Business and Professional Ethics:Principles and Practices(Prof. Dennis P. McCann, CRRS Lecturer)

Outline of Topic

• The Problem of “Market Morality”: Profit (Li) and Righteousness (Yi)

• A Little Hint from the West

• A Foreigner’s Suggestion for modernizing Confucian Moral Philosophy

• Practical Consequences: Rethinking “Guanxixue”

The problem of “Market Morality”: Profit (Li) and Righteousness (Yi)

Market Morality: A Contradiction in Terms?

• Everywhere you look today, it’s “Money, Money, Money….”

• Does Market Reform decrease or increase Corruption?

• Is going into Business still like “Going out to Sea?”

The problem of “Market Morality”: Profit (Li) and Righteousness (Yi)

Profit and Righteousness: Does more Li mean less Yi?

• A Struggle over the meaning of Modernization

• A Struggle over the meaning of Confucian Tradition

• What are the resources for bringing Li and Yi into Harmonious Relationship?

The problem of “Market Morality”: Profit (Li) and Righteousness (Yi)

Business & Professions: Like Li & Yi?

Business and Profit Maximization: ONE Moral Duty of “Fiduciary Responsibility”

• The Business Manager’s only Moral Duty is to Maximize Li for the Owners/Investors)

• Professions and the Ethic of Service: MANY Moral Duties of “The Superior Person,” all converging on Ren

• Are Business and Professional Ethics in Conflict?

Western Resources for Overcoming the Disharmony of Li and Yi

What We can Learn from “Applied Moral Philosophy”:

• Moral Rights and Moral Goods are to be found in Business, as in any other human Activity.

• Wealth Maximization (Good) is Moral, so long as Justice (Right) is always done in the way we do Business.

• Good Business Ethics IS Good Business.

• Credibility Problem for Applied Moral Philosophy

Western Resources for Overcoming the Disharmony of Li and Yi

What we can Learn from Management Theory (Peter Drucker)

• What is the Purpose of a Business?

• Profit IS NOT the Purpose of a business

• Profit IS the measure of Success in fulfilling the purpose of a business

• “The Purpose of a Business is to Create a Customer”

• A Focus on Customers Means a Focus on Forming Ethical Relationships: Customers are People whom you have given Good Reasons for Coming Back for More. Customers are People who TRUST you.

A Foreigner’s Suggestion for modernizing

Confucian Moral Philosophy

Cross-Cultural Studies: The World’s Debt to Confucius and Aristotle

• Aristotle’s Nichomachean Ethics: Moral Virtues and a Theory of Justice in the Marketplace

• Confucius’s Lun Yu: The Manager’s and the Professional’s (The Superior Man’s) Moral Virtues and the Way to Cultivate them

A Foreigner’s Suggestion for modernizing

Confucian Moral Philosophy Confucian Ethics as a “Rectification of

Names”

• Harmony is Achieved when Each Person lives up to the Ethics implicit in Human Relationships

• The Five Traditional Relationships:» Emperor---Subjects» Parents-----Children» Husband---Wife» Older Brother---Younger Brother» Older Friend-----Younger Friend

• Moral Duties understood within the Relationship

• Moral Duties as “Asymmetrical Reciprocities”

• Moral Leadership by Moral Example

A Foreigner’s Suggestion for modernizing

Confucian Moral Philosophy Limits of Traditional Confucian Ethics:

• The Centrality of the Traditional Chinese Family

• The State (Empire): the Family in “Big Characters”

• Modernization means Social Responsibility outside the Family

• Economic Globalization means Doing Business with Strangers

• The Scarcity of TRUST and the Expansion of Guanxixue

A Foreigner’s Suggestion for modernizing

Confucian Moral Philosophy Expanding the “Rectification of

Names”: A Confucian Approach to Business & Professional Ethics

I propose Two New Categories of Relationships:

Merchant------Customer

Professional--Client

Both carry all Ethical Assumptions of Confucian Moral Relationships

A Foreigner’s Suggestion for modernizing

Confucian Moral Philosophy Merchant----Customer: Business Men and Women act

in ways that effectively Create Customers:

Turn Strangers into Good Guanxi who want to Exchange “Gifts” with you

Professional---Client Professionals act in ways that

effectively Create Clients: Serving one another through

the Application of Knowledge Professionals do NOT exploit

Clients

Practical Consequences: Rethinking “Guanxixue”

How did “Guanxi” come to mean the same thing as “Corruption”?

What is Corruption? What is Gift-Giving and Receiving? What is Bribery and Extortion? When does Gift-Giving become Bribery?

Does Modernization Change the Meaning of Guanxi? (Modernity as a World without Yi)

• The Need for Guanxi in a Modernizing Society: The Problem of Trust in a World of Strangers

Practical Consequences: Rethinking “Guanxixue”

Confucian Ethics and Guanxi:

• Mencius: “The Superior Man Never Allows Himself to be Bought.” (Book 2, Part B, Number 3: Universal Condemnation of Bribery)

• Confucius: Good Guanxixue and Bad Guanxixue distinguished on the basis of Yi. If the ritual dimension is ignored, Guanxixue is likely to be Bad.

• Good Guanxixue and Bad Guanxixue are distinguishable on the basis of the Relationship that is cultivated, and the Reciprocities appropriate to it.

Practical Consequences: Rethinking “Guanxixue”

Confucian Ethics and Guanxi:

• Bribes are distinguishable from Gifts not on the basis of the amount of money involved (US Legal Standard).

• Bribes are distinguishable from Gifts on the basis of Ren, one’s moral intention. (Confucian Moral Standard)

• If the intent is to cultivate a Relationship, and not to purchase a favor, this can be regarded as Good Guanxixue.