1.

One of the myths in business ethics says that ethics is a personal,

individual affair, not a public or debatable matter. Do you
agree/disagree with the statement? Please elaborate your answer.
Answer: I disagree with this statement, because ethics is personal or
religious beliefs, and that one decides what is right and wrong
in the privacy of ones conscience. Every individual must make
moral choice in life. This individual ethical choice is most often
influenced by discussions, conversations, and debates, and
made in group context. Therefore, to argue that ethics related
to business issues is mainly a matter of personal or individual
choice is to underestimate the role organization play in shaping
and influencing members attitudes and behaviors.
2. Why do you think it is important to teach ethics in business school? Do
you think ethics can be taught and trained? Why/why not?
Answer: Most activity in business is making a lot of decisions. These
decisions depend on facts, inferences, and rigorous, ethical
reasoning. And yes it can be taught and trained, either ethics
course or training sessions to teach us how ways of thinking
and behaving in situations. Besides, as a businessman, we have
to look at difference perspective to make a decision.
3. What are the benefit of using stakeholder theory approach in ethical
decision making? How does this approach work?
Answer: With stakeholder management approach, including
frameworks for analyzing and evaluating a corporations
relationships (present and potential) with external groups, aims
ideally at reaching win-win collaborative outcomes. This winwin means making moral decision that benefits the common
good of all constituencies within the constraints of justice,
fairness, and economic interest. The aim in using the
stakeholder approach as communication strategy is to change
perceptions and rules of engagement to create win-win
outcomes.
4. Why does every ethical issue have dilemmas? Do you believe ethical
dilemmas can be prevented and solved morally without the use of
principles? Explain.
Answer: Decision choices presented by an ethical dilemma usually
involve solutions that do not satisfy all stakeholders. In some
situations, there may be a resolution to an ethical dilemma that
is the right thing to do, although none of the stakeholders
material interests are benefited. Ethical dilemmas that involve
many stakeholders require a reasoning process that clearly
states the dilemma objectively, and then proceeds to articulate
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the issues and different solution alternatives. Although ethical

reasoning has been defined, in part, by acting on principled
thinking, it is also true that moral creativity, negotiating skills,
and knowing your own values also help solve tough real world
situations.
Yes I believe ethical dilemmas can be prevented with deciding
what is right and wrong in an international context also involves
understanding laws and customs, and the level of economic,
social, and technological development of the nation or region
involved. On the other hand, we should not easily accept
stereotypical descriptions of how to do business by means of
what may be considered local customs.
5. Why is utilitarianism useful for conducting stakeholder analysis? What
are the problems using this principle?
Answer: Utilitarianism is a useful principle for conducting a stakeholder
analysis, because it forces decision makers to (1) consider
collective as well as particular interests, (2) formulate
alternatives based on the greatest good for all parties involved
in a decision, and (3) estimate the costs and benefits of
alternatives for the affected groups.
The problems are:

No agreement exists about the definition of good for all

concerned. Is it truth, health, peace, profits, pleasure,
cost reductions, or national security?9
No agreement exists about who decides. Who decides
what is good for whom? Whose interests are primary in
the decisions?
The actions are not judged, but rather their
consequences. What if some actions are simply wrong?
Should decision makers proceed to take those actions
based only on their consequences?
How are the costs and benefits of nonmonetary stakes,
such as health, safety, and public welfare, measured?
Should a monetary value be assigned to non-marketed
benefits and costs?10 What if the actual or even
potentially harmful effects of an action cannot be
measured in the short term, but the action is believed to
have potentially long-term effects, say in 20 or 30 years?
Should that action be chosen?
Utilitarianism does not consider the individual. It is the
collective for whom the greatest good is estimated. Do
instances exist when individuals and their interests
should be valued in a decision?
The principles of justice and rights are ignored in
utilitarianism. The principle of justice is concerned with

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the distribution of good, not the amount of total good in a

decision. The principle of rights is concerned with
individual entitlements, regardless of the collective
calculated benefits.
Even given these problems, the principle of utilitarianism is still
valuable under some conditions: when resources are fixed or
scarce; when priorities are in conflict; when no clear choice
fulfils everyones needs; and when large or diverse collectives
are involved in a zero-sum decision, that is, when a gain for
some corresponds to a loss for others.

