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HONESTWORKA Business Ethics ReaderJoanne B. CiullaUniversity of RichmondClancy MartinUniversity of Missouri, Kansas CityRobert C. SolomonUniversity of Texas at AustinNew York OxfordOXFORD UNIVERSITY PRESS2007

CONTENTSPREFACExviiINTRODUCTION1XX*W H Y W E WORK: THE MEANING OF WORKIntroduction11Box: "WORTHY WORK"4Joanne B. Ciulla I "From Curse to Calling: A Short History of theMeaning of Work" 5Box: "THE NOONDAY DEMON"7Michelle Quinn I "Hopping On and Off Career Track"10CASESCase 1.1: Sloan Wilson, "The Job Interview" 12Case 1.2: Nick Denton, "Less Heat, More Light" 152PROMISES AND BETRAYALS ON THE JOB: ETHICS IN THE WORKPLACEIntroduction 17Norman E. Bowie I "Respecting the Humanity in a Person"Arlie Hochshild I "Exploring the Managed Heart" 22Box: "ROBERT C. SOLOMON, THE PASSIONS"1923Box: "JOHN STUART MILL ON THE GREATEST GOOD AND EXPEDIENCY"Anita M. Superson I "The Employer-Employee Relationship and theRight to Know" 26John Orlando I "The Ethics of Corporate Downsizing" 30Box: ROSABETH Moss KANTER, "ETHICAL MANAGEMENT OFUNCERTAIN EMPLOYMENT"34Annette Friskopp and Sharon Silverstein I "Anti-Gay Jokes"Box: "MORE MEN ARE SAYING 'STOP' "39173724

CONTENTSCASESCase 2.1: John R. Boatright, "A 'State of the Art' Termination" 41Case 2.2: William H. Shaw and Vincent Barry, "AIDS in the Workplace" 42Case 2.3: Kurt Eichenwald, "Racial Discrimination at Texaco" 43Case 2.4: Joanne B. Ciulla, "The Energetic Boss" 46Case 2.5: Joanne B. Ciulla, "Does Home Life Matter at Work?" 46Case 2.6: "Discrimination at Wal-Mart: Unequal Wages and Opportunities" 47Box: "SEXUAL HARASSMENT GUIDELINES"51Case 2.7: Joanne B. Ciulla, "Prejudice or Preference?" 52Case 2.8: Joanne B. Ciulla, "Attraction or Business As Usual?" 52Case 2.9: Joanne B. Ciulla, "Innocent and Dangerous" 53" T H E CHECK IS IN THE M A I L " : HONESTY AND T R U S T IN BUSINESSIntroduction5555Box: "ARISTOTLE, KANT, AND MILL ON HONESTY"58Albert Z. Carr I "Is Business Bluffing Ethical?" 59Timothy B. Blodgett I "Replies to Carr" 64Box: "NIETZSCHE ON HONESTY"65Norman E. Bowie I "Does It Pay to Bluff in Business?" 67Robert C. Solomon I "Is It Ever Right to Lie?" 69Sissela Bok I "Defining Secrecy—Some Crucial Distinctions" 72Richard T. De George I "Secrecy and Disclosure" 76Sue De Wine I "Giving Feedback: The Consultant's Craft" 77Evan M. Dudick I "Do Management Gurus Lie?" 82The Economist I "Self-Deception" 84Paul Ekman and Mark G. Frank I "Lies That Fail" 85Box: "TRANSPARENCY INTERNATIONAL—USA PROGRAM"88Robert C. Solomon and Fernando Flores I "Building Trust" 91CASESCase 3.1: Robert C. Solomon, "Flying or Lying in Business Class" 95Case 3.2: Robert C. Solomon, "Willful Ignorance? Or Deception?" 95Case 3.3: Clancy Martin, "Blindsided by Bankruptcy" 96Case 3.4: William H. Shaw and Vincent Barry, "Testing for Honesty" 97Case 3.5: Margaret P. Battin and Gordon B. Mower, "The Columbia Shuttle Disaster:Should We Have Told the Astronauts the Truth?" 100T H E GOOD LIFE103Introduction 103Robert C. Solomon I "Strategic Planning—For the Good Life"106

