criminal conduct.
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" Specific individual(s) within high levelpersonnel of the organization must have been assigned overall
responsibility to oversee compliance with such standards and procedures.
" The organization must have used due care not to delegate substantial discretionary authority to indi-
viduals whom the organization knew, or should have known through the exercise of due diligence, had
a propensity to engage in illegal activities.
" The organization must have taken steps to communicate effectively its standards and procedures to all
employees and other agents, e.g., by requiring participation in training programs or by disseminating
publications that explain in a practical manner what is required.
" The organization must have taken reasonable steps to achieve compliance with its standards, e.g.,
by utilizing monitoring and auditing systems reasonably designed to detect criminal conduct by its
empoyees and other agents and by having in place and publicizing a reporting system whereby em-
ployees and other agents could report criminal conduct by others within the organization without fear
of retribution.
Recommendations by the Federal Sentencing Guidelines for an Effective Compliance Program
" Appointing individuals to serve as ethics or compliance officers
" Developing corporate credos and codes of ethics that effectively communicate an organization's ethical
standards and expectations to employees.
" Designing ethics training programs for all employees
" Designing and implementing monitoring and auditing systems
" Designing and implementing an effective system of punishments and sanctions. These must be accom-
panied by investigative procedures that respect employee due process rights.
4.2.4 Textbox 2: Compliance Oriented Codes and Programs Versus Values Ori-
ented Codes and Programs
Compliance Strategy
1. The initial and still probably the most prevalent method for responding to the Federal Sentencing
Guidelines is the compliance strategy. This strategy is based on three interrelated components:
2. Rules: Compliance strategies are centered around strict codes of ethics composed of rules that set
forth minimum thresholds of acceptable behavior. The use of rules to structure employee action does
run into problems due to the gap between rule and application, the appearance of novel situations, and
the impression that it gives to employees that obedience is based on conformity to authority.
3. Monitoring: The second component consists of monitoring activities designed to ensure that em-
ployees are conforming to rules and to identify instances of non-compliance. Monitoring is certainly
effective but it requires that the organiztion expend time, money, and energy. Monitoring also places
stress upon employees in that they are aware of constantly being watched. Those under observation
tend either to rebel or to automatically adopt behaviors they believe those doing the monitoring want.
This considerably dampens creativity, legitimate criticism, and innovation.
4. Disciplining Misconduct: The last key component to a compliance strategy is punishment. Pun-
ishment can be effective especially when establishing and enforcing conduct that remains above the
criminal level. But reliance on punishment for control tends to impose solidarity on an organization
rather than elicit it. Employees conform because they fear sanction. Organizations based on this fear
are never really free to pursue excellence.
Values Orientation
1. Development of Shared Values: Using a process similar to the one described above, a company
develops a Statement of Shared Values. These provide guidelines that replace the hard and fast rules of
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a compliance code. Statements in values-oriented codes play a different logical function that statements
in compliance codes. "Principles of Professional/Organizational Conduct" in compliance codes specify
circumstances of compliance: time, agent, place, purpose, manner, etc. These circumstances provide
sufficient content to set forth principles of professional conduct as rules that can be violated. This, in
turn, allows them to be backed by punishment for violation. "Ideals of the Profession/Organization
state a community's shared aspirations. They set forth levels of behavior well beyond the minimum.
And they chart out directions for continuous improvement.
2. Support for Employees: Since Statements of Values set forth excellences or aspirations, the role of
the organization changes from monitoring and then punishing misbehavior to finding ways of opening
avenues for employees to realize key values in their day to day activity. In other words, the role of the
organization changes from the punitive to the supportive.
3. Ethical Aspirations: In summary, values orientations set forth higher standards for behavior. Going
well beyond the moral or legal minimum, these values, clarified in an organization's statement of values,
serve as aspirations. A values orientation requires that an organization find ways to reinterpret basic
values as excellences. Hence, it is most compatible with a virtue orientation and virtue ethical theory.
4.2.5 Exercise 1: Evaluating the Pirate Credo
Read the Pirate Credo. Then answer the following questions individually
" What is good about the Pirate Credo?
" What is bad about the Pirate Credo?
" What is the purpose served by the Pirate Credo? For the Pirate Community? For non-members?
4.2.6 Exercise 2: Evaluating Bona Fide Codes of Ethics
Form small work teams of four to five individuals. Carry out the following fours steps and
report your results to the rest of the group.
1. Review a few sample codes per team.
2. List the values you identify in the codes. Express each value as a word or in as few words as possible.
3. Identify any recurring values.
4. Record and post the list of values.
4.2.7 Exercise 3: Do a Statement of Values for Students at Your University
In this third exercise, work with your group to develop a refined list of five to seven values.
You can refine your list by integrating or synthesizing values, grouping specific values under
more general ones, and integrating values into others as parts. Do your best to make your list
comprehensive and representative.
1. Brainstorm: list the values for your group. Keep in mind that values are multi-dimensional. For
example, in the academic context, the values will break down into dimensions corresponding to stake-
holder: faculty, students, administration, and other academic stakeholders.
2. Refine: reduce your list to a manageable size (5-7). Do this by rewording, synthesizing, combining,
and eliminating.
3. Post: share your list with the entire group.
4. Revise: make any last minute changes.
5. Combine: a moderator will organize the lists into a ballot
6. Vote: Each person ranks the top five values
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4.2.8 Exercise 4-Conveying Our Values: Crafting a Values-Based Code
Each value in your Statement of Values needs to be accompanied by a Value Profile. Give a
description of the value in everyday, non-technical terms. Think concretely. For example, those
who exemplify your value behave in a certain fashion, exhibit certain commitments, pursue
certain projects, and show certain attitudes and emotions. Try to think of general guidelines to
keep in mind when working to realize your value. Finally, values challenge us because portray
our aspirations. Think of specific ways values challenge us. For example, students may set for
themselves the challenge of working responsibly in teams. They can further spell out what
kinds of actions and attitudes this might require. Faculty members might set for themselves
the challenge of grading more fairly. This could require actions like developing rubrics and
refining exams to make them clearer. The purpose of this fourth exercise is to provide content
to your statement of values and begin its implementation in your community. The following
steps ennumerated below will help.
1. Value: Responsibility
2. Description: a responsible person is a person who...
3. Principle: The faculty, students, and staff of the college of business Administration will...
4. Commitments: Keep office hours, do your fair share in work teams, divide work into clear and
coordinated tasks, tec.
4.2.9 Exercise 5: Creating Awareness of the UPRM College of Business Admin-
istration Statement of Values
This exercise provides you an opportunity to study and discuss the UPRM College of Business Administration
Statement of Values (available via the PREREQUISITE LINKS). Your task consists of the following tasks:
* Read the entire UPRM CBA Statement of Values (individually)
* Discuss the particular section/value assigned to your group and briefly describe what commitments or
challenges does this value present for the students, faculty and/or staff of the CBA
* List the most important commitments or challenges as precise and concise principles
4.2.10 Exercise 6: Assessing the UPRM College of Business Administration
Statement of Values
This exercise offers four scenarios in academic integrity. Your job is to discuss each scenario in terms of
the values listed in the UPRM College of Business Administration Statement of Values (available via the
PREREQUISITE LINKS).
Marta Acevedo, a business administration student, has a report due tomorrow. She has been
overwhelmed for the last few weeks with assignments from other classes and doesn't really
have time to complete this exercise. She discovers that her roommate took this same class
the previous semester and has a complete report on disk. She considers using her roommate's
report. Should she? What would you do if you were her?
* Is Marta threatening any of the values listed in the ADEM SOV? Which ones?
* What can be done prevent this kind of problem from arising in the first place? Should Marta have
planned her course load better when registering? Can teachers coordinate to prevent overloading
students with the same deadlines? Whose fault is this? The students? The teachers? The system?
* Can this problem be posed as a conflict between ADEM values and other values held by students and
teachers? If so, what are values that are in conflict? How can these conflicts be addressed?
* Do you think the ADEM SOV adequately addresses this problem? If not, how can it be improved?
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You are head of your department. A recent study has revealed that plagiarism, which is a
university-wide problem, is especially bad in your department. Imagine your relief when a
member of your faculty brings you his latest software project, a super-effective and compre-
hensive anti-plagiarism software program. This program does everything. It detects subtle
changes in style in student papers. Its new search engine quickly connects to existing online
paper data bases, greatly expanding the ability of a professor to detect the sources from which
their students have copied. Furthermore, it allows professors to upload papers and projects
from past semesters and provides fast and flexible indexing to help them identify recycled stu-
dent work. Professors can zero in on students using recycled papers, and the former students
who have become their suppliers. Following the recent lead of Ohio State University, you can
now revoke the degrees of past students who participate in this version of academic dishonesty.
In short, this new and exciting software package allows you to monitor the work of present
and past students to a degree thought impossible even in the recent past. "Plagiarism," your
colleague tells you, "will now become a thing of the past."
" Does this anti-plagiarism program threaten any of the values in the ADEM SOV? If so, which values?
" Is the department chairperson treating students disrespectfully by adopting and implementing the anti-
plagiarism software? Can faculty treat students disrespectfully as "justifiable" retaliation for student
cheating and plagiaring? Do two wrongs make a right?
" What is the cause of plagiarism? Do students do it out of ignorance of standards and practices of
documentation and achnowledgment? Do they do it because they procrastinate until they do not have
time to do the assignment properly? Do students resort to plagiarism because they have too many
conflicting obligations such as family, job, large course loads, etc.?
You teach an advanced course in Engineering Economics that has both graduate and under-
graduate students. At the end of the semester the students turn in a group project that
comprises 40% of their grade. One of the groups complains to you that only 4 out of the 5
members have done any work. The fifth student, the one who allegedly has done no work, is
an undergraduate. The others are graduate students. You talk with the undergraduate who
claimed that she tried to involve herself in the group activities but was excluded because she
was an undergraduate. What should you do?
" ADEM faculty have identified students not working together effectively in groups as a major concern.
Do you find this a problem? What do you think are the causes of students not participating effectively
in work groups?
" Assume that the teacher in this case is committed to implementing the ADEM SOV. Which values are
at play in this case? Design an action for the teacher that realizes these values?
" Assume you are a member of this student work group. What can groups do to ensure that every member
is able to participate fully? What do group members do to exclude individuals from participating?
You are studying frantically for your exam in a computer engineering course. It will be very
difficult. But your roommate, who is also taking the course and has the exam tomorrow, seems
unconcerned. When you ask why, he tells you that he has a copy of the exam. Apparently,
a group of students in the class found out how to hack into the professor's computer and
download the exam. (They installed a Trojan horse called Sub-Seven into the professor's
computer which allows unauthorized access; then they searched through the professor's files,
found the exam and downloaded it.) Your roommate has the exam in his hand and asks you
if you would like to look at it. What should you do?
* A group of students in a computer ethics class created a survey that asked students if they would
avail themselves of exams obtained through means such as that described in the scenario above. Sixty
percent of the respondents said that they would. Compare this to the value commitments expressed in
the ADEM SOV? Is there a gap between aspiration and behavior? What can be done to reduce this
gap?
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" Suppose you took the exam. Would this have any long term effects on your character? Would acting
dishonestly this time make it easier to do so in the future?
" Suppose you wish to uphold standards of academic integrity in this case and not take the exam. Should
you turn your roommate in to the teacher? Would keeping this exam theft a secret undermine any of
the UPRM ADEM values? If so, which ones?
You have now discussed some or all of the above cases in terms of the ADEM Statement of Values. What do
you think are the strengths of this document? What are its weaknesses? Do you recommend any changes?
What are these?
Sources for Cases
" Case 1 has been developed by William Frey, Chuck Huff, and Jos6 Cruz for their book, Good Com-
puting: A Virtue Approach to Computer Ethics. This book is currently in draft stage and is under
contract with Jones and Bartlett Publishing Company.
" Cases 2 and 3 were developed by UPRM faculty teams from the College of Engineering during work-
shops held for the ABET 2001 Steering Committee and the Department of Industrial Engineering.
These workshops took place April 6, 2001 and May 14, 2001.
" Case 4 has been modified from "The Plagiarism Detector" written by Moshe Kam. It can be found
at the beginning of the ethics chapter in Practical Engineering Design, edited by Maja Bystrom and
Bruce Eisenstein. Moshe Kam. "The Plagiarism Detector", in Practical Engineering Design, edited by
Maja Bystrom and Bruce Eisenstein. Boca Raton, FLA: CFC Press, 2005: 27-28.
4.2.11 Assessment Tools
Ethics Across the Curriculum Matrix
This is an unsupported media type. To view, please see
http://cnx.org/content/m14319/latest /EACMatrix_ Template _ADEM _Feb_17.doc
Figure 4.2: This table will help you document your class discussion of the ADEM Statement of Values.
Muddy Point Exercise
This is an unsupported media type. To view, please see http://cnx.org/content/m14319/latest/MP.doc
Figure 4.3: Clicking on this media file will open a word format for the Muddiest Point Exercise.
Students are invited to discuss the strongest and weakest facets of the ADEM Statement of Values.
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Module Assessment Form
This is an unsupported media type. To view, please see http://cnx.org/content/m14319/latest/MAP.doc
Figure 4.4: Clicking on this media file will open a general module assessment form taken from Michael
Davis' IIT EAC workshop. This form will help you assess the SOV activity as well as other EAC modules.
4.2.12 Bibliography
1. Lynn Sharp Paine (1994) "Managing for Organizational Integrity," in Harvard business review, March-
April: 106-117
2. Gary R. Weaver and Linda Klebe Trevino (1999) "Compliance and Values Oriented Ethics Programs:
Influences on Employees' Attitudes and Behavior," in Business Ethics Ethics Quarterly 9(2): 315-335
3. Stuart C. Gilman (2003) "Government Ethics: If Only Angels Were to Govern," in Professioinal Ethics,
edited by Neil R. Luebke in Ph Kappa Phi Forum, Spring 2003: 29-33.
4. Stephen H. Unger (1994) Controlling Technology: Ethics and the Responsible Engineer, 2nd Edition.
New York: John Wiley and Sons: 106-135.
5. "Federal Sentencing Guidelines-Sentencing of Organizations," in Ethical Theory and Business, 5th
Edition, edited by Tom L Beauchamp and Norman E. Bowie, New Jersey: Prentice Hall: 182-187.
This article was reprinted with permission from The United States Law Week, Vol. 50 pp. 4226-29
(March 26, 1991) (Bureau of National Afairs, Inc.
4.3 Pirate Code for Engineering Ethics4
4.3.1 Statements of Value/Codes of Ethics
* William J. Frey
* Center for Ethics in the Professions
* University of Puerto Rico at Mayaguez
4.3.2 Module Introduction
In this module, you will learn about professional and occupational codes of ethics by looking at a bad code,
writing your own code, and then critically examine a professional code of ethics, the engineering code for
the Colegio de Ingenieros y Agrimensores de Puerto Rico. Three exercises will take you through the process
of examining the Pirate Creed, writing your own code, and examining the Colegio's code. Text boxes will
provide helpful background information on purposes served by professional codes, philosophical objections,
and a framework for working your way through a stakeholder-based code like that of the CIAPR or the
National Society of Professional Engineers. This module provides a Spanish translation of the Pirate Creed
prepared by Dr. Dana Livingston Collins of the Department of Humanities in the University of Puerto Rico
at Mayagiiez.
4This content is available online at .
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Concluding this module are two word documents uploaded as media files. One provides the exercises
that are presented in this module in XML format. The other provides the background information that has
been presented in this module as Textboxes.
4.3.3 Module Activities
1. You will analyze the Pirate Creed in terms of (a) its different functions, (b) the community values it
embodies, and (c) how it stands toward nonmembers of the pirate community as well as members.
2. You will write a code of ethics for an occupational or professional area such as business or engineering.
3. You will debrief the rest of the class on your group's code, clarify its functions and values, and defend
it if necessary.
4. This module will conclude with a look at the code of ethics of the Puerto Rico State Society of
Professional Engineers and Land surveyors or Colegio de Ingenieros y Agrimensores de Puerto
Rico.
4.3.4 Pirates Creed of Ethics (translated into Spanish by Dana Collins)
1. El capitan tendri comando total durante una batalla y tendra la autoridad para dirigir el barco. El
que no sigua al capitan podri ser castigado se la tripulacion no vota en contra del castigo.
2. Si el barco naufraga, la tripulacion permaneceri unidos hasta el capitan consigue otra nave. Si la nave
es propiedad comnn de la tripulacion, la primera nave capturada perteneceri al capitan con una (1)
parte de botin.
3. El cirujano del barco recibiri doscientas (200) coronas para el mantenimiento de su equipo medico y
recibiri una (1) parte del botin.
4. Los otros oficiales recibirin una (1) parte cada uno, y si se distinguen, la tripulacion determinari
cuanto recibirin como recompensa.
5. El botin de una nave capturada seri distribuido en partes iguales.
6. El primero que senale la aparicion de un barco que sea capturado recibiri cien (100) coronas.
7. El que pierda un ojo, una mano, o una pierna mientras esti en servicio, recibiri hasta seis esclavos o
seiscientas (600) coronas.
8. Los suministros y raciones serin compartidos por igual.
9. La penalidad por traer una mujer disfrazada a bordo es la muerte.
10. Si un hermano roba de otro, perderA su nariz u orejas. Se peca de nuevo, se le darin un mosquete,
municiones, plomo y una botella de agua y seri abandonado en una isla.
11. Si hay duda en una disputa entre hermanos, una corte de honor determinari el veredicto. Si un
hermano es encontrado culpable, la primera vez seri perdonado, pero al ofender de nuevo, seri atado
a un canon y recibiri un latigazo de cada miembro de la tripulacion. El mismo castigo seri dado a
todos, incluyendo oficiales, quienes se emborrachen al punto de perder sus sentidos mientras esten en
el barco.
12. El que se duerma mientras esti trabajando como centinela, recibirin latigazos por todos los miembros
de la tripulacion. Se repite el crimen, su cabeza seri rajada.
13. A todos quienes conspiren para desertar, o lo que hayan desertado y sean capturados, sus cabezas serin
rajadas.
14. Pelas entre varios hermanos mientras esten a bordo seri resueltos en tierra con pistolas y espadas. El
que saque primera sangre ser~i el vencedor. No pueden golpear a otro mientras est~n a bordo de la
nave.
4.3.5 Exercise 1: Pirate Creed
" What is good about the Pirate Creed of Ethics?
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" what is bad about the Pirate Creed of Ethics?
" What is the purpose of the Creed for the Pirate Community?
" What values are embedded in the Pirate Creed
" How does the Pirate Creed deal with nonmembers?
4.3.6 Exercise 2: Writing a Code of Ethics for Engineers
" Step One: Identify the purpose behind your engineering code of ethics. For example, is it to punish
wrongful behavior, provide a set of guidelines, educate the community, support ethical behavior, or
create an ethics dialogue?
" Step Two: Identify the contributions that engineering makes to society.
" Step Three: Identify the stakeholders of the engineering profession. A stakeholder is any group or
individual with a vital or essential interest tied to what engineers do. along with these stakeholders,
identify their stakes, that is, the goods, rights, interests or values that are maintained, promoted, or
diminished by what engineers do?
" Step Four: Enumerate the obligations or duties that engineers have toward each of these stakeholders.
In other words, what can engineers do to maintain, promote, or diminish the stakes of each stakeholder?
" Step Five: Identify the conflicting obligations that arise from the fact that engineers have different
stakeholders who hold conflicting stakes? Do any of these stakeholders or stakes have obvious priority
over the others?
" Step Six: Step back and reflect on what you have written. For example, look for different kinds of
provisions. Does your code use ideals of the profession which set forth the profession's central or
cardinal objectives? Does your code contain principles of professional conduct which set forth
minimal levels of behavior and prerscribe sanctions and punishments for compliance failures? In the
CIAPR (Colegio de Ingenieros y Agrimensores de Puerto Rico) code of ethics, the fundamental
principles and basic canons set forth the ideals of the profession. The principles of professional conduct
fall in the section on practical norms.
" Step Seven: The Final Audit. Submit your code to an overall audit to see if anything has been
left out. Have you included all the stakeholders and their stakes? Have you left out any ethical
considerations such as rights and duties? Compare your code to the law. Are your code's provisions
legal? Do they overlap with existing law? Do they imply criticisms of existing laws? If they imply
punishments or sanctions, what measures does your code prescribe to administer justly and properly
these sanctions? Finally, be sure to guard against the equal but opposite sins of over-specificity and
too much generality. Overly specific codes try to provide a rule for every possible situation. Because
this is impossible, these codes tend toward rigidity, inflexibility, and irrelevance. Codes that are too
general fail because they can be interpreted to rationalize any kind of claim and, thus, mask immoral
actions and intentions.
4.3.7 Exercise 3: Studying the code of Ethics of the Colegio de Ingenieros y
Agrimensores de Puerto Rico
" Identify the provisions that touch upon the relation of the engineer to the public. What goods are at
stake in this relation? What can engineers do to preserve or promote these goods?
" Identify provisions that touch upon the relation of the engineer to the client. What goods are at stake
in this relation? What can engineers do to preserve or promote these goods?
* Identify provisions that touch upon the relation of the engineer to the CIAPR (professional engineering
society) What goods are at stake in this relation? what can engineers do to preserve or promote these
goods?.
* Finally, identify provisions that touch upon the relation of the engineer to other engineers (peer rela-
tions). What goods are at stake in this relation? What can engineers do to preserve or promote these
goods?
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4.3.8 Textbox 1: Code of Ethics of Colegio de Ingenieros y Agrimensores de
Puerto Rico (Puerto Rico State society of Professional Eng
" The CIAPR code of ethics has three parts:
" Part One: Three Fundamental Principles which express cardinal objectives for engineering practice in
Puerto Rico
" Part Two: Ten Canons which set forth general rules for ethical engineering practice
" Part Three: Each canon is repeated followed by several practical norms. by setting forth detailed rules,
practical norms specify and interpret the basic canons. They also set forth specific and concrete rules
for professional and ethical conduct
" The CIAPR code of ethics is a stakeholder code. This means it identifies engineering stakeholders, the
goods they depend upon, and the duties engineers have in protecting or promoting these goods.
Key Engineer Relations
" The relation between engineer and public is founded on the goods of health, safety and welfare.
" The relation between engineer and client is founded on the good of faithful agency (trust).
" The relation between the individual engineer and the profession is founded on the engineer working
to maintain the good reputation and integrity of the profession.
" The peer relation between practicing engineers is founded on the good of collegiality.
Engineer and Public
" Duties arising in this relation are tied to maintaining or promoting the goods of health, safety, and
welfare. They include minimizing harm, avoiding paternalism (making decisions for others who have
the right and ability to make these for themselves), free and informed consent (the right of those taking
a risk to consent to that risk).
" FP1: Deberin considerar su principal funcion como profesionales la de servir a la humanidad. Su
relacion como professional y cliente, y como professional y patrono, deberi estar sujeta a su funcion
fundamental de promover el bienestar de la humanidad y la de proteger el interes pnblico.
" Canon 1: Velar por sobre toda otra consideracion por la seguridad, el ambiente, la salud y el bienestar
de la comunidad en la ejecucion de sus responsabilidades profesionales.
" Practical Norm 1d: Cuando tengan conocimiento o suficiente razon para creer que otro ingeniero
o agrimensor viola las disposiciones de este Codigo, o que una persona o firma pone en peligro la
seguridad, el ambiente, la salud o el bienestar de la comunidad, presentarin tal informacion por escrito
a las autoridades concernidas y cooperarin con dichas autoridades proveyendo aquella informacion o
asistencia que les sea requerida.
Engineer to Client
" Duties stemming from this relation arise out of faithful agency, that is, the responsibility of an engineer
to remain true to the client's interests. Positively this includes exercising due care for the client by
carrying out the client's interests through the exercise of sound, competent engineering professional
judgment. Negatively this entails avoiding conflicts of interest and revealing the client's confidential
information.
" Faithful Agency: Canon 4-Actuar en asuntos profesionales para cada patrono o cliente como agentes
fieles o fiduciarios, y evitar conflictos de intereses o la mera apariencia de 6stos, manteniendo siempre
la independencia de criterio como base del profesionalismo.
* Conflict of Interest: 4a-Evitarin todo conflicto de intereses conocido o potencial con sus patronos
o clientes e informarin con prontitud a sus patronos o clientes sobre cualquier relacion de negocios,
intereses o circunstancias que pudieran influenciar su juicio o la calidad de sus servicios.
* Confidentiality: 4i-Tratarin toda informacion, que les llegue en el curso de sus encomiendas pro-
fesionales, como confidencial y no usarin tal informacion como medio para lograr beneficio personal si
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tal accion es adversa a los intereses de sus clientes, de sus patronos, de las comisiones o juntas a las
que pudiera pertenecer o del pnblico.
Engineer to Profession
" This includes working to promote the profession's autonomy and independence as well as main-
taining its good reputation. Moreover it requires that engineers participate in their professional
society, work to advance engineering, be objective and impartial in their work, and associate only with
persons of good reputation.
" Canon 3: Emitir declaraciones pnblicas nnicamente en una forma veraz y objetiva.
" Practical Norm 3a: Serin objetivos y veraces en informes profesionales, declaraciones o testimonios.
Incluirin toda la informacion relevante y pertinente en tales informes, declaraciones o testimonios.
Engineer to Engineer
" This relation is based on the good of Collegiality. It requires that engineers work to maintain friendly
and collaborative relations with other engineers by avoiding disloyal competition and comparative
advertising and by always giving peers due credit for their contributions to engineering projects and
designs.
" Practical Norm 41: Antes de realizar trabajos para otros, en los cuales puedan hacer mejoras, planos,
disenos, inventos, u otros registros, que puedan justificar la obtencion de derechos de autor o patentes,
llegaran a un acuerdo en relacion con los derechos de las respectivas partes. (Give due credit to
colleagues for their work).
" Canon 5: Edificar su reputacion profesional en el merito de sus servicios y no competir deslealmente
con otros. (Avoid disloyal competition)
" Practical Norm 6b: Anunciarin sus servicios profesionales sin auto-alabanza y sin lenguaje en-
ganoso y de una manera en que no se menoscabe la dignidad de sus profesiones. (Non-comparative
advertising)
" Practical Norm 5h: No tratarin de suplantar, ni suplantarin otro ingeniero o agrimensor, despues de
que una gestion profesional le haya sido ofrecida o confiada a Aste, ni tampoco competiri injustamente
con 6l. (Avoid disloyal competition)
4.3.9 Professional Codes as Social Contracts
" What some have said about defining ethics could also be applied to defining a profession: it's a bit
like "nailing jello to a tree." Nevertheless, we can make to reasonable claims about professions: tye
can be treated as social contracts, and they have someting to do with specialized knowledge. If these
two claims hold, then a third claim can be made, namely, that professions have an ineliminable ethical
dimension.
" A legitimate contract between two parties requires a quid pro quo (a mutually beneficial exchange)
and free consent (consent that includes full information and excludes force or deception). The social
contract between engineering and society can be pictured int he following way:
Profession as Social Contract
Society grants to Profession Profession grants to Society
Autonomy Self-Regulation
Prestige Primacy of public health, safety, and welfare
Monopoly Developing and enforcing ethical and professional standards
Table 4.4
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Society grants autonomy, prestige, and monopoly control to the profession of engineering.
1. Autonomy includes freedom from regulation and control from the outside through cumbersome laws,
regulations, and statutes.
2. Prestige includes high social status and generous pay.
3. Monopoly status implies that the profession of engineering itself determines who can practice engineer-
ing and how it should be practiced.
4. The profession promises to use its autonomy responsibly by regulating itself. it does this by developing
and enforcing professional and ethical standards. By granting prestige to the profession, society has
removed the need for the profession to collectively bargain for its self-interest.
5. Not having to worry about its collective self-interest, the profession is now free to hold paramount the
health, safety, and welfare of the public.
6. This contract explains why professions develop codes of ethics. Codes document to the public the
profession's commitment to carry out its side of the social contract, namely, to hold paramount public
welfare. They can do this because society will honor its side of the contract, namely, to remove from
the profession the need to fight for its self-interest
This social contract is more symbolic and explanatory than real.
