What is business ethics?

1. Arranging values to guide decisions

For example, what is more importantand valuable: consumers (in this case students paying for an
education)getting their books cheaply or protecting the rights of the university to runthe business side of
its operation as it sees fit?
2. Understanding the facts
Who, for example, is involved in the textbook conflict? Students, clearly, as well as university
administrators. What about parents who frequently subsidise their college children? Are theyparticipants
or just spectators? What about those childless men and women in Alabama whose taxes go to the
university? Are they involved? And how much money are we talking about? Where does it go? Why?
How andwhen did all this get started?
3. Constructing arguments
There may remain disagreements about facts and values at the end of an argument in ethics, but others
need to understand the reasoning marking each step taken on the way to your conclusion.
Ethics is a determination about right and wrong. Conclusions are only taken seriously if composed from
clear values, recognized facts, and solid arguments.

The place of business ethics

Morality, ethics, and metaethics: What is the difference?
Moralityterm that to determine boundaries of characters, behaviours, wants, opinions, right, wrong good
or bad. Only involves specific guidelines that should be instituted and followed. The rules
Ethics emanate from personal values, sense of obligation to do what is right is internal as opposed to the
external pressure of the law. Related to the ability of man to take actions, either good or bad. Is a rule of
action that is rooted from human thinking? The moral factory, the production guidelines. The making of
the rules.
Metaethics the most abstract and theoretical discussions surrounding right and wrong. The origin of the
entire discussion.
Morality is the rules, ethics is the making of rules, and metaethics concerns the origin of the entire
discussion.
Shareholder perspective
1) Making decisions that are in the owners best interest.
2) Decisions guided by a need to maximize return on investment for the organizations shareholders.

3) Individuals who approach ethics from this perspective feel that ethical business practices are the ones
that make most money.

Stakeholder perspective
1) Corporate social responsibility is often used in discussions on business ethics.
2) Companies should consider the needs & interests of multiple stakeholder groups.
3) Individuals and group affect or affected by companys actions and decisions.
Shareholders are stakeholders, they are not the only ones who fall under the definition of stakeholder.
Stakeholders: employees, suppliers, customers, competitors, gov.agencies the news media, community
residents and others
Normative Ethics-concerns how people ought to act.
Descriptive Ethics-how people are actually acting.
Is business ethics necessary?
Business needs policying because it is dirty enterprise featuring people who get ahead by being selfish
liars.
Successful business work well to enrich society, and business ethicists are interfering and annoying scolds
threatening to ruin our economic welfare.

1.2 Theories of Duties and Rights: Traditional Tools for Making Decisions in Business
If the means justify the ends if you should follow the rules no matter the consequences then when
the agents ask Lepp point blank whether he is selling the medicine, the ethical action is to admit it. He
should tell the truth even though that will mean the end of his business.
if the ends justify the means if your ethical interest focuses on the consequences of an act instead of
what you actually do then the ethics change. If there is a law forcing people to suffer unnecessarily, it
should be broken. And when the agents ask him whether he is selling, he is going to have an ethical
reason to lie.
Duties to ourselves
Begins with our responsibility to develop our abilities and talents.
Duties-Duties to others
Avoid wronging others
Honesty duty to tell the truth
Respect others
Beneficence duty to promote the welfare of others
Gratitude duty to thank those who help you
Fidelty duty to keep our promises
Reparation duty to compensate others
Fairness
Treating equals equally and unequals unequally
Fairness does not mean everyone gets the same treatment: it means the rules for treating people must be
applied equally
Impartiality the rule of no exception
Modern fairness: Rawls
A veil of ignorance
As a way of testing fairness, especially with respect to the distribution of wealth
Rawls proposed that we try to re-imagine society without knowing what our place in it would be.
Is the idea that when you set up rules, you do not get to know beforehand where you will fall inside them,
which is going to force you to construct things in a way that is really balanced and fair.

Where do duties comes from?

Witten into nature of the universe, they are part of the way things are.
Humanity in the sense that part of what it means to be human is to have this particular sense of right and
wrong.
Advantages & Disadvantages of duties
Advantages-fairly easy to understand and wok with
Straightforward rules about honesty, gratitude, and keeping our ends of agreements.
Disadvantages-no hard and fast rule for deciding which duties should take precedence over others.
Immanuel Kant: The duties of the categorical imperative
An imperative is something you need to do.
A hypothetical imperative is something you need to do, but only certain circumstances.
Example: I have to eat, but only in those circumstances where I am hungry.
A categorical imperative, by contrast, is something you need to do all the time: there are ethical rules
that do not depend on the circumstances, and it is the job of the categorical imperative to tell us what they
are.
Categorical Imperative
Act in the way that the rule for your action could be universalised
A consistency principle
Like the golden rule: treat others as you would like to be treated.
Objection: impossible to live by
Treat people as an end, and never as a means to the end.
A dignity principle
Objection: difficult to actually work.

What rights do I have?

The right to life
The right to freedom
The right to free speech
The right to religious expression
The right to pursue happiness
What is consequentialism?

Consequentialists. They do not care so much about your act; they want to know about the
consequences. Consequentialists will want to know about the effects.
Utilitarianism: The greater good

Utilitarianism is a consequentialist ethics the outcome matters, not the act.