CONTENTSixAristotle I "On the Good Life"108Box: "ADAM SMITH ON CAPITALISM"111Epicurus I "On Pleasure" 112Andrew Carnegie I "Wealth" 114Solomon Schimmel I "Greed" 118Box: "LABOR DAY, 2004"119Joanne B. Ciulla I "Leisure and Consumption"120Box: BERTRAND RUSSELL, "IN PRAISE OF IDLENESS"121LynneMcFall I "Integrity" 125Cheshire Calhoun I "Standing for Something" 128Joe Dominguez and Vicki Robin I "Your Money or Your Life"Bertrand Russell I "Impersonal Interests" 134*Robert C. Solomon I "Why Ethics?"131136CASESCase 4.1: James Fenimore Cooper I "The Opportunist" 138Case 4.2: Bowen H. McCoy I "The Parable of the Sadhu" 139Box: "THE HAPPINESS Box"141Case 4.3: Arthur Miller I "A Life Badly Lived" 142Case 4.4: Ruth Capriles I "Rags to Riches to Rags" 1435MONEY, HOW W E G E T IT, AND W H E R E IT GOES: ACCOUNTING,AND INVESTMENT ETHICSIntroductionFINANCE,148148Box: "ACCOUNTING AND MERGERS"149Richard T. De George I "Ethical Issues for Accountants"Box: "Six PRINCIPLES OF ETHICAL ACCOUNTING"151152Carol J. Loomis I "Lies, Damned Lies, and Managed Earnings"Box: "LEARNING TO CHEAT?"154155Box: PRICE WATERHOUSECOOPERS, "ETHICAL DECISION MAKING"158Ed Cohen I "Arthur Andersen Refugees Reflect on What Went Wrong"Box: SHERRON WATKINS, "BEFORE THE WHISTLE BLEW . . . "162162Robert E. Frederick and W. Michael Hoffman I "The Individual Investor in SecuritiesMarkets: An Ethical Analysis" 164Box: "DIRE CONSEQUENCES . . . "166John R. Boatright I "Finance Ethics"Box: "THE WAKE-UP CALL"172169

CONTENTSJennifer Moore I "What Is Really Unethical About Insider Trading?" 176Box: ROEL C. CAMPOS, "ETHICS MATTER"181Frank Partnoy I "F.I.A.S.C.O." 184Box: "ARISTOTLE ON MONEY"186CASESCase 5.1: The Democratic Policy Committee,"A Modern History of 'Creative' Accounting" 188Case 5.2: Lisa H. Newton and David P. Schmidt, "Merger Mania"Case 5.3: Ron Duska, "Annuities to Seniors" 192Case 5.4: John R. Boatright, "An Auditor's Dilemma" 193Case 5.5: David Lawrence and Tom L. Beauchamp,"Enron and Employee Investment Risk" 1946W H O GETS W H A T AND W H Y ? FAIRNESS AND JUSTICEIntroduction190196196Box: "PLATO AND ARISTOTLE ON JUSTICE"Plato I "RingofGyges"197199Box: "WOULD YOU RATHER EARN MORE, OR JUST MORE THAN THEOTHER FELLOW?"200Adam Smith I "On Human Exchange and Human Differences" 201Latin Trade I "A Latin Viewpoint: The Bentonville Menace" 204Joanne B. Ciulla I "Exploitation of Need" 205Box: "MARX ON ALIENATED LABOR"206John Rawls I "Justice as Fairness" 208Peter Singer I "Rich and Poor" 210Irving Kristol I "A Capitalist Conception of Justice" 213Box: "EXECUTIVE COMPENSATION"217Friedrich von Hayek I "Justice Ruins the Market" 219Eduard Garcia I "The Winner-Take-All Game" 221Gerald W. McEntee I "Comparable Worth: A Matter of Simple Justice" 224CASESCase 6.1: Naomi Klein, "Revolution Without Ideology" 227Case 6.2: Jim Hightower, "Going Down the Road" 228Case 6.3: Joanne B. Ciulla, "The Problem with Dudley Less" 230Case 6.4: Joanne B. Ciulla, "Overworked and Ready to Blow" 231Case 6.5: Rogene A. Buchholz, "Poverty Area Plants" 232Case 6.6: William H. Shaw and Vincent Barry, "Poverty in America" 232Case 6.7: William H. Shaw and Vincent Barry, "Burger Beefs" 234Case 6.8: Sasha Lyutse, "Nike's Suppliers in Vietnam" 237