* Codes allow the profession to document to society that it has developed proper standards and intends
to enforce them. They express the profession's trust in society to keep its side of the bargain by
granting autonomy, prestige, and monopoly. Of course this contract has never been explicitly enacted
at a point in historical time. But the notion of a social contract with a mutually beneficial exchange
(a quid pro quo) provides a useful device for modeling the relation that has actually evolved between
society and its professions.
Professions and Responsibility
" Professions have been created to exercise stewardship over knowledge and skill domains.
" Exercising stewardship over X generally means watching over, preserving, protecting, and even im-
proving X. Stewardship is a forward-looking kind of responsibility similar to the responsibility that a
parent exercises toward his or her children. The steward is a trusted servant or agent of the landowner
who acts in the owner's place while the later is absent or incapacitated.
" "Stewardship," thus, refers to the profession's responsibility to safeguard its specific domain of knowl-
edge and skill. This domain is essential to society in some way (it provides society with a basic, common
good) and society delegates responsibility for this domain to its members who are specially suited to
exercise it.
" So, generally speaking, professions can be characterized in terms of epistemological and ethical respon-
sibilities.
" The epistemological responsibility refers to stewardship over the knowledge and skills that characterizes
the profession. The profession preserves, transmit, and advances this domain of knowledge and skill.
(Epistemology study of knowledge.)
" The ethical dimension refers to the responsibility of the profession to safeguard knowledge and skill
for the good of society. Society trusts the profession to do this for the sake of the comnmon good.
Society also trusts the profession to regulate its own activities by developing and enforcing ethical and
professional standards.
4.3.10 Objections to and Mischievous Side Effects of Codes of Ethics
These objections are taken from John Ladd, "The Quest for a Code of Professional Ethics: An
Intellectual and Moral Confusion." This article can be found in Deborah G. Johnson, editor,
(1991) Ethical Issues in Engineering, New Jersey: Prentice Hall: 130-136. The author of this
module has taken some liberties in this presentation.
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" Codes "confuse ethics with law-making" (Ladd, 130). Ethics is deliberative and argumentative
while law-making focuses on activities such as making and enforcing rules and policies.
" A code of ethics is an oxymoron. Ethics requires autonomy of the individual while a code assumes
the legitimacy of an external authority imposing rule and order on that individual.
" Obedience to moral law for autonomous individuals is motivated by respect for the moral
law. On the other hand, obedience to civil law is motivated by fear of punishment.
Thus, Ladd informs us that when one attaches "discipinary procedures, methods of adjudication and
sanctions, formal and informal, to the principles that one calls 'ethical' one automatically converts them
into legal rules or some other kind of authoritative rules of conduct...."(Ladd 131) Accompanying code
provisions with punishments replaces obedience based on respect for the (moral) law with conformity
based on fear of punishment.
" Codes lead to the dangerous tendency to reduce the ethical to the legal. Ethical principles
can be used to judge or evaluate a disciplinary or legal code. But the reverse is not true; existing laws
cannot trump ethical principles in debates over ethical issues and ethical decisions. As Ladd puts it,
"That is not to say that ethics has no relevance for projects involving the creation, certification and
enforcement of rules of conduct for members of certain groups.... [I]ts [ethics's] role in connection with
these projects is to appraise, criticize and perhaps even defend (or condemn) the projects themselves,
the rules, regulations and procedures they prescribe, and the social and political goals and institutions
they represent." (Ladd 130)
" Codes have been used to justify immoral actions. Professional codes have been misued by
individuals to justify actions that go against common morality. For example, lawyers may use the fact
that the law is an adversarial system to justify lying. Ladd responds in the following way to this dodge:
"{T}here is no special ethics belonging to professionals. Professionals are not, simply because they
are professionals, exempt from the common obligations, duties and responsibilities that are binding on
ordinary people. They do not have a special moral status that allows them to do things that no one
else can." (Ladd 131)
Mischievous Side-Effects of Codes (from John Ladd)
" Codes make professionals complacent. (Ladd 135) First, they reduce the ethical to the minimally
acceptable. Second, they cover up wrongful actions or policies by calling them-within the context
of the code-"ethical". For example, the NSPE code of ethics used to prohibit competitive bidding.
Enshrining it in their code of ethics gave it the appearance of being ethical when in fact it was motivated
primarily by self interest. This provision was removed when it was declared unconstitutional by the
U.S. Supreme Court for violating the Anti-Trust law.
" Because codes focus on micro-ethical problems, "they tend to divert attention from macro-
ethical problems of a profession." (Ladd 135) For example, in Puerto Rico, the actions of the
Disciplinary Tribunal of the Colegio de Ingenieros y Agrimensores de Puerto Rico tend to focus on
individual engineers who violate code provisions concerned with individual acts of corruption; these
include conflicts of interest, failing to serve as faithful agents or trustees, and participating in corrupt
actions such as taking or giving bribes. On the other hand, the CIAPR does not place equal attention
on macro-ethical problems such as "the social responsibilities of professionals as a group" (Ladd 132),
the role of the profession and its members in society (Ladd 135), and the "role professions play in
determining the use of technology, its development and expansion, and the distribution of the costs."
(Ladd 135)
4.3.11 Exercise: Questions for Reflection
1. Which of Ladd's criticisms apply to the Pirate Creed?
2. How does your group's code of ethics stand in relation to Ladd's criticisms?
3. Do Ladd's objections apply t the ABET, NSPE, or CIAPR codes?
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WORD FILE
This is an unsupported media type. To view, please see
http://cnx.org/content/m13849/latest/Code_EX_Bx_1.doc
Figure 4.5: Module Exercises.
4.4 Corporate Ethics Compliance Officer Report5
NOTE: This module has been designed to bring together the following modules responding to
the AACSB four ethics themes, corporate leadership, ethical decision-making, corporate social
responsibility, and corporate governance. The links in this module tie it directly to EAC Toolkit
modules that will help in preparation of the CECO report. The include the following:
- Type or paste the content directly into the appropriate section
- Socio-Technical Systems in Professional Decision Making (m14025)
- Developing a Statement of Values (m14319)
- Pirate Code for Engineering Ethics (m13849)
- Moral Ecologies in Corporate Governance (m17353)
- Three Views of Corporate Social Responsibility (m17318)
- Different Approaches to Corporate Governance (m17367)
These modules have links of their own that will prove invaluable for this activity. An example
is the Leeds School of Business at the University of Colorado; this link connects to a search
engine for finding codes of ethics and corporate social responsibility programs.
The media file below provides a generic poster presentation template geared toward this assignment.
5This content is available online at .
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Template for CECO Poster Presentation
This is an unsupported media type. To view, please see http://cnx.org/content/m18646/latest/Corporate
Governance Presentation.pptx
Figure 4.6: This media file provides a template of the poster presentation required for ADME 3405,
the course "Corporate Leadership and Social Responsibility." The different sections can be filled in by
preparing PowerPoint slides, pressing control + Print Screen when in presentation viewing mode, and
copy-pasting into appropriate part of poster template slide.
4.4.1 Introduction
You are the CECO of your company. Being familiar with the requirements of Sarbanes-Oxley and the Federal
Sentencing Guidelines, you have been charged with developing a comprehensive ethics program that includes
(1) a socio-technical system study, (2) a corporate code of ethics, (3) an ethics training program for new and
ongoing employees, (4) an ethics hotline or some other reporting mechanism, (5) a CSR (corporate social
responsibility) challenge, and (6) recruitment and leadership strategies for implementing ethics. Your report
will begin with an executive summary and end with a concluding section that discusses implementation
issues and needs.
4.4.2 What you need to know ...
Sections of CECO Corporate Ethics Report
1. Executive Summary (1 page)
2. Socio-Technical System Table plus written explanation. (3-5 pages)
3. Corporate Code of Ethics that provides core values, a description of each value, and how you plan to
disseminate and implement your code. (3-5)
4. CSR (Corporate Social Responsibility) Challenge
5. Description of Ethics Training Program including activities and required resources (3-5 pages)
6. Recruitment and Leadership Strategies for Implementing Ethics into your organization (3-5 pages)
7. A Conclusion that includes a summary of the report, a time frame for implementing your ethics
program, and an inventory of program needs and resources (1 page)
4.4.3 What you will do ...
Executive Summary
The executive summary should be no more than one page. Expect to write this several times because it
needs to be the clearest and best written section. Written for your CEO, it should provide a quick two
minute summary of your ethics plan. Write it in active voice, use ordinary language, and make references
throughout the summary to the sections of the report that provide more in-depth analysis of the issue at
hand. In this section you will tell your reader what you are going to say in the report.
Socio-Technical System
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" This section will provide both a table and written description to help your reader understand the socio-
technical system in which your company works and which provides the ethical and social challenges to
which your program will respond.
" For information on how to compose a STS table and the different frames covered refer to module
m14025, Socio-Technical Systems in Professional Decision-Making. The table for Burger Man provides
frames that will be most relevant to this module but there are also other STS tables adopted for use
in power engineering and engineering practice in Puerto Rico.
" Your written analysis should summarize and explore in more detail the STS issues that you are ad-
dressing in your corporate ethics plan. These would include compliance issues as well as fields in which
your corporation's aspirations could be realized.
Corporate Code of Ethics
" Your job here is to write a code of ethics for your corporation emphasizing the key value aspirations
and CSR challenges that your are targeting in your ethics program. Your code should include...
" The values that form your corporation's highest and central commitments.
" A description or profile of each value. See the Developing a Statement of Values module for more on
this.
" How your values apply to both the corporation's stakeholders and to its key CSR challenges.
" You should be clear about the function your code is playing both within your ethics plan and within
the corporate organization. Six key functions are (1) to educate, (2) to foster an ethical dialogue, (3) to
discipline employees, (4) to support employees in their efforts to realize the corporation's core commit-
ments/values, (5) to communicate these commitments/values to employees and other stakeholders, and
(6) to serve as a public testament of the key ethical and value commitments that define the integrity
of your organization.
Ethics Training Program
" This section details how you educate employees on the key components of your ethics program including
the core ethical and value commitments. It should also provide means for getting employee buy-in for
the ethics program as well as components that help employees with special ethical challenges. It should
include the following:
" How you plan to educate employees on the company's code of ethics.
" How the company's core ethical values and principles should be integrated in the company's key
operations including setting policy, strategic planning and decision-making.
" How your ethics program addresses your company's moral ecology. (Is it finance-, customer-, or quality
driven? How do employees develop successful moral careers and modes of ethical advocacy within each
of these companies? How does your ethics training program support this process?)
CSR Challenges
" Several companies have special challenges in CSR. For example, Coca Cola when operating in India
finds itself sharing scarce water resources with local, subsistence farmers. What are their responsibilities
in this context? Relate your CSR challenge to the STS description in the second section.
" Develop a response to this CSR challenge. How does this realize your company's key moral values?
" Contextualize your company's CSR response within a general CSR perspective: shareholder, stake-
holder, alliance.
Recruitment and Leadership Strategies for Implementing Ethics
* In this section you will describe how you will realize your core objectives in recruiting new employees
and in developing a leadership style.
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" Consider, for example, how you will integrate values into the different components of your corporation's
recruiting mechanism. Justice in the job description. Communicating to new employees their job and
moral responsibilities. Recruiting employees who will be able to develop successful moral careers in
the moral ecology of your company.
" Recognizing and responding to ethical risks such as maintaining privacy and property.
Conclusion
In the executive summary, you have told your reader what you are going to say in this report. The main
body of the report contains what you need to say. This final section tells the reader what you have said by
recapitulating and summarizing the report's high points. Include a time frame for implementing your ethics
program as well as a description of the program's needs.
4.4.4 What did you learn?
Check List
* Each group will turn in this checklist, fully filled out and signed. Checking signifies that your group
has completed and turned in the item checked. Failure to submit this form will cost your group 20
points
_ _ _ _ _ Executive Summary
" _ _ _ _ _ Socio-Technical System Table and Written Explanation
" Code of Ethics
_ _ _ _ _ Ethics Training Program
" _ _ _ _ _ Corporate Social Responsibility Challenge and Response
_ _ _ _ _ Recruitment and Leadership Strategies for Implementing Ethics
" Conclusion
Group Self Evaluation Requirements
* Group Self-Evaluation Form including...
" _ _ _ _ a list of the goals your group set for itself
" _ _ _ _ a carefully prepared, justified, and documented assessment of your group's success in reaching
these goals
" _ _ _ _ a careful assessment of what you did and did not learn in this activity
" _ _ _ _ a discussion of obstacles you encountered and the measures your group took to overcome these
" _ _ _ _ a discussion of member participation and contribution including the member contriution forms
" _ _ _ _ a general discussion of what worked and what did not work for you and your group in this
activity
" Each member will turn in a filled out a Team Member Evaluation Form. This form can be
accessed through the media file listed above. It is suggested that you do this anonomously by turning
in your Team Member Evaluation Form in a sealed envelop with the rest of these materials. You are
to evaluate yourself along with your teammates on the criteria mentioned in the form. Use the scale
suggested in the form.Your first item here
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Team Member Evaluation Form
This is an unsupported media type. To view, please see http://cnx.org/content/m18646/latest/TEAM
MEMBER RATING SHEET.docx
Figure 4.7: This Team Member Evaluation Form must be filled out by each team member. Evaluate
yourself and each member in terms of the criteria. It is preferable if you do this anonymously.
Group Pledge
" I certify that these materials have been prepared by those who have signed below, and no one else.
I certify that the above items have been checked and that those items with check marks indicate
materials that we have turned in. I also certify that we have not plagiarized any material but have
given due acknowledgment to all sources used. All who sign below and whose names are included on
the title page of this report have participated fully in the preparation of this project and are equally
and fully responsible for its results.
" Member signature here
* Member signature here _____________
" Member signature here
* Member signature here _____________
" Member signature here
" Member signature here
4.4.5 Appendix
4.4.6 EAC ToolKit Project
4.4.6.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License6 regarding permission to reuse this material.
4.4.6.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
4.5 Being an Ethical Job Candidate7
4.5.1 Module Introduction
Chances are that you are either actively involved in an effort to find work or soon will be. Based on stories that
come from the job-hunting experiences of UPRM students in Practical and Professional ethics classes, this
module presents the employment guidelines put out by the IEEE, challenges these guidelines with realistic
cases and scenarios, and provides you with decision-making tools to tackle these ethical complexities. This
6http://creativecommons.org/licenses/by/2.0/
7This content is available online at
" You should accept the new job. After all, your classmate has done you a favor. It's a lot more money,
and you are certainly in a position to help AA.
" You should not accept this job offer since it is clear that your former classmate and AA are only
interested in the proprietary and confidential information you have about MW.
" You should accept the job but only after you have done two things. First, you need to consult with
MW to define precisely the boundaries of your confidentiality obligations. Then you should make these
boundaries clear to AA and only if they accept these boundaries should you agree to work for them.
" Your solution....
7. You Can't Take It With You
You are leaving Computing Systems, Inc. to work for Compware, Inc,. a competitor. Before you leave
Computing Systems, you are debriefed by the Personnel Office and a company lawyer on the proprietary
information you have had access to while working with Computing Systems. They have itemized the infor-
mation that you cannot divulge to or use in your work with Compware. It is your professional judgment
that they are including information that is general knowledge and should not be considered confidential or
proprietary. It is also information that would be useful-even essential-for what you will be doing in your
new job. You feel that this confidentiality agreement is overly restrictive and would handicap you in your
new job. What should you do?
How should you respond to CSI's restrictions on what you can and cannot disclose in your
new work with Compware?
1. You should assert your rights to make use of all the information that your training has provided you.
This includes especially the innovations you introduced to CSI. Because this is the result of your hard
work you should be able to take it with you to your new job.
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2. Even though CSI's confidentiality boundaries are, in your opinion, restrictive, you have no choice but
to accept them. Make these boundaries clear to Compware and hope that they still want your services.
3. You need to consult a lawyer here. Clearly CSI is trampling on your legal rights but you will need
expert help to assert them.
4. Your solution....
4.5.6 More on Full and Honest Disclosure: Terms of Interview
Full Disclosure also pertains to providing full disclosure of the terms of the interview as well
as full disclosure of the terms of employment should the search reach this point.
* Full disclosure would include providing the job candidate with a detailed itinerary of the interview
process. As we will see in the case below, some interviewers deliberately leave off certain items to
create surprises.
* Full disclosure of the nature of the job should include a detailed description of routine activities as well
as non-routine possibilities. An example of a significant non-routine task would be that occasions may
arise where an employee may at some point be called upon to work on a weapons project.
* In short, the job candidate should be given, during the interview, an orientation on work responsibilities,
places in which the work will be carried out, and the colleagues with whom he or she will be working.
8. Oh, by the way...
Pedro, who will graduate at the end of the current semester, is a student at a well known Hispanic serving
university. He and two of his classmates are flown by Comp-Org for an interview at company headquarters.
During a phone conversation with the company representative setting up the interview, he asks if there
is anything he should do to prepare for the interview. The company representative answers, "No." Pedro
receives a faxed itinerary of the interview-it looks routine. So Pedro and his classmates board the plane and
arrive at their destination, the company headquarters. The company official who meets them at the airport
tells them that the first item on the interview agenda is a drug test. When Pedro objects-"Why weren't we
told about this before we agreed to the interview?"-he is told that if this is unacceptable to him, he can get
right back on the plane because the interview is over for him.
What should Pedro do?
* He should get on the plane. This act on the part of the interviewer violates his right of prior disclosure
of the terms of the interview.
* He should submit to the drug test. After all, he should have reasonably expected that the company
would do something like this. Since whether or not he has a drug habit is highly job relevant, the
company has a right to this information.
* He should file a grievance against the company for discriminating against Hispanics.
* Your solution....
Employers should also treat information about job candidates and employees as confidential
In the following case, examine whether information about why a former employee with your company had
been fired is or is not confidential and should or should not be included in any recommendation you write
for that employee.
9. The Recommendation
A worker under your supervision has recently been fired for incompetence and repeated violations of con-
fidentiality. Several weeks later, the worker returns to ask you for a letter of recommendation. He says you
owe it to him; you fired him and he has not been able to find any work and has a family to support.
What should you do?
1. Write the letter and withhold information about the employee being fired. While he may be a slacker,
you should help him as a means of helping his family.
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2. Write the letter but include the information about the employee being fired. If you frame it properly,
maybe he will get a job and be able to support his family.
3. Refuse to write a letter. If you leave out what the prospective employer considers crucial information
you may be liable for any harm this slacker causes. And you wouldn't be doing the former employee
any favor in writing the letter because you would be wrong to conceal information about his being
fired.
4. Your solution....
Finally, interviewers and employers have the obligation to treat job candidates and employees
with dignity. This includes respecting privacy and refraining from harassment. The following
case raises interesting questions about just what constitutes harassment during an interview.
* A recent graduate from University X, Marta has a strong and successful interview with a representative
from a local, respected company. She discussed her skills, experience, and asked several perceptive
questions about working conditions, job responsibilities, and benefits. The interviewer, obviously
impressed, asked Marta back for a second interview with his supervisor.
* The second interview followed a different course. The interviewer, an older man, did not ask her about
her skills or experience. Instead he reminisced about his days as a college student. He talked about his
children-what they were studying and their career plans. He mentioned his wife in passing. Then he
told Marta that the people who do well in his company are hard workers. "The strongest person," he
said, "will do whatever is necessary to survive in a harsh, competitive environment." Then he looked
at her hands and asked if she was single and if she still lived with her parents.
* How should Marta answer these questions?
* Do these questions invade Marta's privacy?
* Do the interviewer's questions, comments, and gestures constitute sexual harassment?
4.5.7 Decision Making Exercise and Ethics Tests
Your Task
* You will be divided into groups and assigned a scenario.
* Each scenario involves a difficulty with interpreting and applying an employee guideline concept.
* Interpret and apply the concept as best you can.
* Develop a value integrative solution that resolves the decision point of your scenario.
Values
* Value: A value "refers to a claim about what is worthwhile, what is good. A value is a single word
or phrase that identifies something as being desirable for human beings." Brincat and Wike, Morality
and the Professional Life: Values at Work
* Justice: Justice as fairness focuses on giving each individual what is his or her due. Three senses of jus-
tice are (1) the proper, fair, and proportionate use of sanctions, punishments and disciplinary measures
to enforce ethical standards (retributive justice), (2) the objective, dispassionate, and impartial distri-
bution of the benefits and burdens associated with a system of social cooperation (distributive justice),
(3) an objectively determined and fairly administered compensation for harms and injustices suffered
by individuals (compensatory justice), and (4) a fair and impartial formulation and administration of
rules within a given group.
* Respect: Recognizing and working not to circumvent the autonomy in others and ourselves. (Au-
tonomy is the capacity to make and execute decisions as well as to set forth ends and goals, integrate
them into life plans, and use these to constitute active identities.) Respect involves recognizing and
respecting rights such as privacy, property, free speech, due process, and free (and informed) consent.
Disrespect undermines autonomy through deception, force, or manipulation.
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CHAPTER 4. CG (CORPORATE GOVERNANCE)
" Responsibility: The ability to develop moral responses appropriate to the moral issues and problems
that arise in one's day-to-day experience. Responsibility includes several senses: (1) individuals are
(capacity) responsible when they can be called upon to answer for what they do; (2) individuals have
(role) responsibilities when they commit to carry out tasks that arise from social and professional roles;
(3) responsibility also refers to the way in which one carries out one's obligations. It can range from
indifference and negligence to care and diligence. Responsibility in this sense turns into a virtue that
formulates diligence and care as excellences worth striving for.
" Honesty - Is honesty telling the truth, the whole truth, and nothing but the truth? Or is it a virtue
that involves a more delicate balance between extremes of excess and defect? Too much honesty results
in harmful bluntness and tactlessness. ("Your child is a hopeless slob. You should disown him." The
former may be true but there are gentler and ultimately more productive ways to communicate this
information to the concerned parent.) We are all familiar with too little honesty, the dishonesty that
results from lying, deceiving, manipulating, exaggerating, distorting, etc.
" Reasonableness - Defusing disagreement and resolving conflicts through integration. Characteristics
include seeking relevant information, listening and responding thoughtfully to others, being open to
new ideas, giving reasons for views held, and acknowledging mistakes and misunderstandings. Thus,
reasonableness as a virtue includes much more than rationality. (From Michael Pritchard, Reasonable
Children)
In making your decision...
1. Try to design a solution that realizes as many values as possible.
2. Wike: "Although values can compete, they don't conflict." Try to solve the value competitions in your
scenario by integrating the competing values in a solution.
3. Wike: "No value necessarily overrides any other."
4. Wike: "Aim to realize all values, but where that is impossible, enact the most important values and/or
the greatest number of values."
Having Trouble? Try this...
1. Nolo Contendere. Take the path of least resistance. (Just go along with what the dominant person
in the situation says.)
2. Negotiate. Try to persuade those in the situation to accept a value-integrative solution, compromise,
or trade off.
3. Oppose. Someone is trying to force you to so something wrong. Get some courage. Oppose the
wrongdoer.
4. Exit. You can't win in this situation so find a way of getting out. Let someone else deal with it.
5. These options can be evaluated and ranked in terms of the values they realize (or don't realize) and
how feasible they are in the given situation.
Try these ethics tests
1. REVERSIBILITY: Would I think this a good choice if I were among those affected by it?
2. PUBLICITY: Would I want this action published in the newspaper?
3. HARM: Does this action do less harm than any available alternative?
4. FEASIBILITY: Can this solution be implemented given time, technical, economic, legal, and political
constraints?
4.5.8 References
1. Victoria S. Wike, "Professional Engineering Ethical Behavior: A Values-based Approach". Proceed-
ings of the 2001 American Society for Engineering Education Annual Conference and
Exposition, Session 2461.
131
2. Michael S. Pritchard (1996) Reasonable Children: Moral Education and Moral Learning.
Lawrence, KS: University of Kansas Press: 11.
3. Stephen H. Unger (1994) Controlling Technology: Ethics and the Responsible Engineer. New
York: John Wiley and Sons: 315-325 (Reprinted with permission of IEEE)
4. Robert C. Solomon (1999) A Better Way to Think About Business: How Personal Integrity
Leads to Corporate Success. Oxford, UK: Oxford University Press: 71-114.
5. See Onlineethics, www.onlineethics.org, for case on which "Oh, By the Way" is based.
4.5.9 Conclusion
What have you achieved?
1. You have become aware of how ethical issues can arise in the job candidacy process.
2. You have a better of your obligations and rights in the job candicacy process.
3. You have practiced decision making by evaluating and ranking solutions to ethics cases.
4. You have worked with integrating important ethical values into solutions to ethical problems.
4.5.10 Presentation of Module before Mechanical Engineering Class
Presentation: Being an Ethical Job Candidate
This is an unsupported media type. To view, please see
http://cnx.org/content/m14468/latest/Be_Et_JobV2.ppt
Figure 4.8: This figure contains a powerpoint presentation of this module used in a Mechanical Engi-
neering Capstone Design course during Spring and Fall semesters, 2007.
Gray Matters in Job Searches
This is an unsupported media type. To view, please see http://cnx.org/content/m14468/latest/Gray
Matters in Job Searches.doc
Figure 4.9: This word file presents four of the above scenarios in Gray Matters form. It provides a
useful handout as well as an abbreviated version of this activity.
132 CHAPTER 4. CC (CORPORATE GOVERNANCE)
Chapter 5
Business Ethics Case Studies
5.1 Biomatrix Case Exercises - Student Module1
NOTE: Write your module for a student audience. To complete or edit the sections below erase
the provided textual commentaries then add your own content using one or more of the following
strategies:
- Type or paste the content directly into the appropriate section
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using the ''Links'' tabs (see example on the right)
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it with your own files.)
5.1.1 Introduction
In this module you will study a real world ethical problem, the Biomatrix case, and employ frameworks based
on the software development cycle to (1) specify ethical and technical problems, (2) generate solutions that
iThis content is available online at .
133
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
integrate ethical value, (3) test these solutions, and (4) implement them over situation-based constraints.
This module will provide you with an opportunity to practice integrating ethical considerations into real
world decision-making and problem-solving in business and computing. This whole approach is based on an
analogy between ethics and design (Whitbeck).
Large real world cases like Biomatrix pivot around crucial decision points. You will take on the role of one
of the participants in the Biomatrix case and problem-solve in teams from three decision points. Problem-
solving in the real world requires perseverance, moral creativity, moral imagination, and reasonableness;
one appropriates these skills through practice in different contexts. Designing and implementing solutions
requires identifying conflicting values and interests, balancing them in creative and dynamic solutions, over-
coming technical limits, and responding creatively to real world constraints.
Each decision point requires that you take up the position of a participant in the case and work through
decision-making frameworks from his or her perspective. You may be tempted to back out and adopt an
evaluative posture from which to judge the participants. Resist this temptation. This module is specifically
designed to give you practice in making real world decisions. These skills emerge when you role play from
one of the standpoints within the case. You will learn that decision-making requires taking stock of one's
situation from within a clearly defined standpoint and then accepting responsibility for what arises from
within that standpoint.
Cases such as Biomatrix are challenging because of the large amount of information gathering and sorting
they require. Moral imagination responds to this challenge by providing different framings that help to filter
out irrelevant data and structure what remains. Framing plays a central role in problem specification. For
example, Biomatrix could be framed as the need to develop quick and decisive responses to cyber-smear. Or
it could be framed legally as employing legal tools (John Doe suits to pierce anonymity) that set a dangerous
precedent against free speech. Yet again, it could be framed as a cautionary tale on the dangers of thinking
that you are anonymous when you speak online. What is important at this stage is that you and your group
experiment with multiple framings of the case around your decision point. This makes it possible to open
up avenues of solution not possible under just one framing.
Tackling large cases in small teams also helps develop the communication and collaboration skills that
are required for group work. Take time to develop strategies for dividing the work load among your team
members. The trick is to distribute equally but, at the same time, to assign tasks according the different
abilities of your team members. Some individuals are better at research while others excel in interviewing
or writing. Also, make sure to set aside time when you finish for integrating your work with that of your
teammates. Start by quickly reviewing the information available on the case. This is called "scoping the
case." Then formulate specific questions to focus further research on information relevant to your problem
solving efforts. This includes information pertinent to constructing a socio-technical analysis, identifying key
"embedded" ethical issues, and uncovering existing best and worst practices.
A case narrative, STS (socio-technical system) description, and two ethical reflections have been published
at http://computingcases.org. This module also links to websites on free speech and privacy law, advice to
corporate officials on how to respond to cyber-smear, and information useful in understanding the products
manufactured by Biomatrix.
