Values

Audrey Sabet Skema Bachelors January 2012

I- The relevance of values in business and in everyday life

} Changing

business environment with complex questions and not always clear- cut answers. skills for tomorrows leader:
Need to think beyond the basic company level Foresee new connections between social and environmental challenges/business growth and innovation.

} New
 

No matter where you are in the decision making process

} New

paradigm: business and society need to be seen as a complex, dynamic and interdependent system. and internalizing externalities

} Measuring } Decision

rules need to be set within the triple bottom line approach with multiple perspectives.

Seize the opportunities

} By

going further than analysing figures on a spread sheet. takes perspectives, values and stakeholders consultation to apply right decisions. questions emerge.

} It

} And

How should the firm interact with its stakeholders?

What direction should a manager take when many take to profit maximization?

What is the purpose of my business activity?

In a world of incredible challenges

} Do

you believe that business has:

The responsibility  The self-interest  The potential



To solve global issues?

From a nation states to a market states order

}

Leaders are becoming more responsible towards the society

and

more

Could create new business opportunities whilst harnessing the market for social and environmental good. Including rethinking the technology, products and services innovation processes. What is the costs and benefits when approaching the Bop (Bottom of the Pyramid) market?

Learn to think critically

} You

have the right if not the obligation to act upon your values. is a constant values conflicts environment. to address ways of managing conflicts better

} Business

} Frameworks

II- What are Your own values?

}

Definition of value:


Business dictionary: Important and enduring beliefs or ideals shared by the members of a culture about what is good or desirable and what is not. Values exert major influence on the behavior of an individual and serve as broad guidelines in all situations. Oxford Dictionary: principles or standards of behaviour; ones judgement of what is important in life.

III- How do you know what feels right? Our values and the appeal of ethical doctrines
}

2 approaches to address individual decision making : the prescriptive and the descriptive approaches. Focus on the prescriptive approach that offers decision making tools if you want to act as a conscious moral agent to make the ethically right decision. First assumption: your intentions are good, your goal is doing the right thing.

Ethical dilemmas
} Very

rarely: clear-cut ethical decision

} Ethical

dilemma: becomes complicated when 2 values/rights/responsibilities conflict and you have to choose between equally unpleasant alternatives.

The lay-off

}2

right values are I conflict Truthfulness and loyalty

} Non

one approach will be perfect and may lead to different conclusions. dont want to make decisions by accident. need to analyse the problem through different angles

} You

} You

Different theories
1.

Consequentialist Theories: we focus on the consequences of an action. Deontological theories: focus on duties, obligations, and principles Integrity theories: focus on virtue ethics

2.

3.

1- Utilitarianism
}

The best known of the consequentialist theories is the utilitarianism: according to the principle of utility, an ethical decision should maximize benefits to society and minimize harms. An utilitarian approaches dilemma by systematically identifying the stakeholders in a particular situation as well as the alternative actions and their consequences (good or bad) for each. THINK BROADER NOT JUST FOR YOURSELF: WHAT IS THE GREATER GOOD? Challenges to this approach: often difficult to obtain info required to evaluate consequences.

The Lay off example

Categorical Imperative
} Kants

moral rule: Act as if thy maxim of thy action were to become by thy will a universal law by nature. the rationale for your action suitable to become a universal law and principle for everyone to follow?

} Is

2- Deontological approaches
}

Deontology: ethical theories concerned with duties and rights. Morality of an action based on the action adherence to the rule. What will the deontologist do if one binding moral rule clashes with other strongly held values? When conflict with consequentialist reasoning: what do you do? And sometimes a decision with good consequences contradicts an important ethical principle.

C- Focus on Integrity (Virtue Ethics)

}

Focus more on the integrity of the moral actor (person) than on the moral act itself (decision or behaviour). The goal is to be a good person because its the type of person you want to be. A virtue ethics perspective considers the actors character motivations and intentions but principles (ex: honesty)/rules (ex: profession ethics code) /consequences are also considered.

Question to ask yourself:

}

What is my relevant moral community, that holds me to the highest moral standards?
}

The community you, as a decision making, operate within (religious, professional, regulatory).

Virtue ethics approach very good for professional companies that have very high standards of ethical conduct for company members (accountants, layers..) with specific rules, standards and code of professional responsibility. What if business, as a professional activity, had its own ethical code of conduct, own ethical standards?

2008 Harvard Business Review Hippocratic oath for managers

Calls on managers to commit:
1.

Service to the Public and Society: recognises the mangers responsibility to serve the public interest by creating sustainable value for society in the long term. Balance Multiple Stakeholdersinterests: must balance the often conflicting needs of many stakeholders to enhance enterprise value in a way that is consistent with societal well-being.

2.

Eight steps to integrate the 3 analysis by Linda Trevino and Katherine A.

Nelson
} } } } } } } }

Step 1: Gather the Facts Step 2: Define the Ethical Issues Step 3: Identify the Affected Parties (stakeholders) Step 4: Identify the Consequences Step 5: Identify the Obligations Step 6: Consider your own character and integrity Step 7: Think creatively about potential actions Step 8: Check your gut!

Step 1: Gather the Facts

} These

three philosophical approaches do not tell you explicitly how to gather the facts. However, fact gathering is easier if you consider the context in which the actions and events occurred or relevant historical facts.

Step 2: Define the Ethical Issues

a number of dilemmas, points of conflict or areas of ethical confrontation. } Consider how the ethical issue would be defined according to each theory described above. } Avoid jumping to conclusions based on personal biases. } Invite others to share their views
} Identify

Step 3: Identify the Affected Parties (stakeholders)

parties may be potentially harmed or helped? } See the problem through the eyes of othersrole playing my help. } Fine-tune your decision with a test run ask potential stakeholders how they would respond to your suggested solution
} What

Step 4: Identify the Consequences

}

Consider the potential consequence for each affected party. Who would be helped? Who would be harmed? Consider the solution that accomplishes the most good.
   

} }

Monetary consequences Long-term vs. short-term consequences Symbolic consequences (e.g. reputation, confidence, and integrity effects). Consequences of secrecy (What happens if I take no action?)

Step 5: Identify the Obligations

} What } Are

duty is owed and to whom?

there stakeholders you have overlooked in step 3 above?

Step 6: Consider your own character and integrity

} Consider

your own community of reference. How would your peers or significant others evaluate the decision or action you are considering? the disclosure rule?
Okay, perhaps not but consider whether you would feel comfortable if your activities were disclosed in the middle of main street or in the New York Times!

} Remember


Step 7: Think creatively about potential actions

} Dont

limit your choice to the obvious yes

or no.
} Think

outside the box.

Step 8: Check your gut!

} After

careful consideration of all alternatives what do your instincts tell you? is possible that you discover that your own values conflict with those of your community of reference (e.g. employer, family, friends, organizations). a choice that you can live with!

} It

} Make

IV- Doing the right thing

Sometimes our professional responsibilities come in conflict with our deepest values: Defining moments (J. Badaracco from Harvard Business Review1998)
   

It is how you form our character Refocusing on your core values and principles Transform those values and beliefs into calculated actions And finally build your own way of deciding what is right

3 kinds of defining moments

1. 2. 3.

An issue of personal identity: Who am I? Organisational: who are we? Companys role in the society: who is the company?

Onset of management
} Joseph

Wharton, University of Pennsylvania, Philadelphia said in 1881 that schools guiding purpose was to graduate students that would serve the community skillfully as well as faithfully in offices of trust and aid in maintaining sound financial morality