Ethics of Business Flashcards
Business ethics
rules, standards, codes, or principles
that provide guidelines for morally right behaviour and
truthfulness in specific situations
➢ Means different things to different managers
Levels of Ethical
Assessment
Level 1 Awareness of moral or Ethical implication
Level 2 Ethical implications assessed upon Individual, Organizational, Economic Efficiency, Governmental, and Social Influences- value judgement of Purpose, Moral Standards of Behavior, Decisions based upon influences
Level 3 Implications Assessed upon use of Ethical Principles- Decisions based upon systematic Analysis of Outcomes, and benefits versus Harms to Stakeholders
Value judgments
subjective evaluations of what is
considered important
➢ Based on how managers intuitively feel about the goodness
or rightness of various goals
Moral standards
the means by which individuals
judge their actions and the actions of others
➢ Based upon accepted behavior in society
Moral standards
the means by which individuals
judge their actions and the actions of others
➢ Based upon accepted behaviour in society
Influences become bases for an individual’s value
judgments and moral standards that determine behaviour 1-5
what are the influences
- Influences of Individuals
- Corporate or Organizational Influences
- Economic Efficiency Influences
- Government and Legal System Influences
- Social Influences
Ethical relativism
belief that ethical answers depend
on the situation and no universal standard or rules exist
to guide or evaluate morality
Peter Drucker
Culture eats strategy for Breakfast
Moral problems should be defined as
resulting in
harms to some and benefits to others
➢ Introduces more realism in the business context
Self-Interest Ethic and corp
(Ethical Egoism)
Individuals or corporations set their own standards for
judging the ethical implications of their actions
➢ Individual’s values and standards are the basis for actions
Seven most cited principles of ethical analysis
self
interest, personal virtues, caring, utilitarian benefits,
universal rules, individual rights, and justice
➢ Ethical principles are applied the same way in any context →
not subjective measures rather objective statements
Problems with self-interest ethic:
Considered easy way out because person relies on own beliefs
without more complicated analysis
➢ Viewed as selfish behaviour
➢ Leads to absolutism; failing to take into consideration interest of
others
Enlightened egoist
attentive to needs of others, and self
interest provides an incentive to restrain one’s self-interest
Maximization of profits is acceptable
as long as interests
of relevant stakeholders are considered
➢ Corporation must stay within rules of operation provided in
society through government
Personal Virtues Ethic
An individual’s or corporation’s behaviour is based upon
being a good person or corporate citizen.
Act virtous, acquired through learning and practice.
“Does this action represent the kind of person I am or
want to be, or present the desired corporate image or
reputation?
Ethics of Caring
Gives attention to specific individuals or stakeholders
harmed or disadvantaged and their particular
circumstances
➢ Responsibility for reducing harm or suffering of others
➢ Solutions designed to respond to needs of particular individuals
or stakeholders
Golden Rule
Utilitarian Ethic
Focuses on the distribution of benefits and harms to all
stakeholders with the view to maximizing benefits
➢ “The greatest good for the greatest number.”
Utilitarian Ethic Problems
Does not account for what is just
➢ What should be maximized to result in community’s
happiness?
➢ Cannot accurately measure some costs and benefits (and/or
risk of miscalculating them)
➢ No method for distributing costs or benefits
Universal Rules Ethic
Ensures that managers or corporations have the same
moral obligations in morally similar situations
➢ “What individuals believe is right for themselves, they should
believe is right for all others”
➢ Persons should be treated as end in themselves, worthy of
dignity and respect and never as a means to one’s own ends
Categorical imperative ethics
rules and morals in society
should be fair to everyone, they should universally apply and
apply over time
Individual Rights Ethic agreed upon
Relies on a list of agreed-upon rights for everyone that
will be upheld by everyone and that becomes the basis
for deciding what is right, just, or fair
➢ Examples: Rights to safety, information, privacy, property
➢ Governments identify rights in constitutions
Individual Rights Ethic Problems
Determining and agreeing upon the list of rights
➢ Rights and/or holders of those rights can be in conflict
➢ Rights are not absolute and overemphasis on one might result in
injustice
Ethic of Justice
Considers that moral decisions are based on the primacy
of a single value: justice which will result in fair outcome
➢ Ethical dilemmas are a conflict among rights that can be
resolved by the impartial application of some general principle
Different types of justice
Procedural justice
➢ Corrective justice
➢ Retributive justice
➢ Distributive justice
