ABSTRACT.

What ethical framework should be used

as a basis for teaching business ethics? Should business
ethics be taught by ethicists in a separate course, by
business faculty in business courses, or perhaps by
both? These are some of the issues this paper will
address. The paper begins with a review of the liter-
ature concerning approaches to teaching business
ethics. Next, some ethical frameworks for teaching
business ethics are considered. Finally, the paper
proposes that students should apply their own personal
values to business ethical issues in the classroom, thus
providing future business leaders with a process for
resolving ethical dilemmas.

Impetus for teaching business ethics
Professional associations and accrediting agencies
have encouraged the incorporation of ethics into
the business curriculum. For example, the
American Assembly of Collegiate Schools of
Business (AACSB) accreditation standards require
that ethics be included in the business cur-
riculum. A survey of AACSB member schools by
Schoenfeldt

et al. (1991) reported that over 90%
of the institutions include ethics as a significant
curriculum topic, and that 53% intend to increase
coverage of the subject. Similarly, the American
Accounting Association (AAA), which is the
national association of university accounting
professors, has taken steps to enhance ethics
education in accounting. The AAA offers
training seminars for accounting faculty, and
has developed case studies for use in the class-
room.
But most business professors have not been
trained to teach ethics. This is not a new
problem. Grimstad (1964) raised questions about
the preparation of business faculty to teach ethics.
So, while the AAA and others have made notable
contributions to the enhancement of teaching
ethics in business and accounting courses,
business faculty are still looking for a framework
to teach business ethics. The overriding theme
of this paper is that business faculty can and
should teach business ethics by raising ethical
issues in business courses, and asking students to
apply their personal values to resolve ethical
dilemmas. This, in turn, will provide future
business leaders with a process which incorpo-
rates ethical considerations in business decisions.
Approaches to teaching business ethics
Many schools require a separate course in ethics,
while others integrate ethical issues into business
courses. Some schools do both. When ethics is
taught as a separate course, students often do not
incorporate what they learn in the ethics course
into other business courses. The ethics course, in
a sense, is just out there, and ethical principles
are not applied to business problems in business
courses. On the other hand, business faculty
sometimes feel uneasy about discussing ethical
theories in the business classroom, since they are
not trained ethicists. Business faculty can,
however, ask students to identify ethical issues
A Framework for
Teaching Business Ethics Alfonso R. Oddo
Journal of Business Ethics 16: 293297, 1997.
1997 Kluwer AcademicPublishers. Printed in theNetherlands.
Alfonso R. Oddo is an AssociateProfessor of Accounting
at Niagara University. Heis a recipient of theSears
Roebuck award for teaching excellence and campus
leadership. His current research interests focus on business
ethics in theaccountingcurriculum, and on issues in
accounting education. He has published numerous
research papers, and is a regular reviewer of PrenticeHall
accountingtextbooks.
in business courses, and to apply their own
personal values to make business decisions.
Mintz (1990) conducted a survey of ethics in
management accounting courses and found that
a little over half of the respondents integrated
ethics into their courses. Teaching materials
included professional codes of ethics, journal and
news articles, case studies, and an ethics video
produced by the Institute of Management
Accountants (IMA). Those who did not teach
ethics cited curriculum constraints, lack of
subject materials, and lack of ability as the
primary reasons for not integrating ethics into
their courses.
Ethics should not be viewed as an add on
to an already-crowded curriculum. Rather,
ethical issues should be addressed concurrent
with business subjects taught in courses
throughout the curriculum. Moreover, business
faculty should not feel that, because they are not
trained in ethics, they are therefore unqualified
to address ethical issues in the business classroom.
Business faculty should alert students to the
ethical implications of business decisions, and ask
the students to resolve the ethical issues using an
appropriate ethical framework, which may
include their own personal value systems.
Epstein (1989) identifies three conceptual
frameworks for teaching business ethics that have
evolved over the years: business ethics, corpo-
rate social responsibility, and corporate social
responsiveness. Epstein describes business ethics
as . . . a special applied branch of ethics which
focuses general ethical principles and analytical
approaches upon a particular field of endeavor
business. Epstein further classifies business ethics
according to four levels of analysis: (1) macro
ethics pertains to norms and values of the total
political-economic system; (2) intermediate
ethics focuses on the conduct of groups of
business firms, such as industries and trade asso-
ciations; (3) organizational ethics concerns the
conduct of specific firms; and (4) individual
ethics deals with the conduct of individual
persons. The next section of this paper will focus
on the business ethics framework, with emphasis
on the application of personal values to business
ethical issues.