6. In your opinion, what are the problems with the free-market society?
What are the problems with the regulated market society? Is there any
third way solution?
Answer: Free-market society problems:

Mechanisms do not effectively inform owners and

managers on how to respond to complex crises that have
far-reaching ethical consequences
Children and other vulnerable groups are not aware of the
effects of advertising on their buying choices.
Many firms advertising activities truthfully inform
consumers about product reliability, possible product
dangers, and proper product use.

Regulated-market problems:

Regulated-market have the same problem with freemarket, that mechanisms do not effectively inform
owners and managers on how to respond to complex
crises that have far-reaching ethical consequences
There are many bigger profit that company cant take, for
instance, paper company cant cut all trees because its
regulated by government.

Third way solution:

Limited liability laws. Capitalism requires capital lots

of it. But without limited liability laws, investors are
unlikely to risk investing their money in business.
Property rights. Without the right to own property and
dispose of it as you wish, capitalism as we know it could
not exist. This legal rights are created and protected by
the government.
Bankruptcy protection. Business inherently risky and
one of the largest risks is business failure, particularly
during recessions and depressions.

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A stable money supply. Without reliable money,

markets would be based primarily on barter and thus be
extremely limited.
Patents and copyrights. Large portions of our economy
would grind to a halt if the government did not grant
patents and copyrights.
Banking regulation and insurance. As we have seen
recently, a capitalist economy depends heavily on stable
banks to finance growing businesses.
International trade law. Global capitalism would be
impossible without trade. Governments create the legal
frameworks the treaties and international trade laws
that facilitate and make this trade possible. free trade is
a misnomer because it implies that it is international
trade that exist free of any political framework.

7. Do you think ethics have universal values and apply similarly in

different cultures? In a country that has diverse cultures like in
Indonesia, can we have different ethical principles among those local
cultures?
Answer: I think ethics do not have universal values and apply similarly
in different cultures. But, If there was a set of universal ethical
principles that applied to all cultures, philosophies, faiths and
professions, it would provide an invaluable framework for doing
business. I think, if we have a company, we should have strong
corporate cultures, because (1) have a widely shared
philosophy, (2) value the importance of people, (3) have heroes
(presidents and products) that symbolize the success of the
company, and (4) celebrate rituals, which provide opportunities
for caring and sharing, for developing a spirit of oneness and
we-ness. Also, individuals and teams in ethical cultures
demonstrate a tolerance and respect for individual differences,
compassion, ability to forgive and accept, and freedom and
courage to do the right thing in questionable situations.
Yes, in Indonesia we can have different ethical principles among
those local cultures. Besides, whether an action is right or
wrong depends on the norms of the society in which it is
practiced.

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8. Do you agree with the statement that Corporate Social Responsibility

(CSR) will help corporation to attain sustainability? Please explain.
Answer: Yes I agree, with managing corporate social responsibility
(CSR) from the corporate board of directors to the marketplace
requires commitment, and significant time, effort, and
resources from organizations. At stake is a companys
reputation, and even survival. External regulation is also
required to help define guidelines and practices for companies
to act responsibly toward their stakeholders, communities, and
society.
9. What are the reasons for corporations to initiate their CSR programs?
Is it only for obligatory reason or are there other reasons?
Answer:
Corporate
social
responsibility
(CSR)
involves
an
organizations duty and obligation to respond to its
stakeholders and the stockholders economic, legal, ethical,
and philanthropic concerns and issues. This definition
encompasses both the social concerns of stakeholders and the
economic and corporate interests of corporations and their
stockholders. Generally, society cannot function without the
economic, social, and philanthropic benefits that corporations
provide. Leaders in corporations who use a stakeholder
approach commit to serving broader goals, in addition to
economic and financial interests, of those whom they serve,
including the public.