Biomatrix Abstract
Biomatrix manufactures a medical product called Synvisc, a lubricant injected into the knee to take the
place of natural lubricants that disappear with age. From April 1999 to August 2000, a series of messages
(some 16,000 in all) highly critical of Biomatrix were posted on a Yahoo bulletin board. These messages, sent
by three individuals operating under 23 pseudonyms, make a series of defamatory claims about Biomatrix
officials, employees, the company's financial status, and its key products. Biomatrix vigorously denied each
of these claims. Yet the quality and quantity of this information may have had negative effects on the
financial well being of the company. During the period in which the messages appeared in Yahoo, Biomatrix
stock dropped from $35 per share to $21. In response, Biomatrix petitioned the court to subpoena Yahoo to
reveal the identities of the persons sending the messages. Yahoo complied identifying Raymond Costanzo,
Richard Costanzo, and Ephraim Morris as the authors of the messages. In a summary judgment, all three
were found guilty of defamation.
135
Biomatrix Time Line
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Date Event Actors
April 1999 through August 2000 Posting of anti-Biomatrix mes- Richard Costanzo, Raymond
sages Costanzo, Ephraim Morris
April 1999 to July 2000 Biomatrix Shares drop from 35 to Caused by BXM Police?
21
March 2000 Announcement of Genzyme's in- Biomatrix and Genzyme Top
tention to buy Biomatrix for Management
$245,000,000
June/July 2000 Initiation of John Doe Lawsuit Plaintiffs: Biomatrix, Balazs,
and Denlinger
July 2000 Court subpoenas Yahoo for iden- Plaintiffs: Biomatrix, Balazs,
tities of message posters (BXM and Denlinger
Police)
August 3, 2000 Summary Judgment against Plaintiffs: Biomatrix, Balazs,
Raymond Costanzo, Richard and Denlinger
Costanzo, and Ephraim Morris
November 7, 2000 SEC approval of Genzyme plan Genzyme and Biomatrix Top
to purchase Biomatrix Management plus SEC
November 7, 2000 Biomatrix stock rises from $19 to
$19.94
January 3, 2001 Yahoo alters bulletin board poli-
cies
Table 5.1
5.1.2 What you need to know ...
5.1.2.1 What you need to know about socio-technical systems
1. STS have seven broad components: hardware, software, physical surroundings, peo-
ple/groups/roles, procedures, laws, and data/data structures.
2. Socio-technical systems embody values
* These include moral values like safety, privacy, property, free speech, equity and access, and security.
Non-moral values can also be realized in and through Socio Technical Systems such as efficiency, cost-
effectiveness, control, sustainability, reliability, and stability.
* Moral values present in Socio Technical Systems can conflict with other embedded moral values; for
example, privacy often conflicts with free speech. Non-moral values can conflict with moral values;
developing a safe system requires time and money. And, non-moral values can conflict; reliability
undermines efficiency and cost effectiveness. This leads to three problems that come from different
value conflicts within Socio Technical Systems and between these systems and the technologies that
are being integrated into them.
* Mismatches often arise between the values embedded in technologies and the Socio Technical Sys-
tems into which they are being integrated. As UNIX was integrated into the University of California
Academic Computing STS (see Machado case at Computing Cases), the values of openness and trans-
parency designed into UNIX clashed with the needs of students in the Academic Computing STS at
UCI for privacy.
137
" Technologies being integrated into Socio Technical Systems can magnify, exaggerate, or exacerbate
existing value mismatches in the STS. The use of P2P software combined with the ease of digital
copying has magnified existing conflicts concerning music and picture copyrights.
" Integrating technologies into STSs produces both immediate and remote consequences and impacts.
3. Socio-technical systems change
" These changes are bought about, in part, by the value mismatches described above. At other times,
they result from competing needs and interests brought forth by different stakeholders. For example,
bicycle designs, the configuration of typewriter keys, and the design and uses of cellular phones have
changed as different users have adapted these technologies to their special requirements.
" These changes also exhibit what sociologists call a "trajectory", that is, a path of development. Tra-
jectories themselves are subject to normative analysis. For example, some STSs and the technologies
integrated into them display a line of development where the STS and the integrated technology are
changed and redesigned to support certain social interests. The informating capacities of computing
systems, for example, provide information which can be used to improve a manufacturing processes
can or to monitor workers for enhancing management power. (See Shoshanna Zuboff, The Age of
the Smart Machine
" Trajectories, thus, outline the development of STSs and technologies as these are influenced by internal
and external social forces.
In this section, you will learn about this module's exercises. The required links above provide information on
the frameworks used in each section. For example, the Socio-Technical System module provides background
information on socio-technical analysis. The "Three Frameworks" module provides a further description of
the ethics tests, their pitfalls, and the feasibility test. These exercises will provide step by step instructions
on how to work through the decision points presented above.
For more information see Huff and Jawer below.
Decision Point One:
You are the publicist for the company Biomatrix, a manufacturer of biotechnology products including
Synvisc, a promising treatment for osteoarthritis. The CEO, Endre Balazs, and Vice President, Janet
Denlinger, come to you. It seems that they are quite upset. Biomatrix and its top level employees have
become the victims of cyber-smear. Dozens of messages have appeared in the highly visible Yahoo Financial
Bulletin Board that make the following unsubstantiated accusations:
" Synvisc (a product manufactured by Biomatrix) produces seriously harmful side effects
" Biomatrix has deceived its stockholders by suppressing negative financial and product information
" Biomatrix and its employees have connections to the mafia
" Company public releases that the merger between Biomatrix and Genzyme is friendly are false. In
fact, the messages allege that the merger will never take place because of Biomatrix's terrible financial
profile
" Biomatrix CEO is under investigation by famous Nazi hunter, Simon Wiesenthal, for crimes he allegedly
committed in Germany during the Second World War
" Biomatrix Vice President requires sexual favors from employees under her supervision as a condition
for promotion
None of these charges is true. But Balazas and Denlinger are devastated by the personal attacks made upon
them. Biomatrix also stands to lose a great deal from the negative publicity. Allegations of side effects from
using Synvisc, a promising new produce patented by the company, threaten to drive the product out of the
market. The recently announced friendly merger between Biomatrix and Genzyme has produced modest
gains in stock prices but the cyber slanderers seem determined to drive Biomatrix stock value down.
You have been charged by Balazs and Denlinger, as publicist, with designing a rapid and
effective campaign against this cyber-smear. Several issues have arisen that demand your
immediate attention:
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
1. The identity of the cyber-slanderers is unknown. What can you do, if anything, to find out who these
individuals are?
2. One of the slanderers claims to have worked for Biomatrix in the past. He/she uses this to lend credence
to the attacks made on the company and its managers. If true, is there anything that can be done to
prevent future employees from resorting to slander as a way of retaliating against the company?
3. If the real identities of the individuals posting the Yahoo messages are revealed, should they be sued?
What are the advantages of defamation lawsuits if those sued do not have the financial resources to
compensate the victim for damages suffered?
4. Should the cyber-slanderers be attacked? If so, how? How, in general, should corporations and their
managers respond to cyber-slander? By publicly refuting the messages? By ignoring these attacks?
By ignoring them until they produce clear damage? Or by responding quickly and proactively before
they produce damage?
Decision Point Two: Defending Against Defamation:
The cat is out of the bag. The BXM Police, those self-styled whistle-blowers against the corporate greed of
Biomatrix, have been revealed as Richard and Raymond Costanzo and Ephraim Morris. (Richard Costanzo
and Ephraim Morris were former Biomatrix employees.) These are the real world names behind the 23
pseudonyms under which 16,000 anti-Biomatrix emails were posted on the Financial Bulletin Board of Yahoo
between April 1999 and August 2000. These messages accused Biomatrix managers of sexual harassment
and Nazi war crimes and Biomatrix of corporate greed.
Biomatrix managers feel that the company has a problem if its former employees find the
motivation to behave in this manner. You are a human resource official in the Biomatrix
and it has fallen on you to design a strategy and program to prevent a reoccurrence of this
cyber-smear disaster. What should you do?
* Bring a defamatory lawsuit against the three? Would this help to recoup damages? What other
benefits could a successful defamation lawsuit bring? What would be the downside of such an action?
* Alter the way in which employees are let go. (In other words develop procedures for firing or laying
off employees that would defuse the desire to get even.) What could be done to sever a relation with
an employee in as good a fashion as possible?
* What steps could be taken to reduce the possibility of a former employee taking a "short selling"
strategy? For example, could steps be taken to restrict the ways in which former employees use the
confidential information they have about the company? Could risk identification measures be taken to
uncover those who could or are benefiting from short selling a company's stock?
* Could Human Resources develop an effective program to counter cyber smear by effective communi-
cation of true and accurate information? How can a good reputation be established that could serve
as a basis for counter-acting defamation?
* In short, design a strategy for Biomatrix that could minimize the risk of future cyber-smear attacks
and/or minimize the impact of these attacks. Defend your strategy in the Ethics Bowl debate.
Decision Point Three: How far does free speech go?
You work with a public service organization devoted to the defense of free speech, both off and online. For
this reason you immediately noticed a newspaper story that three individuals, Richard Costanzo, Raymond
Costanzo, and Ephraim Morris, were found guilty in a summary judgment of defamation. It seems they
published, under 23 psuedonyms, some 16,000 messages that made negative claims against Biomatrix and
its managers that they were unable to substantiate.
The claims made by these individuals in their emails were pretty strong:
* Biomatrix's most popular product, Synvisc, has produced significant harmful side effects and the com-
pany has taken wrongful measures to suppress this information. Synvisc is a manufactured substance
that resembles the natural fluids that lubricate knee movements. These fluids disappear with age pro-
ducing a condition called osteoarthritis. Synvisc has been presented as a highly promising treatment
for this problem.
139
" They also accuse Biomatrix of covering up that fact that they are targets of potentially damaging
lawsuits.
" These three individuals, who style themselves the BXM Police, also accuse the company of covering
up negative, harmful information about their upcoming merger with Genzyme. The messages claim
that inside information reveals that the merger will never take place.
" The BXM police also accuse Biomatrix top management of having committed war crimes and acts of
sexual harassment.
During pre-trial depositions, the accused were unable to substantiate any of these claims. While the motives
for posting these messages have never been made clear three stand out: revenge, short selling, and the
perception that rules of defamation did not apply in cyber space. You have been asked by your organization
to contact the BXM Police and propose that they appeal this decision. You and your organization think
that there are strong legal and ethical arguments, based on the right to free speech, that need to be put
forth in this case. Your job in this decision point is to set forth these legal and moral arguments. In other
words, construct a comprehensive defense for the BXM Police.
Important Considerations
" EPIC (Electric Privacy Information Center) and the ACLU (American Civil Liberties Union) present
an amici curiae (friend of the court brief) outlining their concerns about the use of John Doe lawsuits
to pierce online anonymity. This brief is summarized in the Biomatrix case materials.
" Perhaps the strongest case for Free Speech is made by John Stuart Mill in On Liberty. Consult this
book and find his argument in the first chapter. The summary of this argument in the Biomatrix case
materials will help. Do defamation lawsuits suppress free speech. Why does Mill think that it is wrong
to suppress even completely false speech?
" Did Biomatrix and its management team suffer damages as a result of the Yahoo messages? What
is this damage? What evidence proves that the damage was caused by the negative speech and not
something else? Who bore the burden of proof in the summary judgment against the BXM Police?
" What is the strongest argument that Biomatrix made against the speech of the BXM three? How can
you and organization counter this argument?
" The strongest argument the BXM Police offer for their actions is that they are not bound by rules of
veracity and defamation while operating pseudonymously online. Should we be held responsible for
what we say online? In the same way that we are held responsible off line? Doesn't Yahoo's disclaimer
to readers that they should not assume that what they read is true suffice to exculpate those who post
false speech?
" It has been suggested that the BXM Police were motivated by greed. Their speech was designed to
lower the price of Biomatrix stock so they could profit from short selling it. Does this change you
defense? There is also inconclusive evidence that they were not acting alone? Does this change your
defense?
5.1.3 What you will do ...
In this section, you will learn about this module's exercises. The required links above provide information on
the frameworks used in each section. For example, the Socio-Technical System module provides background
information on socio-technical analysis. The "Three Frameworks" module provides a further description of
the ethics tests, their pitfalls, and the feasibility test. These exercises will provide step by step instructions
on how to work through the decision points presented above.
5.1.4 Exercise One: Problem Specification
In this exercise, you will specify the problem using socio-technical analysis. The STS section of the Biomatrix
Case narrative (found at Computing Cases) provides a good starting point. In the first table, enter the
information from the Biomatrix case materials pertinent to the general components of a STS, its hardware,
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
software, physical surroundings, people/groups/roles, procedures, laws, data. Some examples taken from
the STS description at Computing Cases are provided to get you started. Then, using the second table,
identify the values that are embedded in the different components of the STS. For example, PICS (platforms
for internet content selection) embody the values of security and privacy. Finally, using the data from your
socio-technical analysis, formulate a concise problem statement.
Exercise la:
Read the socio-technical system analysis of the Biomatrix case at http://computingcases.org. Fill in the
table below with elements from this analysis that pertain to your decision point.
Socio-Technical System Table
Hardware Software Physical People/GroupsJRoldures Laws, Data and
Surround- Codes, Data Struc-
ings Regulations tures
Plant man- Yahoo soft- cyber vs real Biomatrix, Getting John Doe OSP user in-
ufacturing ware space Genzyme, a Yahoo Lawsuits formation
Synvisc Yahoo account
Table 5.2
Instructions for Table 1:
1. Go to http://computingcases.org and review the STS description provided for the Biomatrix case.
2. Pull out the elements of the STS description that are relevant to your decision point. List them under
the appropriate STS component in the above table.
3. Think about possible ways in which these components of the Biomatrix STS interact. For example,
what kinds of legal restrictions govern the way data is collected, stored, and disseminated?
4. Develop your STS table with an eye to documenting possible ethical conflicts that can arise and are
relevant to your decision point.
Exercise lb
Examine the values embedded in the STS surrounding this decision point. Locate your values under the
appropriate component in the Biomatrix STS. For example, according to the STS description for Biomatrix
found at Computing Cases, the Yahoo software that structures the architecture of the bulletin boards embody
certain values like free speech. Should this be changed given the threat of defamation? What are Yahoo
responsibilities in the context of defamation?
Value Table
Hardware Software Physical People/GroupsRoldures Laws/Codes/ 4IailaiData
Surround- Structures
ings
Security
Privacy
continued on next page
141
Property
Justice_(Eq-
uity/Access)
Free Speecy
Table 5.3
Instructions for Table 2:
1. This module links to another Connexions module, Socio-Technical Systems in Professional Decision-
Making. There you will find short profiles of the values listed in the above table: security, privacy,
property, justice, and free speech. These profiles will help you to characterize the values listed in the
above table.
2. Look for value conflicts or mismatches. For example, free speech in the Yahoo discussion space could
conflict with laws that protect against defamation. How are these laws transferred online?
3. Identify those components of the Biomatrix STS that embody or embed value. For example, list the
values realized and frustrated by the software components discussed in the Biomatrix case in the STS
description.
4. Look for ways in which different elements of the STS that embed value can interact and produce
value conflicts. These conflicts are likely sources for problems that you should discuss in your problem
statement and address in your solution.
Exercise 1c:
Write out the requirements (ethical and practical) for a good solution. Identify the parts of the STS that
need changing. Then, develop a concise summary statement of the central problem your decision point
raises. As you design solutions to this problem, you may want to revise this problem statement. Be sure to
experiment with different ways of framing this problem.
Harris, Pritchard, and Rabins provide a useful approach to problem specification. See refer-
ences below.
5.1.5 Exercise Two: Solution Generation
Generate solutions to the problem(s) you have specified in Exercise 1. This requires that...
* each member of your group develop a list of solutions,
* the group combines these individual lists into a group list, and...
* the group reduces this preliminary list to a manageable number of refined and clarified solutions for
testing in the next stage.
Helpful Hints for Solution Generation
1. Solution generation requires proficiency in the skills of moral imagination and moral cre-
ativity.
Moral imagination is the ability to open up avenues of solution by framing a problem in different ways.
Toysmart could be framed as a technical problem requiring problem-solving skills that integrate ethical
considerations into innovative designs. Moral creativity is the ability to formulate non-obvious solutions
that integrate ethical considerations over various situational constraints.
2. Problems can be formulated as interest conflicts. In this case different solution options are
available.
* Gather Information. Many disagreements can be resolved by gathering more information. Because
this is the easiest and least painful way of reaching consensus, it is almost always best to start here.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Gathering information may not be possible because of different constraints: there may not be enough
time, the facts may be too expensive to gather, or the information required goes beyond scientific or
technical knowledge. Sometimes gathering more information does not solve the problem but allows for
a new, more fruitful formulation of the problem. Harris, Pritchard, and Rabins in Engineering Ethics:
Concepts and Cases show how solving a factual disagreement allows a more profound conceptual
disagreement to emerge.
* Nolo Contendere. Nolo Contendere is latin for not opposing or contending. Your interests may
conflict with your supervisor but he or she may be too powerful to reason with or oppose. So your only
choice here is to give in to his or her interests. The problem with nolo contendere is that non-opposition
is often taken as agreement. You may need to document (e.g., through memos) that you disagree with
a course of action and that your choosing not to oppose does not indicate agreement.
* Negotiate. Good communication and diplomatic skills may make it possible to negotiate a solution
that respects the different interests. Value integrative solutions are designed to integrate conflicting
values. Compromises allow for partial realization of the conflicting interests. (See the module, The
Ethics of Team Work, for compromise strategies such as logrolling or bridging.) Sometimes it may
be necessary to set aside one's interests for the present with the understanding that these will be taken
care of at a later time. This requires trust.
* Oppose. If nolo contendere and negotiation are not possible, then opposition may be necessary.
Opposition requires marshalling evidence to document one's position persuasively and impartially. It
makes use of strategies such as leading an "organizational charge" or "blowing the whistle." For more
on whistle-blowing consult the discussion of whistle blowing in the Hughes case that can be found at
computing cases.
* Exit. Opposition may not be possible if one lacks organizational power or documented evidence. Nolo
contendere will not suffice if non-opposition implicates one in wrongdoing. Negotiation will not succeed
without a necessary basis of trust or a serious value integrative solution. As a last resort, one may
have to exit from the situation by asking for reassignment or resigning.
3. Solutions can be generated by readjusting different components of the STS.
* Technical Puzzle. If the problem is framed as a technical puzzle, then solutions would revolve around
developing designs that optimize both ethical and technical specifications, that is, resolve the technical
issues and realize ethical value. In this instance, the problem-solver must concentrate on the hardware
and software components of the STS.
* Social Problem. If the problem is framed as a social problem, then solutions would revolve around
changing laws or bringing about systemic reform through political action. This would lead one to focus
on the people/groups/roles component (working to social practices) or the legal component.
* Stakeholder Conflict. If the problem is framed as a conflict between different stakeholder interests,
then the solution would concentrate on getting stakeholders (both individuals and groups) to agree on
integrative or interest compromising solutions. This requires concentrating on the people/group/role
component of the STS. (Note: A stakeholder is any group or individual with a vital interest at play in
the situation.)
* Management Problem. Finally, if the problem is framed as a management problem, then the
solution would revolve around changing an organization's procedures. Along these lines, it would
address the (1) fundamental goals, (2) decision recognition procedures, (3) organizational roles, or (4)
decision-making hierarchy of the organization. These are the four components of the CID (corporate
internal decision) structure described in the "Ethical Reflections" section of the Toysmart case.
* Nota Bene: Financial issues are covered by the feasibility test in the solution implementation stage.
As such, they pose side issues or constraints that do not enter into the solution generation phase but
the solution implementation phase.
4. Brainstorming. Moral creativity, which involves designing non-obvious solutions, forms an
essential part of solution generation. Here are some guidelines to get you started.
143
" Individually make out a list of solutions before the group meeting. Work quickly to realize a pre-
established quota of five to ten solutions. After composing a quick first draft, revise the list for clarity
only; make no substantial changes.
" Start the group brainstorming process by having the group review and assemble all the individual
solutions. Do this quickly and without criticism. Beginning criticism at this stage will kill the creativity
necessary for brainstorming and shut down the more timid (but creative) members of the group.
" Review the list and identify solutions that are identical or overlap. Begin the refining process by
combining these solutions.
" Having reviewed all the brainstormed solutions, it is now time to bring in criticism. Begin by eliminating
solutions with major ethical problems such as those that violate rights, produce injustices, or cause
extensive harm.
" Identify but do not eliminate solutions that are ethical but raise serious practical problems. Do not
initially eliminate an ethical solution because there are obstacles standing in the way of its imple-
mentation. Be descriptive. Identify and impartially describe the obstacles. Later, in the solution
implementation stage, you may be able to design creative responses to these obstacles.
" Identify solutions that do not "fit" your problem statement. These require a decision. You can throw
out the solution because it does not solve the problem or you can change the problem. If a solution
does not fit the problem but, intuitively, seems good, this is a sign that you need to take another look
at your problem statement.
" Don't automatically reject partial solutions. For example, sending memos through email rather than
printing them out and wasting paper may not solve the entire recycling problem for your company.
But it represents a good, partial solution that can be combined with other partial solutions to address
the bigger problem.
" Through these different measures, you will gradually integrate criticism into your brainstorming pro-
cess. This will facilitate working toward a manageable, refined list of solutions for testing in the next
stage.
Exercise 3: Develop a Solution List
" Have each member of your team prepare a solution list and bring it to the next group meeting. Set a
quota for this individual list, say, 5 to 10 solutions.
" Prepare a group list out of the lists of the individual members. Work to combine similar solutions. Be
sure to set aside criticism until the preliminary group list is complete.
" Make use of the following table.
" Refine the group list into a manageable number of solutions for testing in the next stage. Combine
overlapping solutions. Eliminate solutions that do not respond to the requirements and the problem
statement that you prepared in the previous exercise. Eliminate solutions that violate important ethical
considerations, i.e., solutions that violate rights, produce harms, etc.
" Check your refined solution list with your problem statement. If they do not match, eliminate the
solution or redefine the problem
Refined Brainstorm List
Solution Ranking Description of Solution Justification (fits requirements, fits problem)
Best Solution
Second Best Solution
Third Best Solution
Fourth Best Solution
Fifth Best Solution
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Table 5.4
Anthony Weston provides an illuminating and useful discussion of creative problem solving in
the reference provided below.
5.1.6 Exercise Three: Solution Testing
In this section, you will test the solutions on the refined list your group produced in the previous exercise.
Three ethics tests, described below, will help you to integrate ethical considerations in the problem-solving
process. A global feasibility test will help to identify solutions with serious practical problems. Finally, a
Solution Evaluation Matrix summarizes the results for class debriefings.
Setting up for the test.
* Identify the agent perspective from which the decision will be made
* Describe the action as concisely and clearly as possible.
* Identify the stakeholders surrounding the decision, i.e., those who will suffer strong impacts (positively
or negatively) from the implementation of your decision. Stakeholders have a vital or essential interest
(right, good, money, etc) in play with this decision.
* In the harm/beneficence test, identify the likely results of the action and sort these into harms and
benefits.
* For the reversibility test, identify the stakeholders with whom you will reverse positions.
* For the public identification test, identify the values, virtues, or vices your action embodies. Associate
these with the character of the agent.
Harm/Beneficence Test
1. What are the harms your solution is likely to produce? What are its benefits? Does this
solution produce the least harms and the most benefits when compared to the available
alternatives?
2. Pitfall-Too much. In this "Paralysis of Analysis" one factor in too many consequences. To avoid
the fallacy restrict the analysis to the most likely consequences with the greatest magnitude (Magnitude
indicates the range and severity of impact).
3. Pitfall-Too Little. A biased or incomplete analysis results when significant impacts are overlooked.
Take time to uncover all the significant impacts, both in terms of likelihood and in terms of magnitude.
4. Pitfall-Distribution of Impacts. Consider, not only the overall balance of harms and benefits
but also how harms and benefits are distributed among the stakeholders. If they are equally or fairly
distributed, then this counts in the solution's favor. If they are unequally or unfairly distributed,
then this counts against the solution. Be ready to redesign the solution to distribute better (=more
equitably or fairly) the harmful and beneficial results.
Reversibility Test
1. Would this solution alternative be acceptable to those who stand to be most affected by
it? To answer this question, change places with those who are targeted by the action and
ask if from this new perspective whether the action is still acceptable?
2. Pitfall-Too much. When reversing with Hitler, a moral action appears immoral and an immoral
action appears moral. The problem here is that the agent who projects into the immoral standpoint
loses his or her moral bearings. The reversibility test requires viewing the action from the standpoint
of its different targets. But understanding the action from different stakeholder views does not require
that one abandon himself or herself to these views.
3. Pitfall-Too little. In this pitfall, moral imagination falls short, and the agent fails to view the
action from another stakeholder standpoint. The key in the reversibility test is to find the middle
ground between too much immersion in the viewpoint of another and too little.
145
4. Pitfall-Reducing Reversibility to Harm/Beneficence. The reversibility test requires that one
assess the impacts of the action under consideration on others. But it is more than a simple listing of
the consequences of the action. These are viewed from the standpoint of different stakeholders. The
reversibility test also goes beyond considering impacts to considering whether the action treats different
stakeholders respectfully. This especially holds when the agent disagrees with a stakeholder. In these
disagreements, it is important to work out what it means to disagree with another respectfully.
5. Pitfall-Incomplete survey of stakeholders. Leaving out significant stakeholder perspectives
skews the results of the reversibility test. Building an excellent death chamber works when one considers
the action from the standpoint of Hitler; after all, it's what he wants. But treating an individual with
respect does not require capitulating to his or her desires, especially when these are immoral. And
considering the action from the standpoint of other stakeholders (say the possible victims of newer,
more efficient gas chambers) brings out new and radically different information.
6. Pitfall-Not Weighing and Balancing Stakeholder Positions. This pitfall is continuous with the
previous one. Different stakeholders have different interests and view events from unique perspectives.
The reversibility test requires reviewing these interests and perspectives, weighing them against one
another, and balancing out their differences and conflicts in an overall, global assessment.
Publicity (or Public Identification) Test
1. Would you want to be publicly associated or identified with this action? In other words,
assume that you will be judged as a person by others in terms of the moral values
expressed in the action under consideration. Does this accord with how you would want
to or aspire to be judged?
2. Pitfall-Failure to association action with character of agent. In the publicity test, the
spotlight of analysis moves from the action to the agent. Successfully carrying out this test requires
identifying the agent, describing the action, and associating the agent with the action. The moral
qualities exhibited in the action are seen as expressing the moral character of the agent. The publicity
test, thus, rests on the idea that an agent's responsible actions arise from and express his or her
character.
3. Pitfall-Failure to appreciate the moral color of the action. The publicity test assumes that
actions are colored by the ends or goods they pursue. This means that actions are morally colored. They
can express responsibility or irresponsibility, courage or cowardice, reasonableness or unreasonableness,
honesty or dishonesty, integrity or corrpution, loyalty or betrayal, and so forth. An analysis can go
astray by failing to bring out the moral quality (or qualities) that an action expresses.
4. Pitfall-Reducing Publicity to Harm/Beneficence Test. Instead of asking what the action says
about the agent, many reduce this test to considering the consequences of publicizing the action. So
one might argue that an action is wrong because it damages the reputation of the agent or some other
stakeholder. But this doesn't go deep enough. The publicity test requires, not that one calculate the
consequences of wide-spread knowledge of the action under consideration, but that one draws from the
action the information it reveals about the character of the agent. The consequences of bad publicity
are covered by the harm/beneficence test and do not need to be repeated in the public identification
test. The publicity test provides new information by turning from the action to the agent. It focuses
on what the action (its moral qualities and the goods it seeks) says about the agent.
Comparing the Test Results: Meta-Tests
1. The ethics tests will not always converge on the same solution because each test (and the ethical
theories it encapsulates) covers a different dimension of the action: (1) harm/beneficence looks at the
outcomes or consequences of the action, (2) reversibility focuses on the formal characteristics of the
action, and (3) publicity zeros in on the moral character of the agent.
