Business Ethics BUSI 1314 Lecture 9 - Rewards

you will:
Have seen markers’ expectations towards the essay (Coursework 2)

have been introduced to a theoretical background for the ethical dimensions of rewards
have participated in philosophically examining an ethical issue, i.e. rewards

equal work
Performance Related Pay
Expectancy theory
Rewards in organisation – agent-principal theory
Broad

Band – what do you think?
Cultural issues

Wim Vandekerckhove - Business Ethics BUSI 1314 - University of Greenwich - 2010-2011

Mary Gentile’s Op Ed on MarketWatch.com: "The Burden of Knowledge:

The ethics of John Paulson and Goldman Sachs"
http://www.marketwatch.com/story/goldman-sachs-and-john-paulson-the-ethics-2010-06-04?reflink=MW_news_stmp (accessed 28 September 2010)

Grameen Bank
Read this comment in The Guardian by Salil Tripathi on micro-credits.
http://www.guardian.co.uk/business/2006/oct/17/businesscomment.internationalaidanddevelopment (accessed 18 October 2010)

Arcelor Mittal
See a briefing paper from a campaigning organisation on how Arcelor Mittal makes a fortune by selling emissions permits:
http://sandbag.org.uk/files/sandbag.org.uk/The_Case_of_ArcelorMittal.pdf (accessed 28 September 2010)

HTC, Vodafone, Google supply chain controversy
This controversy over union busting in Taiwan is mentioned on many websites, but here is a link to one of them:
http://goodelectronics.org/news-en/taiwanese-electronics-workers-figth-for-their-rights(accessed 18 October 2010)

Wim Vandekerckhove - Business Ethics BUSI 1314 - University of Greenwich - 2010-2011

an organisation (choose a case from list underneath). Analysis means

you :
point out the controversy,
explain why the issue is controversial (why is it not straightforward right or wrong?),
identify arguments made,
evaluate the arguments made (what kind of argument is it, is it a good argument?).
This means that you will be approaching the issue from more than one position (stakeholder) and you will make use of more than one ethical perspective (in identifying and evaluating the arguments made).
End your essay with your personal position on the issue. Of course, you need to give arguments here as well.
Referencing is necessary – but academic references are optional.
Maximum 2500 words – Deadline 17 December 2010 3pm

Wim Vandekerckhove - Business Ethics BUSI 1314 - University of Greenwich - 2010-2011

of Greenwich - 2010-2011

Greenwich - 2010-2011
€ 13m /

year

BUSI 1314 - University of Greenwich -

2010-2011

In the US in 2006, black men earned 72.1%
and hispanic men earned 57.5%
of what white men earned,

http://www.infoplease.com/ipa/A0908883.html

In 2003 in the UK, women earned 78% of what men earned
(reflects gross average earnings)

http://www.infoplease.com/ipa/A0882775.html

In 2005 in the US, the average CEO
earned 262 times the pay of the average worker.
In 1965, that was 24.

http://www.epi.org/economic_snapshots/entry/webfeatures_snapshots_20060621/

BUSI 1314 - University of Greenwich -

2010-2011

Treaty of Rome (1957) – Article 119
‘equal pay for equal work’
Between men and women

Equal Pay Directive (1975)
(N. 75/117) – Article 1
‘equal pay for work of equal value’

UK
Equal Pay Act – (Amended Regulations 1983 SI 1983/1794)
‘equal value’?
Effort,
Skills,
Decision

Vandekerckhove - Business Ethics BUSI 1314 - University of Greenwich

- 2010-2011

Pay for results

Not for attendance – ‘presenteism’

On the decline for
Manual workers

Greenwich - 2010-2011
Payment by result

on the decline
for manual workers

Why?

- University of Greenwich -

2010-2011

Effort

Performance

Outcome

Control

Procedural
Justice

Distributive
Justice

1314 - University of Greenwich -

2010-2011

Principal

Agent

Result

Issues:
Control the agent
Principal lacks knowledge about how to get results
Agent acts in agent’s behalf, not in principal’s

Solution:
Provide agent with incentives so that agent’s goals are aligned with principal’s

University of Greenwich - 2010-2011
Pay
Position
Is

this fair?
Would it work?
Would you like this?

1314 - University of Greenwich -

2010-2011

Hofstede

Power Distance

Individualism / Collectivism

of Greenwich - 2010-2011
Reward
For effort

(action under control)

Is it perceived as fair?
(for effort + compared to others)

Market reality

Regulations

Agent-Principal
(goals in line)