Chapter 1- The Language of Ethics
Business Ethics is:
-How we act as individuals in business
-How we structure our organizations
-How we structure our business society, laws and systems
Three traditions of ethical thought: ***READ IN TEXTBOOK
1. Deontology- Focuses on actions (Means people use to achieve their goals)
e.g.- when deciding to lie, is the act morally defensible? (NOT who is lying/the good or bad outcome)
2. Character Ethics- Focuses on agents (Persons who are acting in the situation)
e.g. Different cultures have different assets (US: Independent, Japan: Teamwork)
3. Consequentialism- Focuses on consequences (Ends/Goals that are outcomes of actions)
-In contrast to deontology, it does not begin with an assumption that actions may be moral (lying, etc.)
e.g. Military can defend or ward off attacks, but attacking for world domination is immoral
-Take the course of action which creates the most favourable balance vs. harm in achieving purposes
-Each tradition highlights important aspects of moral life and most communities/people need the
resources of all 3 to provide a comprehensive picture of moral life
Three corresponding Decision Guides to use in analyzing cases (from the 3 traditions). They are
frameworks for analyzing the moral dimensions of a given situation:
1. Standards of conduct (to address moral and legal rules that focus on actions)
-Beneficence: People should provide help to others
-Nonmaleficence: Avoid causing harm to others, especially intentional/direct harm
-Autonomy: People should be free to make their own choices (re: their own welfare/life projects)
-Justice: People should give others what they are due and operate with a sense of fair play
-Responsibility: People have certain expectations of themselves and feel obligations to themselves
which they expect in turn from others
-If the public finds out about this activity, could it lead to action against the firm (lawsuits)?
2. Character and Relationships (Having significant levels of trust, respect, cooperation, teamwork and
effective communication is morally and strategically vital (savings on monitoring and synergy together)
-What character traits does the firm (or managers) need to be successful over time?
3. Purposes and Consequences (Moral importance of Managers selecting the right goals and using the
resources of the organization to realize them.
-Which purposes are most important? Are there clear priorities among stakeholder claims?
-Are there any natural alliances between stakeholders that can be developed? The 3 Decision Guides and Decision Making: Three tools that Managers can use to test their decisions so
that it reflects their best thinking (help capture what is going on morally in a given case).
Avoid Rationalization: Process of convincing yourself that a decision is fair and defensible, but it serves
your own interests or offers an easy way out.
Using these three tests…
1. Publicity- Scrutinize your reasoning for a decision by answering a tough question that might otherwise
be avoided: could you defend your choice if it were made public?
2. Reversibility- Put yourself in the position of the person who would suffer the negative consequences
3. Generalizability- Would you recommend others adapt the reasoning in other cases?
-Do they reflect your ethical values and satisfy key stakeholders (scrutiny)?
Reflective Equilibrium- A way to think about the process of reconciling our conscience and practical
judgement with our theories and principles. When theoretical and practical intuitions are in balance,
reflective equilibrium is achieved. Do not put all of your eggs in the ‘theory’ or ‘practical’ basket.
e.g. Levi’s stayed in China despite human rights policy since they are providing opportunities to workers
Chapter 2- Sources of Ethical problems and how to prevent them
Why do good people make unethical choices?
Self-Interest: Can cause managerial mistakes. Not intrinsically problematic, plays a role in
‘Adam Smith’s (believes people want self interests only) conception of Markets’.. says fair play is critical
for any well-functioning society and is the basis for free market exchanges as well.
-Problems arise when self-interest is used as a means to create profits regardless of the impact on
others, or violates the basic moral norms like fairness.
*Self Interest or Greed?
Moral Development: Some ppl may operate at lower levels that impede ability to make sound decisions
-Unethical if Managers think of benefitting oneself as the dominant imperative and the only fear is
Kohlberg’s 6 steps – Different people make different decisions in similar situations because they are in
different stages of cognitive moral development (From self-centred, to social centred, to ethics centred)
1. Punish and Obedience (Preconventional)- Children focus on rewards for behaviour (satisfy own needs)
2. Individual Purpose (Preconventional)- Looks past authority to see how action can serve their needs
3. Interpersonal Relationships (conventional)- Conform to society, living up to expectations to those you
admire (loyalty).. now are