2. The meta-tests turn this surface disagreement into an advantage. The convergence or divergence
between the ethics tests become indicators of solution strength and weakness.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
3. Convergence. When the ethics tests converge on a given solution, this indicates solution strength
and robustness.
4. Divergence. When tests diverge on a solution-a solution does well under one test but poorly under
another-this signifies that it needs further development and revision. Test divergence is not a sign
that one test is relevant while the others are not. Divergence indicates solution weakness and is a call
to modify the solution to make it stronger.
Exercise 3: Summarize your results in a Solution Evaluation Matrix
1. Place test results in the appropriate cell.
2. Add a verbal explanation to the SEM table.
3. Conclude with a global feasibility test that asks, simply, whether or not there exist significant obstacles
to the implementation of the solution in the real world.
4. Finish by looking at how the tests converge on a given solution. Convergence indicates solution strength;
divergence signals solution weakness.
Solution Evaluation Matrix
Solution/Test Harm/Beneficence Reversibility Publicity (public identification) Feasibility
First Solution
Second Solution
Third Solution
Fourth Solution
Fifth Solution
Table 5.5
The ethics tests are discussed in Cruz and Davis. See references below. Wike and Brincat
also discuss value based approaches in the two references below.
5.1.7 Exercise Four: Solution Implementation
In this section, you will trouble-shoot the solution implementation process by uncovering and defusing
potential obstacles. These can be identified by looking at the constraints that border the action. Although
constraints specify limits to what can be realized in a given situation, they are more flexible than generally
thought. Promptly identifying these constraints allows for proactive planning that can push back obstacles
to solution implementation and allow for realization of at least some of the value embodied in the solution.
A Feasibility Test focuses on these situational constraints and poses useful questions early on in the
implementation process. What conditions could arise that would hinder the implementation of a solution?
Should the solution be modified to ease implementation under these constraints? Can the constraints be
removed or modified through activities such as negotiation, compromise, or education? Can solution imple-
mentation be facilitated by modifying both the solution and the constraints?
Feasibility Constraints
147
Category Sub-Category
Resource Money/Cost Time/Deadlines Materials
Interest Organizational(Supervisor)Legal (laws, regula- Political/Social
tions)
Technical Technology does not ex- Technology patented Technology needs modi-
ist fication
Table 5.6
Resource Constraints:
" Does the situation pose limits on resources that could limit the realization of the solution
under consideration?
" Time. Is there a deadline within which the solution has to be enacted? Is this deadline fixed or
negotiable?
" Financial. Are there cost constraints on implementing the ethical solution? Can these be extended
by raising more funds? Can they be extended by cutting existing costs? Can agents negotiate for more
money for implementation?
" Resource. Are necessary resources available? Is it necessary to plan ahead to identify and procure
resources? If key resources are not available, is it possible to substitute other, more available resources?
Would any significant moral or non-moral value be lost in this substitution?
Interest Constraints
" Does the solution threaten stakeholder interests? Could it be perceived as so threatening
to a stakeholder's interests that the stakeholder would oppose its implementation?
" Individual Interests. Does the solution threaten the interests of supervisors? Would they take
measures to block its realization? For example, a supervisor might perceive the solution as undermining
his or her authority. Or, conflicting sub-group interests could generate opposition to the implementation
of the solution even though it would promote broader organizational objectives.
" Organizational Interests. Does the solution go against an organization's SOPs (standard operating
procedures), formal objectives, or informal objectives? Could acting on this solution disrupt organi-
zation power structures? (Perhaps it is necessary to enlist the support of an individual higher up in
the organizational hierarchy in order to realize a solution that threatens a supervisor or a powerful
sub-group.)
" Legal Interests. Are there laws, statutes, regulations, or common law traditions that oppose the
implementation of the solution? Is it necessary to write an impact statement, develop a legal compliance
plan, or receive regulatory approval in order to implement the solution?
" Political/Social/Historical Constraints. Would the solution threaten or appear to threaten the
status of a political party? Could it generate social opposition by threatening or appearing to threaten
the interests of a public action group such as an environmental group? Are there historical traditions
that conflict with the values embedded in the solution?
Technical Constraints
* Technology does not yet exist. Would the implementation of the solution require breaking new
technological ground?
* Technology Protected by Patent. The technology exists but is inaccessible because it is still under
a patent held by a competitor.
* Technology Requires Modification. The technology required to implement solution exists but
needs to be modified to fit the context of the solution. Important considerations to factor in would be
the extent of the modification, its cost, and how long it would take to bring about the modification.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
5.1.8 What did you learn?
This section provides closure to the module for students. It may consist of a formal conclusion that sum-
marizes the module and outlines its learning objectives. It could provide questions to help students debrief
and reflect on what they have learned. Assessment forms (e.g., the "Muddiest Point" Form) could be used
to evaluate the quality of the learning experience. In short, this section specifies the strategy for bringing
the module to a close.
In this module, you have...
" studied a real world case that raised serious problems with intellectual property, privacy, security, and
free speech. Working with these problems has helped you to develop a better "working" understanding
of these key concepts,
" studied and practiced using four decision-making frameworks: (1) using socio-technical analysis to
specify the problem in a complex, real world case, (2) practiced brainstorming techniques to develop
and refine solutions that respond to your problem, (3) employed three ethics tests to integrate ethical
considerations into your solutions and to test these solutions in terms of their ethics, and (4) applied
a feasibility analysis to your solutions to identify and trouble-shoot obstacles to the implementation of
your ethical solution,
" explored the analogy between solving ethical and design problems,
" practiced the skills of moral imagination, moral creativity, reasonableness, and perseverance, and...
" experienced, through key participant perspectives, the challenges of ethics advocacy "under the gun."
Debrief on your group work before the rest of the class
1. Provide a concise statement and justification of the problem your group specified
2. Present the refined solution generation list your group developed in exercise 2.
3. Present and provide a quick summary explanation of the results of your group's solution evaluation
matrix.
4. Show your group's feasibility matrix and summarize your assessment of the feasibility of implementing
the solution alternatives you tested in exercise three.
Group Debriefing
1. Were there any problem you group had working together to carry out this case analysis? What were
the problems and how did you go about solving them?
2. What problems did you have with understanding and practicing the four frameworks for solving prob-
lems? How did you go about solving these problems? Does your group have any outstanding questions
or doubts?
3. Now that you have heard the other groups present their results, what differences emerged between
your group's analysis and those of the other groups? Have you modified your analysis in light of the
analyses of the other groups? If so how? Do the other groups need to take into account any aspects of
your group's debriefing?
5.1.9 Appendix
This optional section contains additional or supplementary information related to this module. It could
include: assessment, background such as supporting ethical theories and frameworks, technical information,
discipline specific information, and references or links.
References
1. More references on the Biomatrix case (in addition to the links provided above) will be added at a
later date.
149
2. Brincat, Cynthia A. and Wike, Victoria S. (2000) Morality and the Professional Life: Values at Work.
Upper Saddle River, NJ: Prentice Hall.
3. Cruz, J. A., Frey, W. J. (2003) An Effective Strategy for Integration Ethics Across the Curriculum in
Engineering: An ABET 2000 Challenge, Science and Engineering Ethics, 9(4): 543-568.
4. Davis, M., Ethics and the University, Routledge, London and New York, 1999: 166-167.
5. Richard T. De George, "Ethical Responsibilities of Engineers in Large Organizations: The Pinto Case,"
in Ethical Issues in Engineering, ed. Deborah G. Johnson (1991) New Jersey: Prentice-Hall: 175-186.
6. Charles Harris, Michael Pritchard and Michael Rabins (2005) Engineering Ethics: Concepts and
Cases, 3rd Ed. Belmont, CA: Thomson/Wadsworth: 203-206.
7. Huff, Chuck and Jawer, Bruce, "Toward a Design Ethics for Computing Professionals in Social Issues
in Computing: Putting Computing in its Place, Huff, Chuck and Finholt, Thomas Eds. (1994)
New York: McGraw-Hill, Inc.
8. Solomon, Robert C. (1999) A Better Way to Think About Business: How Personal Intgrity
Leads to Corporate Success. Oxford, UK: Oxford University Press.
9. Anthony Weston. (2001) A Practical Companion to Ethics, 2nd ed. USA: Oxford University
Press, 2001, Chapter 3.
10. Carolyn Whitbeck (1998) Ethics in Engineering Practice and Research. U.K. Cambridge Uni-
versity Press: 55-72 and 176-181.
11. Wike, Victoria S. (2001) "Professional Engineering Ethics Bahavior: A Values-based Approach," Pro-
ceedings of the 2001 American Society for Engineering Education Annual Conference and
Exposition, Session 2461.
5.1.10 EAC ToolKit Project
5.1.10.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License2 regarding permission to reuse this material.
5.1.10.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
5.2 Gray Matters for the Hughes Aircraft Case3
5.2.1 Introduction
I. Introduction
The Hughes Aircraft Case involves a group of employees in charge of testing chips for weapons systems.
Because of the lengthy testing procedure required by the U.S. Defense Department, Hughes soon fell behind
schedule in delivering chips to customers. To get chips out faster, some Hughes middle level managers
began to put pressure on employees to pass chips that had failed tests or to pass them without testing.
The scenarios below consist of narratives that stop at the point of decision. Your job is to complete the
narrative by making a decision. Alternatives are provided to get the process started, but you may find it
necessary to design your own solution. Ethics and feasibility tests help you to evaluate these alternatives
and even design new ones more to your liking. This format superficially resembles the Gray Matters exercise
used at Boeing Corporation. (More information on the history of Gray Matters can be found by consulting
2http: //creativecommons.org/licenses/by/2 .0/
3This content is available online at .
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Carolyn Whitbeck, Ethics in Engineering Practice, 1998, 176-182.) This version differs in being more open-
ended and more oriented toward giving you the opportunity to practice using ethical theory (which has been
encapsulated into ethics tests).
5.2.2 Directions
II. Directions
* Read the following scenarios and the accompanying solutions
* Evaluate the alternatives in terms of the tests described below.
* Choose the one you think best or design your own solution if you believe you can do better.
* Summarize your results by filling in the solution evaluation matrix that appears on the page following
the scenario. Notice that the first column repeats the solution alternatives.
* Be prepared to present your matrix to the class. You will also provide the other groups in the class
with a copy of your matrix for their ethics portfolios
Scenario One: Responding to Organizational Pressure
Frank Saia has worked at Hughes Aircraft for a long time. Now he is faced with the most difficult decisions of
his career. He has been having problems in the environmental testing phase of his microchip manufacturing
plant; the detailed nature of these tests has caused Hughes to be consistently late in delivering the chips to
customers. Because of the time pressure to deliver chips, Saia has been working to make the production of
chips more efficient without losing the quality of the product. Chips are manufactured and then tested, and
this provides two places where the process can bottle up. Even though you might have a perfectly fine chip
on the floor of the plant, it cannot be shipped without testing. And, since there are several thousand other
chips waiting to be tested, it can sit in line for a long time. Saia has devised a method that allows testers to
put the important chips, the "hot parts," ahead of the others without disrupting the flow and without losing
the chips in the shuffle. He has also added a "gross leak" test that quickly tells if a chip in a sealed container
is actually sealed or not. Adding this test early in the testing sequence allows environmental testing to avoid
wasting time by quickly eliminating chips that would fail a more fine-grained leak test later in the sequence.
Because environmental testing is still falling behind, Saia's supervisors and Hughes customers are getting
angry and have begun to apply pressure. Karl Reismueller, the director of the Division of Microelectronics at
Hughes, has given Saia's telephone number to several customers, whose own production lines were shut down
awaiting the parts that Saia has had trouble delivering. His customers are now calling him directly to say
"we're dying out here" for need of parts. Frank Saia has discovered that an employee under his supervision,
Donald LaRue, has been skipping tests on the computer chips. Since LaRue began this practice, they have
certainly been more on time in their shipments. Besides, both LaRue and Saia know that many of the "hot"
parts are actually for systems in the testing phase, rather than for ones that will be put into active use. So
testing the chips for long-term durability that go into these systems seems unnecessary. Still, LaRue was
caught by Quality Control skipping a test, and now Saia needs to make a decision. Upper management has
provided no guidance; they simply told him to "handle it" and to keep the parts on time. He can't let LaRue
continue skipping tests, or at least he shouldn't let this skipping go unsupervised. LaRue is a good employee,
but he doesn't have the science background to know which tests would do the least damage if they were
skipped. He could work with LaRue and help him figure out the best tests to skip so the least harm is done.
But getting directly involved in skipping the tests would mean violating company policy and federal law.
Alternatives
1. Do nothing. LaRue has started skipping tests on his own initiative. If any problems arise, then LaRue
will have to take responsibility, not Saia, because LaRue was acting independently of and even against
Saia's orders.
2. Call LaRue in and tell him to stop skipping tests immediately. Then call the customers and explain
that the parts cannot be shipped until the tests are carried out.
3. Consult with LaRue and identify non essential chips or chips that will not be used in systems critical
to safety. Skipping tests on these chips will do the least damage.
151
4. Your solution....
Scenario Two: Responding to Wrongdoing
Margaret Gooderal works in a supervisory position in the environmental testing group at Hughes Aircraft.
Her supervisor, Donald LaRue, is also the current supervisor for environmental testing. The group that
LaRue and Gooderal together oversee test the chips that Hughes makes in order to determine that they
would survive under the drastic environmental conditions they will likely face. Rigorous testing of the chips
is the ideal, but some chips (the hot chips) get in line ahead of others. Gooderal has found out that over
the last several months, many of these tests are being skipped. The reason: Hughes has fallen behind in the
production schedule and Hughes upper management and Hughes customers have been applying pressure to
get chip production and testing back on schedule. Moreover, LaRue and others feel that skipping certain
tests doesn't matter, since many of these chips are being used in systems that are in the testing phase, rather
than ones that will be put into active use. A few months after Margaret Gooderal started her new position,
she was presented with a difficult problem. One of the "girls" (the women and men in Environmental Testing
at Hughes), Lisa Lightner, came to her desk crying. She was in tears and trembling because Donald LaRue
had forcefully insisted that she pass a chip that she was sure had failed the test she was running. Lightner
ran the hermeticity test on the chips. The chips are enclosed in a metal container, and one of the questions
is whether the seal to that container leaks. From her test, she is sure that the chip is a "leaker"-the seal
is not airtight so that water and corrosion will seep in over time and damage the chip. She has come to
Gooderal for advice. Should she do what LaRue wants and pass a chip she knows is a leaker?
Alternatives
1. Gooderal should advise Lightner to go along with LaRue. He is her supervisor. If he orders to pass
the chip, then she should do so.
2. Gooderal should go to Human Resources with Lightner and file a harassment complaint against LaRue.
Skipping tests is clearly illegal and ordering an employee to commit an illegal act is harassment.
3. Gooderal and Lightner should blow the whistle. They should go to the U.S. defense department and
inform them of the fact that Hughes Aircraft is delivering chips that have either failed tests or have
not been tested.
4. Your solution....
Scenario 3: Goodearl, Ibarra, and the AMRAAM Incident
Now that Goodearl had few sympathizers among upper management, she increasingly turned to Ruth Ibarra
in Quality assurance for support in her concerns about test skipping and the falsification of paperwork. One
day, Goodearl noticed that some AMRAAM chips with leak stickers were left on her project desk in the
environmental testing area. The leak stickers meant that the seal on the chips' supposedly airtight enclosure
had failed a test to see if they leaked. AMRAAM meant that the chips were destined to be a part of an
Advanced Medium Range Air-to-Air Missile. Goodearl knew that these parts could not be retested and
needed to be simply thrown away. So why was someone keeping them? She also knew that these were
officially "hot parts" and that the company was behind schedule in shipping these parts. After consulting
with Ruth Ibarra, the two of them decided to do some sleuthing. They took the chips and their lot travelers
to a photocopy machine and made copies of the travelers with "failed" noted on the leak test. They then
replaced the chips and their travelers on the desk. Later that day, as Don LaRue passed the desk, Goodearl
asked Don LaRue if he knew anything about the chips. "None of your business," he replied. The chips
disappeared, and later the travelers showed up in company files with the "failed" altered to "passed." So,
Goodearl and Ibarra had clear evidence (in their photocopy of the "failed" on the traveler) that someone
was passing off failed chips to their customers. And these were important chips, part of the guidance system
of an air-to-air missile.
Alternatives: Since they have clear evidence, Gooderal and Ibarra should blow the whistle.
Evaluate each of the following ways in which they could blow the whistle
1. Blow the whistle to Hughes' Board of Directors. In this way they can stop the test skipping but will
also be able to keep the whole affair "in house."
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
2. Blow the whistle to the local news media. In this way they will shame Hughes into compliance with
the testing requirements.
3. Take the evidence to the U.S. Department of Defense, since they are the client and are being negatively
impacted by Hughes' illegal actions.
4. Some other mode of blowing the whistle....
Solution Evaluation Matrix
Alternatives/TestsReversibility/RigHarm/Benefits Virtue/Value Global Feasibil-
Test Test Test (Also Pub- ity Test (Imple-
licity) mentation Ob-
stacles)
Alternative One Evaluate Alt 1
(Worst Alterna- using reversibil-
tive) ity/rights test
Alternative Two Weigh harms
(Best among against benefits
those given) for alt 2
Alternative What val-
Three ues/disvalues
are realized in alt
3?
Your Solution What obstacles
could hinder im-
plementation of
solution?
Table 5.7
5.2.3 Ethics Tests: Set Up and Pitfalls
III. Solution Evaluation Tests
" REVERSIBILITY: Would I think this is a good choice if I were among those affected by it?
" PUBILICITY: Would I want to be publicly associated with this action through, say, its publication in
the newspaper?
" HARM/BENEFICENCE: Does this action do less harm than any of the available alternatives?
" FEASIBILITY: Can this solution be implemented given time, technical, economic, legal, and political
constraints?
Harm Test Set-Up
* Identify the agent (=the person who will perform the action). Describe the action (=what the agent
is about to do).
* Identify the stakeholders (individuals who have a vital interest at risk) and their stakes.
* Identify, sort out, and weight the expected results or consequences.
Harm Test Pitfalls
* Paralysis of Action-considering too many consequences.
* Incomplete analysis-considering too few results.
153
" Failure to weigh harms against benefits.
" Failure to compare different alternatives.
" Justice failures-ignoring the fairness of the distribution of harms and benefits.
Reversibility Test Set-Up
" Identify the agent
" Describe the action
" Identify the stakeholders and their stakes
" Use the stakeholder analysis to select the relations to be reversed.
" Reverse roles between the agent (you) and each stakeholder: put them in your place (as the agent)
and yourself in their place (as the target of the action
" If you were in their place, would you still find the action acceptable?
Reversibility Pitfalls
" Leaving out a key stakeholder relation.
" Failing to recognize and address conflicts between stakeholders and their conflicting stakes.
" Confusing treating others with respect with capitulating to their demands (Reversing with Hitler).
" Failing to reach closure, i.e., an overall global reversal assessment that takes into account all the
stakeholders the agent has reversed with.
Public Identification Set-Up
" Set up the analysis by identifying the agent, describing the action under consideration, and listing the
key values or virtues at play in the situation.
" Associate the action with the agent.
" Identify what the action says about the agent as a person. Does it reveal him or her as someone
associated with a virtue/value or a vice?
Public Identification Pitfalls
1. Action is not associated with the agent. The most common pitfall is failure to associate the agent and
the action. The action may have bad consequences and it may treat individuals with disrespect but
these points are not as important in the context of this test as what they imply about the agent as a
person who deliberately performs such an action.
2. Failure to specify the moral quality, virtue, or value of the action that is imputed to the agent in the
test. To say, for example, that willfully harming the public is bad fails to zero in on precisely what
moral quality this attributes to the agent. Does it render him or her unjust, irresponsible, corrupt,
dishonest, or unreasonable?
Gray Matters in Hughes Exercises
This is an unsupported media type. To view, please see
http://cnx.org/content/m14036/latest/GM_HughesV2.doc
Figure 5.2: These exercises present three decision points from Hughes, solution alternatives, summaries
of ethics and feasibility tests, and a solution evaluation matrix. Carry out the exercise by filling in the
solution evaluation matrix.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
This timeline is taken from the Computing Cases website developed and maintained by Dr. Charles Huff at
St. Olaf College. Computing Cases is funded by the National Science Foundation, NSF DUE-9972280 and
DUE 9980768.
5.2.4
Time Line
1979 Ruth Ibarra beginsworking for Hughes Air-
craft company's Microelectronic Circuit Division
(Hughes MCD) in Newport Beach, CA
1981 Margaret Gooderal begins working for Hughes
MCD as a supervisor for assembly on the hybrid
production floor and as a supervisor in the hybrid
engineering lab
1984 Ibarra becomes supervisor for hybrid quality assur-
ance
1985 Goodearl asks Ibarra to look at errors in paper-
work, Ibarra brings errors to the attention of her
supervisors and was told to keep quiet. This begins
time period where Goodearl/Ibarra become aware
of problems in hybrid chip testing and paperwork.
1986 Goodearl becomes supervisor for seals processing in
the environmental testing area.
1986 Faise Claims Act (31 U.S. C 3729-3733) becomes
False Claims Reform Act of 1986 making it stronger
and easier to apply.
Oct. 1986 Goodearl/Ibarra report problems ot Hughes man-
agement, and, after the problems were not fixed,
Goodearl/Ibarra reported the allegations of faulty
testing to the United States Department of Defense.
Jan 9, 1987 Earliest date that Hughes may have stopped ne-
glecting environmental screening tests.
1988 Ibarra leaves Hughes feeling that her job had been
stripped of all real responsibility.
March 1989 Goodearl is laid off from Hughes.
1995 Goodearl and her husband are divorced.
Table 5.8
Civil Suit Timeline
1990-1996 United States of America, ex rel. Taxpayers
Against Fraud, Ruth Aldred (was Ibarra), and Mar-
garet Goodearl v. Hughes Aircraft Company, Inc.
continued on next page
155
1990 Goodearl files wrongful discharge suit against
Hughes and a number of individual managers,
which was eventually dropped in favor of the civil
suit.
May 29, 1990 Thinking the government investigation was tak-
ing too much time, Goodearl/Aldred file civil suit
against Hughes under False Claims Reform Act of
1986 with the help of Taxpayers Against Fraud and
Washington law firm Phillips and Cohen.
December 1992 Under provisions of the FCA, the U.S. Department
of Justice Civil Division takes over the civil case.
Sep. 10, 1996 Hughes found guilty in civil trial. Pays U.S. Gov-
ernment 4,050,00 dollars and each relator 891,000
dollars plus a separate payment of 450,000 dollars
to cover attorney's fees, costs, and expenses.
Table 5.9
Criminal Suit Timeline
1991-1993 United States of America v. Hughes Aircraft Co.,
and Donald LaRue
December 13, 1991 After a lengthy investigation, the U.S. Department
of Defense charges Hughes and Donald A. LaRue
with a 51-count indictment accusing it of falsifying
tests of microelectronic circuits (criminal suit).
June 15, 1992 Hughes found guilty of conspiring to defraud the
U.S. Government in crminal case, co-defendent
LaRUE acquitted following 4-week trial. Good-
earl/Aldred called as witnesses in trial. Hughes ap-
peals.
Oct. 29, 1992 Hughes fined 3.5 million in criminal trial decision.
December 2, 1993 Appellate court upholds 1992 criminal conviction
and sentence. Hughes appeals.
Table 5.10
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Hughes Socio Technical System
Hardware/So frysical People, Procedures Laws and Data and
Surround- Roles, Regulations Data Struc-
ings Structures tures
Description Hybrid Battle con- Hughes Chip Test- Legally Lot Trav-
Chips ditions Microelec- ing: Tem- Mandated elors to
(circuitry under which tric Circuit perature Tests document
hermetically chips might Division Cycle, Con- chips
sealed in be used stant Ac-
metal or celeration,
ceramic Mechani-
packages in cal Shock,
inert gas Hermeticity
atmosphere (Fine and
Gross Leak),
P.I.N.D.
Analogue E-1000 at Department Hughes Whistle
to Digital Hughes of Defense Human Blower
Conversion (Clean (Office of Resources Protection
Chips Room) Inspector Procedures Legislation
General) for Com-
plaints
Radar and Hughes Dissenting Qui Tam
Missile Quality Professional Lawsuit,
Guidance Control Opinions Civil Suit,
Systems Criminal
Suit
Individuals:
Reismueller,
Temple,
Saia,
LaRue,
Goodearl,
Ibarra/Aldre
Table 5.11
5.2.5 Blowing the Whistle
Ethical Dissent
1.
2.
3.
4.
5.
6.
7.
Establish a clear technical foundation.
Keep your arguments on a high professional plane, as impersonal and objective as possible, avoiding
extraneous issues and emotional outbursts.
Try to catch problems early, and keep the argument at the lowest managerial level possible.
Before going out on a limb, make sure that the issue is sufficiently important.
Use (and help estabish) organizational dispute resolution mechanisms.
Keep records and collect paper.
These items are taken from the IEEE website, link above.
157
Before Going Public
1. Make sure of your motivation.
2. Count your costs.
3. Obtain all the necessary background materials and evidence.
4. Organize to protect your own interests.
5. Choose the right avenue for your disclosure.
6. Make your disclosure in the right spirit.
7. These items come from the IEEE (see onlineethics link) and from the manuscript of Good Computing
by Chuck Huff, William Frey, and Jose Cruz.
Places to Go
1. Government Agencies
2. Judicial Systems
3. Legislators
4. Advocacy Groups
5. News Media
6. In Puerto Rico, laws 14 and 426 have been passed to protect those who would blow the whistle on
government corruption. The Oficina de Etica Gubernamental de Puerto Rico has a whistle blower's
hotline. See link above.
When to Blow the Whistle.
1. Serious and Considerable Harm
2. Notification of immediate supervisor.
3. Exhaustion of internal channels of communication/appeal.
4. Documented Evidence.
5. Likelihood of successful resolution.
References
1. Richard T. De George, "Ethical Responsibilities of Engineers in Large Organizations: The Pinto Case,"
in Ethical Issues in Engineering, ed. Deborah G. Johnson (1991) New Jersey: Prentice-Hall: 175-
186.
2. Carolyn Whitbeck (1998) Ethics in Engineering Practice and Research. U.K. Cambridge University
Press: 55-72 and 176-181.
3. Charles Harris, Michael Pritchard and Michael Rabins (2005) Engineering Ethics: Concepts and Cases,
3rd Ed. Belmont, CA: Thomson/Wadsworth: 203-206.
5.3 Case Analysis Module: Therac-254
Computer Ethics
Case Module Template
By William J. Frey
Module Introduction:
The Therac-25 case is what Huff and Frey call a thick, historical, evaluative, big news and bad news case.
Tackling cases of this complexity requires both careful thought and considerable skill. Especially important
is the ability to sift through the case details, documents, and conflicting narratives. The purpose of this
module is to provide students with a structure to tackle big, long, and complicated cases. Students will receive
frameworks to help them structure the case's ethical and social problems. They will also be provided with
4This content is available online at .
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
decision points that will help them to enter into the case and take up the standpoint of a participant. The
module presented below can be linked to materials that can be found at www.computingcases.org. Nancy
Leveson, in Safeware:System Safety and Computer (515-553), also provides an excellent and comprehensive
account. Excellent advice on how to teach the case, updated information, and clear explanations of the
programming errors are provided by Chuck Huff and Richard Brown in "Integrating Ethics into a Computing
Curriculum: A Case Study of the Therac-25." The materials posted at Computing Cases were all developed
through NSF projects DUE-9972280 and DUE 9980768.)
The module presents the case abstract and timeline. It then refers students to computingcases.org where
they will find the case narrative, history, and supporting documents that provide background information
necessary for analysis. The case abstract and timeline introduce students to the basic outlines of the case.
The accompanying decision point taken from the case provides students with the necessary focus to carry out
an in-depth analysis. Students respond to the decision-point by working through the four stages: problem
specification, solution generation, solution testing, and solution implementation.
Module Activities:
1. Instructor introduces the case based on the abstract and timeline found at www.computingcases.org5
2. Students read case abstract, timeline, case decision point, and case analysis exercises.
3. Students do further research into the case by consulting ComputingCases materials which include
narratives, histories, supporting documents, and ethical analyses.
4. Students carry out the activities outlined in the accompanying case exercises by (a) specifying the
problem raised in the decision point, (b) generating solutions, (c) testing solutions using ethics tests, and
(d) developing plans for implementing the solution over situational constraints.
