Lecture Notes Week 9 (Class 17 and 18)
Lecture Notes Week 9 (Class 17 and 18) BA 101
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This 6 page Class Notes was uploaded by howellkaila on Friday March 6, 2015. The Class Notes belongs to BA 101 at University of Oregon taught by Tom Durant in Winter2015. Since its upload, it has received 50 views. For similar materials see Intro to Business in Business at University of Oregon.
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Date Created: 03/06/15
Week 9 Lecture Notes Classes 17 and 18 Philosophical Approaches The Friedman Doctrine 0 Social responsibility of a business is to increase profits 0 As long as company stays within law and rules without deception or fraud Utilitarian O The consequence of the action is used to determine the moral good of the action Kantian Ethics 0 Moral worth of actions is determined by one39s motive not by outcome of consequence Rights Theories O Recognizes fundamental rights and privileges of human beings these rights establish a minimum level of morally acceptable behavior Justice Theories 0 Focus on attainment of a just distribution of goods and services that is fair and equitable eves of Ethical Standards 1 It is not about the law 2 Organizational policies and procedures 3 Moral stance employees take when faced with decisions not governed by formal rules Manager39s Role Shape the organization through Employment agreement Structure ofJob Interpersonal Interactions interact with employees with decency and respect Roots of Unethical Behavior Why do some managers behave unethically 1 Personal ethics code 2 Do not realize they are behaving unethically Fail to ask the right questions 3 Organization39s Culture Considers primarily economic consequences not ethical ones 4 Unrealistic Performance Goals Encouraging unethical behavior 5 Unethical Leadership Encouraging behavior that is suspected to be unethical Sarbanes Oxlev Act of 2002 Establishes new or enhanced standards for all US public company boards management and public accounting firms Can be referred to as O The Public Company Accounting Reform 0 Investor Protection Act of 2002 O Sox 0 Sarbox Stakeholders and the Enterprise External Stakeholders Customers Suppliers Creditors Governments Unions General Public Local Communities W Stockholders Employees Managers Board Members mkeholders contribute to the company and in return the company gives stakeholders inducements or an incentive to continue contributing to the company Ethics and Strategy the accepted principles of right or wrong governing the conduct of business people Ethical Dilemmas Occur when No agreement on accepted principles No available alternatives seem ethically acceptable Acceptable Principles are Codified into Laws Tort Laws governing product liability Contract Law deals with contracts and breach of contract Intellectual Property Law protection of intellectual property Antitrust Law governing competitive behavior Securities Law issuing and selling securities Being ethical is more than obeying the law Ethical Issues SelfDealing 0 Managers make money illegally with corporate money at someone else39s expense Information Manipulation 0 Hide information to advance oneself individually Anticompetitive Behavior 0 Actions aimed to harm competitors Opportunistic Exploration 0 Of other players in the value chain in which the firm is embedded Substandard Working Conditions 0 Do not invest enough in working conditions and pay workers under market wage Environmental Degradation O Harm the environment through business actions Corruption 0 Pay bribes to access high profit business contracts Behaving Ethically Managers should HirePromote people with wellgrounded sense of personal ethics Build a culture within the organization that values ethical behavior Leaders are in ethical manner Put decision making process in place that requires people to consider their ethics in business decisions Put strong corporate governance in place quotThe Corporation Externalities O a consequence of an economic activity that is experienced by unrelated third parties I Positive Effect of Welleducated labor force on productivity of the company I Negative Pollution emitted by a factory that harms local resident39s health Social Responsibilitv 1 Economic Responsibilities Be Profitable 4 2 Legal Responsibilities Obey the Law b 3 Ethical Responsibilities Be Ethical do what is right and fair 4 4 PhilanthrOpic ReSponsibilities Be a Good Corporate Citizen If you need info about our Foundation Final Project suggest you take a look at the first 30 slides on the Class 18 PowerPoint on Blackboard Forms of Business Organization Options for Organizing a Business Business Entitv Options Sole Proprietorship Partnership Corporation Limited Liability Company LLC Sole Pronrietorship You as an individual want to start a business Quick easy cheap simple Full control with minimal administration Adaptable Downsides 0 Risk and personal exposure 0 Credibility of business is as good as yours personally 0 Raising additional capital Partnership Mutual Agency the right for all partners to act as agents for the normal business operations with the authority to bind it to business agreements Unlimited Liability Share riskwealth evenly Limited Partnership No mutual agency No provision for limited liability Do not share riskwealth equally To prepare for a partnership realize all partnerships fail Someone will die eventually and that partnership is over Think ahead Corporation No single individual responsible government is nervous about this Corporate Governance Stockholders 4 Board of Directors w 1 Top Management 2 Middle Management 3 Supervisiory TVpes of Corporations Domestic Corporations 0 Operate in state it is incorporated Foreign Corporations 0 Operate in states other than state of incorporation Alien Corporations 0 Organized in one country and operate in another Differences between Partnerships and Corporations Partnership Corporation Voluntary Association Separate Legal Entity Unlimited Liability Limited Liability Mutual Agency Limited Stockholder power Limited Life Unlimited Life Limited access to Money Easy access to capital Partners Keep Control Stockholders may lose Control Relatively Unregulated Government Regulation Single Taxation Double Taxation Other Types S Corporations 0 O 0 Limited liability Single Taxation Unlimited Life Restrictions I number and type of shareholders Limited Liabilitv Companies 0 O O 0 Like a corporation Taxed like Partnership Not limited to number of Shareholders Restrictions I Type of shareholders Types of Stock Common Stock 0 Voting Rights 0 Residual Claims to Assets Preferred Stock 0 No Vote 0 First claim on income Preferred dividend 0 First claim on assets after debt Mergers and Acquisitions Merger 0 Two companies become one Acguisition 0 One firm buys another I Horizontal two in the same industry I Vertical distribution channel suppliersdistributors I Conglomerate unrelated business