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学术英语学术英语Academic English 1Unit 2 Business EthicsText A Striking the Right Balance2Free enterprise Free enterprise refers to the system of business in which individuals are free to decide what to produce,how to produce it,and at what price to sell it.自由企业制度，就是确保企业能够拥有在产权受法律保护的基础上所享有的自由创业权、自由经营权、自由交易权以及自由支配或处置财产权等一系列的制度安排。它包括产权制度、进入退出制度、公平竞争制度、平等合约制度、平等交易制度以及平等获取信息服务制度等。Unit 2Business EthicsText A Background information3Do you agree or not?Profit maximization is the right goal for a business-Adam Smith 42016年315晚会：共筑消费新生态【曝光曝光】“饿了么饿了么”惊现黑心作坊惊现黑心作坊 看完你还会饿看完你还会饿么？么？【曝光曝光】制造用废钢料制造用废钢料 这样的假牙你敢戴吗？这样的假牙你敢戴吗？【权威发布权威发布】跨境电商进口儿童用品超三成不合跨境电商进口儿童用品超三成不合格格【消费预警消费预警】你买的人参可能一半是白糖！你买的人参可能一半是白糖！Balance profit and business ethics5Business EthicsBusiness ethics means written and unwritten codes of moral standards that are critical to the current activities and future aspirations of a business organization.They can differ from one company to another because of differences in cultural perspectives,operational structures and strategic orientations.The guiding framework of business ethics exists all levels of the organization.It is about having the wisdom to determine the difference between right actions and wrong decisions.In simpler terms,business ethics provides the morality standards and behavioral patterns expected of individuals and the business as a whole.These moral standards can be perceived in terms of the microenvironment and macro environment of the business.6Stakeholder VS ShareholderThere are two schools of thought regarding how companies should approach a definition for business ethics:the shareholder perspective and the stakeholder perspective.7Stakeholder VS ShareholderShareholder PerspectiveThose who approach ethical decision making from a shareholder perspective focus on making decisions that are in the owners best interest.Decisions are guided by a need to maximize return on investment for the organizations shareholders.Individuals who approach ethics from this perspective feel that ethical business practices are ones that make the most money.8Stakeholder VS ShareholderStakeholder PerspectiveThe phrase corporate social responsibility is often used in discussions of business ethics.The idea behind this concept is the belief that companies should consider the needs and interests of multiple stakeholder groups,not just those with a direct financial stake in the organizations profits and losses.Organizations that approach business ethics from a stakeholder perspective consider how decisions impact those inside and outside the organization.Stakeholders may include:employees,suppliers,customers,competitors,government agencies,the news media,community residents and others.The idea behind stakeholder based ethical decision making is to make sound business decisions that work for the good of all affected parties.9Importance of Ethical Business DecisionsCompanies and people who behave in a socially responsible manner are much more likely to enjoy ultimate success than those whose actions are motivated solely by profits.Knowing the difference between right and wrong and choosing what is right is the foundation for ethical decision making.In many cases,doing the right thing often leads to the greatest financial,social,and personal rewards in the long run.10Corporate Social ResponsibilityDefinitions Corporate social responsibility(CSR)is about how companies manage the business processes to produce an overall positive impact on society Corporate social responsibility(CSR)refers to a business practice that involves participating in activities that benefit society.11Pyramid of Social Responsibility(Carroll 1991)12Text A Striking the Right BalancePara 1In 1776,Adam Smith described how an“invisible hand”guides companies as they strive for profits,and that hand leads them to decisions that benefit society.Smiths insights led him to conclude that profit maximization is the right goal for a business and that the free enterprise system is best for society.13Text A Striking the Right BalanceBut the world has changed since 1776.Firms today are much larger,they operated globally,they have thousands of employees,and they are owned by millions of stockholders.This make us wonder if the“invisible hand”still provides reliable guidance.Should companies still try to maximize profits,or should they take broader view and take more balanced actions designed to benefit customers,employees,suppliers,and society as a whole?14Para 2Most academics today subscribe to the following modified version of Adam Smiths theory:A firms principal goal should be to maximize the wealth of its stockholders,which means maximizing the value of its stocks.15Para 2Free enterprise is still the best economic system for the country as a whole.Under the free enterprise framework,companies develop products and services that people want and that benefit society.However,some constraints are needed-firms should not be allowed to pollute the air and