CONTENTS7Is " T H E S O C I A L R E S P O N S I B I L I T Y O F B U S I N E S S . . . T O I N C R E A S E I T S P R O F I T S " ?SOCIAL RESPONSIBILITY AND STAKEHOLDER T H E O R YIntroduction239239Milton Friedman I "The Social Responsibility of Business Is toIncrease Its Profits" 241Christopher D. Stone I "Why Shouldn't CorporationsBe Socially Responsible?" 246Peter A. French I "Corporate Moral Agency"250R. Edward Freeman I "A Stakeholder Theory of the Modern Corporation"Kenneth J. Arrow I "Social Responsibility and Economic Efficiency"261J. Maurice Clark I "The Changing Basis of Economic Responsibility"265CASES255«Case 7.1: Ana G. Johnson and William F. Whyte, "Mondragon Cooperatives"Case 7.2: Rogene A. Buchholz, "Social Audit" 270Case 7.3: Kelly McDougall, Tom L. Beauchamp, and John Cuddihy,"The NYSEG Corporate Responsibility Case" 271Case 7.4: Thomas I. White, "Beech-Nut's Imitation Apple Juice" 273Case 7.5: Thomas I. White, "Sentencing a Corporation to Prison" 2748W H E N INNOVATION BYTES BACK: E T H I C S AND TECHNOLOGYIntroduction269276276Box: "LOCKE ON PROPERTY"277Deborah C. Johnson I "Intellectual Property Rights and Computer Software"279Box: RICHARD DE GEORGE, "SEVEN THESES FOR BUSINESS ETHICSAND THE INFORMATION AGE"283Box: "FOUCAULT AND THE PANOPTICON"285Elizabeth A. Buchanan I "Information Ethics in a Worldwide Context"Deborah C. Johnson "Hacker Ethics"287291Box: C. KLUCKHORN, "INTERNET CULTURE?"Bill Joy I "Why The Future Doesn't Need Us"292296Theodore Roszak I "In Defense of the Naked Mind"300CASESCase 8.1: Joel Rudinow and Anthony Graybosch, "Digital Divide" 308Case 8.2: Joel Rudinow and Anthony Graybosch, "Hacking into theSpace Program" 308Case 8.3: Joel Rudinow and Anthony Graybosch, "The I Love You Virus"Case 8.4: Richard A. Spinello, "Privacy Pressures: The Use of Web Bugsat HomeConnection" 309309