Utilitarianism is a happiness calculation. When you are doing something, you take each person
who will be affected and ask whether they will end up happier or it will not make a difference.
Version of utilitarian happiness
Hedonistic vs idealistic
Hedonistic getting pleasure right now is good but not as good as maximising the feeling over long
term.

Idealistic distinguished low and high sensations

Version of utilitarian regulation
Act utilitarianism
Affirms that a specific action is recommended if it increases happiness.
Rule utilitarianism
Whether we would all benefited if everyone obeyed a rule. If we would if the general
happiness level increases because the rule is there then rule utilitarianism proposes that we
adhere to it.
Utilitarianism: Advantages & disadvantages
Advantages
Clarity and simplicity
Acceptability
Flexibility
Breath
Disadvantages
Subjectivity

Quantifications
Apparent injustice
The utilitarian monster
The utilitarian sacrifice
Altruism
An action is morally right if the actions consequences are more beneficial than unfavourable for
everyone except the person who acts.
Eg Mother Theresa, Gandhi
Rules of altruism
Hard questions faced by altruist:
The happiness definition what counts as happiness?
The happiness measure how can it be measured?
The happiness foresight are recipients going to be happier overall?
Altruism: advantages & disadvantages
Advantages
Clarity and simplicity
Acceptability
Flexible
Disadvantages
Uncertainty about the happiness of others
Shortchanging yourself.
Egoism: Just me
Ethical egoism
Whatever action serves my self-interest is also morally right action.
Egoism means putting your welfare above others while selfishness is refusal to see beyond
yourself.
Enlightened egoism, cause egoism, the invisible hand
Enlightened egoism
The conviction that benefitting others acting to increase their happiness
Cause egoism
Works from the idea that giving the appearance of helping others is a promising way to advance
my own interest in biz.
Invisible hand
The force of the marketplace competition, which encourages individuals to make money for a
better life

Rules of egoism

Personal egoist vs impersonal egoist

Do whatever is necessary to maximise his/her own happiness
Everyone should do what is best for themselves and without the concern for the welfare of others
Rational egoism vs Psychological egoist
Rational stands at the idea that egoism makes sense.
Psychological believes that putting our interest in front of everyone is not a choice, its a reality.
4 relations between egoism and business
Egoist in an egoist organisation
Egoist in a non-egoist organisation
Non egoist in an egoist organisation
Non egoist in a non egoist organisation
Advocating and against egoism
Advocating
Clarity and simplicity
Practicality
Sincerity
Unintended consequences
Dignity
Argument against
Egoism is not ethics
Egoism ignores blatant wrong
Psychological egoism is not true
Cultural relativism
Nietzsche different cultures and people each produce their own moral recommendations
and prohibitions, and there is no way to indisputably prove that one set is simply and
universally preferable to another.
Nietzsches eternal return of the same
Every decision you make and everything you feel, say and do will have to be repeated
forever at the end of your life, you will die and are immediately reborn right back in the
same year and place where everything started. Existence becomes and infinite loop.
Therefore, we should always act as though the eternal return were real
Eternal return: advantage & drawback
Advantage
Adds gravity to life
Forces you to make your own decisions
Drawbacks
How can we make peaceful and harmonious societies when all anyone ever thinks
about is what best for themselves forever?

Cultural ethics
Cultural ethics embrace the idea that moral doctrines are just the rules a community
believes, and they accept that there is no way to prove our societys values are better than
another.
Right and wrong in the business world is nothing more than what is commonly
considered right and wrong in a specific community.
Cultural ethics: advantage & drawback
Advantage
Allows people to be respectful of others and their culture
Explicitly acknowledges that there is no way to compare one culture against
another as better or worse.
adapts well to contemporary reality
Drawback
It does not leave any clear paths to make things better
It provides few routes to resolving conflicts within a society
Virtue theory
The idea that people who are good will do the good and right thing, regardless of the
circumstances: whether they are at home or abroad.
The idea that we can and should instill those qualities in people and then let them go out
into the complex business world confident that they will face dilemmas well.
Virtues and Vices
Virtues
Wisdom
Fairness
Courage
Temperance
Prudence
Sincerity
civility
Virtue ethics: advantage & drawback
Advantage
Flexibilty
Confidence that the virtuous will be equipped to manage unforceable moral
dilemmas in unfamiliar circumstances.
Drawback
Lack of specificity
Theory does not allow clear, yes or no responses to specific problems.
Discourse Ethics
1. Define the stakeholders

2. Establish a language of discussion

3. Establish the goal, which in discourse ethics is always the peaceful and consensual
resolution to the dilemma.
4. Define the problem.
Discourse ethics: advantage & drawback

Advantage
The search for solution opens the door all the way. Everything is on the table.
Drawback
Everything is on the table.
For every ethical dilemma faced, you have to start over.

Ethics of care
The basic question is not about yourself
Focus of moral regulation from the individual to networks of social relationships
Ethics of care: advantages & drawbacks
Advantages
It can cohere
It humanizes
It allows
Disadvantages
Threatens to devolved into tribalism