water,to engage in unfair employment practices,or to create monopolies that exploit consumers.16Para 3These constraints take a number of different forms.Through the political process,society imposes a wide range of regulations that are designed to keep companies from engaging in practices that hurt society.Another set of constraints are the costs that are assessed on companies if they take actions that harm society.Properly imposed,these costs fairly transfer value to suffering parties and help create incentives that help prevent similar events from occurring in the future.17Para 3Two recent examples dramatically illustrate these points.First,many Wall Street firms engaged in extremely risky activities that pushed the financial system to the brink of collapse in 2007 and 2008.Saving the financial system required a bailout of banks and other financial companies,and that bailout imposed huge costs on the taxpayers,and also helped push the economy into a deep recession.18Para 3Apart from the huge costs imposed on society,the financial firms also paid a heavy price-a number of leading financial institutions saw a huge drop in their stock price,some failed and went out of business,and many Wall Street executives lost their jobs.More recently,in 2010,the massive BP oil spill in the Gulf of Mexico had a terrible environmental and economic impact of the Gulf region.19Para 3In the three months following the initial explosion,BPs stock lost half of its value,and no one knew how high its total cost would be and whether the company would survive.The spill has also led the United States and other nations to re-examine their policies regarding deep-water drilling,and that might have a serious adverse effect on long-run oil supplies.20 CREDIT CRISIS21backgroundUS Federal Reserve lower the interest rates to only%after 911.Investor:low return for 1%,Bank:borrow money from Fed for 1%,cheap credit(低息贷款),go crazy with leverage,earn lots of money,Then investors of Wall Street also wants to earn more money.22Leverage is borrow money to amplify the outcome of a deal$10,00023How did that happen?House buyersInvestorsWall street24How did it work?mortgage 25Bad result sub-prime mortgage crisis 26End27Para 4Still,some argue that the costs imposed on BP are insufficient to cover the damages that were incurred,and that the theory of constrained profit maximization is inadequate.For example,GE Chief Executive Officer(CEO)Jeffrey Immelt believes that just obeying the law is not enough,and that companies should strive to behave ethically and continually operate with societys interests in mind.28Para 4Immelt further argues that value and reputation go hand in hand,and that having a good reputation with customers,suppliers,employees and regulators is essential if value is to be maximized.In his words,“The reason people come to work for GE is that they want to be part of something bigger than themselves.29Para 4They want to work hard,win promotions,and be well-compensated,but they also want to work for a company that makes a difference,a company thats doing great things in the world its up to GE be to a good citizen.Not only is that a nice thing to do,but its good for business and thus the price of our stock.”30Para 5GE is not alone.An increasing number of companies see their mission as more than just making money for their shareholders.Googles well-know corporate motto is“Dont Be Evil.”Consistent with this mission,the company has its own in-house foundation that has made large investments in a wide range of philanthropic ventures worldwide.There are other instances where corporate leaders have donated personal funds.31Para 6In 2008,Microsoft Corporations Bill Gates gave a speech to the world Economic Forum in which he made the case for a“creative capitalism”.Gates stated that,“such a system would have a twin mission:making profits and also improving lives for those who dont fully benefit from market forces.”32Para 7Gates has certainly been true to his word.In 2000,he and his wife established the Bill&Melinda Gates Foundation.Today the fund has assets totaling$33.5 billion.It received a notable boost in 2006 when famed investor Warren Buffett announced that he would donate a huge share of his fortune to the Foundation.33Para 7To date,Buffett has contributed more than$6 billion,and over time he is scheduled to contribute additional stock that is now worth in excess of$40 billion.These efforts show that there is more to life than money,but it often takes money to do good things.34Bill Gates was born on Oct,28 in 1955 and grew up in Seattle with his two sisters.His father was a lawyer and his mother was a teacher.Bill Gates had his elementary school and high school education is Seattle.Bill Gates35 And it was during that time Bill founded that his interests lying in writing programs and began to write programs at 13.36In 1973,Bill Gates was admitted by Harvard but he quitted from Harvard three years later.He put all his time and energy into designing programs for Microsoft