DSST Business Ethics flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Utilitarianism

Consequentialist theory holding that the right action is the one producing the greatest total welfare, counting every affected party's interests equally. It permits sacrificing individual rights when aggregate benefit is larger.

Categorical imperative

Kant's test of moral rules: act only on maxims you could will as universal law, and treat humanity as an end, never merely as a means.

Veil of ignorance

Rawls's device for choosing fair principles: decide rules without knowing your wealth, talents, or social position, so you cannot tailor principles to your advantage.

Stakeholder theory

Freeman's view that a firm should balance the claims of all groups affected by it, including employees, customers, suppliers, and community, not only shareholders.

Carroll's CSR pyramid

Four stacked responsibilities: economic (be profitable), legal (obey law), ethical (do what is right beyond law), and philanthropic (contribute to community).

Triple bottom line

Reporting framework measuring performance on profit, people, and planet, so social and environmental results are evaluated alongside financial results.

Friedman doctrine

The position that a corporation's only social responsibility is to use resources in activities designed to increase profits while conforming to law and basic ethical custom.

Strategic CSR

Corporate social activity chosen because it also advances business goals, such as training that reduces turnover while raising local skill levels.

Market failure

A condition where unregulated markets allocate resources inefficiently, typically from externalities, monopoly power, public goods, or information asymmetry, justifying regulation.

Regulatory capture

A situation in which an agency advances the interests of the industry it regulates rather than the public interest, often through information dependence and revolving-door hiring.

Cap and trade

Market-based regulation that sets a total pollution limit, issues tradable permits, and lets firms buy and sell allowances to meet the cap at lowest cost.

Strict liability

Legal standard imposing responsibility for harm without proof of intent or negligence, common for defective products and abnormally dangerous activities.

Employment at will

Doctrine letting either employer or employee end the relationship at any time for any lawful reason, limited by public policy, implied contract, and good faith exceptions.

Disparate impact

Discrimination theory challenging a neutral employment rule that disproportionately excludes a protected group and is not justified by business necessity.

BFOQ

Bona fide occupational qualification: a narrow defense allowing hiring based on sex, religion, or national origin when that trait is essential to performing the job.

Quid pro quo harassment

Sexual harassment in which submission to unwelcome conduct is made a condition of employment, promotion, or other job benefits by someone with authority.

Whistleblower

An employee or insider who reports illegal or unethical organizational conduct to authorities or the public, often protected by statutes against retaliation.

Informed consent

Permission given after disclosure of what data is collected, how it will be used, who receives it, and the consequences of refusing.

Data minimization

Privacy principle limiting collection and retention to data necessary for a stated purpose, reducing harm from breach, misuse, or secondary use.

Fair use

Copyright defense weighing purpose of use, nature of the work, amount used, and effect on the market; it permits some limited unlicensed use.

Insider trading

Trading securities on material nonpublic information obtained in breach of a duty of trust, violating securities law and fair market principles.

FCPA

U.S. Foreign Corrupt Practices Act: prohibits bribery of foreign officials by firms with U.S. ties and requires accurate books and internal accounting controls.

Moral minimum

A floor of universal ethical standards, such as avoiding child labor and respecting basic rights, that applies across cultures regardless of local practice.

Sweatshop code of conduct

A written supplier standard on wages, hours, child labor, and safety; credible only when monitored through independent audits with consequences for violations.

Transfer pricing

Prices charged for transactions between affiliated companies in different countries; they affect where profit is reported and raise tax fairness questions.

Stakeholder salience

Model ranking stakeholders by power, legitimacy, and urgency; groups scoring high on all three are definitive and command immediate managerial attention.

Business judgment rule

Legal presumption protecting directors from liability for good-faith decisions made with reasonable care and no conflict of interest, even if outcomes are poor.

Duty of loyalty

Fiduciary obligation requiring directors and officers to put the corporation's interest ahead of personal interest and to avoid self-dealing or usurping opportunities.

Negative externality

A cost imposed on third parties not reflected in market price, such as pollution, causing overproduction of the harmful activity absent regulation.

Tragedy of the commons

Depletion of a shared resource because each user gains the full benefit of use while bearing only a fraction of the cost of depletion.

Precautionary principle

Policy holding that when evidence suggests serious or irreversible harm, lack of full scientific certainty should not delay cost-effective protective measures.

Greenwashing

Marketing that overstates or fabricates environmental credentials, misleading stakeholders about a product's or firm's actual ecological impact.