5. Students prepare their case analyses working in small groups.
6. These groups present their completed analysis to the class in a case-debriefing session.
7. The instructor concludes by discussing the problem-solving issues and intermediate moral concepts
raised by the case.
5.3.1 Therac-25 Abstract
Therac-256 was a new generation medical linear accelerator7 for treating cancer. It incorporated the most
recent computer control equipment. Therac-25's computerization made the laborious process of machine
setup much easier for operators, and thus allowed them to spend minimal time in setting up the equipment.
In addition to making setup easier, the computer also monitored the machine for safety. With the advent
of computer control, hardware based safety mechanisms were transferred to the software. Hospitals were
told that the Therac-25 medical linear accelerator had "so many safety mechanisms" that it was "virtually
impossible" to overdose a patient. Normally, when a patient is scheduled to have radiation therapy for cancer,
he or she is scheduled for several sessions over a few weeks and told to expect some minor skin discomfort
from the treatment. The discomfort is described as being like a mild sunburn over the treated area. But
in this case on safety critical software, you will find that some patients received much more radiation than
prescribed
Therac -25 Timeline
5http://www.computingcases.org/
6http://www.computingcases.org/case_materials/therac/teaching/therac/supportingdocs/Therac%20Glossary.html#tr25
7http://www.computingcases.org/case_materials/therac/teaching/therac/supportingdocs/Therac%20Glossary.html#trl3
159
Early1970's AECL and a French Company (CGR) collaborate
to build Medical Linear Accelerators (linacs). They
develop Therac-6, and Therac-20. (AECL and
CGR end their working relationship in 1981.)
1976 AECL developes the revolutionary "double pass"
accelerator which leads to the development of
Therac-25.
March, 1983 AECL performs a safety analysis of Therac-25
which apparently excludes an analysis of software.
July 29,1983 In a PR Newswire the Canadian Consulate General
announces the introduction of the new "Therac 25"
Machine manufactured by AECL Medical, a divi-
sion of Atomic Energy of Canada Limited.
ca. Dec. 1984 Marietta Georgia, Kennestone Regional Oncology
Center implements the new Therac-25 machine.
June 3, 1985 Marietta Georgia, Kennestone Regional Oncology
CenterKatherine (Katy) Yarbrough, a 61-year-old
woman is overdosed during a follow-up radiation
treatment after removal of a malignant breast tu-
mor. Tim Still, Kennestone Physicist calls AECL
asking if overdose is possible; three days later he is
informed it is not.
July 26, 1985 Hamilton, Ontario, Canada. Frances Hill, a 40-
year-old patient is overdosed during treatment for
cervical carcinoma. AECL is informed of the injury
and sends a service engineer to investigate.
November 3, 1985 Hamilton Ontario patient dies of cancer, but it is
noted on her autopsy that had she not died, a full
hip replacement would have been necessary as a re-
sult of the radiation overdose.
November 8, 1985 Letter from CRPB to AECL requesting additional
hardware interlocks and changes in software. Letter
also requested treatment terminated in the event of
a malfunction with no option to proceed with single
key-stroke. (under Canada's Radiation Emitting
Devices Act.)
November 18, 1985 Katy Yarbrough files suit against AECL and
Kennestone Regional Oncology Center. AECL in-
formed officially of Lawsuit.
December 1985 Yakima Valley Memorial Hospital, Yakima Wash-
ington. A woman being treated with Therac-25 de-
velops erythema on her hip after one of the treat-
ments.
January 31, 1986 Staff at Yakima sends letter to AECL and speak on
the phone with AECL technical support supervisor.
February 24, 1986 AECL technical support supervisor sends a written
response to Yakima claiming that Therac-25 could
not have been responsible for the injuries to the
female patient.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Table 5.12
Scenario: You are an engineer working for AECL sent to investigate an alleged overdosing incident at
the Ontario Cancer Foundation in Hamilton. Ontario. The following is the description provided to you of
what happened:
On July 26, 1985, a forty-year old patient came to the clinic for her twenty-fourth Therac-25 treatment
for carcinoma of the cervix. The operator activated the machine, but the Therac shut down after five
seconds with an HTILT error message. The Therac-25's console display read NO DOSE and indicated a
TREATMENT PAUSE
Since the machine did not suspend and the control display indicated no dose was delivered to the patient,
the operator went ahead with a second attempt at a treatment by pressing the Proceed Command Key,
expecting the machine to deliver the proper dose this time. This was standard operating procedure, and
Therac-25 operators had become accustomed to frequent malfunctions that had no untoward [bad] conse-
quences for the patient. Again the machine shut down in the same manner. The operator repeated this
process four times after the original attempt-the display showing NO DOSE delivered to the patient each
time. After the fifth pause, the machine went into treatment suspend, and a hospital service technician was
called. The technician found nothing wrong with the machine. According to a Therac-25 operator, this
scenario also was not unusual.
After treatment, the patient complained of a burning sensation, described as an "electric tingling shock"
to the treatment area in her hip....She came back for further treatment on July 29 and complained of
burning, hip pain, and excessive swelling in the region of treatment. The patient was hospitalized for the
condition on July 30, and the machine was taken out of service. (Description taken from Nancy Leveson,
Safeware, pp 523-4)
You give the unit a thorough examination and are able to find nothing wrong. Working with the operator,
you try to duplicate the treatment procedure of July 26. Nothing out of the ordinary happens. Your
responsibility is to make a recommendation to AECL and to the Ontario Cancer Foundation. What will it
be?
1. Identify key components of the STS
Part/Level Hardware Software Physical People, Procedures Laws & Data
of Analy- Surround- Groups, & Regula- & Data
sis ings Roles tions Structures
Table 5.13
2. Specify the problem:
2a. Is the problem a disagreement on facts? What are the facts? What are cost and time constraints on
uncovering and communicating these facts?
2b. Is the problem a disagreement on a critical concept? What is the concept? Can agreement be reached
by consulting legal or regulatory information on the concept? (For example, if the concept in question is
safety, can disputants consult engineering codes, legal precedents, or ethical literature that helps provide
consensus? Can disputants agree on positive and negative paradigm cases so the concept disagreement can
be resolved through line-drawing methods?
2c. Use the table to identify and locate value conflicts within the STS. Can the problem be specified
as a mismatch between a technology and the existing STS, a mismatch within the STS exacerbated by the
introduction of the technology, or by overlooked results?
161
STS/Value Safety (free- Justice (Equity Privacy Property Free Speech
dom from & Access)
harm)
Hardware/software
Physical Sur-
roundings
People,
Groups, &
Roles
Procedures
Laws
Data & Data
Structures
Table 5.14
3. Develop a general solution strategy and then brainstorm specific solutions:
Problem / So- Disagreement Value Conflict Situational
lution Strategy Constraints
Factual
Conceptual
Integrate?
Tradeoff?
Resource?Technical?Interest
Table 5.15
3a. Is problem one of integrating values, resolving disagreements, or responding to situational constraints?
3b. If the conflict comes from a value mismatch, then can it be solved by modifying one or more of the
components of the STS? Which one?
4. Test solutions:
Alternative Reversibility Value: Jus- Value: Re- Value: Re- Harm Code
Test tice sponsibility spect
A #1
A #2
A #3
Table 5.16
5. Implement solution over feasibility constraints
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Time Cost Individual Organization Legal/ So- Available Manufactur
cial Techno-
logy
#1
#2
#3
ibility
Table 5.17
5.4 Toysmart Case Exercises - Student Module
NOTE: Write your module for a student audience. To complete or edit the sections below erase
the provided textual commentaries then add your own content using one or more of the following
strategies:
- Type or paste the content directly into the appropriate section
- Link to a published CNX module or an external online resource
using the ''Links'' tabs (see example on the right)
- Link to a document or multimedia file within the content after
uploading the file using the ''Files'' tab (see example below)
- Cite content not available online
Word Version of this Template
This is an unsupported media type. To view, please see http://cnx.org/content/m14789/latest/ EAC TK
STD TEMPLATE.doc
Figure 5.3: This is an example of an embedded link. (Go to "Files" tab to delete this file and replace
it with your own files.)
5.4.1 Introduction
In this module you will study a real world ethical problem, the Toysmart case, and employ frameworks based
on the software development cycle to (1) specify ethical and technical problems, (2) generate solutions that
integrate ethical value, (3) test these solutions, and (4) implement them over situation-based constraints.
This module will provide you with an opportunity to practice integrating ethical considerations into real
8This content is available online at .
163
world decision-making and problem-solving in business and computing. This whole approach is based on an
analogy between ethics and design (Whitbeck).
Large real world cases like Toysmart pivot around crucial decision points. You will take on the role of
one of the participants in the Toysmart case and problem-solve in teams from one of three decision points.
Problem-solving in the real world requires perseverance, moral creativity, moral imagination, and reason-
ableness; one appropriates these skills through practice in different contexts. Designing and implementing
solutions requires identifying conflicting values and interests, balancing them in creative and dynamic solu-
tions, overcoming technical limits, and responding creatively to real world constraints.
Each decision point requires that you take up the position of a participant in the case and work through
decision-making frameworks from his or her perspective. You may be tempted to back out and adopt an
evaluative posture from which to judge the participants. Resist this temptation. This module is specifically
designed to give you practice in making real world decisions. These skills emerge when you role play from
one of the standpoints within the case. You will learn that decision-making requires taking stock of one's
situation from within a clearly defined standpoint and then accepting responsibility for what arises from
within that standpoint.
Cases such as Toysmart are challenging because of the large amount of information gathering and sorting
they require. Moral imagination responds to this challenge by providing different framings that help to filter
out irrelevant data and structure what remains. Framing plays a central role in problem specification. For
example, Toysmart could be framed as the need to develop more effective software to help negotiate the
exchange of information online. In this case, a software programming expert would be brought in to improve
P3P programs. Or it could be framed as a legal problem that requires ammending the Bankruptcy Code.
What is important at this stage is that you and your group experiment with multiple framings of the case
around your decision point. This makes it possible to open up avenues of solution that would not be possible
under one framing.
Tackling large cases in small teams also helps develop the communication and collaboration skills that
are required for group work. Take time to develop strategies for dividing the work load among your team
members. The trick is to distribute equally but, at the same time, to assign tasks according the different
abilities of your team members. Some individuals are better at research while others excell in interviewing
or writing. Also, make sure to set aside time when you finish for integrating your work with that of your
teammates. Start by quickly reviewing the information available on the case. This is called "scoping the
case." Then formulate specific questions to focus further research on information relevant to your problem
solving efforts. This includes information pertinent to constructing a socio-technical analysis, identifying key
"embedded" ethical issues, and uncovering existing best and worst practices.
A case narrative, STS (socio-technical system) description, and two ethical reflections have been published
at http://computingcases.org. This module also links to websites on bankruptcy and privacy law, the Model
Business Corporation Act, consumer privacy information, and the TRUSTe website.
5.4.2 What you need to know ...
5.4.2.1 What you need to know about socio-technical systems
1. STS have seven broad components: hardware, software, physical surroundings, peo-
ple/groups/roles, procedures, laws, and data/data structures.
2. Socio-technical systems embody values
* These include moral values like safety, privacy, property, free speech, equity and access, and security.
Non-moral values can also be realized in and through Socio Technical Systems such as efficiency, cost-
effectiveness, control, sustainability, reliability, and stability.
* Moral values present in Socio Technical Systems can conflict with other embedded moral values; for
example, privacy often conflicts with free speech. Non-moral values can conflict with moral values;
developing a safe system requires time and money. And, non-moral values can conflict; reliability
undermines efficiency and cost effectiveness. This leads to three problems that come from different
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
value conflicts within Socio Technical Systems and between these systems and the technologies that
are being integrated into them.
* Mismatches often arise between the values embedded in technologies and the Socio Technical Sys-
tems into which they are being integrated. As UNIX was integrated into the University of California
Academic Computing STS (see Machado case at Computing Cases), the values of openness and trans-
parency designed into UNIX clashed with the needs of students in the Academic Computing STS at
UCI for privacy.
* Technologies being integrated into Socio Technical Systems can magnify, exaggerate, or exacerbate
existing value mismatches in the STS. The use of P2P software combined with the ease of digital
copying has magnified existing conflicts concerning music and picture copyrights.
* Integrating technologies into STSs produces both immediate and remote consequences and impacts.
3. Socio-technical systems change
* These changes are bought about, in part, by the value mismatches described above. At other times,
they result from competing needs and interests brought forth by different stakeholders. For example,
bicycle designs, the configuration of typewriter keys, and the design and uses of cellular phones have
changed as different users have adapted these technologies to their special requirements.
* These changes also exhibit what sociologists call a "trajectory", that is, a path of development. Tra-
jectories themselves are subject to normative analysis. For example, some STSs and the technologies
integrated into them display a line of development where the STS and the integrated technology are
changed and redesigned to support certain social interests. The informating capacities of computing
systems, for example, provide information which can be used to improve a manufacturing processes
can or to monitor workers for enhancing management power. (See Shoshanna Zuboff, The Age of
the Smart Machine
* Trajectories, thus, outline the development of STSs and technologies as these are influenced by internal
and external social forces.
In this section, you will learn about this module's exercises. The required links above provide information on
the frameworks used in each section. For example, the Socio-Technical System module provides background
information on socio-technical analysis. The "Three Frameworks" module provides a further description of
the ethics tests, their pitfalls, and the feasibility test. These exercises will provide step by step instructions
on how to work through the decision points presented above.
For more information see Huff and Jawer below.
Decision Point One:
You are David Lord, a former employee of Holt Educational Outlet, a manufacturer of educational toys
located in Waltham, Mass. Recently, you have joined with Stan Fung of Zero Stage Capital, a venture
capital firm to buy out Holt Educational Outline. After changing its name to Toysmart, you and Fung
plan to transform this brick and mortar manufacturer of educational toys into an online firm that will link
customers to a vast catalogue of educational, high quality toys. Designing a website to draw in toy customers,
linking to information on available toys, setting up a toy distribution and shipping system, and implementing
features that allow for safe and secure online toy purchases will require considerable financing. But, riding
the crest of the dot-com boom, you have two promising options. First, a venture capital firm has offered
you $20,000,000 for website development, publicity, and other services. Second, Disney has offered the same
amount for financing, but has added to it an additional $25,000,000 in advertising support. Disney has a
formidable reputation in this market, a reputation which you can use to trampoline Toysmart into prominence
in the growing market in educational toys. However, Disney also has a reputation of micro-managing its
partners. Develop a plan for financing your new dot-coin.
Things to consider in your decision-making:
1. What are Toysmart values? What are Disney values? Would Disney respect Toysmart's values?
2. What synergies could result from working with Disney? For example, could you share information on
customers? You could feed your customer profiles to Disney in exchange for their customer profiles.
165
What kind of data managing technology would be required for this? What ethical problems could arise
from transferring customer identifying information to third parties?
3. What kind of commitment would you be willing to make to Disney in terms of product and sales? How
should Disney reciprocate? For example, how long should they stick with you through sales that fall
short of projections?
Decision Point Two:
You work for Blackstone, "an 18-person software business." You have been asked by Toysmart to provide
software the following functions: (1) designing a webpage that would attract customers and communicate
Toysmart Values, (2) advise Toysmart on its privacy and data security policy including whether to register
with an online trust, security measures to protect customer data during online transactions, and measures
to prevent unauthorized access to customer data while stored, and (3) a comprehensive online catalogue
that would provide customers with access to educational toys from a variety of small busines manufacturers.
An example of small toy manufacturers to which Toysmart should be linked is Brio Corporation which
manufactures wooden toys such as blocks, trains, and trucks. Develop general recommendations for Toysmart
around these three areas.
Information for this scenario comes from Laura Lorek, "When Toysmart Broke,"
http://www.zdnet.com/eweek/stories/general/0,1101,2612962,00.html. Accessed July 16, 2001.
Things to consider in your decision-making
" Toysmart is a fairly new dot-com. While it is supported by Disney, it is still a risky venture. Should
you ask them for advance payment for whatever services you render? What kind of policies does your
company have for identifying and assessing financial risk?
" What kind of privacy and data security policy should you recommend to Toysmart? What kind of
values come into conflict when a company like Toysmart develops and implements privacy and data
security measures? (Use your STS description to answer this question.)
" Should Toysmart become bankrupt, their data base would turn into a valuable asset. What recom-
mendations should you make to help Toysmart plan around this possibility? What values come into
conflict when planning to dispose of assets during bankruptcy proceedings? What kind of obligations
does a company take on during its operation that continue even after it has become bankrupt?
" Using the link provided with this module, visit the TRUSTe website and find its white paper on
developing a privacy policy. Evaluate this privacy policy for Toysmart. What benefits can a strong
privacy policy bring to a dot-com? Should Toysmart work to qualify to display the TRUSTe seal on
its website? Examine TRUSTe procedures for transferring confidential customer PII to third parties?
What obligations will this create? Would this over-constrain Toysmart?
Decision Point Three:
You work for PAN Communications and have been providing advertising services for Toysmart. Now you
find out that Toysmart has filed a Chapter 11 bankruptcy, and it has an outstanding debt to your company
for $171,390. As a part of this filing procedure, Toysmart has reported its assets at $10,500,000 with
debts of $29,000,000. Toysmart creditors, including PAN Communications, have petitioned the Office of the
United States Trustee for a "Creditors' Committee Solicitation Form." This will allow for the formation of
a committee composed of Toysmart creditors who decide on how the assets of the bankrupt firm will be
distributed. You, because of your knowledge of bankruptcy and accounting procedures, have been asked
to represent your company on this committee. This bleak situation is somewhat remedied by the customer
data base that Toysmart compiled during its operation. It contains profiles of the PII (personal identifying
information) of 260,000 individuals. Because selling educational toys is profitable, there is a good chance
that this data base could be sold for up to $500 a profile to a third party. Should you recommend selling
this data base? Should Toysmart customers be notified of the pending transfer of their PII and, if so, how
should they be notified?
Here are some constraints that outline your decision
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
" As a member of the Creditors' Committee, you have a fiduciary duty to Toysmart creditors in work-
ing to distribute fairly the remaining Toysmart assets. This would, all things being equal, lead to
recommending selling the Toysmart customer data base
" There are some provisions in the bankruptcy code that may require or allow overriding fiduciary duties
given prior legal commitments made by Toysmart. These commitments, in the form of strong privacy
guarantees made to customers by Toysmart on its webpage, may constitute an "executory contract."
See the Legal Trail table in the Toysmart case narrative and also Larren M. Nashelsky, "On-Line
Privacy Collides With Bankruptcy Creditors," New York Law Journal, New York Law Publishing
Company, August 28, 2000.
" Finally, Nashelsky makes an interesting argument. While deontological considerations would require
setting aside creditor interests and honoring Toysmart privacy promises, a justice-based argument
would recommend a compromise. Bankruptcy proceedings start from the fact that harm (financial)
has been done. Consequently, the important justice consideration is to distribute fairly the harms
involved among the harmed parties. Harm distributions are correlated with benefit distributions.
Because Toysmart customers benefited from Toysmart offerings, they should also bear a share of the
harms produced when the company goes bankrupt. This requires that they allow the distribution of
their PII under certain conditions.
Things to consider in your decision-making
" How do you balance your obligations to PAN with those to other Toysmart creditors as a member of
the Creditors' Committee?
" How should you approach the conflict between honoring Toysmart promises and carrying out Creditor
Committee fiduciary duties? Do you agree with Nashelsky's argument characterized above?
" Should the Bankruptcy Code be changed to reflect issues such as these? Should privacy promises
be considered an "executory contract" that overrides the duty to fairly and exhaustively distribute a
company's assets?
" Finally, what do you think about the FTC's recommendation? The Bankruptcy Court's response?
The final accommodation between Toysmart and Buena Vista Toy Company?
5.4.3 What you will do ...
In this section, you will learn about this module's exercises. The required links above provide information on
the frameworks used in each section. For example, the Socio-Technical System module provides background
information on socio-technical analysis. The "Three Frameworks" module provides a further description of
the ethics tests, their pitfalls, and the feasibility test. These exercises will provide step by step instructions
on how to work through the decision points presented above.
5.4.4 Exercise One: Problem Specification
In this exercise, you will specify the problem using socio-technical analysis. The STS section of the Toysmart
Case narrative (found at Computing Cases) provides a good starting point. In the first table, enter the
information from the Toysmart case materials pertinent to the general components of a STS, its hardware,
software, physical surroundings, people/groups/roles, procedures, laws, data. Some examples taken from
the STS description at Computing Cases are provided to get you started. Then, using the second table,
identify the values that are embedded in the different components of the STS. For example, PICS (platforms
for internet content selection) embody the values of security and privacy. Finally, using the data from your
socio-technical analysis, formulate a concise problem statement.
Exercise la:
Read the socio-technical system analysis of the Toysmart case at http://computingcases.org. Fill in the
table below with elements from this analysis that pertain to your decision point.
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Socio-Technical System Table
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Hardware Software Physical People/GroupspRohedures Laws, Data and
Surround- Codes, Data Struc-
ings Regulations tures
Holt Educa- Platforms Cyber Space Toysmart Buying Toys COPPA Toysmart
tion Outlet for Internet the corpora- Online Customer
Content tion Data Base
Selection
Table 5.18
Instructions for Table 1:
1. Go to http://computingcases.org and review the STS description provided for the Toysmart case.
2. Pull out the elements of the STS description that are relevant to your decision point. List them under
the appropriate STS component in the above table.
3. Think about possible ways in which these components of the Toysmart STS interact. For example,
what kinds of legal restrictions govern the way data is collected, stored, and disseminated?
4. Develop your STS table with an eye to documenting possible ethical conflicts that can arise and are
relevant to your decision point.
Exercise lb
Examine the values embedded in the STS surrounding this decision point. Locate your values under the
appropriate component in the Toysmart STS. For example, according to the STS description for Toysmart
found at Computing Cases, the software programs prominent in this case embody certain values; SSLs
embody security and privacy, P3P property, and PICS privacy. Next, look for areas where key values can
come into conflict.
Value Table
Hardware Software Physical People/Groupsplohedures Laws/Codes/4ailaiData
Surround- Structures
ings
Security
Privacy
Property
Justice (Eq-
uity/Access)
Free Speecy
Table 5.19
Instructions for Table 2:
1. This module links to another Connexions module, Socio-Technical Systems in Professional Decision-
Making. There you will find short profiles of the values listed in the above table: security, privacy,
property, justice, and free speech. These profiles will help you to characterize the values listed in the
above table.
2. The second ethical reflection in the Toysmart case narrative (at Computing Cases) also contains a
discussion of how property comes into conflict with privacy.
3. Identify those components of the Toysmart STS that embody or embed value. For example, list the
values realized and frustrated by the software components discussed in the Toysmart case in the STS
description.
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4. Look for ways in which different elements of the STS that embed value can interact and produce
value conflicts. These conflicts are likely sources for problems that you should discuss in your problem
statement and address in your solution.
Exercise 1c:
Write out the requirements (ethical and practical) for a good solution. Identify the parts of the STS that
need changing. Then, develop a concise summary statement of the central problem your decision point
raises. As you design solutions to this problem, you may want to revise this problem statement. Be sure to
experiment with different ways of framing this problem.
Harris, Pritchard, and Rabins provide a useful approach to problem specification. See refer-
ences below.
5.4.5 Exercise Two: Solution Generation
Generate solutions to the problem(s) you have specified in Exercise 1. This requires that...
* each member of your group develop a list of solutions,
* the group combines these individual lists into a group list, and...
* the group reduces this preliminary list to a manageable number of refined and clarified solutions for
testing in the next stage.
Helpful Hints for Solution Generation
1. Solution generation requires proficiency in the skills of moral imagination and moral cre-
ativity.
Moral imagination is the ability to open up avenues of solution by framing a problem in different ways.
Toysmart could be framed as a technical problem requiring problem-solving skills that integrate ethical
considerations into innovative designs. Moral creativity is the ability to formulate non-obvious solutions
that integrate ethical considerations over various situational constraints.
2. Problems can be formulated as interest conflicts. In this case different solution options are
available.
* Gather Information. Many disagreements can be resolved by gathering more information. Because
this is the easiest and least painful way of reaching consensus, it is almost always best to start here.
Gathering information may not be possible because of different constraints: there may not be enough
time, the facts may be too expensive to gather, or the information required goes beyond scientific or
technical knowledge. Sometimes gathering more information does not solve the problem but allows for
a new, more fruitful formulation of the problem. Harris, Pritchard, and Rabins in Engineering Ethics:
Concepts and Cases show how solving a factual disagreement allows a more profound conceptual
disagreement to emerge.
* Nolo Contendere. Nolo Contendere is latin for not opposing or contending. Your interests may
conflict with your supervisor but he or she may be too powerful to reason with or oppose. So your only
choice here is to give in to his or her interests. The problem with nolo contendere is that non-opposition
is often taken as agreement. You may need to document (e.g., through memos) that you disagree with
a course of action and that your choosing not to oppose does not indicate agreement.
* Negotiate. Good communication and diplomatic skills may make it possible to negotiate a solution
that respects the different interests. Value integrative solutions are designed to integrate conflicting
values. Compromises allow for partial realization of the conflicting interests. (See the module, The
Ethics of Team Work, for compromise strategies such as logrolling or bridging.) Sometimes it may
be necessary to set aside one's interests for the present with the understanding that these will be taken
care of at a later time. This requires trust.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
" Oppose. If nolo contendere and negotiation are not possible, then opposition may be necessary.
Opposition requires marshalling evidence to document one's position persuasively and impartially. It
makes use of strategies such as leading an "organizational charge" or "blowing the whistle." For more
on whistle-blowing consult the discussion of whistle blowing in the Hughes case that can be found at
computing cases.
" Exit. Opposition may not be possible if one lacks organizational power or documented evidence. Nolo
contendere will not suffice if non-opposition implicates one in wrongdoing. Negotiation will not succeed
without a necessary basis of trust or a serious value integrative solution. As a last resort, one may
have to exit from the situation by asking for reassignment or resigning.
3. Solutions can be generated by readjusting different components of the STS.
" Technical Puzzle. If the problem is framed as a technical puzzle, then solutions would revolve around
developing designs that optimize both ethical and technical specifications, that is, resolve the technical
issues and realize ethical value. In this instance, the problem-solver must concentrate on the hardware
and software components of the STS.
" Social Problem. If the problem is framed as a social problem, then solutions would revolve around
changing laws or bringing about systemic reform through political action. This would lead one to focus
on the people/groups/roles component (working to social practices) or the legal component.
" Stakeholder Conflict. If the problem is framed as a conflict between different stakeholder interests,
then the solution would concentrate on getting stakeholders (both individuals and groups) to agree on
integrative or interest compromising solutions. This requires concentrating on the people/group/role
component of the STS. (Note: A stakeholder is any group or individual with a vital interest at play in
the situation.)
" Management Problem. Finally, if the problem is framed as a management problem, then the
solution would revolve around changing an organization's procedures. Along these lines, it would
address the (1) fundamental goals, (2) decision recognition procedures, (3) organizational roles, or (4)
decision-making hierarchy of the organization. These are the four components of the CID (corporate
internal decision) structure described in the "Ethical Reflections" section of the Toysmart case.
" Nota Bene: Financial issues are covered by the feasibility test in the solution implementation stage.
As such, they pose side issues or constraints that do not enter into the solution generation phase but
the solution implementation phase.
4. Brainstorming. Moral creativity, which involves designing non-obvious solutions, forms an
essential part of solution generation. Here are some guidelines to get you started.
" Individually make out a list of solutions before the group meeting. Work quickly to realize a pre-
established quota of five to ten solutions. After composing a quick first draft, revise the list for clarity
only; make no substantial changes.
" Start the group brainstorming process by having the group review and assemble all the individual
solutions. Do this quickly and without criticism. Beginning criticism at this stage will kill the creativity
necessary for brainstorming and shut down the more timid (but creative) members of the group.
" Review the list and identify solutions that are identical or overlap. Begin the refining process by
combining these solutions.
" Having reviewed all the brainstormed solutions, it is now time to bring in criticism. Begin by eliminating
solutions with major ethical problems such as those that violate rights, produce injustices, or cause
extensive harm.