xii9CONTENTST H E A R T OF SEDUCTION: T H E E T H I C S OF ADVERTISING, MARKETING, AND SALESIntroduction 311John Kenneth Galbraith I "The Dependence Effect"311313Box: "PLATO ON THE DANGER OF BELIEVING BAD ARGUMENTS"315Friedrich von Hayek I "The Non Sequitur of the'Dependence Effect'" 318Robert L. Arrington I "Advertising and Behavior Control" 321Alan Goldman I "The Justification of Advertising in a Market Economy" 326Leslie Savan I "The Bribed Soul" 331Box: "CONSPICUOUS CONSUMPTION"333Thomas L. Carson I "The Ethics of Sales" 336Box: "ASK M E NO QUESTIONS . . . "340CASESCase 9.1: Manuel G. Velasquez, "Toy Wars" 343Case 9.2: Rogene A. Buchholz, "Advertising at Better Foods" 347Case 9.3: Joseph R. DesJardins and John J. McCall, "Advertising'sImage of Women" 348Case 9.4: William H. Shaw and Vincent Barry, "Hucksters in the Classroom" 349Case 9.5: Tom L. Beauchamp and Norman E. Bowie, "Marketing Malt Liquor" 35110THINGS FALL A P A R T : P R O D U C T LIABILITY AND CONSUMERS353Introduction 353Peter Huber I "Liability" 356John Nesmith I "Calculating Risks: It's Easier Said Than Done" 361Box: "WHAT'S RISKY? CHANCES OF DEATH?"362Stanley J. Modic I "How We Got into This Mess" 363George G. Brenkert I "Strict Products Liability and Compensatory Justice" 367Henry Fairlie I "Fear of Living" 374Warren E. Burger I "Too Many Lawyers, Too Many Suits" 378MarkDowie I "Pinto Madness" 381Patricia Werhane I "The Pinto Case and the Rashamon Effect" 384CASESCase 10.1: William H. Shaw and Vincent Barry, "The Skateboard Scare" 388Case 10.2: William H. Shaw and Vincent Barry, "Aspartame:Miracle Sweetener or Dangerous Substance?" 389Case 10.3: Joseph R. DesJardins and John J. McCall, "Childrenand Reasonably Safe Products" 391Case 10.4: William H. Shaw and Vincent Barry, "Living and Dying with Asbestos" 392Case 10.5: Kenneth B. Moll and Associates, "Merck and Vioxx" 394

CONTENTS11"YouxKNOW H O W TO WHISTLE, DON'T YOU?" WHISTLE-BLOWING,COMPANY LOYALTY, AND EMPLOYEE RESPONSIBILITY396Introduction 396Box: "MARTIN LUTHER KING ON SILENCE"397Sissela Bok I "Whistleblowing and Professional Responsibility" 398Box: "RALPH NADER ON WHISTLE-BLOWING"400Michael Davis I "Some Paradoxes of Whistleblowing" 403Ronald Duska I "Whistleblowing and Employee Loyalty" 408Box: JOSEPH PULITZER, "SECRECY AND DISCLOSURE"410Box: JIM YARDLEY, "THE UPSIDE OF WHISTLE-BLOWING"412David E. Soles I "Four Concepts of Loyalty" 414Box: "BLIND TO EARNED LOYALTY"417tGeorge D. Randels I "Loyalty, Corporations, and Community" 421CASESCase 11.1: Sherron Watkins, "The One Successful Business Model" 426Case 11.2: Pat L. Burr, "Would You Blow the Whistle on Yourself?" 428Case 11.3: William H. Shaw and Vincent Barry, "Changing Jobsand Changing Loyalties" 429Case 11.4: David Margasak, "The Greenhouse Effect: Putting theHeat on Halliburton" 430Case 11.5: Joseph R. DesJardins and John J. McCall,"Whistleblowing at the Phone Company" 43112T H I N K LOCAL, A C T GLOBAL: INTERNATIONAL BUSINESS433Introduction 433Benjamin Barber I "Jihad vs. Me World" 436Box: "ISAIAH BERLIN"438Thomas L. Friedman I "The Lexus and the Olive Tree" 440MaryMidgley I "Trying Out One's New Sword" 443Dalai Lama I "The Ethic of Compassion" 447Thomas Donaldson I "Values in Tension: Ethics Away from Home" 449Box: "WHAT D O THESE VALUES HAVE IN COMMON?"452The Economist I "Doing Business in Dangerous Places" 456United Nations Universal Declaration of Human Rights 458CASESCase 12.1: Joanne B. Ciulla, "The Oil Rig" 462Case 12.2: Karen Marquis and Joanne B. Ciulla, "Diller's Dilemma: Street Childrenand Substance Abuse" 463