Session 9

The Employees Obligation

to The Firm

Course : CB442 Professional Development
Year : September 2013
Bina Nusantara
Employee's main moral duty is to work
toward the goals of the firm.
This view is called "the law of agency,"
which specifies the legal duties of
employees toward their employer.
The employee, must pursue the firm's goals
and do nothing that conflicts with them
while working for the firm.

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An employee might fail to live up to this
duty in several ways:
might steal outright from the firm,
act on a conflict of interest,
use his position to leverage illicit benefits
out of others through extortion or bribery.
Bina Nusantara
Conflicts of interest arise when:
employees have a private interest in the
outcome of a task antagonistic to the firm's
interests
it might affect the employee's independent
judgment on the firm's behalf.
The result is that self-interest induces
employees to act in ways that may not be in
the best interests of the firm.
employees hold another job or consultancy
outside the firm.

.
Conflicts can be either actual or potential
Actual conflicts occur when a person
discharges his or her duties in a manner
prejudicial to the firm.
A potential conflict occurs when a person is
merely motivated or tempted to do so.
If contractual agreements impose moral duties,
then actual conflicts of interest are clearly
immoral.
Potential conflicts of interest may or may not be
ethical, depending on the probability that the
employee's judgment will be affected (or seem to
be affected) by the conflict of interest.
Commercial Bribes/Extortion and Gifts

Bribes and extortion are unethical and create clear
conflicts of interest.

Accepting gifts may or may not be ethical, depending
on a number of factors:
What is the value of the gift?
What is the purpose of the gift?
What are the circumstances under which the gift
was given?
What is the position of the recipient?
What is the accepted practice in the area?
What is the company's policy?
What is the law?

Employee Theft and Computers

Employees contractual agreement to accept
only specific benefits in return for services and
to use the firm's resources for the good of the
firm.
Use of company resources and other
appropriation of benefits counts as theft.
Though theft is often petty (e.g. stealing of
stationeries or padding of expense accounts), it
extends to white-collar crimes such as
embezzlement, larceny, fraud, and forgery.

Computer Theft
More recent forms of theft involve forms
ofminformation and company computers.

Copying a company's software or data, or using a
company computer for personal business (unless
explicitly allowed) are examples of unethical forms
of theft.

Trade Secrets

Propriety information or "trade secrets" is
information that the company owns concerning
its activities, which it explicitly indicates that it
does not want others to have.
Sharing such information is also unethical
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Insider Trading
Information can lead to other types of unethical behavior.
Insider trading, the act of buying or selling company
stock on the basis of confidential or proprietary
information, is illegal and unethical.
Some argue that insider trading is actually ethical and
socially beneficial; it does not harm anyone and helps
the stock price reflect its true value, they maintain.
These arguments ignore basic facts about insider
trading: the information being proprietary, does not
belong to the trader (stolen property).
Research shows that insider trading violates people's
rights, based on unjust advantage, harms overall utility of
society.

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Case Study : Intl cyber criminals arrested in Medan













(Source : http://m.thejakartapost.com/news/2012/12/20/int-l-cyber-criminals-arrested-
medan.html)

Identify and analyze the ethical aspect on cyber thief of the case above.

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The North Sumatra Police arrested 47 foreign nationals fromChina, South Korea and Taiwan on
Thursday at a luxurious home in Medan, North Sumatra. The arrests were made on
Wednesday night and Thursday morning. The individuals were allegedly members of an
international cyber crime network.
Today we arrested 11 Taiwanese nationals and last night we managed to catch 36 Chinese,
Korean and Taiwanese nationals, North Sumatra Police special crime director Sr. Comr.
Sadono Budi Nugroho said on Thursday at his office. The 47 peoples ages ranged from 20
35 years old, 16 were women.
Sadono said that during the first raid, 11 people managed to escape but they came back the
next morningwhen the police detained them. The house was used as their base camp.
According to Sadono, the police had monitored their activities for two months after a tip-off
regarding suspicious activities by the National Polices detective unit. During the arrests, the
police also confiscated dozens of cell phones, satellite phones and computers.
Sadono said that the 47 foreigners were wanted in their respective countries for cyber crime.
We will hand them over to the National Police, he said. (swd)