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MGMT 1040
William(bill) Woof

Chapter 4 Page 87 to 95 Moral Analysis and Ethical Duties Moral problems arise when financial performance and social performance are in conflict Financial performance is easy to measure (revenues, costs, profits) Social performance is difficult to measure but represents overal satisfaction of population Results of moral problems can benefit, hurt, impose rights of and expand rights of stakeholders Key is to find equitable balance between financial and social performance and logically convince others to accept the balance As we become a global economy, effectively resolving moral problems grows in importance because stakeholders are more diverse Impossible to avoid all harms or rights ignored It is important to find an equitable balance that everyone can accept In order to find equitable balance, three evaluative methods are used Evaluative methods study economic outcomes, legal requirements, and ethical duties Economic outcomes Based on impartial market choices Manager should produce with the least wanted (cheapest) resources to produce the most wanted (highest price) goods Greatest satisfaction for shareholders of the firm Greatest satisfaction of members of society Theoretical and practical problems exist with this approach Theoretical problem: "optimal benefits for all" can only occur if following conditions are met All input factor and output factor markets are truly competitive All suppliers and all customers within those markets are fully informed All external costs are totally included Legal requirements Belief is managers must always obey law because law supposedly represents collective moral standards of society Theoretical and practical problems exist with this approach Critical practical problem is that it is hard to write legal requirements that will cover all current and future moral problems that may come before a court Critical theoretical problem is that most legal requirements are not wholly representative of all cultural, religious, economic, and social situations Ethical duties Defined as duties you believe you owe to other people based on your own rational thought No one can tell you your duties Universal principles help decide ethical duties Can use them to convince others to support your solution University principles Rules for decisions or actions that are: Not limited to a cultural, religious, economic, or social situation Thought to lead to overall well-being and satisfaction of society Easily understood why the principle leads to overall benefit Example: an universal principle from Aristotle Proposed that a person should be open, honest, truthful, and proud of what he did Reasons that since Greek society at the time composed of groups of citizens who varied in all aspects If everyone knew what everyone else was doing, everyone would work together Pride is important because if one is proud of what they do, they'll inform others on what they're doing Application to health care insurance case If insurance companies were proud of their actions, they'd let everyone know what exactly they were doing His principle is universal because it can be applied to all and understood by all Definition of Moral Philosophy Universal principles are derived from the study of moral philosophy Moral philosophy is study of proper thought and conduct How people normatively should think about issues Tried to establish logical thought process based on an incontrovertible principle The principle could determine whether a decision or action was right or wrong No agreement on incontrovertible principle Many proposed first principles help to estimate degree of rightness or wrongness of a given action Example: sales rep for health care consulting firm received cash payments from health care insurance companies Can be considered wrong because Cash payment not openly and proudly acknowledged Not economically efficient What if company sent a case of wine and a thank-you note instead Is it still right? All moral problems involve compromises on the nature and extent of those benefits and harms, and of those rights recognized and denied There is no "right" thing for all situations Compromises have to be made Moral philosophy helps to make the "right" choice and define ethical duties to each other It is not as extensive as one may wish Principle of Self-Interests (Protagoras and Democritus) Developed by Greek philosophers in Athens Only measure that matters is the life of the individual and the means by which that life can be made to be satisfying and fulfilling "better a good life than a pleasant dinner" Only the long-term goal of a good life matters Evaluative goals for a good life has to combine comfortable conditions and cheerful companions Can only achieve this by a moderation in personal lifestyles and accepting public standards Necessary to follow these two to avoid irritating others Justice is seen as a contract where everyone agrees not to harm anyone Everyone accepts this because it is in everyone's long-term self interests to live in a society with little probability of harm "Never take any decision or action that is not in the long-term, or enlightened, self-interests of yourself and of the organization to which you belong in order to avoid the possibility of future retribution and harm from others" Principle of Personal Virtues (Socrates and Aristotle and Plato) Moderated or enlightened self-interest not acceptable to these philosophers Socrates' problem is one can act unethically to reach a position of wealth and power where he has no fear of retribution Concluded that everyone should act with honour, pride, and self-worth Don't have to be kind, concerned for others Only have to follow the three values set out because human existence’s goal is to pursue excellence Excellence requires those values Rational pursuit of excellence, known as knowledge of the good, is basis of Greek philosophy Two thousand four hundred years ago, these men in Athens laid the foundation of Western approach to politics and ethics Happened because of prosperity and peace in Greece Effective trade routes and good climate resulted in prosperous trade Conflicts that arose between nobles (ex-warriors), merchants (ex-sailors), and citizens (current residents) brought interest in government Interest in government brought schools Schools taught rhetoric then logic Interest in logic led to question, "what is the good life" Socrates never wrote anything about the good life but Plato recorded his discussions and published them Socrates goal was to develop "first rule for a