Business Ethics Unit 6

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UTILITARIANISM

Part One.Fundamental Tenets ofUtilitarianism

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Utilitarianism: Problems 

Maximizing happiness might require performing immoral actions.

E.g.. Could save three lives by taking one. Utilitarianism does not explain why we should

respect people’s “rights”. Utilitarianism does not support keeping

promises, unless it will support the general happiness.

Utilitarianism seems to be too demanding

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Immanuel Kant (1724-1804) 

Sought to establish all philosophy on a rational ground.

Believed that what is right and wrong could be determined by reason.

Reason dictates a basic, unconditional imperative, that applies to all rational beings. (Kant called this ‘the categorical imperative.’)

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The Categorical Imperative Two formulations.

The Universal Law Formulation: Always act on those maxims that you could at the same time (rationally) will to become a universal law (of nature).

Application: You are thinking of cheating on your exam. Could you will a world in which everyone cheated? No. Because if everyone cheated, then the exams would not be taken seriously and you would not achieve what you are seeking in cheating.

Kant argued that it is never right to lie. Basic idea: If you have a reason that makes it rational for

you to do something, then that same reason would make it rational for any human being to do the same thing. If you could not rationally will for everyone to do it, then it must not really be rational for you to perform that action.

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The Categorical Imperative Two formulations. 

The End-in-themselves Formulation: Always treat rational beings (other persons) as ends-in-themselves, and never merely as a means.

Application: You are thinking of cheating on your exam. But to cheat on an exam is to manipulate your instructor into giving you a grade you do not deserve. You are simply using them to get a good grade.

Basic idea: Humans beings have inherent worth or dignity and should be treated with respect due to their status as rational beings. To be a rational being is to have the capacity to make autonomous, rational decisions. Lying, killing, cheating, injuring, manipulating, etc., others in order to achieve you own goals is to treat them as things to be used and to bypass their own freedom and right to set their own rational goals.

Business Ethics...

comprises principles and standards that guide behavior in the world of business

is right or wrong, acceptable or unacceptable behavior within the organization

is determined by key stakeholders

Social Responsibility...

is the obligation a business assumes toward society

is designed to maximize the positive influence & minimize the negative

includes economic, legal, ethical, and philanthropic dimensions

Why study business ethics & social issues?

in an Ethics Officer Assoc. Survey, 48% of employees indicated that they had done something unethical or illegal in the past year

annual cost of unethical or illegal acts by U.S. employees: $400 billion

Common Unethical Acts...

lying to supervisors falsifying records alcohol and drug abuse conflict of interest stealing gift/entertainment receipt in violation of

company policy 1997 Society for Human Resource Management/

Ethics Resource Center, Business Ethics Survey.

Key Causes of Unethical Behavior...

meeting overly aggressive financial or business objectives

meeting schedule pressures helping the organization survive rationalizing that others do it resisting competitive threats saving jobs

1997 Society for Human Resource Management/ Ethics Resource Center, Business Ethics Survey.

Key Influences On Ethical Behavior... personal values supervisor influence senior management influence internal drive to succeed performance pressures lack of punishment friends/coworker influence

1997 Society for Human Resource Management/ Ethics Resource Center, Business Ethics Survey.

Why Misconduct Is Not Reported...

fear of not being considered a team player did not think corrective action would be taken fear of retribution (from management) “no one else cares, why should I” did not trust the organization to keep report

confidential 1997 Society for Human Resource Management/

Ethics Resource Center, Business Ethics Survey.

Classification of Ethical Issues...

conflict of interest

honesty and fairness

communications

organizational relationships

Conflict of Interest...

exists when an individual must choose whether to advance his/her own interests, the organization’s, or others’

examples include bribes or personal payments, gifts, or special favors intended to influence decision making

Honesty & Fairness...

following applicable laws a regulations & not knowingly harming stakeholders

Is advertising prescription drugs on TV and in magazines fair?

Are long distance information ads that place the cost of the call in very small print at the bottom of the screen fair?