Some frameworks for teaching business
ethics
What ethical frameworks can business faculty
refer to when addressing ethical issues in the
business classroom? Should the discussion of
ethics be philosophical and theoretical, or prac-
tical and applied? This section of the paper
considers these questions. Five ethical frame-
works will be presented: normative ethical
theories, the Vincentian tradition, professional
codes of ethics, corporate codes of ethics, and
personal values.
Normativetheories
Ethics at Niagara University is addressed both in
a required ethics course, and as a topic integrated
into business courses throughout the curriculum.
At NU, students are required to take three course
units of philosophy and three course units of
religious studies as part of the general education
component of the curriculum. One of the
required philosophy courses is ethics, which
addresses normative ethical theories including
utilitarian theories, deontological theories,
theories of justice and theories of rights. A
business ethics course, which applies ethical
theories to business, is also available. Thus, ethical
theories are covered in the required philosophy
course.
Next, ethical principles and their application
to real-world business situations are reinforced in
the business courses. Just as teaching writing
cannot be left solely to the English faculty,
teaching ethics cannot be left solely to the
philosophy faculty. If students get into the habit
of considering the ethical implications of business
decisions in the courses where they learn about
business, then they are more likely to transfer this
learning to their business careers.
In addition to philosophy professors teaching
ethics in their philosophy courses, and business
faculty teaching ethics in their business courses,
more cooperation between business faculty and
philosophy faculty is needed. Guest-lecture
appearances by business faculty in the philosophy
classroom and by philosophy faculty in the
294 Alfonso R. Oddo
business classroom, joint research efforts between
philosophy and business faculty, and attendance
at professional conferences business faculty at
philosophy conferences, and philosophers at
business conferences provide opportunities for
business and philosophy professors to share ideas.
Business faculty, philosophy faculty, and most
importantly, students would benefit from these
business/ philosophy joint ventures.
Vincentian tradition
Vincentian tradition gives Niagara University its
unique identity. Niagara University and its sister
institutions, St. Johns University and DePaul
University, were founded by the Vincentian
Fathers and Brothers, who take their name
from St. Vincent de Paul, a French priest who
dedicated his life to the poor and helpless.
Niagara University seeks to instill in its students
a deep concern for the rights and dignity of the
human person, especially for the poor, the suf-
fering, the handicapped, and the outcast.
Accordingly, the Vincentian tradition provides
another framework within which students can
evaluate the ethical implications of business
decisions. Does a particular business policy
promote the rights and dignity of the human
person? Is a business decision sensitive to the
needs of the poor?
Professional association codes
Professional accounting associations provide
ethical guidance for their members, and these
guidelines can be used in the classroom as a
framework for evaluating ethical issues. In this
manner, students will become aware of these
professional standards, and accustomed to apply
them in their business decisions.
The Code of Professional Conduct of the
AICPA governs accountants in public practice.
The code consists of two sections: principles and
rules. The principles provide the framework for
the rules, which govern the performance of
professional services by members. Compliance is
voluntary, though members who fail to comply
are subject to disciplinary action. The principles
address professional responsibilities, the public
interest, integrity, due care, objectivity and
independence, and the scope and nature of
services.
Similarly, the Standards of Ethical Conduct for
Management Accountants regulates accountants
in industry. The standards address the principles
of competence, confidentiality, integrity and
objectivity. The IMA has produced a video series
to illustrate ethical dilemmas faced by manage-
ment accountants. This video series has been
effective in the classroom by raising awareness of
ethical issues and by stimulating vigorous discus-
sion.
Corporatecodes
The IMA Code specifies that . . . When faced
with significant ethical issues, management
accountants should follow the established policies
of the organization bearing on the resolution of
such conflict. . . . Hence, corporate codes of
ethics provide another source of guidance in
dealing with business ethical issues. Corporate
codes vary from business to business, and students
should be aware of the existence of the codes as
a framework within which to apply their personal
values to ethical issues in business decisions.
