Final Version 1

Final Version

LGST 210-910: Corporate Responsibility and Ethics Summer Term I

Instructor: Gastón de los Reyes Email: [email protected] Phone: 215-573-0609 Office: Huntsman 635.1 Office hours: W 4-5pm

COURSE DESCRIPTION AND OVERVIEW This course aims to prepare you to hold and articulate a carefully thought through position on a variety of basic ethical puzzles in business life. We will start the class tackling the role of the corporation and managers, then moving to questions about business’s engagement with the global resource environment—human, natural and otherwise. The class will finish with a closer look at selected problems of morality and justice that are inescapable parts of life as a business professional.

The goal of the class is for you to become comfortable with a discrete set of concepts—many of them philosophical—that will help us carefully break problems apart for joint scrutiny. Ultimately, our goal is practical: you should begin to get the experience needed to confidently raise and discuss ethical issues as an employee inside an organization and as a citizen confronted with business ethics news stories on a daily basis.

The primary testing ground for our efforts together is classroom discussion. In addition, you will each write an essay in two drafts to incorporate my feedback. You will also get hands-on experience by working in small groups to define and respond to a case. The class will finish with an in-class exam meant to test your understanding of the central concepts.

REQUIREMENTS & COMMENTS GRADING 1. Attendance and This class is a joint effort, and your active participation and engagement are essential. There are many ways to class participation participate, in addition to speaking in class: x Everyone is expected to initiate at least one discussion thread on the Canvas site, and you are welcome to 20% do so more often. Such a thread might raise a question about the readings, or about how a current event might fit into philosophical theory, etc. x You should pay attention to news and blogs outside of class to notice business ethics issues and are invited to bring any such issues to our attention in class. You should identify and informally present one article to the class over the course of the semester. x You are also encouraged to participate by coming to office hours to discuss the material.

1 Final Version

Please see me right away if you have any concerns with being able to attend every class session. I expect you to treat class like showing up to an important job. Absences not excused in advance that do not owe to an unforeseen and material situation will substantially and negatively impact your participation grade.

2. Preparation for A commitment to careful preparation for class is assumed. “Cold” calling to ask about the readings is standard. I class each day have tried to limit the “theory” reading to about 20 pages per day. This will be supplemented with case and/or newspaper articles that make for lighter reading.

3. Essay (1,700 to There is no better way to synthesize your learning than to write, and writing about ethics takes practice. Your 2,000 words) essay should pose and work out your answer to a question based, in particular, on the Chouinard reading. My first review of the essay will not be for a grade but for feedback. This will give you a much better model for your 30% experience as a professional than writing a single draft for a grade.

4. Team work— Working in groups of 4 (+-1) students, your team will jointly select a Project of Change that you will prepare and Project of Change present to the class. The idea behind the Project of Change is (i) to identify a business ethics problem that you will analyze with the tools from class and (ii) to articulate a constructive way to approach the problem involving, e.g., 15% entrepreneurship, an awareness campaign, legislation, partnerships, protest, leading through virtue, etc. Your team will work with me not only to identify the Project but also to develop your presentation.

I will post a series of recent newspaper articles that might inspire you with a project idea.

5. Future Reference To protect against the risk of memory loss, you are to write yourself a survival memo (no more than 1,000 words) Memorandum that communicates the most helpful lessons, models and concepts you’ve learned about ethics in business for your (1,000 words) personal reference. You will be graded based on seriousness of engagement with the materials (including GVV) and the task of memorializing and synthesizing the lessons you drew from our work. 10% 6. Final exam There will be a 75-minute closed-book exam to evaluate the clarity of your understanding of the central concepts covered in class. This will consist of short-answer questions, multiple choice questions, and one short essay whose 25% topic will be announced in advance.

2 Final Version

OTHER CLASS-BASED ACTIVITIES

Defining concepts. Many concepts will come up in class, and we need to be able to speak a common language to make progress together. This requires us to develop working definitions for all distinctive uses of a word, such as “efficiency,” that comes up in different ways. Please raise your hand if a word comes up that may have multiple or unclear meanings. We will try to give it a meaning together and will keep track of such terms throughout the course.

DECORUM

Internet, chat and games in “off” settings and devices stored away during class, except when computers are used during group work.