successful life" Successful then meant happy No happiness in the pursuit of pleasure or ownership of property unless you knew how to use them well Therefore, knowledge of the "good" was the goal of life However, knowledge came from good and bad and wisdom/foolishness of intellect It is important to develop both sides so everyone would recognize proposals that were good for themselves (ethics) and society (politics) Ethics and politics are synonymous in Greek thinking cannot have one without other Plato succeeded Socrates when he died and focused more on politics Wrote the republic where he discussed justice-- what it is and how to achieve it Athens was divided into statesment (leaders, men of thought), nobles (warriors, men of courage), merchants (sailors, men of property) You need all three for society Justice defined as harmonious union of all three groups Aristotle focused on ethics The need to have good men in order to form a good society Goal of society had to be happiness for all citizens, not pleasure, wealth, or fame Since humans are reasoning animals, happiness has to be associated with reason If active use of reason leads to excellence then happiness is the "pursuit of excellence" Excellence is focused in character of man and can be found in many dimensions Openness, honesty, truthfulness, temperance, friendliness, courage, modesty, and pride Consequently if everyone strives for excellence on those dimensions All elements in diverse Athenian society work well for benefit of all "we should be open honest truthful, moderate, and proud of what we do so that we work together well for the benefit of all" Translated in modern terms: "never take any decision or action that is not open,honest, and truthful, and that you would not feel proud to have reported on front pages of newspapers" The Principle of Religious Injunctions (early religious writers of many faiths) Problem with previous principle is that those personal virtues (open, honest, truthful, and proud) are not enough Early writers of religion felt something more was needed Came from community (brotherhood and sisterhood) and service (kindness, compassion, and help) that underlies all faiths Golden rule of Christianity Do unto others as you would have others do unto you Can be found in many other religions that predate Christianity Basic teachings of most religions stress community and duty of kindness, compassion and help to people "never take any action that is not kind and compassionate toward others, and that not forward a sense of true community, a belief that all of us should work jointly toward a common goal" Principle of Government Requirements (Hobbes and Locke) Kindness, compassion, and a sense of everyone working jointly toward a common goal only if everyone would be kind compassionate and oriented toward the well-being of the full community but everyone won't be Hobbes returns to assumption that everyone is self-centered Hobbes thinks people are equal in strength of body and mind Equality of this leads to equality of hope in achieving ends Leads to constant struggle for gain, safety, and for reputation Constant struggle can become war Resulting chaos leads to decline in science, trade, and production and final outcome "the life of a man: solitary, poor, nasty, brutish, and short" Hobbes proposed that everyone living in a state of nature would sacrifice right to life to a powerful authority that guarantees peace and enforces the law Locke added right to liberty and property This lead to the development of the social contract Hobbes and Locke concluded that basic ethical principle would be "obey the law to avoid chaos and loss" The Principle of Universal Duties (Kant, 1724-1804) pg.96 • States that none of us should ever take any action that we would not be willing to see others be free or even encouraged to take in roughly similar situations. o Problem: provides no means for the comparison or relative ranking of alternatives. o A decision or action is either morally right or morally wrong, with no possible gradations between those two extremes. • States that we should always treat other people as ends, worthy of dignity and respect, and never as means to our own ends. o Problem: it is hard not to treat other people as means to our ends. • Kant’s Ethics are duty based. • Non-consequentialist • A system based on rules or principles which govern decisions. • The modern version of this ethical principle is, “Never take any action that you would not be willing to see others, faced with the same or a closely similar situation, also be free or even encouraged to take, and never take any action that does not treat all others as ends, worthy of dignity and respect, and never as means to your own ends.” • refer to pg. 53 of Shaw’s text for more information about Kant’s Ethics. The Principle of Distributive Justice (Rawls, 1921-2002) pg.97 • Rawls believed that society was an association of free individuals and that cooperation between those individuals was needed to generate social benefits in the form of marketable goods and services, but benefits were unjustly distributed with the least well off in society. • Rawls suggested that under the conditions of the Social Contract (aka Veil of Ignorance) they would make a single and simple agreement. • The single and simple agreement would be that inequalities in the distribution of the material benefits of social cooperation would be permitted only as long as it was reasonable to assume that those inequalities would work out to the benefit of all. o Example: It would be perfectly all right to pay scientists more than labourers because it would be reasonable to assume that the additional pay would attract more scientists who would invent better products that would make life more rewarding for everyone, including the labourers. • Veil of Ignorance: where people did not know what abilities, skills, or resources they might have, and this their potential for earnings to satisfy their needs. o Under the veil of ignorance, the people in Rawls’ original position have no knowledge about themselves or their situation that would lead them to argue from a partial or biased point of view. • Distributive justice seeks the just distribution of benefits and burdens. Rawls believed that the distribution of resources in society creates inequality, and Rawls argued in favour of arranging social institutions in a manner that promotes the least well off in society (those with the least income, education, skills, wealth, competence, influence, or power). In effect, the demands of distri
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