* Identify but do not eliminate solutions that are ethical but raise serious practical problems. Do not
initially eliminate an ethical solution because there are obstacles standing in the way of its imple-
mentation. Be descriptive. Identify and impartially describe the obstacles. Later, in the solution
implementation stage, you may be able to design creative responses to these obstacles.
* Identify solutions that do not "fit" your problem statement. These require a decision. You can throw
out the solution because it does not solve the problem or you can change the problem. If a solution
171
does not fit the problem but, intuitively, seems good, this is a sign that you need to take another look
at your problem statement.
* Don't automatically reject partial solutions. For example, sending memos through email rather than
printing them out and wasting paper may not solve the entire recycling problem for your company.
But it represents a good, partial solution that can be combined with other partial solutions to address
the bigger problem.
* Through these different measures, you will gradually integrate criticism into your brainstorming pro-
cess. This will facilitate working toward a manageable, refined list of solutions for testing in the next
stage.
Exercise 3: Develop a Solution List
* Have each member of your team prepare a solution list and bring it to the next group meeting. Set a
quota for this individual list, say, 5 to 10 solutions.
* Prepare a group list out of the lists of the individual members. Work to combine similar solutions. Be
sure to set aside criticism until the preliminary group list is complete.
* Make use of the following table.
* Refine the group list into a manageable number of solutions for testing in the next stage. Combine
overlapping solutions. Eliminate solutions that do not respond to the requirements and the problem
statement that you prepared in the previous exercise. Eliminate solutions that violate important ethical
considerations, i.e., solutions that violate rights, produce harms, etc.
* Check your refined solution list with your problem statement. If they do not match, eliminate the
solution or redefine the problem
Refined Brainstorm List
Solution Ranking Description of Solution Justification (fits requirements, fits problem)
Best Solution
Second Best Solution
Third Best Solution
Fourth Best Solution
Fifth Best Solution
Table 5.20
Anthony Weston provides an illuminating and useful discussion of creative problem solving in
the reference provided below.
5.4.6 Exercise Three: Solution Testing
In this section, you will test the solutions on the refined list your group produced in the previous exercise.
Three ethics tests, described below, will help you to integrate ethical considerations in the problem-solving
process. A global feasibility test will help to identify solutions with serious practical problems. Finally, a
Solution Evaluation Matrix summarizes the results for class debriefings.
Setting up for the test.
* Identify the agent perspective from which the decision will be made
* Describe the action as concisely and clearly as possible.
* Identify the stakeholders surrounding the decision, i.e., those who will suffer strong impacts (positively
or negatively) from the implementation of your decision. Stakeholders have a vital or essential interest
(right, good, money, etc) in play with this decision.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
" In the harm/beneficence test, identify the likely results of the action and sort these into harms and
benefits.
" For the reversibility test, identify the stakeholders with whom you will reverse positions.
" For the public identification test, identify the values, virtues, or vices your action embodies. Associate
these with the character of the agent.
Harm/Beneficence Test
1. What are the harms your solution is likely to produce? What are its benefits? Does this
solution produce the least harms and the most benefits when compared to the available
alternatives?
2. Pitfall-Too much. In this "Paralysis of Analysis" one factor in too many consequences. To avoid
the fallacy restrict the analysis to the most likely consequences with the greatest magnitude (Magnitude
indicates the range and severity of impact).
3. Pitfall-Too Little. A biased or incomplete analysis results when significant impacts are overlooked.
Take time to uncover all the significant impacts, both in terms of likelihood and in terms of magnitude.
4. Pitfall-Distribution of Impacts. Consider, not only the overall balance of harms and benefits
but also how harms and benefits are distributed among the stakeholders. If they are equally or fairly
distributed, then this counts in the solution's favor. If they are unequally or unfairly distributed,
then this counts against the solution. Be ready to redesign the solution to distribute better (=more
equitably or fairly) the harmful and beneficial results.
Reversibility Test
1. Would this solution alternative be acceptable to those who stand to be most affected by
it? To answer this question, change places with those who are targeted by the action and
ask if from this new perspective whether the action is still acceptable?
2. Pitfall-Too much. When reversing with Hitler, a moral action appears immoral and an immoral
action appears moral. The problem here is that the agent who projects into the immoral standpoint
loses his or her moral bearings. The reversibility test requires viewing the action from the standpoint
of its different targets. But understanding the action from different stakeholder views does not require
that one abandon himself or herself to these views.
3. Pitfall-Too little. In this pitfall, moral imagination falls short, and the agent fails to view the
action from another stakeholder standpoint. The key in the reversibility test is to find the middle
ground between too much immersion in the viewpoint of another and too little.
4. Pitfall-Reducing Reversibility to Harm/Beneficence. The reversibility test requires that one
assess the impacts of the action under consideration on others. But it is more than a simple listing of
the consequences of the action. These are viewed from the standpoint of different stakeholders. The
reversibility test also goes beyond considering impacts to considering whether the action treats different
stakeholders respectfully. This especially holds when the agent disagrees with a stakeholder. In these
disagreements, it is important to work out what it means to disagree with another respectfully.
5. Pitfall-Incomplete survey of stakeholders. Leaving out significant stakeholder perspectives
skews the results of the reversibility test. Building an excellent death chamber works when one considers
the action from the standpoint of Hitler; after all, it's what he wants. But treating an individual with
respect does not require capitulating to his or her desires, especially when these are immoral. And
considering the action from the standpoint of other stakeholders (say the possible victims of newer,
more efficient gas chambers) brings out new and radically different information.
6. Pitfall-Not Weighing and Balancing Stakeholder Positions. This pitfall is continuous with the
previous one. Different stakeholders have different interests and view events from unique perspectives.
The reversibility test requires reviewing these interests and perspectives, weighing them against one
another, and balancing out their differences and conflicts in an overall, global assessment.
Publicity (or Public Identification) Test
173
1. Would you want to be publicly associated or identified with this action? In other words,
assume that you will be judged as a person by others in terms of the moral values
expressed in the action under consideration. Does this accord with how you would want
to or aspire to be judged?
2. Pitfall-Failure to association action with character of agent. In the publicity test, the
spotlight of analysis moves from the action to the agent. Successfully carrying out this test requires
identifying the agent, describing the action, and associating the agent with the action. The moral
qualities exhibited in the action are seen as expressing the moral character of the agent. The publicity
test, thus, rests on the idea that an agent's responsible actions arise from and express his or her
character.
3. Pitfall-Failure to appreciate the moral color of the action. The publicity test assumes that
actions are colored by the ends or goods they pursue. This means that actions are morally colored. They
can express responsibility or irresponsibility, courage or cowardice, reasonableness or unreasonableness,
honesty or dishonesty, integrity or corrpution, loyalty or betrayal, and so forth. An analysis can go
astray by failing to bring out the moral quality (or qualities) that an action expresses.
4. Pitfall-Reducing Publicity to Harm/Beneficence Test. Instead of asking what the action says
about the agent, many reduce this test to considering the consequences of publicizing the action. So
one might argue that an action is wrong because it damages the reputation of the agent or some other
stakeholder. But this doesn't go deep enough. The publicity test requires, not that one calculate the
consequences of wide-spread knowledge of the action under consideration, but that one draws from the
action the information it reveals about the character of the agent. The consequences of bad publicity
are covered by the harm/beneficence test and do not need to be repeated in the public identification
test. The publicity test provides new information by turning from the action to the agent. It focuses
on what the action (its moral qualities and the goods it seeks) says about the agent.
Comparing the Test Results: Meta-Tests
1. The ethics tests will not always converge on the same solution because each test (and the ethical
theories it encapsulates) covers a different dimension of the action: (1) harm/beneficence looks at the
outcomes or consequences of the action, (2) reversibility focuses on the formal characteristics of the
action, and (3) publicity zeros in on the moral character of the agent.
2. The meta-tests turn this surface disagreement into an advantage. The convergence or divergence
between the ethics tests become indicators of solution strength and weakness.
3. Convergence. When the ethics tests converge on a given solution, this indicates solution strength
and robustness.
4. Divergence. When tests diverge on a solution-a solution does well under one test but poorly under
another-this signifies that it needs further development and revision. Test divergence is not a sign
that one test is relevant while the others are not. Divergence indicates solution weakness and is a call
to modify the solution to make it stronger.
Exercise 3: Summarize your results in a Solution Evaluation Matrix
1. Place test results in the appropriate cell.
2. Add a verbal explanation to the SEM table.
3. Conclude with a global feasibility test that asks, simply, whether or not there exist significant obstacles
to the implementation of the solution in the real world.
4. Finish by looking at how the tests converge on a given solution. Convergence indicates solution strength;
divergence signals solution weakness.
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Solution Evaluation Matrix
Solution/Test Harm/Beneficence Reversibility Publicity (public identification) Feasibility
First Solution
Second Solution
Third Solution
Fourth Solution
Fifth Solution
Table 5.21
The ethics tests are discussed in Cruz and Davis. See references below. Wike and Brincat
also discuss value based approaches in the two references below.
5.4.7 Exercise Four: Solution Implementation
In this section, you will trouble-shoot the solution implementation process by uncovering and defusing
potential obstacles. These can be identified by looking at the constraints that border the action. Although
constraints specify limits to what can be realized in a given situation, they are more flexible than generally
thought. Promptly identifying these constraints allows for proactive planning that can push back obstacles
to solution implementation and allow for realization of at least some of the value embodied in the solution.
A Feasibility Test focuses on these situational constraints and poses useful questions early on in the
implementation process. What conditions could arise that would hinder the implementation of a solution?
Should the solution be modified to ease implementation under these constraints? Can the constraints be
removed or modified through activities such as negotiation, compromise, or education? Can solution imple-
mentation be facilitated by modifying both the solution and the constraints?
Feasibility Constraints
Category Sub-Category
Resource Money/Cost Time/Deadlines Materials
Interest Organizational(Supervisor)Legal (laws, regula- Political/Social
tions)
Technical Technology does not ex- Technology patented Technology needs modi-
ist fication
Table 5.22
Resource Constraints:
" Does the situation pose limits on resources that could limit the realization of the solution
under consideration?
" Time. Is there a deadline within which the solution has to be enacted? Is this deadline fixed or
negotiable?
" Financial. Are there cost constraints on implementing the ethical solution? Can these be extended
by raising more funds? Can they be extended by cutting existing costs? Can agents negotiate for more
money for implementation?
175
* Resource. Are necessary resources available? Is it necessary to plan ahead to identify and procure
resources? If key resources are not available, is it possible to substitute other, more available resources?
Would any significant moral or non-moral value be lost in this substitution?
Interest Constraints
" Does the solution threaten stakeholder interests? Could it be perceived as so threatening
to a stakeholder's interests that the stakeholder would oppose its implementation?
" Individual Interests. Does the solution threaten the interests of supervisors? Would they take
measures to block its realization? For example, a supervisor might perceive the solution as undermining
his or her authority. Or, conflicting sub-group interests could generate opposition to the implementation
of the solution even though it would promote broader organizational objectives.
" Organizational Interests. Does the solution go against an organization's SOPs (standard operating
procedures), formal objectives, or informal objectives? Could acting on this solution disrupt organi-
zation power structures? (Perhaps it is necessary to enlist the support of an individual higher up in
the organizational hierarchy in order to realize a solution that threatens a supervisor or a powerful
sub-group.)
" Legal Interests. Are there laws, statutes, regulations, or common law traditions that oppose the
implementation of the solution? Is it necessary to write an impact statement, develop a legal compliance
plan, or receive regulatory approval in order to implement the solution?
" Political/Social/Historical Constraints. Would the solution threaten or appear to threaten the
status of a political party? Could it generate social opposition by threatening or appearing to threaten
the interests of a public action group such as an environmental group? Are there historical traditions
that conflict with the values embedded in the solution?
Technical Constraints
" Technology does not yet exist. Would the implementation of the solution require breaking new
technological ground?
" Technology Protected by Patent. The technology exists but is inaccessible because it is still under
a patent held by a competitor.
" Technology Requires Modification. The technology required to implement solution exists but
needs to be modified to fit the context of the solution. Important considerations to factor in would be
the extent of the modification, its cost, and how long it would take to bring about the modification.
5.4.8 What did you learn?
This section provides closure to the module for students. It may consist of a formal conclusion that sum-
marizes the module and outlines its learning objectives. It could provide questions to help students debrief
and reflect on what they have learned. Assessment forms (e.g., the "Muddiest Point" Form) could be used
to evaluate the quality of the learning experience. In short, this section specifies the strategy for bringing
the module to a close.
In this module, you have...
* studied a real world case that raised serious problems with intellectual property, privacy, security, and
free speech. Working with these problems has helped you to develop a better "working" understanding
of these key concepts,
* studied and practiced using four decision-making frameworks: (1) using socio-technical analysis to
specify the problem in a complex, real world case, (2) practiced brainstorming techniques to develop
and refine solutions that respond to your problem, (3) employed three ethics tests to integrate ethical
considerations into your solutions and to test these solutions in terms of their ethics, and (4) applied
a feasibility analysis to your solutions to identify and trouble-shoot obstacles to the implementation of
your ethical solution,
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
" explored the analogy between solving ethical and design problems,
" practiced the skills of moral imagination, moral creativity, reasonableness, and perseverance, and...
" experienced, through key participant perspectives, the challenges of ethics advocacy "under the gun."
Debrief on your group work before the rest of the class
1. Provide a concise statement and justification of the problem your group specified
2. Present the refined solution generation list your group developed in exercise 2.
3. Present and provide a quick summary explanation of the results of your group's solution evaluation
matrix.
4. Show your group's feasibility matrix and summarize your assessment of the feasibility of implementing
the solution alternatives you tested in exercise three.
Group Debriefing
1. Were there any problem you group had working together to carry out this case analysis? What were
the problems and how did you go about solving them?
2. What problems did you have with understanding and practicing the four frameworks for solving prob-
lems? How did you go about solving these problems? Does your group have any outstanding questions
or doubts?
3. Now that you have heard the other groups present their results, what differences emerged between
your group's analysis and those of the other groups? Have you modified your analysis in light of the
analyses of the other groups? If so how? Do the other groups need to take into account any aspects of
your group's debriefing?
5.4.9 Appendix
This optional section contains additional or supplementary information related to this module. It could
include: assessment, background such as supporting ethical theories and frameworks, technical information,
discipline specific information, and references or links.
References
1. Brincat, Cynthia A. and Wike, Victoria S. (2000) Morality and the Professional Life: Values at Work.
Upper Saddle River, NJ: Prentice Hall.
2. Cruz, J. A., Frey, W. J. (2003) An Effective Strategy for Integration Ethics Across the Curriculum in
Engineering: An ABET 2000 Challenge, Science and Engineering Ethics, 9(4): 543-568.
3. Davis, M., Ethics and the University, Routledge, London and New York, 1999: 166-167.
4. Richard T. De George, "Ethical Responsibilities of Engineers in Large Organizations: The Pinto Case,"
in Ethical Issues in Engineering, ed. Deborah G. Johnson (1991) New Jersey: Prentice-Hall: 175-186.
5. Charles Harris, Michael Pritchard and Michael Rabins (2005) Engineering Ethics: Concepts and
Cases, 3rd Ed. Belmont, CA: Thomson/Wadsworth: 203-206.
6. Huff, Chuck and Jawer, Bruce, "Toward a Design Ethics for Computing Professionals in Social Issues
in Computing: Putting Computing in its Place, Huff, Chuck and Finholt, Thomas Eds. (1994)
New York: McGraw-Hill, Inc.
7. Solomon, Robert C. (1999) A Better Way to Think About Business: How Personal Intgrity
Leads to Corporate Success. Oxford, UK: Oxford University Press.
8. Anthony Weston. (2001) A Practical Companion to Ethics, 2nd ed. USA: Oxford University
Press, 2001, Chapter 3.
9. Carolyn Whitbeck (1998) Ethics in Engineering Practice and Research. U.K. Cambridge Uni-
versity Press: 55-72 and 176-181.
10. Wike, Victoria 5. (2001) "Professional Engineering Ethics Bahavior: A Values-based Approach," Pro-
ceedings of the 2001 American Society for Engineering Education Annual Conference and
Exposition, Session 2461.
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5.4.10 EAC ToolKit Project
5.4.10.1 This module is a WORK-IN-PROGRESS; the author(s) may update the content as
needed. Others are welcome to use this module or create a new derived module. You can
COLLABORATE to improve this module by providing suggestions and/or feedback on your
experiences with this module.
Please see the Creative Commons License9 regarding permission to reuse this material.
5.4.10.2 Funded by the National Science Foundation: "Collaborative Development of Ethics
Across the Curriculum Resources and Sharing of Best Practices," NSF-SES-0551779
5.5 Ethics and Laptops: Identifying Social Responsibility Issues in
Puerto Rico1
Module Introduction
While social responsibility has been recognized as one of the key areas of business ethics, much more needs
to be done to develop frameworks and tools to clarify the concept itself and to implement it in business and
professional practice on a day-to-day basis. This module will give students the opportunity to practice using
frameworks and techniques that address these two needs.
Developing socio-technical system analyses provides an effective means to highlight issues of social re-
sponsibility. Since socio-technical systems embody values, building their descriptions allows us to read off
potential problems due to harmful impacts and value conflicts. To facilitate this, you will be building socio-
technical system descriptions using a grid or matrix that provides the components of socio-technical systems,
levels under which they can be analyzed, and the values that they tend to embody. Building socio-technical
system descriptions also requires using methods of participatory observation. These include constructing sur-
veys and questionnaires, developing interviews, and building day-in-the-life scenarios. This module will help
you frame and respond to social responsibility issues by providing a framework for socio-technical analysis
and a set of methodological tools taken from participatory observation.
Module m14025 (Social-Technical Systems in Professional Decision Making) provides background infor-
mation on STSs, their construction and their uses. Links to this module and to the website, Computing
Cases, can be found in the upper left hand corner of this module. They provide useful background informa-
tion. This module makes use of a case, Texas Laptops, that was developed by Chuck Huff and C. Nathan
DeWall for NSF projects, DUE-9972280 and DUE-9980768.
Texas Laptop Case
1. In the late 1990's, the Texas State Board of Education proposed the ambitious plan of providing each of
the state's four million public school students with their own laptop computer. This plan was devised
to solve several problems confronting Texas public education.
2. Laptop computers could make educational resources more accessable to students who were faced with
special challenges like deafness or blindness. Computers offer software options (such as audio books)
that promise to reach more students than traditional printed textbooks.
3. Laptops also promised to solve the problem of obsolete textbooks. Texas purchased textbooks for their
students at considerable costs. The purchasing cycle ran six years. By the end of this cycle, textbooks
were out of date. For example, in the late 1990's when the laptop plan was proposed, history textbooks
still referred to the Soviet Union and to the existence of the Berlin Wall. Laptops, on the other hand,
would present textbook content in digital form which would eliminate printing and shipping costs and
facilitate updates through online downloads.
4. Texas business leaders were concerned about the computer literacy of the upcoming generation of
students. By employing laptops in more and more teaching activities, students would learn how to
9http: //creativecommons.org/licenses/by/2 .0/
ioThis content is available online at .
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
interact with computers while taking advantage of the new and more effective modes of presentation
offered.
1. However, adopting laptops also presented problems that critics quickly brought forth.
2. Teachers would need to learn how to use laptop computers and would have to change their teaching to
accomodate them in the classroom.
3. Apparent cost savings disappeared upon further, closer examination. For example, it became clear
that textbook publishers would not so easily give up the revenues they had come to depend upon that
came from textbook purchases for public school students. Updates from downloads could turn out to
be more expensive and eductional software could be coded to restrict access and dissemination.
4. Further studies indicated that technical support costs would run two to three times initial outlays.
Keeping laptop hardware and software up and running required technical support and continued in-
vestment.
5. Texas found that while some school districts-the richer ones-had already begun projects to integrate
computing technology, the poorer school districts would require considerable financial support.
To deal with these problems, Texas carried out several pilot projects that examined the effectiveness of
laptop integration in select school districts. While several successes were reported a series of problems arose
that led Texas Board of Educaton officials to postpone the laptop project. First, pilot projects depended on
donations from private computing vendors. While some were forthcoming, others failed to deliver hardware
on time and provided only minimal technical support. Second, teachers resisted laptop integration due to
the extensive investment of time required to appropriate computing skills and the difficulty of modifying
existing curricula and teaching styles to accomodate laptop hardware and software. Third, at that time the
available educational software, such as digitalized textbooks, was expensive, inadequately developed, and
narrowly focused on curricular areas such as writing and math practice. Teachers also began to develop more
comprehensive and philosophical criticisms of laptop use. Education specialist, Larry Cuban, argued that
while laptops provided good support for a vocational education, they failed to deliver on other educational
goals such as teaching children how to interact with their peers and teachers and teaching children the civic
virtues necessary to become active participants in a democratic form of government. Studies began to appear
that argued that skills developed through computer use came at the expense of other, more social skills.
The Texas Laptop plan was never formally implemented beyond the pilot project phase. However, several
computer integration projects have been carried out in other parts of the country. For example, Larry Cuban
reports on computer integration projects carried out in Silicon Valley in California. MIT has developed a
cheap laptop computer for use in developing nations. You can find a link to computer integration projects
that have been implemented in Philadelphia public schools through the support of the Microsoft Foundation.
Students in computer ethics classes at the University of Puerto Rico at Mayaguez have looked into the
feasibility of integrating laptops in the public school socio-technical system in Puerto Rico. They began by
looking at the project to provide public school teachers with laptops that was carried out in the late 1990's
under the Pedro Rossello administration. The student research projects came to focus on three problem
areas. First, they examined whether there were structures in laptop design that made computers unfit
for use by children. Second, they studied whether social or ethical problems would arise from disposal of
spent laptops. Third, they investigated the impact on copyright law and intellectual property practices that
digitalizing printed textbooks would have.
Exercise 1: Prepare a STS Grid
* Construct a socio-technical system (STS) grid for public schools in Puerto Rico
* Using the templates found at m14025 (Socio-Technical Systems in Professional Decision Making) iden-
tify the key constituents such as hardware, software, physical surroundings, etc.
* Select key levels for analysis. For example, you may want to look at the STS from the standpoint of
individuals (students and teachers), small groups (public school systems), and institutions (education
and business).
179
* Starting with a short list of values, identify the values embedded in the public school STS and, if
possible, the specific components in which these values are embedded. A good place to start is to see
how different physical arrangements of the classroom embody different approaches to education.
Values in STSs
Values that can be used for exercise 1 include Justice (equity and access), Property, Privacy, Free Speech,
Responsibility (Safety). More on these values can be found by clicking on the Computing Cases link provided
in this module. Several of these values are defined in the Ethics of Team Work module, m13769.
Exercise 2: Identifying Potential or Latent Problems in STSs
" Choose one of the following three problem areas to help focus your work: (1) value problems that may
arise when laptops with their current design are integrated in the PR STS; (2) value problems that
may arise by the digitalization of textbooks and other educational materials; (3) value problems and
potential harms that may arise during the disposal of spent laptops.
" Compare values embodied in current laptop design with those embodied in the Puerto Rican public
school STS. Are there any conflicts? What are these?
" Look more closely at the Puerto Rican public school STS. Are there any conflicts that will be high-
lighted, exaggerated, or increased by the integration of laptop computers.
" Finally, look for potential harms that could occur in the short, middle, and long term future.
Exercise 3: Develop Counter-Measures to Problems
" Generate 5 to 10 options to respond to the problems you have identified. Make sure that you include
the status quo among your options.
" Check each option against the problems you have identified. Does the option solve the problems
identified in your STS analysis? Does it integrate the conflicting values and avoid untoward results?
Does it give rise to new problems?
" Prepare a short presentation for the class (5 to 10 minutes) where you outline your problem, set forth
the range of solutions you have identified, and describe and justify your solution. Be sure to address
issues that may arise when you turn to implementing your solution.
" Provide a one or two sentence argument that your solution is best for delivering on social responsibility.
Exercise 4: Evaluate the Microsoft Philadelphia Public Schools Project
" Listen to/read the news report on the Microsoft Foundation's project to integrate computing technology
in Philadelphia. (You can find it by clicking on the link in this module.)
" Is this an example of a corporation carrying out its social responsibility to the surrounding community?.
" Evaluate Microsoft generally in terms of its social responsibility.
5.6 Case Analysis and Presentation: Machado"
Computer Ethics
Case Module Template: Machado Case
By William J. Frey
Module Abstract:
This module, designed for the EAC Toolkit (NSF SES 0551779), will test the Toolkit and Connexion's
ability to network different online and offline sources for ethics across the curriculum. It consists of four com-
ponents designed to provide tools for an in-depth analysis of the cases found at www.computingcases.org"2
;it also makes substantial references to the draft manuscript of a textbook in computer ethics entitled
11hi content is available online at .
12http: //www.computingcases.org/
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CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Good Computing: A Virtue Approach to Computer Ethics under contract with Jones and Bartlett Pub-
lishing Company. (This book will consist of the cases displayed at Computing Cases-Therac-25, Machado,
and Hughes Aircraft-and 7 additional cases all developed through NSF projects DUE-9972280 and DUE
9980768.)
Module Introduction:
This module as displayed in Connexions presents the case abstract and timeline both taken from Com-
puting Cases. It then refers to the website where the following can be found by browsing:
" case narrative,
" case history,
" a teaching introduction which also provides a useful overview,
" an ethical analysis that can be accessed by clicking on the appropriate concept in the table displayed
(clicking on safety will open a short document that discusses the safety implications of the case)
" a Socio-Technical Analysis which spells out the different components of the cases socio-technical sys-
tem such as hardware, software, physical surroundings, people/groups/roles, procedures, laws, and
data/data structures.
" supporting documents such as three RFCs (Request for Comments) on the Unix finger command, a
profile of students at UCI, and an interview with Allen Schiano from the University of California at
Irvine's Office of Academic Computing.
These materials all posted at www.computingcases.org13 provide the background information necessary for
a detailed and exhaustive case analysis. (A suggestion: since you will be working in groups, divide these
readings among your group members and take advantage of class time to report to one another on the
contents of the links you have individually explored. Be sure to triangulate by assigning more than one
member to each link. This will help to identify and solve problems in interpretation.)
The case abstract and timeline in this module outline the case. The following decision point taken from
the Machado case will provide the focus for an in-depth case analysis. You will respond to the decision-point
by working through a four stage decision making procedure inspired by the standard Software Development
cycle:
" problem specification,
" solution generation,
" solution testing, and...
" solution implementation.
Module Activities:
1. Instructor introduces the case based on the abstract and timeline found at www.computingcases.org14
2. Students read case abstract, timeline, case decision point, and case analysis exercises.
3. Students do further research into the case by consulting ComputingCases materials which include
narratives, histories, supporting documents, and ethical analyses.
4. Students carry out the activities outlined in the accompanying case exercises by (a) specifying the
problem raised in the decision point, (b) generating solutions, (c) testing solutions using ethics tests, and
(d) developing plans for implementing the solution over situational constraints.
5. Students prepare their case analyses working in small groups.
6. These groups present their completed analysis to the class in a case-debriefing session.
7. The instructor concludes by discussing the problem-solving issues and intermediate moral concepts
raised by the case.
Machado Abstract:
In September of 1996, 19 year-old Richard Machado sent email to 59 Asian students at his public college,
threatening them with phrases like "I will personally make it my life's career to hunt you down and kill you"
13http: //www.computingcases.org/
14http: //www.computingcases.org/
181
and signed by "Asian Hater." Several of these individuals reported this incident to the Office of Academic
computing (OAC). One of the recipients was a student employee of the OAC. The administrators of the
OAC were faced with a decision about how to respond to harassing and threatening email sent over their
system to students of their University, using their facilities.
Machado Timeline
11/16/95 Machado sends email threat to New University pa-
per (UCI) via his roommate's computer.The email
is traced to the roommate's computer.Roommate
later said Machado had access to the computerMa-
chado identified as sender.
11/21/95 Warrant for arrest is filed against Machado, issued
by Irvine Police Department-the warrant is a "no
bail felony warrant."Machado consents to a prop-
erty search.Case given up shortly after-Machado's
roommate took the blame so he "wouldn't be both-
ered anymore."
(Between 1/1/96 and 9/20/96) Machado's older brother murdered in armed rob-
bery prior to following incident;Machado is doing
poorly in school, getting pressure from family to
uphold high expectations.