CSR brings a whole bunch of benefits to your company and to

the rest of society. You can do some good in the world while
possibly cutting costs and making your company look
absolutely fantastic, such as:
a. Customer engagement
Half of the point of CSR is to benefit the company and
improve its reputation. Basically, you want people to
know about it. Using CSR can help you to engage with
your customers in different and new ways. It can be
easier to strike up conversations with your customers
since the message is about something good.
b. Employee engagement
Along the lines of customer engagement, its important
and beneficial that your employees know whats going
on within the organization. You are missing an
opportunity if you keep your business CSR in the dark.
Employees will gain a sense of pride and happiness
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c.

d.

e.

f.

towards the company if they are aware something good

is going on.
Brand differentiation
Brand differentiation used to be the main reason why
companies would participate in CSR. Now that CSR has
become more common, using it for brand differentiation
has become more difficult.
Long-term plans
CSR is a companys way of looking into the future. Its an
effort to look into the companys interest and
sustainability. CSR initiatives help organizations step
back and forget about next quarter for a minute to focus
on ten years from now.
Cutting costs
Companies can use less packaging or less energy, for
example, and -boom- you have sustainability and CSR
while saving some dollars.
Innovation
Innovation is a great benefit to both a company and to
society. A company will make plans and research to
development some type of sustainability and end up
with a product that can truly change the world for the
better. For example, Unilever was able to innovate new
products like conditioner for hair that uses less water.
Things like this may have not come to be without the
idea of sustainability and CSR.

10. What traits should be preserved for us in order to be survived in

globalization era?
Answer: We must be:
a. Open to other cultures and flexible.
b. Aware of verbal and nonverbal differences in
communication with a person from another culture.
c. Aware that management practices developed in one
culture may not be easily transferred to another.
d. Aware of the cultural influences on behaviour.
e. Adaptive.
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f. Loyal, honest, and ethical.

g. Have multidisciplinary perspectives, which are needed for
problem solving.
And also, we have to increase our:
a. Strategic awareness
b. Adaptability to new situations
c. Sensitivity to different cultures
d. Ability to work in international teams
e. Language skills
f. Understanding international marketing
g. Relationship skills
h. Family support
i. International negotiating skills
j. Self-reliance
k. Open, non-judgmental personality
l. Flexibility of thinking
m. Sensitivity to others
n. Ability to see the big picture
o. Leadership skills
p. Drive and determination
q. Intellectual capability

Question from Cases:

Enron
1. What led to the collapse of Enron?
o Enron was able to hide huge derivative losses that would have
stopped its growth much sooner if widely understood. Publicly
traded corporations are required to make their financial
statements public, but Enron's finances were an impassable
maze of carefully crafted imaginary transactions between itself
and its subsidiaries that masked its true financial state. In other
words, losses were held off the book by subsidiary companies,
while assets were stated.
o The disgrace drove so much business away from and created
such liability for accounting firm Arthur Anderson that it was
itself forced out of business. By this time, though, the true value
of the company had been revealed and the stock price collapsed,
leaving employees with worthless options and pension packages.
Of course, executives that understood the real picture sold their
shares in advance of the collapsed and waltzed away with
billions.
2. How did Enrons corporate culture promote unethical decisions and
actions?
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Answer: Enron failure did not happen by accident. It was facilitated by a

corporate culture that encouraged greed and fraud, as
exemplified by the energy traders who extorted California energy
consumers. Rather than focus on creating real value,
management's only goal was in maintaining the appearance of
value, and therefore a rising stock price. This was exacerbated by
a fiercely competitive corporate culture that rewarded results at
any cost. Some divisions of Enron replaced as much as 15 percent
of its work force annually, leaving employees to scramble for any
advantage they could find to justify their continued employment.
Sampoerna
What is the most challenging cross-cultural issue in Sampoerna after the
acquisition process by Philip Morris?
Answer:

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If
we
look at portion of family members, portion members with
university degree, distribution of members company origin, and
distribution of members nationalities are the biggest challenging
cultural issue that could Sampoerna face after the acquisition,
because they work together with Philip Morris which had a strong
culture. But this cross-cultural can lead a brighter future for HM
Sampoerna. Angky Camaro, managing director, said that "The
international experience of our new Board member, combined
with the continuity and deep local expertise of our current Board,
will make HM Sampoerna an even more formidable competitor in
Indonesias cigarette market.".
Citibank
What factors has made Citibank fail to maintain its standard operation
procedure in both Melinda Dee and Irzen Octa cases?
Answer: Regulatory oversights as well as loose corporate governance
certainly have contributed. Additionally, there seems to be a
growing conduct gap between a corporations beliefs and its
actions. Citibank has certainly created a strong and aspirational
set of values and principles with their code of conduct.
Unfortunately, this commitment has not been adopted by all
employees. There clearly has been a failure by corporate leaders
to create or govern the appropriate ethical culture.

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