Business ethics

Question 1

Henry Ford:

Answer 1

‘A business that makes nothing but money is a poor kind of business’.

Question 2

Is Ford ethical?

Answer 2

No!!!
The Ford Pinto case, 1970.
Severe design flaw discovered, if it was in a collision from more than 20 MPH, the tank would explode.
The conclusion was that it would cost $11 dollars per car to fix.
But this cost would be more expensive than the deaths or injuries so didn’t fix it. More cost effective to let people die.

Question 3

Body shop founder quote:

Answer 3

Anita Roddick, ‘good ethics is good business’, but is this oxymoronic???

Intrinsic reasons, doing good because it is the good thing to do.

Question 4

Alan Sugar:

Answer 4

‘What’s your hook?’, being ethical businesses is just a hook to gain more profit.
Why do businesses promote when they are eco-friendly??? Surely if they are promoting it, it isn’t for intrinsic reasons.

Question 5

What are the main issues in business ethics??

Answer 5

• Corporate social responsibility.
• Whistle-blowing.
• Globalisation.

Question 6

Milton Friedman and CSR:

Answer 6

• US Economist.
  As long as you are not fraudulent, the only things you need to do are ‘increase its profits’.
• Was reacting to the conception that businesses should aim to improve the lives of workers, said this was socialism, which restricts capitalism which supposedly improves individuals lives.

Question 7

What are the strengths of Friedman’s views?

Answer 7

• Main focus of a business should be to make profit, as without a profit a business will not survive.
• Presents idea of social responsibility to society (responsible for yourself).
• Increase of money in a company improves the money in the economy.

Question 8

Weaknesses to Friedman’s view:

Answer 8

• Thinks that CSR should not be enforced by the government, but surely it is unethical to disregard well-being of employees??
• Companies can still be successful whilst pursuing ethical measures.

Question 9

Examples of the problems with capitalism:

Answer 9

Sweatshop workers Arifa worked in a Bangladesh sweat shop, starting at age 10, working 13-14 hour days.

Question 10

CSR:

Answer 10

Business’ have a duty to consider the effects of their actions on society as a whole.
- Shareholders
- Stakeholders
But is the focus on these just a method of covering the greed???

Question 11

What are shareholders?

Answer 11

People who have a share in a business.
You gain money if the business is successful.

Question 12

What are stakeholders?

Answer 12

A business must monitor its impact, employees, consumers, community.

Question 13

Internal stakeholders:

Answer 13

• Groups within a business, concerned over how much profit it makes.
• Suppliers, workers, managers, lenders.

Question 14

External stakeholders:

Answer 14

• Groups outside the business.
• Want quality goods for a reasonable price.
• Local community don’t want environmental damage.

Sometimes interests can conflict with internal and external.

Question 15

Relationship between business and consumer:

Answer 15

• No fraud.
• Social responsibility.
• Consumer rights, quality, safety, price.

Important, Nike and Gap were found using child labour, Nike now manages factories using panorama programme.
But surely Nike wouldn’t have actually done anything if they were not caught. Extrinsic reasons, not intrinsic reasons.

Question 16

Why is it important to keep employees happy?

Answer 16

They won’t work hard.
Bad quality products/service, less profit.

With new developments in internet, social media gets an insight into the companies flaws.

Question 17

What are whistle blowers?

Answer 17

Someone who risks their livelihood to tell the truth about a company.
They are now protected by the law.
Can give information anonymously.

Question 18

Whistle blower case study:

Answer 18

Karen Silkwood.
Mysteriously died in a car incident, challenging Kerr-McGee about the safety of nuclear facility.
Said she had found serious violations of health and safety regulations.

Question 19

What is globalisation?

Answer 19

Integrating businesses around the world.
Happening more because mechanistic developments.

Question 20

What is the problem with globalisation?

Answer 20

Cheap labour, no breaks required and no minimum wage.
- Means smaller businesses cannot compete.
- Poor remain poor, rich get richer.

Question 21

Benefits of globalisation:

Answer 21

• Gives jobs to poorer communities.
• Consumerism means consumers happier with cheaper clothing.
• More of an insight into different cultures.

Question 22

Reality of sweat shops:

Answer 22

2013, Bangladesh factory collapsed. Rana Plaza.
- Had supplied chains like Primark, Walmart.
- 1100 died.
- Ground floor had shut due to cracks in the building. But others on higher floors told to keep working.

$30 million given in compensation and 35 unsafe factories were closed.

Question 23

‘A Blueprint for Better Business’

Answer 23

Cardinal Vincent Nichols, used natural law and catholic teachings:
- Human dignity (each person can never be merely an instrument)
- The Common Good
- Solidarity
- Fraternity (fellowship to ANYONE no matter the culture)

• Do follow Natural law, but surely can fit into Kant. His imperatives, universal law of nature and the end in itself.
  YET, the common good is utilitarian. Fraternity also utilitarian, disregards religion, for the greatest good, not specifically one religion.

Question 24

Kantian ethics and whistle-blowing:

Answer 24

Importance of honesty, maxim of a ‘lying promise’.
But don’t you have a duty to the business?
Norman Bowie says whistle-blowing breaks ‘prima facie duty of loyalty to one’s employer’.

Question 25

Kantian ethics and globalisation:

Answer 25

Uses people as a means to an end, you also cannot universalise this.
Opposed to slavery, Rana Plaza.

Question 26

William Temple:

Answer 26

Develops Kant’s second formulation of a means to an end.
Business is inherently wrong, as using a customer for profit is using them as a means to an end.

Question 26

Utilitarianism and Whistle-Blowing:

Answer 26

• Whistleblowing could lead to mass unemployment. Weight balance of good vs bad.

Question 27

Utilitarianism and globalisation:

Answer 27

Western goods produced at lower price= the greatest number happier.

But Bentham rejects this, still thinks we are using people.

Question 28

Peter Singer:

Answer 28

Tweaks Utilitarianism, we should focus on minimising pain more than maximising pleasure, globalisation is NOT good.