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Ethical Theory – Part II
Dr Andrea Werner
MGT 3110
Business and Society
19 October 2009
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Lecture overview
 Ethical theories as frameworks to evaluate ethical issues
in business
 Consequences/Utilitarianism
 Ethics of duty/Deontology/Kantianism
 Ethics of Rights and Justice
 Virtue Ethics
 Confucian Ethics
 Discourse Ethics
 Postmodern Ethics
 How are we to use ethical theories in ethical decisionmaking in business?
 The idea of moral imagination
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Virtue ethics
 Descends from classical Hellenistic
tradition represented by Plato and Aristotle
 Focuses on character of decision-maker:
morally correct actions are those
undertaken by actors with virtuous
characters
 “What would a virtuous person do in this
situation?”
 Being virtuous means having the right desires and
motivations (Beauchamp et al. 2009:35)
concept of the ‘mean’ (Fisher and Lovell 2009:104)
 Cardinal virtues (Plato): wisdom, justice, temperance
(self-control), courage
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Virtue ethics
 Linked to the idea of human happiness or flourishing, the
good life (“eudemonia”): a virtuous life is one that allows
individuals to achieve true happiness – both for
themselves and for their communities
 Moral virtues are acquired in a particular community of
practice
 ‘Modern’ virtues may include: honesty, courage,
faithfulness, trustworthiness, integrity, fairness,
generosity, patience, compassion …
What virtues do you value in your culture?
What virtues do you value in a business person in your culture?
Are your answers to the questions above identical – why/why not?
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Virtue Ethics and Business
 the virtuous organisation (Collier 1995, Solomon
2004)
economic success is just one part of the good
business life, other aspects are important, too: a good
product/service, employees fulfilling their human
potential, harmonious relationships with all
stakeholders
business organisations as moral communities:
developing virtuous managers and employees
 virtue approach reflected in mission statements
e.g. Merck (pharmaceutical company)
http://www.merck.com/about/mission.html
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Critique of Virtue ethics
 Which way of life exemplifies flourishing or
true happiness?
Different communities have different ideals:
accumulation of wealth vs valuing of excellence,
social relationships etc.
 Virtue ethics may not help us if we face
serious ethical dilemmas
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Confucian Ethics – an Eastern virtue ethic
 Confucius (551-479 BCE)
 a humanist, collectivist ethic
 “The nature of a person’s self is
defined and constituted by the
bundles of his or her social
relationships in the world” (Ip 2009)
 de: virtue, character formation
through personal cultivation of
virtues (Junzi: moral person)
 Harmony seen as the primary goal
of personal and social life
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Confucian Ethics
5 cardinal virtues of humanity (lived out and learned in
social relationships)
 ren: capacity of compassion or benevolence for fellow
human beings, human-heartedness
 zhong shu: the Confucian formulation of the Golden Rule (neg
version)
 positive act of moral engagement in others’ moral welfare and
development
 yi: a sense of moral rightness
 li: conventional propriety; etiquettes, norms and
protocols in both personal and institutional lives
 e.g. xiao: filial piety
 zhi hui: wisdom
 xin ren: trustworthiness
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Confucian Ethics in Business and its
limitations
 business an activity embedded in social matrix – effect of
one’s action on social matrix should always be
considered
 value placed on trustworthiness
 favour of long-term business relationships
 guanxi: importance of good relationships/connections
 employer-employee relationship (and other business
relationships) may resemble familial relationship
(Koehn 1999, Ip 2009)
 But also: danger of authoritarianism, sacrifice of
individual interests and rights in the name of ‘harmony’,
nepotism, corruption, how are people treated who do not
belong to one’s group/society?
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Discourse Ethics
 “…deals with the proper process of rational
debate that are necessary to arrive at a
resolution of ethical questions.” (Fisher and
Lovell 2009:125)
 ethical reflection starts from real life experiences
 norms and solutions are generated through
social interaction and open dialogue among all
the different parties that are affected by the
issue
 ultimate goal of ethical issues in business should
be the peaceful settlement of conflicts
(Steinmann and Löhr, 1994)
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Discourse Ethics
Ideal speech situation – criteria include:
o
o
o
o
every participant has an equal chance to argue and to question suspension of power differences
all participants can express their own authentic attitudes, desires
and needs
non-persuasion
non-coercion; the only force allowed is that of the better argument
(Habermas 1990:89, Crane & Matten 2007:114, Fisher &
Lovell 2009:pp. 126)
Practical Application: Stakeholder Dialogue
 e.g. Proctor & Gamble: series of dialogues with a
number of societal stakeholders around safety and
environmental impact of products
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Limitations of Discourse Ethics
 practical time-limits
 requires high-level cognitive abilities on the part of the
participants
 assumption that people behave rationally in discourses
 power differences are not easily suspended
 relies on the willingness of participants to follow the ‘noncoercive force of the best argumentation’
 some stakeholders have no voice (e.g. future
generations)
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Postmodern Ethics / Levinas
 “Postmodern Ethics … locates morality beyond the
sphere of rationality in an emotional ‘moral impulse’
towards others.” (Crane & Matten 2007:115)
Emmanuel Levinas (1906-1995)
 morality is grounded in the encounter with the ‘other’ ethics of proximity
 encounter with the ‘other’ create infinite/unlimited
responsibility for him/her
 “I am not only for the Other but also for all the absent
others who look at me in the eyes of the Other.”
(Soares 2008)
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Postmodern Ethics and Business
Gustafson (2000:21 cited in Crane & Matten 2007:pp. 115)
 individuals should not divorce their professional lives
from their personal lives
 persons with certain moral qualities regarded as
examples for moral practice
 different situations might require different moral
responses
 ethical reasoning is a constant learning process
 ethical learning enhanced through ‘real life’ encounters
(development of moral impulse)
 ‘Blood Sweat and TShirts’ – a BBC documentary
http://www.bbc.co.uk/thread/blood-sweat-tshirts/
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Postmodern Ethics and Business
Soares (2008)
 The corporation has responsibility for each party
which has a relationship to it
 It is through responsibility that the corporation is
able to discover its true aim and meaning
Critique:
 A very demanding approach to ethics
 Is unlimited responsibility to the ‘other’ realistic in
a business context?
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How do we use ethical theory?
 “All theoretical approaches throw light on one and the
same problem and thus work in a complementary rather
than a mutually excluding fashion.” (Crane & Matten
2007:119)
 Utilitarianism: social consequences
 Ethics of Duty: duties to others
 Ethics of Rights: entitlement of others based on idea of
human dignity
 Discourse Ethics: process of resolving conflicts
 Virtue Ethics / Confucianism: moral character
 Confucianism / Postmodern Ethics: relationships with others
 Postmodern Ethics: moral impulse and emotions
see Crane & Matten 2007:121
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And finally … moral imagination
 concept introduced to business ethics by Patricia
Werhane (1999)
 is concerned with whether one has a “sense of the
variety of possibilities and moral consequences of their
decisions, the ability to imagine a wide range of possible
issues, consequences and solutions”
 allows us to see beyond the ‘rules of the game’ and
standard responses
 enables creative moral managerial decision-making
Examples
 bank lending with aim of social and economic renewal of
neighbourhood
 environmental innovation
 flexible work-schemes for employees faced with redundancy
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ANY QUESTIONS?
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