Cooperation which established in 1975 by Bill and his friend Paul Allen.37Bill Gates married Melinda French Gates on January,1st in 1994.They have three children.In the spare time,Bill has passion in reading books and playing golf.38Warren Buffett LifeuHis financial career began at the age of 14.uAt 26,he set up his first investment partnership for family and friends with$174,000.uAt the end of 2008,his personal fortune was$60billion and Berkshire Hathaway,his holding company,was valued at$200million.uBuffett loves charity,preparing to contribute$37 billion,accounting for 85%of his property.39words for his sonHis son doesnt follow in his footsteps,but keeps the faith of Warren Buffett,that is:Enjoying what you are doing everyday is a true success.Earning a lot of money may make you rich,but that means seeking a meaningless life by sacrificing your happiness.That may be stupid.40Text A OverviewCritical reading and thinking1.Scan Text A and completing the following table.The original version The modified versionThe invisible hands guides companies to strive for profits.Profit maximization is the right goal for a business.Free enterprise system is best for society.A firms principal goal should be to maximize the wealth of its stockholders.Free enterprise is still the best economic system for the country as a whole.Some constraints are needed for firms.Unit 2Business Ethics41Exercise 2Argument 11)a wide range of regulations are imposed 2)assessing costs on companies;BP oil spillArgument 21)behave ethically;value and reputation2)Dont be Evil3)creative capitalism 4)contributed more than$6 billion42Language building upTask 1-1 1.无形的手 2.自由企业制度 3.股东4.经济体制5.开发产品和服务6.市场力量7.金融机构8.严重衰退9.破产43Language building up10.stock price 11.mission 12.corporate motto 13.assets 14.maximize profits 15.financial system 44Language building upTask 1-2 1.When politicians and economists talk about【market force】,they mean the economic factors that affect the availability of goods and the demands for them,without any help from or control by the government.2.The dramatic change in business environment makes all industries face drastic completion.This is also happened in the【financial institutions】.45Language building upTask 1-2 3.A【free enterprise system】can be contrasted with a socialist economic system,which depends heavily on government planning and public ownership of the means of production.4.The oil price increases pushed the European economy into【deep recession】.46Language building upTask 1-2 5.Adam Smiths famous【invisible hand】theory has been modified to cater to the current economic situation.6.An individual or organization that owns stocks in a corporation can be called【stockholder】.47Language building upTask 1-2 7.In economics,【profit maximization】is the short-run or long-run process by which a firm determines the price and output level that returns the greatest profit.8.A socialist market【economic system】has now taken shape,and the basic role played by the market has been improved in the sphere of resource allocation.48Language building upTask 2-Signpost language1.and 2.Another 3.also 4.Not only,but 5.other 49Language building upTask 3-formal English 1.Smiths insights led him to conclude that profit maximization is the right goal for a business and that the free enterprise system is best for society.(understanding)2.Most academics today subscribe to the following modified version of Adam Smiths theory.(agree with)50Language building upTask 3-formal English 3.Through the political process,society imposes a wide range of regulations that are designed to keep companies from engaging in practices that hurt society.(forces to be accepted)4.and that might have a serious adverse effect on long-run oil supplies.(bad)51Language building upTask 3-formal English 5.An increasing number of companies see their mission as more than just making money for their shareholders.(purpose)6.Consistent with this mission,the company has its own in-house foundation that has made large investments in a wide range of philanthropic ventures worldwide.(charitable)52Language building upTask 3-formal English 7.There are other instances where corporate leaders have donated personal funds.(given)8.It received a notable boost in 2006 when famed investor Warren Buffett announced that he would donate a huge share of his fortune to the Foundation.