1

Chapter - 13

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Learning Objectives

Identify ethical issues in how the use of

information technologies in business affects
employment, individuality, working conditions,
privacy, crime, health, and solutions to societal
problems.

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Learning Objectives (continued)

Identify types of security management strategies

and defenses, and explain how they can be used
to ensure the security of e-business applications.

How can business managers and professionals

help to lessen the harmful effects and increase the
beneficial effects of the use of information
technology?

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Section I

Security, Ethical, and Societal Challenges

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Ethical Responsibility
The use of IT presents major security challenges,
poses serious ethical questions, and affects society in
significant ways.
IT raises ethical issues in the areas of..
 Crime

 Privacy

 Individuality

 Employment

 Health

 Working conditions
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Ethical Responsibility (continued)

But, IT has had beneficial results as well.

So as managers, it is our responsibility to minimize

the detrimental effects and optimize the beneficial
effects.

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Ethical Responsibility (continued)

Business Ethics
Basic categories of ethical issues
Employee privacy
Security of company records

Workplace safety

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Ethical Responsibility (continued)

Theories of corporate social responsibility

Stockholder theory
Managers are agents of the stockholders.
Their only ethical responsibility is to increase
profit without violating the law or engaging
in fraud

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Ethical Responsibility (continued)

Theories of corporate social responsibility (continued)

Social Contract Theory

Companies have ethical responsibilities to all
members of society, which allow corporations to
exist based on a social contract

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Ethical Responsibility (continued)

Theories of corporate social responsibility (continued)

 Firstcondition – companies must enhance
economic satisfaction of consumers and
employees
 Second condition – avoid fraudulent practices,
show respect for employees as human beings, and
avoid practices that systematically worsen the
position of any group in society

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Ethical Responsibility (continued)

Theories of corporate social responsibility (continued)

Stakeholder theory
 Managers have an ethical responsibility to manage a
firm for the benefit of all its stakeholders.
 Stockholders

 Employees

 Customers

 Suppliers

 Local community

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Ethical Responsibility (continued)

Theories of corporate social responsibility (continued)

Sometimes stakeholders are considered to
include
Competitors

Government agencies and special interest

groups
Future generations

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Ethical Responsibility (continued)

Technology Ethics
 Four Principles :
 1. Proportionality
Good must outweigh any harm or risk

Must be no alternative that achieves the same

or comparable benefits with less harm or risk

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Ethical Responsibility (continued)

Technology Ethics (continued)

 2. Informed consent
Those affected should understand and accept

the risks
 3. Justice
 Benefits and burdens should be distributed
fairly

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Ethical Responsibility (continued)

Technology Ethics (continued)

 4. Minimized Risk
Even if judged acceptable by the other three
guidelines, the technology must be
implemented so as to avoid all unnecessary risk

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Ethical Responsibility (continued)

 Ethical Guidelines

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Ethical Responsibility (continued)

Ethical guidelines (continued)

Responsibilities of end users
Act with integrity
Increase their professional competence

Set high standards of personal performance

Accept responsibility for their work

Advance the health, privacy, and general

welfare of the public

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Computer Crime

Association of Information Technology

Professionals (AITP) definition includes
The unauthorized use, access, modification, and
destruction of hardware, software, data, or network
resources
Unauthorized release of information

Unauthorized copying of software

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Computer Crime (continued)

AITP guidelines (continued)

 Denying an end user his/her own hardware,
software, data, or network resources
Using or conspiring to use computer or network
resources to illegally obtain info or tangible
property

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Computer Crime (continued)

Hacking

The obsessive use of computers, or the

unauthorized access and use of networked
computer systems

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Computer Crime (continued)

Cyber Theft
Involves unauthorized network entry and the
fraudulent alteration of computer databases

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Computer Crime (continued)

Unauthorized use at work

Also called time and resource theft
 May range from doing private consulting or

personal finances, to playing video games, to

unauthorized use of the Internet on company
networks

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Computer Crime (continued)

Software Piracy
Unauthorized copying of software
Software is intellectual property protected by
copyright law and user licensing agreement

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Computer Crime (continued)

Piracy of intellectual property

 Other forms of intellectual property covered by
copyright laws
 Music

 Videos

 Images

 Articles

 Books

 Other written works

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Computer Crime (continued)

Computer viruses and worms

Virus

A program that cannot work without being

inserted into another program

Worm

A distinct program that can run unaided

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Computer crime ( cont’d)

 Adware & Spyware

 Adware
Even though adware software purporting to serve
some useful function and often fulfilling that
function, also allows Internet advertisers to
display advertisements as banners and pop-up ads
without the consent of the computer user.