Communications...

refers to the transmission of information and the sharing of meaning

examples: deceptive advertising, product safety information, & product composition

Are vitamin and herbal supplements using ‘puffery’ in their advertising? Note: roughly half of Americans take

supplements

Organizational Relationships...

behavior of organizational members toward stakeholders

includes confidentiality, meeting obligations & deadlines, not pressuring others to behave unethically

Ethical Issues Can Relate to All Functional Areas...

accounting

finance

management

marketing

Discrimination define

to discriminate in employment is “to make an adverse / unfavorable decision regarding an employee or job applicant based on his or her membership in a certain group

Determining whether discrimination occurs

in employment depends …..

3 basic facts:a. whether the decision in some way harms or

disadvantages the employee or job applicant;b. whether the decision is based on an employee’s or

job applicant’s membership in a certain group, rather than individual merit; and

c. whether the decision rests on prejudice, false stereotypes, or the assumption that the group is in some way inferior and thus deserving of unequal treatment.

On moral perspectives there arecompelling moral arguments against job discrimination:

on racial or sexual grounds for 3 instances:a. Utilitarian grounds:

• The idea is that an action (or rule) is right only if there is no other act (or rule) that would produce a greater amount of whatever consequence that the utilitarian is focusing on (e.g., happiness, preferences, welfare).

• Since acts (or rules) that do not discriminate result in less harm than those that do, it follows that discrimination is wrong.

3 instances

b. Kantian grounds: If one attempted to universalize a maxim / saying advocating discrimination,

namely, that an action is right only if the agent would be willing to be so treated

Presumably, no one (who was rational) would be willing to be discriminated against on the basis of gender or race.

3 instances

c. Moral rights: On the assumption that there are moral rights, then people have these rights not because of their gender or race, but simply in virtue of being human.

There seems to be a moral right to be treated fairly, and discrimination on the basis of gender or race is, by its very nature, unfair.

Thus, moral rights are violated by discrimination on the basis of gender or race.

Evidence of Discrimination

two kinds of evidence – (race and gender):

a. Statistical evidence

b. Attitudinal / Outlook (mind-set) evidence

Affirmative action:

an organisational program designed to give preference in hiring and promotion to women and minorities, including veterans, the aged, and the disabled.

3 arguments for affirmativeaction,

i. Compensatory Justice demands affirmative action programs.

Here the key idea is that discrimination on the basis of race and sex has existed in the past.

We need to do something (compensate) to “help repair the wrongs of the past.”

3 arguments for affirmativeaction,2. Affirmative Action is necessary to permit fairer

competition. Here the key idea is that members of certain races

and women have been raised in families that have been affected by discrimination.

they are treated unfairly by many of the institutions that exist in our society, therefore at a disadvantage, and so cannot compete fairly with white men in the job market.

3 arguments for affirmativeaction,

3. Affirmative Action is necessary to break the cycle that keeps minorities and women locked into low-paying, low- prestige jobs.

Here the key idea is that members of certain races and women have been locked into low-paying, low-prestige jobs. ( has bad social consequences so there must be programs to break this pattern.)

3 arguments against affirmative action.

1. Affirmative Action injures white men and violates their rights.

2. Affirmative Action itself violates the principle of equality (egalitarianism / fairness)

3. Nondiscrimination will achieve our social goals; stronger affirmative action is unnecessary.

Comparable Worth

the doctrine of comparable worth holds -that women and men should be paid on the same scale, not just for doing the same or equivalent jobs, but for doing different jobs involving equal skill, effort and responsibility.”

Advocates of comparable worth say…

that justice demands that women receive equal pay for doing work of comparable value.

Jobs should be objectively evaluated in terms of education, skills, and experience required Responsibilities & working conditions

Opponents of comparable worth insist that .. women, desiring flexible schedules and less

demanding jobs, have freely chosen lower-paying occupations and thus are not entitled to any redistribution in pay scales.

Sexual Harassment

Sexual harassment occurs as behaviour of a sexual nature that affects a person’s employment situation.

3 kinds of sexual harassment Sexual threats Sexual offer hostile work environment

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