Drinks, snack bars, fruit and the like are fine. Please be considerate in your food selections (odor, noise) if circumstances require you to eat more substantially in class.

COURSE MATERIALS

Required texts:

Chouinard, The Responsible Corporation (available at Lippincott)

Digital Subscriptions & Reference

Freakonomics is available on Netflix.

Study.net & Harvard Business School cases

You will need to purchase additional materials (not to exceed roughly $60). I will give you adequate advanced notice. These items are marked with “(sn)”.

Canvas

All other materials are available on Canvas and/or there are links to the internet location below.

3 Final Version

Detailed Schedule of Assignments

Date Topic Key Concepts Reading / In-class Assignment Part One: Business Policy and the Role of Managers Week 1—The Centrality of Values in Business Life Tuesday, Introduction x Purpose (Personal, x Christensen, How Will You Measure Your Life? (sn) (in the “On Managing May 21 to class Professional, Yourself” HBS collection) Organizational) x https://www.youtube.com/watch?v=y_ZmM7zPLyI x Hypothetical versus Categorical In-Class Materials Imperatives x Starting Assumptions for Giving Voice to Values (in-class reading) x Obligations versus x Olympic Ideal Takes Beating In Badminton NYT (in-class reading) Virtue x The importance of perspective Wednesda Why morality x Utilitarianism (and x Gioia, Pinto Fires and Personal Ethics y, matters in cost-benefit x Friedman on Pinto case: http://www.youtube.com/watch?v=jltnBOrCB7I May 22 business analysis) versus x Paine, Managing for Organizational Integrity (sn) organizations profit x Six Components of a Great Culture maximization http://blogs.hbr.org/cs/2013/05/six_components_of_culture.html x Organizational scripts In-Class Materials x Giving Voice to x The TJ Hooper Case (in-class reading) Values Thursday, What is the x The legal form of a x Andrews, The company and its strategists: Relating corporate strategy to May 23 corporation corporation personal values (sn) and where do x Legal obligations x Stout, Bad and Not-so-Bad Arguments for Shareholder Primacy (sections III its values of and V are optional) come from? managers/directors x Bad Directors and Why They are Retained NYT x The relevance of x NYTimes: Directors Disappoint by What They Don’t Do values to company x NYTimes: JPMorgan Directors Feel Heat in a Vote strategy

4 Final Version

Week 2—Organizational Purpose, Managerial Purpose Tuesday, What is the x Friedman Doctrine: x Does Business Have a Social Responsibility? Debate in Bank Magazine May 28 role of Argument and o Hodges, Yes managers? Premises o Friedman, No (reprint of The social responsibility of business is to x Stakeholder theory increase its profits from New York Times Magazine) x Freeman, Stakeholder Theory on http://www.youtube.com/watch?v=bIRUaLcvPe8 x Wednesday, Stewardship x Value x Guest Speaker: Amine Benali, Manu Life May 29 ; Maximization http://www.manulifemutualfunds.ca/portfolio-management/portfolio- Legitimacy; x Measuring managers/amine-benali/ Introduction performance versus x (Start reading Chouinard) to Projects strategy x Jensen, Value Maximization (HBR Working Knowledge) of Change x Andrews’s critique x Reason.net debate with Whole Foods Owner and Friedman of the Friedman x Andrews, Public Responsibility in the Private Corporation Doctrine x Has Organic Been Oversized NYT x Managerial x Palm Oil Case purpose versus value maximization Thursday, Corporate x Sustainability x Chouinard, The Responsible Company (chapters 1-3, 5, 7) May 30 Responsibilit versus x Working groups to develop individual paper topics y in responsibility x Discuss business ethics problems of concern with team and jointly develop Patagonia concept for project of change

5 Final Version

Part Two: Managing the Global Resource Environment Week 3— Corporate Responsibility Abroad: Extending Resources, Human Resources, Natural Resources Monday , June 3 First draft of essay due by 5pm (first draft will be for comments, not grade) **15 minute meetings to be scheduled for all students on Tuesday and Wednesday Tuesday, A Morality x Duty of x Peter Singer on youtube June 4 of beneficence http://www.youtube.com/watch?v=onsIdBanynY&feature=player_embedded Assistance?: x Bottom of the x Prahalad and Hammond, Serving the World’s Poor, Profitably Lifesaving pyramid x Dunfee, Do Firms with unique competencies for rescuing victims of human Drugs x Relevance of catastrophes have special obligations? distance and x The Merck Case nationality to extension of Optional resources x Leonard, When is Doing Business with the Poor Good for the Poor? x CSR budgets x Joy that Lasts on the Poorest of Playgrounds NYT

