Download Ethics

Ethics - 1
Key Definitions
 Moral:
“relating to principles of right
and wrong”
 Ethics:
“the discipline of dealing with
what is good and bad and with
moral duty and obligation”
Ethics - 2
Study of Ethics
 Process of determining what is and
is not a reasonable standard of moral
conduct.
 Process of problem-solving to resolve
situations in which there is actual or
potential harm to an individual or
group.
Ethics - 3
BUSINESS ETHICS
 The study of morality as applied to
business
 Aims at developing reasonable moral
standards for business conduct
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STAGES OF MORAL DEVELOPMENT
Lawrence Kohlberg
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Preconventional – Self
1. Obey or Pay
2. Self-Satisfaction
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Conventional – Group
3. Group Approval
4. Law and Order
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Postconventional – Universe
5. Standards of Society
6. Logical Moral Principles
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BUSINESS ETHICS
Levels of Analysis
 Individual
– Role of individual
– Impact on individual
 Organizational
– Impact of organization
– Decisions, policies, structures
 Systemic
– Social systems
– Economic and political institutions
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Stakeholder Analysis
Any individual, group or item that can affect or is
affected by an organization’s decisions.
Government
Financial
Community
Suppliers
Creditors
Employees
Firm
Investors
Media
Competitors
Environmentalists
Labor Unions
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APPROACHES TO
MORAL REASONING
 Utilitarianism
– Examines net welfare produced for all
stakeholders
 Rights
– Emphasizes rights and duties of stakeholders
 Justice
– Focuses on fair processes and equitable
distribution of the benefits and burdens
imposed by an action or policy on stakeholders
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UTILIARIANISM CRITERIA
“Greatest Good for the
Greatest Number”
1. Identify alternatives
Which one do
I choose???
2. Determine costs and benefits of each
alternative for each primary stakeholder
3. Select alternative that produces greatest net
good for greatest number of stakeholders
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RIGHTS APPROACH
“Action is correct if it respects the rights
of stakeholders affected by the action”
 Moral entitlements by virtue of being human
 Rights independent of being members of
social institutions
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RIGHTS APPROACH
Moral Duties
 Duty Not to Interfere
 Duty to Protect Rights
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JUSTICE APPROACH
 Equal Treatment
– Stakeholders treated the same except when
they differ in relevant ways
 Consistent Administration of Rules
– Policies and procedures, job descriptions,
salary negotiations should be administered
fairly and evenhandedly
 Restitution
– People should be accountable for injustices
they commit except for those which are
uncontrollable
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SEVEN-STEP PROCEDURE
Moral Decision Making
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What are the facts?
What are the ethical issues?
What are the alternatives?
Who are the primary stakeholders?
What are the ethics of the alternatives?
What are the practical constraints?
What actions should be taken?
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MISCONCEPTIONS ABOUT
BUSINESS ETHICS
 Business ethics = an oxymoron
 Proper ethical analysis = clear cut solutions
 Ethics = Legal compliance
 Ethical analysis = an “ivory tower” approach
 Good ethics = good “business”