9/20/96(Friday, 10:54 am) Machado sends hate Asians/threat email to about
59 UCI studentsMachado sent message a second
time shortly after, when he did not receive replies to
the first email.Incident brought to the attention of
Assoc. Director of The Academic Computing Cen-
ter, by her employees.Machado identified in com-
puter lab and was asked to leave by Core Services
manager.
9/21/96 Director of OAC reads Machado's email and decides
that it is a police matter.
9/24/96(Monday) The incident is reported to University Police De-
partmentAn officer is assigned to the case.
9/26/96 Retrieval of surveillance video confirmed Machado
as the sender.Irving City Police notified and in-
volved in case.
continued on next page
182
CHAPTER 5. BUSINESS ETHICS CASE STUDIES
9/27/96 Registrar's office helps police locate Machado's ad-
dress and phone number.
9/28/96 An officer phones Machado's residence and leaves
messageMachado calls back and agrees to meet with
an officer that afternoon at 5pm.Two charges filed
after meeting: Machado (1) knowingly and without
permission uses computer services and (2) makes
telephone calls with intent to annoy.
11/14/96 A stolen vehicle report is filed for Machado's sec-
ond roommate's car.Machado had told one room-
mate he was borrowing his other roommate's
car.Machado did not have permission to borrow car.
11/18/96 FBI attempts investigation.An agent goes to
Machado's residence; Machado is not there and
hasn't been seen there since 11/13.Machado al-
legedly left with Young's keys on 11/14.Other sus-
picions: $80 missing from roommate's coin jar; $154
visa charges to roommate's card, $54 of which were
unauthorized; calls on 11/10, 11, and 12.
11/21/96 FBI agent phones Machado's roommate for confir-
mation of stolen car/info on Machado's disappear-
ance.
11/22/96 Roommate interviewed.
11/23/96 Tammy Machado (Machado's sister) interviewed
and said Machado had disappeared on the day
his brother called him to inquire about Machado's
name appearing in newspaper regarding Asian hate
mails.Machado denied the reports in the paper to
his brother; claimed it to be someone else.Tammy
is informed that court date is set for 11/25 and if
Richard doesn't show, they would issue a warrant
for his arrest.
continued on next page
183
2/6/97 Machado is arrested when attempting to enter US
from Mexico-caught by US Immigration Inspec-
tor.Machado is reported as looking homeless, hav-
ing no possessions, looking for construction work in
Mexico.
9/16/97 Machado is charged with 10 counts of interfering
with a federally protected activity-in this case,
students attending a university.Machado is told he
will face up to 10 years if convicted.
11/12/97 Trial takes place and on this date a re-
cess is granted when new information is un-
covered/presented. Questionnaires were revealed in
which 9 of the students who got the messages said
they were not overtly bothered by Machado's email.
11/18/97 Jury deadlocked 9 to 3 in favor of acquittal.Case
said to have national importance by federal prose-
cutors, so a second trial was set for 1/27/98.
2/13/98 Richard Machado is found guilty on 2 counts of
civil rights violations.Took only 3 weeks of trial
to reach verdict.Following conviction, Machado is
released on a $10,000 bond from custody but is
turned over to Irvine police on impending auto theft
charges.Sentencing is postponed until 4/10/98.Pos-
sible maximum time Machado could serve would be
1 yr.Machado has already spent 1 yr. in jail await-
ing trials, tec.Machado is recommended for anger
& racial tolerance counseling, not allowed on UCI
campus, and prohibited from having any contact
with victims.
continued on next page
184
CHAPTER 5. BUSINESS ETHICS CASE STUDIES
Table 5.23
Scenario #1:
You are a systems administrator at the Office of Academic Computing at the University of California at
Irvine and have been asked to modify the Unix system to prevent the reoccurrence of the Machado incident
Scenario #2:
You are a systems administrator at the Office of Academic Computing at the University of California at
Irvine and have been asked to develop an orientation program for students who will use university computing
laboratories and facilities. Special emphasis is put on preventing a reoccurrence of the Machado incident.
1. Identify key components of the STS
Part/Level Hardware Software Physical People, Procedures Laws & Data
of Analy- Surround- Groups, & Regula- & Data
sis ings Roles tions Structures
Table 5.24
2. Specify the problem:
2a. Is the problem a disagreement on facts? What are the facts? What are cost and time constraints on
uncovering and communicating these facts?
2b. Is the problem a disagreement on a critical concept? What is the concept? Can agreement be reached
by consulting legal or regulatory information on the concept? (For example, if the concept in question is
safety, can disputants consult engineering codes, legal precedents, or ethical literature that helps provide
consensus? Can disputants agree on positive and negative paradigm cases so the concept disagreement can
be resolved through line-drawing methods?
2c. Use the table to identify and locate value conflicts within the STS. Can the problem be specified
as a mismatch between a technology and the existing STS, a mismatch within the STS exacerbated by the
introduction of the technology, or by overlooked results?
STS/Value Safety (free- Justice (Equity Privacy Property Free Speech
dom from & Access)
harm)
Hardware/software
Physical Sur-
roundings
continued on next page
185
People,
Groups, &
Roles
Procedures
Laws
Data & Data
Structures
Table 5.25
3. Develop a general solution strategy and then brainstorm specific solutions:
il?Tnterest
Table 5.26
3a. Is problem one of integrating values, resolving disagreements, or responding to situational constraints?
3b. If the conflict comes from a value mismatch, then can it be solved by modifying one or more of the
components of the STS? Which one?
4. Test solutions:
Alternative Reversibility Value: Jus- Value: Re- Value: Re- Harm Code
Test tice sponsibility spect
A #1
A #2
A #3
Table 5.27
5. Implement solution over feasibility constraints
Alternative Resource Interest Technical
Con-
straint
Time Cost Individual Organization Legal/ So- Available Manufactur
cial Techno-
logy
continued on next page
ibility
186
CHAPTER 5. BUSINESS ETHICS CASE STUDIES
#1
#2
#3
Table 5.28
Machado Summary
This is an unsupported media type. To view, please see
http://cnx.org/content/m13818/latest/Machado_F06.ppt
Figure 5.4: PowerPoint File.
Chapter 6
Business Ethics Bowl
6.1 Practical and Professional Ethics Bowl Activity: Follow-Up In-
Depth Case Analysis'
6.1.1 Module Introduction
This module provides students with a structure for preparing an in-depth case study analysis based on
feedback they have received through their participation in an Ethics Bowl competition as part of the
requirements for courses in Practical and Professional Ethics taught at the University of Puerto Rico at
Mayaguez. Students viewing this module will find formats for analyzing decision making cases and position
cases such as the decisions published by the National Society of Professional Engineers Board of Ethical
Review. They will receive information pertinent to preparing in-depth case analyses, short summaries
of the case pool for the Ethics Bowl competition, and a summary of procedures for carrying out a group
self-evaluation. More information on the Engineering Ethics Bowl carried out at UPRM can be found in
Jose A Cruz-Cruz, William J. Frey, and Halley D. Sanchez, "The Ethics Bowl in Engineering Ethics at the
University of Puerto Rico - Mayaguez" in Teaching Ethics 4(3): 15-32.
6.1.2 Choosing Your Case
1. You must choose one of the two cases you presented on in the Ethics Bowl. (This means the case on
which you gave your initial presentation.
2. You may choose either the first round decision-making case or the NSPE Board of Ethical Review Case
How should you choose your case?
1. Which case did you find the most interesting, challenging, or fruitful?
2. On which case did you receive the most interesting feedback from the other team and the judges?
3. Do you want to make, defend, and implement a decision or analyze a BER decision?
Once you choose your case, you need to analyze it according to the following steps:
Decision-Making Cases
i~i content is available online at .
187
188
CHAPTER 6. BUSINESS ETHICS BOWL
Worksheets Decision-Making Case
Identify and state the (ethically) relevant facts
STS Table (Table + Verbal Explanation) Prepare a Socio-Technical Analysis. Fill in the STS
table (see below) and then verbally describe each
component.
Value Table (Table + Written Problem Statement) Fill out a Value Table (see below) Use it to identify
the ethical problem or problems. Summarize this
by providing a concise problem statement that is
explicitly tied to the Value Table.
Brainstorm Lists (initial and refined lists) 4. Brainstorm solution to the problem or problems.
Be sure to discuss how list was generated and how it
was refined. Describe value integration and interest
negotiating strategies used.
Solution Evaluation Matrix (Matrix + Verbal Ex- 5. Compare, evaluate, and rank the solutions
planation and Justification)
6. Choose the best available solution. Provide a jus-
tification summarizing ethical and feasibility con-
siderations highlighted in Solution Evaluation Ma-
trix.
Feasibility Matrix (Matrix + Verbal Explanation) 7. Develop a plan for implementing your solution.
Discuss and justify this plan explicitly in terms of
the specific feasibility considerations in the Feasi-
bility Matrix.
Develop and discuss preventive measures (if appli-
cable)
Table 6.1
NSPE-BER Case
Worksheets
1. Identify and state the (ethically) relevant facts
Stakeholders (Matrix + Verbal Explanation) 2. Identify the stakeholders and their stakes.
Problem Classification (Matrix + Concise Verbal 3. Identify the ethical problem or problems
Problem Statement)
4. State the BER decision and summarize their
code-based justification (cite code provisions, sum-
marize principles, and list relevant precedents)
continued on next page
189
Solution Evaluation (Matrix + detailed verbal ex- 5. Evaluate the BER decision using the three ethics
planation and justification) tests, code test, and global feasibility test.
6. Construct a strong counter-position and counter-
argument to the BER decision
Solution Evaluation (Matrix + detailed verbal ex- 7. Evaluate counter-position and counter-argument
planation and justification) using the 3 ethics tests, feasibility test, and code
test
Solution Implementation (Feasibility Matrix + Ver- 8. Evaluate counter-position and counter-argument
bal Explanation) in terms of relevant feasibility considerations. Pro-
vide a matrix/table + verbal explanation.
Table 6.2
6.1.3 In-Depth Analysis: Step by Step
Description of In-Depth Case Analysis
Title of Assignment: "In-Depth Case Analysis"
Due Date for Written Projects:One week after the last class of the semester.
What is required?
1. Participation in at two ethics bowl competitions.
2. Each group will choose from the two cases it debated in the Ethics Bowl a case for a more extended
analysis carrying out the seven-step decision making framework. They will prepare an extended analysis of
this case (10 to 20 pages).
3. Each group will prepare summaries of the 15 cases assigned for the ethics bowl. These summaries
(a minimum of one page for each case) will be handed in with the extended case study analysis. These
summaries should include a problem statement, a solution evaluation matrix, and a feasibility matrix.
4. Each final submission will also include a group self-evaluation. This evaluation will include:
" _ _ _ _ a list of the goals each group set for itself
" _ _ _ _ a careful, justified and documented assessment of your success in reaching these goals
" _ _ _ _ a careful assessment of what you did and did not learn in this activity
" _ _ _ _ a discussion of obstacles you encountered and measures your group took to overcome these.
" _ _ _ _ a discussion of member participation and contribution including the member contribution
forms
" _ _ _ _ _in general what worked and what didn't work for you and your group in this activity
5. A group portfolio consisting of the materials prepared by your group during the group class activities:
" _____Virtue Chart (Responsibility)
" _ _ _ _ _ Gray Matters Solution Evaluation Matrix
_ _ _ _ _ Rights Chart: Free & Informed Consent
" __-__ _Group Code of Ethics
Structure of Written Analysis
1. A brief summary of the case focusing on the ethically relevant facts.
2. A Socio-Technical System Table +Short paragraph on each of the seven categories.
3. A Value Table +a short paragraph on the embedded values you have identified and where they occur in
the STS. Then state whether you have found any value mismatches, magnified existing value conflicts,
and remote/harmful consequences.
190
CHAPTER 6. BUSINESS ETHICS BOWL
4. On the basis of your STS analysis and value conflict analysis, provide a short, concise problem state-
ment. Make sure your the problem you have identified is grounded in your STS and value analysis. If
not, one or the other (or both) needs to be changed.
5. A brainstorm list in which you record the solutions your group has designed to solve the problem
stated above. The rough unrefined list should include around 10 solutions. Then refine this list into
three. Spend time detailing how you reached your refined list. Did you synthesize rough solutions? On
what basis did you leave a solution out all together? Did you find other ways of relating or combining
solutions? Spend time documenting your brainstorming and refining process. Show in detail how you
came up with the refined list.
6. Do a comparative evaluation of three of the refined solutions you developed in the previous step. First,
prepare a solution evaluation matrix that summarizes your comparative evaluation. Use the table
provided below. Second, provide a verbal account of the solution evaluation and comparison process
you present in the solution evaluation matrix.
7. Reach a final decision. Defend your decision using the ethics and feasibility tests. If the decision
situation in which you are working is a dynamic one, then proppose a series of solutions that you will
pursue simultaneously, including how you would respond to contingencies that might arise. (You could
express this in the form of a decision tree.)
8. Fill out a Feasibility Matrix. See matrix below
9. Present an implementation plan based on your Feasibility Matrix. This plan should list the obstacles
that might arise and how you plan to overcome them. (For example, don't just say, "Blow the whistle."
Discuss when, how, where, to whom, and in what manner. How would you deal with reprisals? Would
your action seriously disrupt internal relations of trust and loyalty? How would you deal with this?)
Work out a detailed plan to implement your decision using the feasibility constraints to "suggest"
obstacles and impedements.
10. Finally, discuss preventive measures you can take to prevent this type of problem from arising again
in the future.
Socio-Technical System Table
Hardware Software Physical People, Procedures Laws, Data and
Surround- Groups, Statutes, Data Struc-
ings Roles Regulations tures
Table 6.3
STS Value Table
191
Integrity
Justice
Respect
Responsibility
for Safety
Free
Speech
Privacy
Property
Table 6.4
Solution Evaluation Matrix
Solution/Test Reversibility Harms/Beneficei hue Value Code Global Fea-
or Rights or Net Util- sibility
ity
Description Is the Does the Does the Moral val- Does the What are
solution solution solution ues realized? solution the resource,
reversible produce the express and Moral values violate technical,
with stake- best ben- integrate frustrated? any code and interest
holders? efit/harm key virtues? Value con- provisions? constraints
Does it ratio? Does flicts re- that could
honor basic the solution solved or impede
rights? maximize exacer- implementa-
utility? bated? tion?
Best solu-
tion
Best al-
ternate
solution
Worst solu-
tion
Table 6.5
Feasibility Matrix
Resource Constraints Technical Con- Interest Constraints
straints
continued on next page
192
CHAPTER 6. BUSINESS ETHICS BOWL
Time Cost Available Applicable Manufact r-Per-son- Organiza- Legal Social,
mate- technol- ability alities tional Political,
rials, ogy Cultural
labor,
etc
Table 6.6
6.1.4 Format
1. Group, team-written projects are to be 10-20 pages in length, double spaced, with standard 1-inch
margins, and typewritten. This does not include documentation, appendices, and other notes.
2. It is essential that you carefully and fully document the resources that you have consulted. The most
direct way to do this is to include numbered entries in a concluding section entitled, "Works Cited". These
entries should provide complete bibliographical information according to standard form (Chicago Manual of
Style or the MLA Manual of Style). Then insert the number of the entry in parenthesis in the text next to
the passage that is based on it. (Example: "The self is a relation that relates itself to its own self...." (4)
The number "4" refers to the forth item in the "Works Cited" section at the end of your paper.)
3. Practical norm 5j of the CIAPR code of ethics sets forth the obligation of the professional engineer to
give others due credit for their work. For this reason, plagiarism will not be tolerated in any form. Possible
forms of plagiarism include but are not limited to the following:
* Quoting directly from other sources without documenting (footnote or bibliography) and/or without
using quotation marks. Claiming that this is an appendix will not excuse this action. Claiming
ignorance will not excuse this action.
* Using the ideas or work of others without giving due credit or proper acknowledgment. "Proper ac-
knowledgment"," in this context, requires a standard bibliographical reference and the use of quotation
marks if the material is being directly quoted.
* If your paper relies exclusively or primarily on extensively quoted materials or materials closely para-
phrased from the work of others, then it will not be credited as your work even if you document it. To
make it your own, you have to summarize it in your own words, analyze it, justify it, or criticize it.
* You will not be credited for material that you translate from English to Spanish unless you add to it
something substantial of your own.
* In general, what you appropriate from another source must be properly digested, analyzed, and ex-
pressed in your own words. If you have any questions on this, please ask me.
* Any plagiarized document-one which violates the above rules-will be given a zero. You will be given
a chance to make this up, and the grade on the make-up project will be averaged in with the zero given
to the plagiarized document. Since this is a group grade, everyone in the group will be treated the
same, even though the plagiarizer may be only one person. Each member of the group is responsible
to assure that other members do not plagiarize in the name of the group. (Since the due date for
the written project is late in the semester, this will probably require that I give the entire group, i.e.,
all members, an Incomplete.) Each member of the group will be held individually responsible in the
above-described manner for the final content of the written report.
4. This is not a research project but an exercise in integrating ethics into real world cases. In Chapters
2 and 3 of Engineering Ethics: Concepts and Cases, the authors present a thorough discussion of the case
study analysis/problem solving method discussed in class. You also have supporting handouts in your file
folders from Magic Copy Center as well as materials I have presented directly in class. Engineering Ethics:
Concepts and Cases also contains several sample case studies that can help guide you in constructing your
own presentation. What I am looking for is a discussion of the case in terms of the ethical approaches and
decision-making frameworks we have discussed this semester. You do not need to "wow" me with research
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into other areas peripherally related to the case; you need to show me that you have practiced decision-making
and made a serious effort to integrate ethical considerations into the practice of engineering.
5. The usual criteria concerning formal presentations apply when competing in the Ethics Bowl. Dress
professionally.
6. You may write your group, team-written project in either Spanish or English.
7. All competitions will take place in the regular classroom.
6.1.5 Media Files Beginning Spring 2007
These media files provide information on the ethics bowl and the follow-up activities including individual
decision point summaries, in-depth case analysis, and group self-evaluation. They have been integrated into
the Business Ethics course during the Spring semester, 2008 and will apply from this date on into the future.
Team Member Evaluation Form
This media object is a downloadable file. Please view or download it at
Figure 6.1: This file contains the team member rating sheet which each group member must fill out
and turn in with his or her group project.
Final Project and Group Self-Evaluation Rubrics
This media object is a downloadable file. Please view or download it at
Figure 6.2: This rubric will be used to grade the in-depth case analysis, the group self-evaluation, and
the Ethics Bowl case summaries.
Basic Moral Concepts for Ethics Bowl
This media object is a downloadable file. Please view or download it at
Figure 6.3: Clicking on this figure will download the basic moral concepts that you will be integrating
into the ethics bowl and your final in-depth case analysis. You will be asked to show how you worked to
integrate these concepts in your group self-evaluation.
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Intermediate Moral Concepts for Ethics Bowl
This media object is a downloadable file. Please view or download it at
Figure 6.4: Clicking on this future will open a table that summarizes the intermediate moral concepts
that are at play in the four cases that are being used in the Ethics Bowl: Hughes, Therac, Toysmart,
and Biomatrix.
Ethics Bowl Cases for ADMI 4016: Environment of the Organization
[MEDIA OBJECT]2
6.1.6 Check List
Breakdown of Project Grade:
Group Team-Written Project: 200 points, group grade.
" This is your group's in-depth case analysis
" It will analyze the decision scenario your group presented on in the ethics bowl
" Your task is to give a full and comprehensive analysis of a decision point using the tables presented
above, accompanying verbal descriptions, and carrying out the four-stage problem-solving framework of
specifying the problem, generating solutions, testing solutions in terms of their ethics, and implementing
these solutions.
Nota Bene
" After the Ethics Bowl, I will provide the class with general feedback and presentations on how to
prepare the final project. When you submit your final report, I will be looking for how you responded
to my comments and suggestions and to the comments and suggestions of the judges and the class.
" Attendance is mandatory for all Ethics Bowl competitions. This is important because you will help
one another by the comments and discussions that are generated by the presentations. Students
not competing need to listen actively and respectfully to the presenting group. Keep in mind the
twin standards of respect and professionalism. I will deduct points from the grades of groups and/or
individuals who do not listen courteously to the presentations of others or who do not attend class
during the presentation cycle.
Nota Bene:
Check List
* Each group will turn in this checklist, fully filled out and signed. Checking signifies that
your group has completed and turned in the item checked. Failure to submit this form
will cost your group 20 points
" _ _ _ _ One page summaries of the 10 Ethics Bowl decision points taken from the Therac-25, Biomatrix,
Toysmart, and Hughes cases.
* _ _ __ Group, in-depth analysis of the case your team presented on in the Ethics Bowl.
* List of Ethically Relevant Facts
* _ _ __ Socio-Technical System Table +Verbal Explanation
2This media object is a downloadable file. Please view or download it at
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" ____ Value Table + Problem Statement + Justification
" _ _ _ _ List of Brainstormed Solutions + Descriptin of Refining Process + Refined list
" ____ Solution Evaluation Matrix + Verbal Comparison of Three Alternatives from refined solution
list
" Chosen Solution + Verbal Justification
" _ _ _ _ Feasibility Matrix + Solution Implementation Plan concretely described and based on feasibility
matrix
" __ __ Preventive Measures (if applicable)
Materials Required from Ethics Bowl
_ Ethics Bowl Score Sheets
" _ _ _ _ _The decision point your team presented on in the competition
" _ _ _ _ _The decision point your team commented on in the competition
Group Self-Evaluation Form including...
" _ _ _ _ a list of the goals your group set for itself
" _ _ _ _ a carefully prepared, justified, and documented assessment of your group's success in reaching
these goals
" _ _ _ _ a careful assessment of what you did and did not learn in this activity
" _ _ _ _ a discussion of obstacles you encountered and the measures your group took to overcome these
" _ _ _ _ a discussion of member participation and contribution including the member contriution forms
" _ _ _ _ a general discussion of what worked and what did not work for you and your group in this
activity
Each member will turn in a filled out Team Member Evaluation Form. This form can be accessed
through the media file listed above. It is suggested that you do this anonomously by turning in your Team
Member Evaluation Form in a sealed envelop with the rest of these materials. You are to evaluate yourself
along with your teammates on the criteria mentioned in the form. Use the scale suggested in the form.
Group Portfolios Include...
" _ _ _ _ _Virtue Tables including the moral exemplar profile your group prepared and presented.
S__ The justification using the rights framework of the right assigned to your group. This was one
of the rights asserted by engineers against their corporate employers.
_ _ _ _ _ A one page summary of how you developed your role in the Incident at Morales "Vista
Publica."
" _ _ _ _ _The code or statement of values summary prepared by your group as a part of the Pirate
Code of Ethics module. This summary focused on one of six organizations: East Texas Cancer Center,
Biomatrix, Toysmart, Hughes Aircraft, CIAPR, or AECL (in the Therac case).
Copy-paste this checklist, examine the assembled materials prepared by your group, and check the items
your group has completed. Then read, copy-paste, and sign the following pledge.
Group Pledge
* I certify that these materials have been prepared by those who have signed below, and
no one else. I certify that the above items have been checked and that those items with
checkmarks indicate materials that we have turned in. I also certify that we have not
plagiarized any material but have given due acknowledgment to all sources used. All who
sign below and whose names are included on the title page of this report have participated
fully in the preparation of this project and are equally and fully responsible for its results.
* M em ber signature here _ __ _ __ __ __ __ __ _ __ __ __ _ __ __
* M em ber signature here _ __ _ __ __ __ __ __ _ __ __ __ _ __ __
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CHAPTER 6. BUSINESS ETHICS BOWL
" Member signature here
* Member signature here _ _ _ _ _ _ _ _ _ _ _ _ _
" Member signature here
" Member signature here
6.2 Ethics Bowl: Cases and Score Sheets3
6.2.1 Module Introduction
This module is designed to give you a brief orientation in the Ethics Bowl competition. It is designed to
compliment and complete other modules concerning the ethics bowl that you will find in the Corporate
Governance course.
6.2.2 Ethics Bowl Rules (briefly)
" The moderator will begin the competition by flipping a coin to determine which team will present first.
If the team that calls wins the toss, they choose whether they or the other team go first.
" Monday: (1) Team 1 will have one minute to consult and seven minutes to give its initial presentation.
The presentation must be tied to the question/task given to it by the moderator. (2) Team 2 has a
minute to consult and seven minutes to make its Commentary on Team 1's presentation. Team 2 can
close its commentary by posing a question to Team 1. (3) Team 1 then has a minute to consult and
fiveminutes to respond to Team 2's Commentary. (4) Team 1 will then answer questions posed by the
two peer review teams. Each peer review team will ask a question. A quick follow-up is allowed. The
peer review question and answer session will go for 15 minutes. (5) The peer review teams will score
the first half of the competition but not announce the results.
" Wednesday: The same procedure will occur while reversing the roles between Teams 1 and 2. Thus,
team 2 will present, team 1 comment, team 2 respond, and then team 2 will answer questions from the
peer review panels. The peer review panels will add the scores for the second part of the competition
but will hold off on announcing the results until Friday's class.
" Friday: The two peer review teams will present and explain their scores. Peer Review teams will take
note: you're objective is not to criticize or evaluate the debating teams but to provide them feedback
in terms of the four categories.
" Debating teams may trade minutes from consulting to presenting. For example, Team 1 may decide to
take two minutes to consult when given their case and task. This means that they will have 6 minutes,
instead of 7, to present.
" Nota Bene: Debating teams and Peer Review teams are not allowed to bring notes into the competition.
You will be provided with paper to take notes once the competition starts.
" Even though the national Ethics Bowl competition allows only one presenter, debating teams will be
allowed to "pass the baton." When one person finishes speaking, another can step in his or her place.
It is absolutely forbidden that more than one person speak at a time. Also, the competing team's
speaking time is limited to its commentary. Once that is over, they are instructed to quitely listen.
Infractions will be followed first by a warning. Second infractions will result in points being taken
away.
6.2.3 Competition Time Line
1. Team 1 Presentation: One minute to consult, seven minutes to present.
2. Team 2 Commentary: One minute to consult, seven minutes to present.
3. Team 1 Response to Commentary: One minute to consult, five minutes to respond.
3This content is available online at .
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4. The question and answer session between Team 1 and the Peer Review teams will last 15 minutes
(running clock). The first peer review team will have 7 minutes 30 seconds for its questions and the
second will have roughly the same time.
5. In the second round, the time line is the same while the debating teams change roles.
6.2.4 Advice to Debating Teams
* Tell us what you are going to do, do it, and then tell us what you have done. In other words, start your
presentation with a summary, then launch into the main body of your presentation, and then conclude
with another summary. This will help the listening audience understand what you are trying to do.
* Be professional, formal, and courteous. Address yourself to the other team and the peer review team.
It is a good idea to stand when you are giving your initial presentation.
* Be sure to communicate your understanding of the scoring criteria. What do you and your team
understand by intelligibility, ethical integration, feasibility, and moral imagination/creativity? Take
time to listen to the other team and the peer review teams to gain insights into their understanding.
During the commentary and the question and answer session you will get crucial clues into what others
think you have achieved and where you need further work. Use this feedback.
* Be sure to thank the peer review teams, moderators, and your opponents during and after the compe-
tition. Such formalities make it possible to penetrate to the deeper practices that underlie the virtue
of reasonableness.
* Relax and have fun! You may not have the opportunity to say everything you want to say. One of the
purposes behind this competition is to help you see just how hard it is to advocate for ethical positions.
We almost always have to do so under serious constraints such as time limits. Also, remember that
you have other forums for "getting it said," namely, your group self evaluation and your in-depth
case analysis. In these places you will be able to discuss these issues in the kind of depth you think
necessary.
6.2.5 Advice to the Peer Review Teams on Scoring
* Remember that all three scoring events of the competition are worth 20 points. The initial presentation,
the response to the commentary and questions, and the commentary on the other team's presentation
all count for the same 20 points.
* Although you have the complete rubric only for the initial presentation, you will score the other parts
of the presentation based on the four criteria: intelligibility, ethical integration, feasibility and moral
imagination/creativity. You will score 1 to 5 on each criteria for a total of 20.
* Three is the middle of the road score. In other words, three is a good, average score. It is not a C-don't
think of scoring as grading. Start each team off from a default of three. Then move off that default
only when something exceptionally good or not so good happens. If your scores deviate much from
straight twelves (36), then you are scoring too high or too low.