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Computer crimes ( cont’d)

 Adware and Spyware (continued)

 Spyware
In the extreme, adware can also collect information
about the user of its host computer and send it over the
internet to its owner. This special class of adware is
called spyware and is defined as any software that
employs users’ Internet connection in the background
without their knowledge or explicit permission.

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Computer Crimes ( cont’d)

 Few characteristics of Spyware

- Not all adware programs are spyware
- Spyware program collect information about
people ranging from general demographics like
name, address and Internet surfing habits to credit
card, national id no., user names, passwords or
other personal information.
- Spyware is considered as a clear threat to
public privacy.
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Privacy Issues

IT makes it technically and economically feasible to

collect, store, integrate, interchange, and retrieve data
and information quickly and easily.
 Benefit – increases efficiency and effectiveness
But, may also have a negative effect on individual’s
right to privacy

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Privacy Issues (continued)

Examples of important privacy issues

Accessing private e-mail and computer records &
sharing information about individuals gained from
their visits to websites and newsgroups
 Always knowing where a person is via mobile and
paging services

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Privacy Issues (continued)

Examples of important privacy issues (continued)

Using customer information obtained from many
sources to market additional business services
Collecting personal information to build individual
customer profiles

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Privacy Issues (continued)

Privacy on the Internet

Users of the Internet are highly visible and open to
violations of privacy
Unsecured with no real rules
Cookies capture information about you every time

you visit a site

That information may be sold to third parties

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Privacy Issues (continued)

Privacy on the Internet (continued)

Protect your privacy by
 Encryptingyour messages
Post to newsgroups through anonymous

remailers
Ask your ISP not to sell your information to
mailing list providers and other marketers
 Decline to reveal personal data and interests

online
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Privacy Issues (continued)

Computer Matching
 Computer profiling and matching personal data to that
profile.
 Individuals have been mistakenly arrested and jailed

because their physical profiles or personal data have

been used by profiling software to match them
incorrectly with the wrong individual.
 Information extracted from the databases of sales

transaction processing systems, Internet websites or

newsgroup people visit and sold to information brokers.

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Privacy Issues (continued)

Privacy laws
Attempt to enforce the privacy of computer-based
files and communications
‘Electronic
Communications Privacy Act’
‘Computer Fraud and Abuse Act’

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Privacy Issues (continued)

Computer Libel and Censorship

The opposite side of the privacy debate
Right to know (freedom of information)

Right to express opinions (freedom of speech)

Right to publish those opinions (freedom of the

press)
Spamming

Flaming

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Other Challenges

Employment

New jobs have been created and productivity has

increased, yet there has been a significant reduction
in some types of jobs as a result of IT.

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Other Challenges (continued)

Computer Monitoring
Concerns workplace privacy
 Monitors individuals, not just work
 Is done continually. May be seen as violating

workers’ privacy & personal freedom

 Workers may not know that they are being monitored

or how the information is being used

 May increase workers’ stress level

 May rob workers dignity at their work

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Other Challenges (continued)

Working Conditions
 IT has eliminated many monotonous, obnoxious
tasks, but has created others

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Other Challenges (continued)

Individuality

Computer-based systems criticized as impersonal

systems that dehumanize and depersonalize
activities
Regimentation

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Health Issues
Jobstress
Muscle damage

Eye strain

Radiation exposure

Accidents

Some solutions

Ergonomics (human factors engineering)

Goal is to design healthy work environments

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Health Issues (continued)

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Societal Solutions
Beneficial effects on society
Solve human and social problems
 Medical diagnosis
 Computer-assisted instruction

 Governmental program planning

 Environmental quality control

 Law enforcement

 Crime control

 Job placement

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Section II

Security Management

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Tools of Security Management

Goal

Minimize errors, fraud, and losses in the e-

business systems that interconnect businesses with
their customers, suppliers, and other stakeholders

