DSST Business Ethics key terms

An ethical theory holding that the right action is the one producing the greatest total benefit or the least harm for everyone affected, weighing outcomes rather than intentions or duties.

An approach judging actions by duty and rules rather than results, holding that people must be treated as ends in themselves and never merely as means to an end.

Kant's test of moral rules: act only on principles you could will as universal law, and treat humanity as an end rather than merely a tool.

A framework that identifies basic entitlements owed to every person, such as safety, privacy, and fair treatment, and treats respecting those entitlements as the core moral duty.

An approach focused on the character of the actor, asking what a person of good character would do and cultivating traits such as honesty, courage, and prudence.

A company's voluntary commitment to consider social and environmental impacts alongside profit, often expressed through community programs, ethical sourcing, and environmental practices.

A reporting framework measuring performance across three dimensions, commonly called profit, people, and planet, so that social and environmental results count alongside financial results.

The view of a firm as a member of society with duties beyond legal compliance, including charitable giving, community engagement, and responsible conduct toward the public.

Operating so that resources meet present needs without impairing the ability of future generations to meet their own, applied to environmental, social, and economic resources.

Economic growth pursued in a way that preserves ecological systems and resource stocks over time, balancing development needs with long-term environmental limits.

Costs or benefits of a transaction that fall on third parties who did not choose them, such as pollution borne by a community or training gained by a rival firm.

A harmful spillover of business activity onto others who are not part of the transaction, such as air pollution or noise, often used to justify regulation or taxation.

The full cost to society of an economic activity, including private costs borne by the firm and external costs imposed on others.

The view that managers owe consideration to everyone affected by or affecting the firm, including employees, customers, suppliers, communities, and owners, not owners alone.

Any individual or group with an interest in, or affected by, a firm's decisions and outcomes, ranging from investors and employees to customers, suppliers, and local communities.

The doctrine that a corporation's primary duty is to maximize returns to its owners, subject to law and basic ethical limits, rather than to balance all stakeholder interests.

A legal and ethical obligation to act in another party's best interest with loyalty and care, as directors and officers owe to the corporation and its shareholders.

A situation in which a person's private interest or relationship could improperly influence decisions made on behalf of an employer or client, requiring disclosure or recusal.

Reporting an employer's illegal, unsafe, or unethical conduct to a supervisor, regulator, or the public, often after internal channels fail and usually protected by law.

Laws and policies shielding employees from retaliation such as firing or demotion when they report suspected wrongdoing in good faith to authorities or internally.

A default rule allowing either employer or employee to end the relationship at any time for any lawful reason, limited by contracts, public policy, and anti-discrimination law.

Dismissal that breaches a contract or violates law or public policy, such as firing someone for reporting safety violations or for a protected characteristic.

The principle, enforced by law, that hiring, pay, promotion, and other employment decisions must not be based on protected characteristics such as race, sex, religion, or age.

Policies that give limited preference in hiring or admissions to members of groups historically excluded, intended to remedy past discrimination and is legally contested.

Unwelcome sexual conduct that is a condition of employment or creates a hostile work environment, treated as a form of illegal sex discrimination.

A workplace permeated with severe or pervasive discriminatory conduct, such as harassment, that unreasonably interferes with an employee's ability to do the job.

Trading securities while in possession of material nonpublic information obtained through a relationship of trust, which violates securities law and fair-market principles.

Facts a reasonable investor would consider important in deciding whether to buy or sell a security, such as pending mergers or unexpected earnings changes.

The duty to reveal relevant facts so that others can make informed decisions, applied in securities filings, product labeling, lending, and consumer transactions.

Agreement given by a person who understands the relevant facts and risks and participates voluntarily, commonly applied to data collection and medical or research settings.

A person's interest in controlling the collection, use, and sharing of personal information, protected by law and by ethical expectations of data stewardship.

Laws and practices governing how organizations collect, store, secure, and transfer personal data, including limits on use and requirements to keep it accurate and safe.

Legally recognized rights in creations of the mind, such as patents, copyrights, trademarks, and trade secrets, balancing incentives to create against public access.

Confidential business information, such as formulas or customer lists, that gives competitive advantage and is protected as long as reasonable secrecy is maintained.

A contract in which a party promises not to reveal specified confidential information, commonly used to protect trade secrets and proprietary plans during business dealings.

A U.S. law prohibiting bribery of foreign government officials to obtain business and requiring accurate books and internal accounting controls.

Offering or accepting something of value to improperly influence a person's official decisions, widely condemned and illegal in most jurisdictions.

A small payment to a low-level official to speed routine, nondiscretionary action, treated narrowly under some anti-bribery laws but ethically contested.

The view that ethical standards are defined by a culture's own norms, raising the question of whether firms should follow local practices or a single global standard.

The position that some ethical standards apply to everyone regardless of local custom, so a firm should not lower basic standards merely because a market allows it.

A workplace with substandard conditions, very low pay, excessive hours, or abuse, often in global supply chains, raising questions about buyer responsibility.

The expectation that a firm monitors and takes responsibility for labor and environmental conditions at its suppliers, even those it does not directly own.

A written statement of an organization's expected standards of behavior, covering areas such as gifts, conflicts of interest, and treatment of employees and customers.

The policies, training, monitoring, and reporting channels a company uses to prevent and detect legal and ethical violations and to respond when they occur.

A U.S. law enacted after major accounting scandals that tightened financial reporting, required executive certification of statements, and protected corporate whistleblowers.

Statutes that prohibit monopolization, price fixing, and other restraints of trade in order to preserve competition and protect consumers.

An agreement among competitors to set prices, divide markets, or restrict output, treated as a serious antitrust violation that harms consumers.

Laws and agencies safeguarding buyers from deceptive advertising, unsafe products, and unfair credit practices, typically through disclosure rules and product liability.

The legal responsibility of a manufacturer or seller for harm caused by a defective or unreasonably dangerous product, regardless of whether negligence is shown.

The standard of reasonable attention and precaution a person or firm must exercise to avoid foreseeable harm to others, such as testing products for safety.

Failure to exercise the care a reasonable person would use in similar circumstances, resulting in harm, and a basis for civil liability.

A condition in which an agency meant to oversee an industry instead serves the interests of the firms it regulates, often through staffing and lobbying ties.

Efforts to influence legislation or regulation through direct contact with officials or grassroots campaigns, lawful when disclosed but vulnerable to undue influence.

The protected expression of companies through donations, advertising, and advocacy on public issues, raising questions about money's influence in politics.

Voluntary giving of money, goods, or time by a business to charitable causes, often used to support communities and build reputation.

A decision method comparing the estimated costs and benefits of alternatives, used in regulation and management and criticized for pricing hard-to-measure values.

A tendency to take greater risks when the consequences are borne by someone else, as when insured parties or protected managers act carelessly.

The risk that managers acting as agents for owners pursue their own interests rather than the owners' interests, addressed through incentives and oversight.

The claim that a preference program unfairly disadvantages members of groups not targeted for remedy, a central legal and ethical objection to affirmative action.

Using protected creative work without permission or a valid exception, such as copying software or reproducing text beyond fair use limits.