Wednesday, Economic x Markets for virtue x Porter & Kramer, Creating Shared Value (Executive Summary) June 5 CSR Sets x “Shared Value” http://hbr.org/2011/01/the-big-idea-creating-shared-value Standards: x Supply chain x Watch Porter interview http://blip.tv/hbr-video-ideacast/rethinking-capitalism- Markets for management 4614047 Virtue and x Vogel, Is there a market for virtue? (page selection TBA) Shared https://proxy.library.upenn.edu/login?url=http://search.ebscohost.com/login.as Value px?direct=true&db=bth&AN=18077262&site=ehost-live x Locke, Can Global Brands Create Just Supply Chains? and read one of the responses to Locke’s article here http://www.bostonreview.net/BR38.3/ndf_richard_locke_global_brands_labor _justice.php x Bangladesh Textile Articles: x Horrific Fire Revealed a Gap in Safety for Global Brands NYT x A survivor of the Tazreen fire and a Bangladeshi labor leader have come halfway around the world toconfront Walmart and other corporations that treat Bangladeshi lives as just another cost of doing business (petition) x NYTimes: Fire at Bangladeshi Factory Kills 8 x NYTimes: Tears and Rage as Hope Fades in Bangladesh

6 Final Version

x Factory Collapse in Bangladesh Exposes Cracks in the System - Working In These Times x Fair-Trade Movement Extends to Clothing x NYTimes: Owner of Collapsed Building Arrested in Bangladesh x As Firms Line Up on Factories, Wal-Mart Plans Solo Effort x Thursday, Political x Globalization x Scherer & Palazzo, Globalization and Corporate Social Responsibility June 6 CSR and x Post-National x UNGRADED MID-TERM Kantian Constellation x Kant, Groundwork for the Metaphysics of Morals (pp. 21-23 required, 21-30 Approaches x Legitimacy recommended) x The relationship x Arnold & Bowie, Sweatshops and Respect for Humanity between the x In China, Human Costs Are Built Into An Ipad NYT multinational x http://video.nytimes.com/video/2012/01/25/business/100 corporation and 000001313019/made-in-china.html foreign-regulated x Watch this video: Made in China labor in the x How waiting longer for the iPhone could help workers supply chain x Chouinard, Chapters 4 and 6 x Using Sweatshops x Conceptualization of cosmopolitan morality Week 4— Censorship / Corruption Monday, Final draft of essay due by 5pm June 10 Tuesday, Censorship x Free speech as a x Google’s China Problem (and China’s Google Problem) NYT June 11 on the human right x http://www.npr.org/blogs/alltechconsidered/2013/04/23/178620215/google- Internet; x Interacting with execs-say-the-power-of-information-is-underrated Human foreign gov’ts x Google Blocks Inflammatory Video in Egypt and Libya Rights Tensions x Google refuses US request to pull video with Foreign x Iran blocks google/youtube Government x Watch this video: How Internet Censorship Works x Spend some time checking out the information on Google's Transparency Report

7 Final Version

x 2011 UN/Ruggie Guiding Principles on Business & Human Rights Summary x NSA Scandal: x The Guardian article that broke the story x NYTimes: Administration Says Mining of Data Is Crucial to Fight Terror x Focus on this: Tech Companies Concede to Surveillance Program x Editorial by Rand Paul: NSA's Verizon surveillance: how the White House tramples our constitution x 2011 UN/Ruggie Guiding Principles on Business & Human Rights Summary http://www.steptoe.com/publications-newsletter-pdf.html/pdf/?item_id=172 x Projects of Change: Prepare initial memo (due Friday, June 14 in class) reviewing the process through which the team came together to define its ideas and identify the best leads and concepts that interest you and why the team is well-suited to pursue them. Also identify your open questions.