(famous)53Text B Two views of social responsibility Para 1:Government regulation and public awareness are external forces that have increased the social responsibility of business.But business decisions are made within the firm and there,social responsibility begins with the attitude of management.Two contrasting philosophies,or models,define the range of management attitudes toward social responsibility 54Para 2The economic modelAccording to the traditional concept of business,a firm exists to produce quality goods and services,earn a reasonable profit and provide jobs.In line with this concept,the economic model of social responsibility holds that society will benefit more when business is left alone to produce and market profitable products that society needs.The economic model has its origins in the 18th century,when businesses were owned primarily by entrepreneurs or owner-managers.Competition was vigorous among small firms,and short-run profits and survival were the primary concerns.55Para 3To the manager who adopts this traditional attitude,social responsibility is someone elses job.After all,stockholders invest in a corporation to earn a return on their investment,not because the firm is socially responsible and the firm is legally obligated to act in the economic interest of its stockholders.Moreover,profitable firms pay federal,state,and local taxes that are used to meet the needs of society.Thus,managers who concentrate on profit believe that they fulfill their social responsibility indirectly through taxes paid by their firms.As a result,social responsibility becomes the problem of government,various environmental groups,charitable foundations,and similar organizations.56Para 4The socioeconomic modelIn contrast,some managers believe they have the responsibility not only to stockholders,but also to customers,employees,suppliers,and the general public.This broader view is referred to as the socioeconomic model of social responsibility,which places emphasis not only on profits but also on the impact of business decisions on society.57Para 5Recently,increasing numbers of managers and firms have adopted the socioeconomic model and they have done so for at least three reasons.First,business is dominated by the corporate form of ownership and the corporation is a creation of society.If a corporation does not perform as a good citizen,society can and will demand changes.Second,many firms are beginning to take pride in their social responsibility records,among them Starbucks Coffee,Hewlett-Packard,Colgate-Palmolive,and Coca-Cola.58Para 5Each of these companies is a winner of a Corporate Conscience Award in the areas of environmental concern,responsiveness to employees,equal opportunity,and community involvement.And of course,many other corporations are much more socially responsible today than they were 10 years ago.Third,many business people believe it is in their best interest to take the initiative in this area.The alternative may be legal action brought against the firm by some special interest group;in such a situation,the firm may lose control of its activities.59Para 6The pros and cons of social responsibility Business owners,managers,customers,and government officials have debated the pros and cons of the economic and socioeconomic models for years.Each side seems to have four major arguments to reinforce its viewpoint.60Para 7Arguments for increased social responsibility Proponents of the socioeconomic model maintain that a business must be more than simply seek profits.To support their position,they offer the following arguments:1.Because business is a part of our society,it cannot ignore social issues.2.Business has the technical,financial,and managerial resources needed to tackle todays complex social issues.3.By helping resolve social issues,business can create a more stable environment for long-term profitability.4.Socially responsible decision-making by firms can prevent increased government intervention,which would force businesses to do what they fail to do voluntarily.61Para 8These arguments are based on the assumption that a business has a responsibility not only to stockholders but also to customers,employees,suppliers and the general public.Arguments against increased social responsibility 62Para 9Opponents of the socioeconomic model argue that business should do what it does best:Earn a profit by manufacturing and marketing products that people want.Those who support their position argue as follows:1.Business managers are responsible primarily to stockholders,so management must be concerned with providing a return on owners investment.2.Corporate time,money and talent should be used to maximize profits,not to solve societys problems.3.Social problems affect society in general,so individual businesses should not be expected to solve these problems.4.Social issues are the responsibility of government officials who are elected for that purpose and who are accountable to the voters for their decisions.63Para 10These arguments obviously are based on the assumption that the primary objective of business is to earn profits and that the government and social institutions should deal with social problems.64Para 11Today,few firms are either purely economic or purely socioeconomic in outlook;most have chosen some middle ground between the two extremes.However,our society generally seems to want-and even to expect-some degree of social responsibility from business.Thus,within this middle ground,businesses are leaning toward the socioeconomic view.65 Economic modelThe socioeconomic modelPurposeTo produce quality g
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