6.2.6 Ethics Bowl Scoring Criteria
1. Intelligibility includes three skills or abilities: (1) the ability to construct and compare multiple
arguments representing multiple viewpoints; (2) the ability to construct arguments and provide reasons
that are clear, coherent, and factually correct; (3) evidence of realizing the virtue of reasonableness by
formulating and presenting value integrative solutions?
2. Integrating Ethical Concerns includes three skills: (1) presenting positions that are clearly re-
versible between stakeholders; (2) identifying and weighing key consequences of positions considered;
(3) developing positions that integrate values like integrity, responsibility, reasonableness, honesty,
humility, and justice.
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3. Feasibility implies that the positions taken and the arguments formulated demonstrate full recognition
and integration of interest, resource, and technical constraints. While solutions are designed with
constraints in mind, these do not serve to trump ethical considerations.
4. Moral Imagination and Creativity demonstrate four skill sets: (1) ability to clearly formulate and
frame ethical issues and problems; (2) ability to provide multiple framings of a given situation; (3)
ability to identify and integrate conflicting stakeholders and stakes; (4) ability to generate solutions
and positions that are non-obvious, i.e., go beyond what is given in the situation.
6.2.7 Peer Review Team Responsibilities
" Attend the debate sessions and the feedback session on Friday after the competition. Remember this
is the capstone event of the course. It looks bad if you do not bother to attend.
" You team will ask questions during the debate. This will constitute, at a minimum, one question and a
quick follow up if necessary. You are not to debate with the presenting team. So your questions should
not be designed to trap them. Rather, seek through your questions to explore seeming weak points,
unclear statements, and incomplete thoughts. Use your questions to help you line up the debating
team against the four criteria.
" Fill out the score sheet and assess the debating teams in terms of intelligibility, integrating ethics,
feasibility and moral imagination/creativity.
" Lead, with the other Peer Review team, the feedback sessions. This requires that you prepare a short,
informal presentation that shows your scoring and then explains it.
" Always, always, always be courteous in your feedback comments. Try to present things positively and
proactively. This is difficult but practice now will serve you well later when you are trying to explaibn
to a supervisor how he or she has made a mistake.
6.2.8 Media Files with Cases and Score Sheets
Engineering Ethics Bowl
This is an unsupported media type. To view, please see
http://cnx.org/content/m13852/latest/Revised_ScoreSheet_Ti_V2.doc
Figure 6.5: Score Sheet Team One.
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Engineering Ethics Bowl
This is an unsupported media type. To view, please see
http://cnx.org/content/m13852/latest/Revised_ScoreSheet_T2_V2.doc
Figure 6.6: Score Sheet Team Two.
Ethics Bowl Cases
This is an unsupported media type. To view, please see http://cnx.org/content/m13852/latest/Ethics
Bowl Cases for Spring 2007.doc
Figure 6.7: Click here to open the word file containing the 12 Ethics Bowl classes for Business Ethics
Apring 2007.
Ethics Bowl Cases for Fall 2007
This is an unsupported media type. To view, please see http://cnx.org/content/m13852/latest/EB_
Fall07_W97.doc
Figure 6.8: These are the cases for the Ethics Bowl Competition for the Fall Semester in the year 2007.
These scenarios or decision points are taken from Incident at Morales, Hughes Aircraft Case, Biomatrix
Case, and Toysmart Case.
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CHAPTER 6. BUSINESS ETHICS BOWL
Debriefing for Ethics Bowl, Round Two
This is an unsupported media type. To view, please see
http://cnx.org/content/m13852/latest/Debriefing_Round_2.ppt
Figure 6.9: This presentation was given Friday, April 27 to the Ethics Bowl teams that debated on the
Therac-25 case and the Inkjet case.
Chapter 7
Course Procedures
7.1 Rubrics for Exams and Group Projects in Ethics1
Module Introduction
This module provides a range of assessment rubrics used in classes on engineering and computer ethics.
Rubrics will help you understand the standards that will be used to assess your writing in essay exams and
group projects. They also help your instructor stay focused on the same set of standards when assessing the
work of the class. Each rubric describes what counts as exceptional writing, writing that meets expectations,
and writing that falls short of expectations in a series of explicit ways. The midterm rubrics break this
down for each question. The final project rubrics describe the major parts of the assignment and then break
down each part according to exceptional, adequate, and less than adequate. These rubrics will help you to
understand what is expected of you as you carry out the assignment, provide a useful study guide for the
activity, and familiarize you with how your instructor has assessed your work.
Business Ethics Course Syllabus
This is an unsupported media type. To view, please see http://cnx.org/content/m14059/latest/Business
Ethics Spring 2007.doc
Figure 7.1: Course Requirements, Timeline, and Links
'This content is available online at .
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CHAPTER 7. COURSE PROCEDURES
Business Ethics Syllabus, Spring 2008
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/SyllabusS08_W97.doc
Figure 7.2: This figure contains the course syllabus for business ethics for spring semester 2008.
Business Ethics Syllabus Presentation
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/BEIntroF07.ppt
Figure 7.3: Clicking on this figure will open the presentation given on the first day of class in Business
Ethics, Fall 2007. It summarizes the course objectives, grading events, and also provides a PowerPoint
slide of the College of Business Administration's Statement of Values.
Ethical Theory Rubric
This first rubric assesses essays that seek to integrate ethical theory into problem solving. It looks at a
rights based approach consistent with deontology, a consequentialist approach consistent with utilitarianism,
and virtue ethics. The overall context is a question presenting a decision scenario followed by possible
solutions. The point of the essay is to evaluate a solution in terms of a given ethical theory.
Ethical Theory Integration Rubric
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/EE_ Midterm_S05_Rubric.doc
Figure 7.4: This rubric breaks down the assessment of an essay designed to integrate the ethical theories
of deontology, utilitarianism, and virtue into a decision-making scenario.
This next rubric assess essays that integrate ethical considerations into decision making by means of three
tests, reversibility, harm/beneficence, and public identification. The tests can be used as guides in designing
203
ethical solutions or they can be used to evaluate decision alternatives to the problem raised in an ethics case
or scenario. Each theory partially encapsulates an ethical approach: reversibility encapsulates deontology,
harm/beneficence utilitarianism, and public identification virtue ethics. The rubric provides students with
pitfalls associated with using each test and also assesses their set up of the test, i.e., how well they build a
context for analysis.
Integrating Ethics into Decision-Making through Ethics Tests
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/CE_Rubric_S06.doc
Figure 7.5: Attached is a rubric in MSWord that assesses essays that seek to integrate ethical consid-
erations into decision-making by means of the ethics tests of reversibility, harm/beneficence, and public
identification.
Student teams in Engineering Ethics at UPRM compete in two Ethics Bowls where they are required
to make a decision or defend an ethical stance evoked by a case study. Following the Ethics Bowl, each
group is responsible for preparing an in-depth case analysis on one of the two cases they debated in the
competition. The following rubric identifies ten components of this assignment, assigns points to each, and
provides feedback on what is less than adequate, adequate, and exceptional. This rubric has been used for
several years to evaluate these group projects
In-Depth Case Analysis Rubric
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/EEFinalRubric_S06.doc
Figure 7.6: This rubric will be used to assess a final, group written, in-depth case analysis. It includes
the three frameworks referenced in the supplemental link provided above.
This rubric provides assessment criteria for the Good Computing Report activity that is based on the
Social Impact Statement Analysis described by Chuck Huff at www.computingcases.org. (See link) Students
take a major computing system, construct the socio-technical system which forms its context, and look for
potential problems that stem from value mismatches between the computing system and its surrounding
socio-technical context. The rubric characterizes less than adequate, adequate, and exceptional student
Good Computing Reports.
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Good Computing Report Rubric
This is an unsupported media type. To view, please see
http://cnx.org/content/m14059/latest/CEFinalRubric_S06.doc
Figure 7.7: This figure provides the rubric used to assess Good Computing Reports in Computer Ethics
classes.
Computing Cases provides a description of a Social Impact Statement report that is closely related to the
Good Computing Report. Value material can be accessed by looking at the components of a Socio-Technical
System and how to construct a Socio-Technical System Analysis.2
Business Ethics Midterm Rubric Spring 2008
This is an unsupported media type. To view, please see http://cnx.org/content/m14059/latest/Midterm
Rubric Spring 2008.doc
Figure 7.8: Clicking on this link will open the rubric for the business ethics midterm exam for spring
2008.
7.2 Integrating the Values of Responsibility and Honesty Into Class
Attendance Module3
7.2.1 Module Introduction
Class Absence Module
Module Introduction
According to the course syllabus, "Class attendance is compulsory. The University of Puerto Rico,
Mayaguez Campus, reserves the right to deal at any time with individual cases of non-attendance. Professors
are expected to record the absences of their students. Frequent absences affect the final grade and may even
result in total loss of credits. Arranging to make up work missed because of legitimate class absence is the
responsibility of the student. (Bulletin of Information Undergraduate Studies, pp 39 1995/6.)"
In this class (Computer and Engineering Ethics) students can miss three classes without losing points.
After this, each further absence will result in four points being subtracted from the student's semester
point total. This module does not in any way affect the university policy or this syllabus policy; both
2http: //www.computingcases.org
3This content is available online at .
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stand as stated above. However, above and beyond University and syllabus policy, this module uses class
attendance as the occasion to reflect upon and realize two important ethical values, responsibility and
honesty. Students will print and fill out the form given below and turn it in to the class instructor upon
each absence. Emphasis under responsibility will be on missing class only for morally legitimate purposes
and on the student's demonstrating a responsible attitude for the class missed by developing a corrective
action plan. Under honesty, the student will make an affirmation that the reasons provided are, in reality,
the reasons underlying the absence. Honesty will also come into play as the student commits to attending
class in the future.
7.2.2 Exercise One
Understanding Morally Legitimate Excuses
" The table below lists characteristics of what ethicists call "capacity responsibility." These conditions-
presented by F.H. Bradley-describe when we can associate an agent with an action for the purposes
of moral evaluation. They consist of (1) self-sameness, (2) moral sense, and (3) ownership. Only the
last applies in the case of absences. Here excuses arise from compulsion or ignorance. Conflicting
obligations,compelling circumstances, and ignorance serve as the basis of morally legitimate excuses.
" The table above correlates general excuses with the conditions of capacity responsibility that they deny.
For example, since you are not morally responsible for actions performed under compulsion, and your
car breaking down on the road is compulsion, then you are not morally responsible for missing class
when your car breaks down.
" But you are responsible for falling under compulsion or ignorance if these present states have resulted
from your past negligence. Aristotle, for example, allows for excusing actions performed out of compul-
sion and because of compulsion. But actions performed out of compulsion but due to past negligence
fall under the umbrella of responsibility. So if your car broke down because you failed to check it for
foreseeable mechanical failure, then the untoward action is due to your negligence, not to circumstances
beyond your control.
Retroactive Responsibility Table
Retroactive Responsibility Excuse Excuse Statement (Some Ex-
amples)
1. Conflicts within a role respon- I have a special project due in an-
sibility and between different role other class and finishing it con-
responsibilities. flicts with attending your class.
2. Overly determining situational I am interviewing for a position
constraints: conflicting interests. after I graduate, and I must be
off the island for a few days.
3. Overly determining situational My car had a flat tire. My
constraints: resource constraints babysitter couldn't come so I had
to stay home with my child. My
alarm clock didn't go off because
of a power outage.
continued on next page
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CHAPTER 7. COURSE PROCEDURES
4. Knowledge limitations Class was rescheduled, and I was
unaware of the change.
5. Knowledge limitations I didn't know the assignment for
class so I cam unprepared. (Not
an excuse for missing class)
Table 7.1
Exercise 1: Provide a Morally Justifiable Excuse for Missing Class
" Offer an honest and responsible ethical assessment of the reason you were unable to carry out your
role responsibility for coming to class. Note that the default here is attending class and any departure
from the default (i.e., missing class) requires a moral justification.
" Begin by examining whether your action can be classified as an excuse arising out of compulsion or
ignorance.
" Your absence may not be morally excusable. In this case, you cannot excuse your absence but still
must explain it.
" Remember that, following Aristotle, you must show that your action was done under and because of
compulsion or under and because of ignorance. In other words, you must show that it did not arise
from past negligence or recklessness.
7.2.3 Proactive/Prospective Responsibility
" In this class, it is not enough to offer a moral excuse to get "off the hook" for your absence. Expressing
remorse, guilt, and regret help you to disassociate yourself from moral harms or wrongs. But it is also
necessary to take measures to prevent the problem from reoccurring in the future.
" This can be put even more forcefully. According to the "Principle of Responsive Adjustment" (or PRA),
failure to take measures to prevent past excusable wrongs from reoccuring leads us to reevaluate these
past actions as no longer excusable but culpable. Showing an unwillingness to "learn from the past"
reveals past negligence or recklessness as-if not intended-at least not unintended. (See Peter A. French,
Corporate and Collective Responsibility)
" Responsibility as a virtue originates in the project of converting our moral weaknesses into strengths.
If past wrongs occurred because of compulsion, future prevention requires extending control and power.
If past wrongs occurred because of ignorance, future prevention requires extending and maintaining
necessary knowledge.
" The table below describes the characteristics of a preventive stance where we begin by identifying
potential wrongs and harms. Once we identify these then we take serious measures to prevent them
from occurring.
" Finally, responsibility as a virtue opens up the horizon of the exemplary. Pursuing excellence requires
our identifying opportunities to go beyond preventing harm to realizing value.
" Your job here is to go beyond attending class to outlining and realizing exemplary participation. Think
of what this entails, first within your group, and then within the class as a whole.
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I I
Responsibility as a Virtue or Proactive Re-
sponsibility
Characteristic
Proactive Response
i
Diffuse blame avoidance
strategies
Avoid trying to diffuse
the blame for missing
class on some other per-
son or situation. For ex-
ample, "I couldn't come
to class because I had
a project due in an-
other class" is not a
morally legitimate ex-
cuse because it places
the blame on the other
class. You have not
taken responsibility for
your absence.
Design responsibili- If you fail to partici-
ties with overlapping pate in a group activ-
domains ity, describe the group's
"Plan B," i.e., how they
worked around your ab-
sence.
Extend the scope and Describe how you found
depth of knowledge. out what was covered in
class and document how
you have learned this
material
Extend power and con- Describe the measures
trol you have taken to elim-
inate the "responsibility
gap" between you and
your work group. For
example, how did you
"make up" for not par-
ticipating in the activ-
ity held in the class you
missed.
Adopt a proactive prob-
lem solving/preventive
approach for the future
Describe what measures
you have taken to avoid
missing classes in the fu-
ture.
Table 7.2
Exercise 2: Getting Proactive about your absence
" Develop a plan for "getting back into the loop." What are you going to do to cover the material and
activities you have missed?
" Get Preventive. Describe what you are going to do now to avoid absences in the future.
" Shoot for the ideal. What can you do-above and beyond class attendance-to realize exemplary partic-
ipation in your ethics class.
208
CHAPTER 7. COURSE PROCEDURES
7.2.4 Conclusion
Exercise #3: Getting and Staying Honest
" Below is a template that you need to duplicate, fill out, and place in the class attendance file that will
be on the desk in front of class.
" Duplicate and sign the honesty pledge at the end of this module.
" Students often wish to provide evidence documenting their claims regarding their absences. You may
do this, but remember that this is neither required nor in the spirit of prospective responsibility.
" Furthermore, be aware that you are not to provide confidential information such as personal health
information or student id numbers or social security numbers. Health issues are to be referred to
generically by saying something like, "I was unable to come to class Tuesday because of health reasons."
1. Class Missed (Day of week and date):
2. Material covered during class:
3. Reason for missing class (please do not provide confidential information):
4. Action Plan for Absence: How you intend to take responsibility for the material covered while you were
absent; How you intend to make reparations to your group for not participating in group learning activities
for the class you missed;
5. How do you plan to avoid absences in the future:
Honesty Pledge
" To realize the value of honesty, you will make the following affirmation:
" The information I have provided above is truthful, the excuses I have ennumerated rig-
orously examined from a moral point of view, and the responsive commitments I have
made above are serious, and I will take active and realistic efforts to carry them out.
Signature:
INDEX
209
Index of Keywords and Terms
Keywords are listed by the section with that keyword (page numbers are in parentheses). Keywords
do not necessarily appear in the text of the page. They are merely associated with that section. Ex.
apples, j 1.1 (1) Terms are referenced by the page they appear on. Ex. apples, 1
A Academic Integrity, @ 7.2(204)
Assessment, @ 7.1(201)
B Business, @ 2.3(34), @ 2.4(38), @ 3.2(55),
@ 3.4(73), @ 6.2(196)
Business and Professional Ethics, @ 5.5(177)
Business Ethics, @ 2.4(38), @ 3.1(47), @ 3.3(63),
@ 3.5(81), @ 4.1(91), @ 4.4(118), @ 5.1(133),
@ 5.4(162)
C Case Analysis, g 5.3(157)
CECO, @ 4.4(118)
Class Attendance, @ 7.2(204)
Code of Ethics, @ 4.3(111)
Collaborative Learning, @ 1.4(13)
Compliance Ethics, @ 4.2(103)
Computer, @ 5.2(149)
Computer Ethics, @ 1.1(1), @ 2.2(25),
@ 5.1(133), @ 5.4(162)
Computers, @ 5.6(179)
Computing, @ 5.3(157)
Corporate governance, @ 2.3(34), @ 3.1(47),
@ 3.2(55), @ 4.4(118)
Corporate Moral Responsibility, @ 4.1(91)
Corporate Social Responsibility, @ 3.3(63)
Corporations, @ 4.1(91)
D Debating, @ 6.2(196)
Decision, @ 5.2(149)
Decision Making, @ 2.2(25)
Decision-making, @ 2.3(34)
Deontology, @ 2.1(19)
Duty, @ 2.1(19)
E EAC Toolkit, @ 3.1(47), @ 4.1(91), @ 5.1(133),
@ 5.4(162)
Engineering, @ 2.4(38), @ 4.3(111)
Engineering Ethics, @ 1.1(1), @ 2.1(19),
@ 2.2(25), @ 6.1(187)
Ethical Dilemma, @ 1.1(1)
Ethical Leadership, @ 2.3(34)
Ethical Theory, @ 1.1(1), @ 1.2(5), @ 2.1(19)
Ethical Values, @ 1.4(13)
Ethics, @ 1.1(1), @ 1.3(11), @ 1.4(13), @ 2.1(19),
@ 2.2(25), @ 2.3(34), @ 2.4(38), @ 3.2(55),
@ 3.4(73), @ 3.5(81), @ 4.1(91), @ 4.2(103),
@ 4.3(111), @ 4.4(118), @ 4.5(122), @ 5.1(133),
@ 5.2(149), @ 5.3(157), @ 5.4(162), @ 5.6(179),
@ 6.2(196), @ 7.1(201), @ 7.2(204)
Ethics Bowl, @ 2.2(25), @ 6.1(187), @ 6.2(196)
Ethics Case Analysis, @ 6.1(187)
Ethics in Decision-Making, @ 6.1(187)
Ethics of Risk, @ 3.5(81)
Ethics Officer, @ 4.4(118)
Exams, @ 7.1(201)
G Group Projects, @ 7.1(201)
H Honesty, @ 7.2(204)
Humanities, @ 4.5(122), @ 5.1(133), @ 5.4(162),
@ 6.1(187)
Incident at Morales, @ 3.4(73)
J Job Candidacy, @ 4.5(122)
M Moral Career, g 3.2(55)
Moral Ecology, @ 3.2(55)
Moral Exemplars, @ 1.3(11)
Moral Psychology, @ 1.3(11)
Moral Responsibility, @ 3.1(47)
P Pirate Creed or Code, @ 4.3(111)
Professional, @ 3.4(73)
Professional Ethics, @ 1.2(5), @ 4.5(122)
R Responsibility, @ 3.3(63), @ 3.4(73), @ 7.2(204)
Right, @ 2.1(19)
Rubric, @ 7.1(201)
S Safety, @ 5.3(157)
Social Impacts, @ 2.4(38)
Social Responsibility, @ 2.3(34), @ 5.5(177)
Socio-technical analysis, @ 2.2(25)
Socio-Technical System, @ 2.4(38)
Socio-technical systems, @ 5.6(179)
210
INDEX
Statement of Value, @ 7.2(204)
T Technical Impacts, @ 2.4(38)
Template, j 4.1(91)
Toolkit, @ 4.1(91)
V Value, g 7.2(204)
Value Orientation, @ 4.2(103)
Values, @ 4.2(103), @ 5.5(177)
Virtue Ethics, @ 1.2(5), @ 1.3(11)
W Work Teams, g 1.4(13)
ATTRIBUTIONS
211
Attributions
Collection: Business Ethics
Edited by: William Frey
URL: http://cnx.org/content/col10491/1.9/
License: http://creativecommons.org/licenses/by/2.0/
Module: "Theory Building Activities: Mountain Terrorist Exercise"
By: William Frey
URL: http://cnx.org/content/m13764/1.11/
Pages: 1-5
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Theory-Building Activities: Virtue Ethics"
By: William Frey
URL: http://cnx.org/content/m13755/1.11/
Pages: 5-11
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Moral Exemplars in Business and Professional Ethics"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m14256/1.8/
Pages: 11-13
Copyright: William Frey, Jose A. Cruz-Cruz
License: http://creativecommons.org/licenses/by/2.0/
Module: "Ethics of Team Work"
By: William Frey
URL: http://cnx.org/content/m13760/1.7/
Pages: 13-18
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Ethical Rights for Working Engineers and Other Professionals"
By: William Frey
URL: http://cnx.org/content/m15554/1.1/
Pages: 19-25
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: Theory-Building Activities: Rights
By: William Frey
URL: http://cnx.org/content/m13758/1.4/
Module: "Three Frameworks for Ethical Decision Making and Good Computing Reports"
By: William Frey
URL: http://enx.org/content/m13757/1.12/
Pages: 25-34
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
212
ATTRIBUTIONS
Module: "Values-Based Decision-Making in Gilbane Gold"
By: William Frey
URL: http://cnx.org/content/m15783/1.4/
Pages: 34-38
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Socio-Technical Systems in Professional Decision Making"
By: William Frey
URL: http://cnx.org/content/m14025/1.9/
Pages: 38-46
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "A Short History of the Corporation"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m17314/1.1/
Pages: 47-55
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Moral Ecologies in Corporate Governance"
By: William Frey
URL: http://cnx.org/content/m17353/1.5/
Pages: 55-63
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Three Views of CSR (Corporate Social Responsibility)"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m17318/1.5/
Pages: 63-73
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Theory Building Activities: "Responsibility and Incident at Morales""
By: William Frey
URL: http://cnx.org/content/m15627/1.4/
Pages: 73-81
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
ATTRIBUTIONS
213
Module: "Ethical Issues in Risk Management for Business"
By: William Frey
URL: http://cnx.org/content/m19085/1.1/
Pages: 81-90
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Different Approaches to Corporate Governance"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m17367/1.1/
Pages: 91-103
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Developing a Statement of Values"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m14319/1.6/
Pages: 103-111
Copyright: William Frey, Jose A. Cruz-Cruz
License: http://creativecommons.org/licenses/by/2.0/
Module: "Pirate Code for Engineering Ethics"
By: William Frey
URL: http://cnx.org/content/m13849/1.10/
Pages: 111-118
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Corporate Ethics Compliance Officer Report"
By: William Frey
URL: http://cnx.org/content/m18646/1.1/
Pages: 118-122
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Being an Ethical Job Candidate"
By: William Frey
URL: http://cnx.org/content/m14468/1.7/
Pages: 122-131
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
214
ATTRIBUTIONS
Module: "Biomatrix Case Exercises - Student Module"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m15187/1.3/
Pages: 133-149
Copyright: William Frey, Jose A. Cruz-Cruz
License: http://creativecommons.org/licenses/by/2.0/
Based on: Toysmart Case Exercises - Student Module
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14789/1.1/
Module: "Gray Matters for the Hughes Aircraft Case"
By: William Frey
URL: http://cnx.org/content/m14036/1.7/
Pages: 149-157
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Case Analysis Module: Therac-25"
By: William Frey
URL: http://cnx.org/content/m13765/1.1/
Pages: 157-162
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Toysmart Case Exercises - Student Module"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m14789/1.1/
Pages: 162-177
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Based on: EAC Toolkit - Student Module Template
By: Jose A. Cruz-Cruz, William Frey
URL: http://cnx.org/content/m14291/1.9/
Module: "Ethics and Laptops: Identifying Social Responsibility Issues in Puerto Rico"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m14257/1.3/
Pages: 177-179
Copyright: William Frey, Jose A. Cruz-Cruz
License: http://creativecommons.org/licenses/by/2.0/
Module: "Case Analysis and Presentation: Machado"
By: William Frey
URL: http://cnx.org/content/m13818/1.2/
Pages: 179-186
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0
Module: "Practical and Professional Ethics Bowl Activity: Follow-Up In-Depth Case Analysis"
By: William Frey
URL: http://enx.org/content/m13759/1.12/
Pages: 187-196
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
ATTRIBUTIONS
215
Module: "Ethics Bowl: Cases and Score Sheets"
By: William Frey
URL: http://cnx.org/content/m13852/1.6/
Pages: 196-200
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Rubrics for Exams and Group Projects in Ethics"
By: William Frey
URL: http://cnx.org/content/m14059/1.7/
Pages: 201-204
Copyright: William Frey
License: http://creativecommons.org/licenses/by/2.0/
Module: "Integrating the Values of Responsibility and Honesty Into Class Attendance Module"
By: William Frey, Jose A. Cruz-Cruz
URL: http://cnx.org/content/m13788/1.3/
Pages: 204-208
Copyright: William Frey, Jose A. Cruz-Cruz
License: http://creativecommons.org/licenses/by/2.0/
Business Ethics
Business Ethics is a derived copy from the Corporate Governance course previously published in Connexions.
While many courses using this title place emphasis on applying classical philosophical and ethical theory, this
course's approach is decidedly interdisciplinary and practical. It is not designed as a socio-humanistic elective,
a service philosophy course, or even an applied philosophical ethics course but as a laboratory, skills-based
course where students develop, practice, and refine decision-making and problem-solving strategies that they
will carry with them into the world of business practice. Emphasis has been placed on responding to the
four ethical themes identified by the AACSB ethics task force: Ethical Leadership, Ethical Decision-Making,
Social Responsibility, and Corporate Governance. Modules include (1) theory building activities (responsi-
bility, rights, virtue), (2) problem specification frameworks emphasizing socio-technical system building and
analogies with design, (3) specific modules responding to AACSB ethics themes (moral ecologies, corporate
social responsibility, corporate governance, and a history of the modern corporation) and (4) modules that
provide the course with a capstone, integrative experience (Business Ethics Bowl, Social Impact Statement
Reports, and Corporate Ethics Compliance Officer Reports). While a quick glance shows that this collec-
tion holds more modules than can possibly be covered in a single semester, this approach gives the user
flexibility as to the method used for integrating ethics into the business administration curriculum. Modules
can be recombined into different standalone courses such as business ethics, business/government/society,
or environment of organizations. Since each module can be covered independently, they can be integrated
into the business administration curriculum as specific interventions in mainstream business courses in areas
like accounting, finance, management, information systems, human resources or office administration. (In
fact many have been written for and tested in these circumstances.) Business Ethics has been developed
through the NSF-funded project, "Collaborative Development of Ethics Across the Curriculum Resources
and Sharing of Best Practices," NSF SES 0551779.
About Connexions
Since 1999, Connexions has been pioneering a global system where anyone can create course materials and
make them fully accessible and easily reusable free of charge. We are a Web-based authoring, teaching and
learning environment open to anyone interested in education, including students, teachers, professors and
lifelong learners. We connect ideas and facilitate educational communities.
Connexions's modular, interactive courses are in use worldwide by universities, community colleges, K-12
schools, distance learners, and lifelong learners. Connexions materials are in many languages, including
English, Spanish, Chinese, Japanese, Italian, Vietnamese, French, Portuguese, and Thai. Connexions is part
of an exciting new information distribution system that allows for Print on Demand Books. Connexions
has partnered with innovative on-demand publisher QOOP to accelerate the delivery of printed course
materials and textbooks into classrooms worldwide at lower prices than traditional academic publishers.