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Tools of Security Management (continued)

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Internetworked Security Defenses

 Internetworked Security Defenses

Five major Tools:
1. Encryption
2. Firewalls
3. Denial of Service Defenses
4. E-mail Monitoring
5. Virus Defenses

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Internetworked Security Defense ( continued)

 1. Encryption
Passwords, messages, files, and other data is
transmitted in scrambled form and unscrambled
for authorized users
Involves using special mathematical algorithms to

transform digital data in scrambled code

Most widely used method uses a pair of public

and private keys unique to each individual

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Internetworked Security Defenses (continued)

 2. Firewalls
Serves as a “gatekeeper” system that protects a
company’s intranets and other computer networks
from intrusion
Provides a filter and safe transfer point
 Screens all network traffic for proper passwords
or other security codes

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Internetworked Security Defenses (continued)

 3. Denial of Service Defenses

These assaults depend on three layers of
networked computer systems
Victim’s website

Victim’s ISP

Sites of “zombie” or slave computers

Defensive measures and security precautions must

be taken at all three levels

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Internetworked Security Defenses (continued)

 4. E-mail Monitoring
“Spot checks just aren’t good enough anymore.
The tide is turning toward systematic monitoring
of corporate e-mail traffic using content-monitoring
software that scans for troublesome words that
might compromise corporate security.”

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Internetworked Security Defenses (continued)

 5. Virus Defenses
Protection may accomplished through
Centralized distribution and updating of
antivirus software
Outsourcing the virus protection responsibility
to ISPs or to telecommunications or security
management companies

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Other Security Measures

Security codes
Multilevel password system
Log onto the computer system

Gain access into the system

Access individual files

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Other Security Measures (continued)

Backup Files
Duplicate files of data or programs
File retention measures

Sometimes several generations of files are kept

for control purposes

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Other Security Measures (continued)

Security Monitors
Programs that monitor the use of computer
systems and networks and protect them from
unauthorized use, fraud, and destruction

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Other Security Measures (continued)

Biometric Security
 Measure physical traits that make each individual unique
 Voice

 Fingerprints

 Hand geometry
 Signature dynamics

 Keystroke analysis

 Retina scanning

 Face recognition and Genetic pattern analysis

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Other Security Measures (continued)

Computer Failure Controls

 Preventive maintenance of hardware and
management of software updates
 Backup computer system

Carefully scheduled hardware or software changes

 Highly trained data center personnel

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Other Security Measures (continued)

Fault Tolerant Systems

Computer systems that have redundant processors,
peripherals, and software
 Fail-over : Uses redundant processors, peripherals and
software for back up.
 Fail-safe : Computer systems continues to operate at the

same level even if there is a major hardware or software

failure.
 Fail-soft: Computer systems can continue to operate at a

reduced but acceptable level in the event of a major system

failure.
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Other Security Measures (continued)

Disaster Recovery
Disaster recovery plan
Which employees will participate and their
duties
What hardware, software, and facilities will be

used
Priority of applications that will be processed

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System Controls and Audits

Information System Controls

Methods and devices that attempt to ensure the
accuracy, validity, and propriety of information
system activities
Designed to monitor and maintain the quality and
security of input, processing, and storage activities

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System Controls and Audits (continued)

Auditing Business Systems

Review and evaluate whether proper and adequate
security measures and management policies have
been developed and implemented
Testing the integrity of an application’s audit trail

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Discussion Questions
What can be done to improve e-commerce
security on the Internet?

What potential security problems do you see in

the increasing use of intranets and extranets in
business? What might be done to solve such
problems?

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Discussion Questions (continued)

What artificial intelligence techniques can a

business use to improve computer security and
fight computer crime?

What are your major concerns about computer

crime and privacy on the Internet? What can you
do about it?

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Discussion Questions (continued)

What is disaster recovery? How could it be

implemented at your school or work?

Is there an ethical crisis in e-business today?

What role does information technology play in
unethical business practices?

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Discussion Questions (continued)

What business decisions will you have to make

as a manager that have both an ethical and IT
dimension?

What would be examples of one positive and one

negative effect of the use of e-business
technologies in each of the ethical and societal
dimensions illustrated in the chapter?

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