Landekich (1989) conducted a research project
sponsored by the National Association of
Accountants (NAA, which was subsequently
renamed the IMA). One objective of the research
project was to draft a model ethical code of
conduct for corporations. The model code
proposes sixteen core standards for company
codes of ethics, and offers guidance in matters
ranging from compliance with all applicable laws
and regulations to the payment of normal
discounts and allowances and the extension of
customary courtesies in the ordinary course of
business.
Business textbooks today include more
coverage of ethics, and often refer to real-world
examples of corporate codes of ethics. Students
could be asked to research an ethical issue
involving an actual corporation, and to use that
particular corporations code of ethics as a basis
for evaluating the ethical issue.
A Framework for TeachingBusiness Ethics 295
The primary reason for using any ethical code
as a framework for addressing ethical issues
should be to help students to be aware of such
codes, and to incorporate them into their
decision process. The particular ethical code is not
as important as the processwhich will continue to
serve students and future business leaders.
Personal values
The principal theme of this paper is that business
faculty should incorporate ethics into their
business courses by helping students to identify
ethical issues in business situations, and asking
students to apply their own personal values to
resolve the ethical issues. But before this theme
is developed, two criticisms of efforts to teach
the subject of business ethics will be addressed.
First, Levin (1989) believes that ethics and/ or
morals are learned early in life, and that by the
time students reach college, they are either
honest or not. Under this assumption, unethical
behavior may result from a failure in early
learning to distinguish between right and wrong.
The second criticism is that much of the business
ethics coursework is based on hypothetical cases
which may not be realistic, and which may be
difficult to apply to actual career experiences.
Bishop (1992) offers a cogent response to the
first criticism. It can be argued that a persons
value system is not static or permanent, but
rather may be subject to great modification and
refinement over time (Henderson, 1988). Thus,
while a persons value system may be funda-
mentally formed early in life, values can be
influenced over time. In any case, the goal of
teaching ethics in the business class should be to
get students to recognize ethical issues and to
apply their own personal values to resolve the
issues. The stage of development of the students
values, or the likelihood that their values can be
influenced is irrelevant, since the goal is to apply,
not to change values.
The second criticism that ethics instruction is
often based on unrealistic, contrived cases can
be overcome by using real-world cases involving
ethical issues. The Wall Street Journal and similar
news media can be used to bring current ethical
issues into the classroom. More importantly, the
primary reason for discussing ethical issues in the
business classroom is for the students to develop
a processwhich considers the ethical implications
of business decisions. The particular case is not
as important as the fact that ethical issues are
considered and become part of the business
decision-making process.
Andrews (1989) observes that business execu-
tives often must rely on their own judgment in
making a decision involving infinitely debatable
issues. Executives must find in their own will,
experience, and intelligence the principles they
apply in balancing conflicting claims. And a
paper by Ferrell and Fraedrich (1990) reviews
how personal values, the competitive environ-
ment, organizational pressures and opportunity
interact to determine ethical decisions in
business. It has been argued that the primary goal
of ethics courses should not be to teach the
difference between right and wrong, but rather
to teach students how to incorporate their values
into the decision-making process (Parks, 1986).
So, while business faculty may be understand-
ably apprehensive about incorporating ethics into
their courses, they can present real-world business
situations, and ask students to identify the ethical
implications and to apply their own personal
values to the issues. The goal is for the students
to develop a decision-making process which
includes a consideration of ethical issues.
Outcomes assessment
Does the incorporation of ethics into the business
curriculum make a difference in the ethical
behavior of students and business leaders? Loeb
(1991) notes that if new or innovative programs
are proposed for business education, considera-
tion should also be given as to how the results
of these programs are to be evaluated. Loeb
identifies five issues relating to the evaluation of
ethics education in business: (1) identifying
reasons for evaluating programs, (2) setting goals
as a prerequisite to evaluating outcomes, (3)
defining broad levels of outcomes, (4) deciding
what to evaluate, and (5) measuring outcomes.
These issues suggest areas for further research.
296 Alfonso R. Oddo
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Niagara University
AssociateProfessor of Accounting
Niagara University, NY 14109
A Framework for TeachingBusiness Ethics 297