Optional x 2011 UN/Ruggie Guiding Principles on Business & Human Rights http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR _EN.pdf Part Three: Puzzles in Morality & Justice Wednesday. Corruption x Sources of x Donaldson & Schoemaker, Self-Inflicted Industry Wounds: Early Warning June 12 of the corruption in the Signals and Pelican Gambits “Market”: market x (optional) Extraordinary Science of Addictive Junk Food Education x Antidotes to x Greg Smith, “Why I Am Leaving Goldman Sachs,” The New York Times and Health corruption in the x Watch Freakonomics--Note the only required segment is the second on one Care market Sumo wrestling x Problem posed by x NYTimes: Ex-Schools Chief in Atlanta Is Indicted in Testing Scandal intermediary Corruption in Medicine purchasers x Medical Bills and Bankruptcy x **Hospital Chain Inquiry Cited Unnecessary Cardiac Work NYT x Unnecessary Angioplastys x News report on Meningitis outbreak and Compounding Pharmacy and on **problem of FDA regulation x **Why Doctors Remain Silent NYT x A Hospital War Reflects Tightening Bind for Doctors Nationwide NYT x A Giant Hospital Chain Is Blazing a Profit Trail NYT

8 Final Version

Thursday, Bribery x Problems with x Fadiman, Traveler’s Guide to Gifts and Bribes (sn) June 13 & Lobbying bribery x Nichols, Business Case for Complying with Bribery Laws (selections TBA) x Bribery versus x Khan Bribery case lobbying Lobbying as Bribery x Listen to this: Why Lobbying Is Now Increasingly In The Shadows x Lobbying against EU Efforts to Limit Pesticides and Save Bees x NYTimes: Banks’ Lobbyists Help in Drafting Financial Bills Walmart in Mexico Case: x NYTimes: More Dissent Is Expected Over a Wal-Mart Scandal x The Sun, the Moon and Walmart x Web Sites Shine Light on Petty Bribery Worldwide Friday, June 14 at noon Project of Change of Memo due, groups to meet with me Tuesday and Wednesday June 17 & 18 Week 5 – Bribery, Deception, Justice and the Professions Tuesday, Deception, x Organizational x US Military and Rape newspaper articles June 17 Betrayal & Civility x Thousands treated for sexual abuse-related injuries in military Civility Sexism and x x What Can Congress Do to Put an End to Rape and Sexual Abuse in the sexual violence Military? x Lying, misrepresentation x Shell, When Is It Legal To Lie In Negotiations? and fraud x What if George Akerlof had written about Lethal “Lemons”? x Conflict on a Trading Floor (sn) x Foreign Assignment Wednesday, Giving Voice x Perils of x Seven Secrets every Whistleblower Needs to Know June 18 to Values Whistleblowing x Recommended interview with ex-CEO-whistleblower of Olympus and x Giving Voice to x Interview with Edward Snowden Whistleblowi Values x Bazerman, Note on Blind Spots ng x Building a GVV Toolkit x Guidelines for Peer Coaching x GVV, New Approach to Values-Driven Leadership x GVV, Starting Assumptions x GVV, Ways of Thinking about Our Values in the Workplace x Market Research Deception x Framing a Life Story x Reasons and Rationalizations x http://blogs.hbr.org/cs/2013/02/how_to_communicate_dissent_at.html

9 Final Version

Thursday, Justice and x Rawls’s Two x Rawls’s Theory of Justice in Part 4 of Rawls on Stanford Encyclopedia of June 19 the Principles of Philosophy at http://plato.stanford.edu/entries/rawls/#JusFaiJusWitLibSoc Professions, Justice x Sibert, Don’t Quit this Day Job NY Times Executive x Rawls’s x With executive pay, rich pull away from rest of America Wash. Post Pay Difference x Krugman, Rule by Rentiers NY Times Principle x Nozick, Distributive Justice (pp. 46-61) (optional) x Nozick’s x Selection from Book V of Aristotle’s Ethics Entitlement x Schwartz, Practical Wisdom listen to interview Theory http://knowledge.wharton.upenn.edu/article.cfm?articleid=3133#.UM- x Epieikeia ZwXWumC8.email x Freedom and the x CEOS Enslaved too rat race x Krishnamurti on the rat race (youtube) x Rajat Gupta’s Lust for Zeros NYT

Week 6 –Team Projects & Exam Monday, June 24 at 5pm Future Reference Memorandum Tuesday, In-class Review Session June 25 Wednesda Team presentations y, June 26 Thursday, In-class exam June 27

10