Personal Ethics and Business Ethics

“Morality is simply the attitude we adopt towards people whom we personally dislike.”~ Oscar Wilde on morality

Morality and Law

Philosopher James Rachels suggest two criteria- Reason & Impartiality.

William Shaw-1. An action can be illegal,

but morally right.2. An action that is legal can

be morally wrong.

How are moral Standards Formed ?

Religion and Morality

Morality, Etiquette and Professional Codes

Management and Ethics

Moral Standards Vs Standards

Characteristics that distinguish

Moral standards with

Standards

Associated with special emotions & Vocabulary

Deal with matters that we think can seriously injure or benefit human beings

Moral standards are not established or changed by the decisions of particular

authoritative bodies

Moral standards to be preferred to other values including self interest

Moral standards are based on impartial considerations

Normative TheoriesNormative Theories

Non-Consequentialist( Deontological-Duty Based)

Consequentialist

Egoism Utilitarianism Kantian Theories

Egoism The view that associates morality with self-interest is

referred to as egoism. Psychological Egoism: To derive their basic moral principle

from the alleged fact that humans are by nature selfish Criticism of the Theory of Psychological Egoism:1. Egoism as an ethical theory is not really a moral theory at

all.2. Psychological egoism is not a sound theory in as much it

assumes that all actions of men are motivated by self interest.

3. Ethical egoism ignores blatant wrongdoings.

Utilitarianism: Ethics of Welfare

Classical Utilitarianism & Traditional Utilitarianism The creators of Traditional Utilitarianism were

Jeremy Bentham(1748-1832) and John Stuart Mill(1806-1873)

Bentham’s principle can be stated as- “ The seeking of pleasure and avoidance of pain, ,that is , happiness, is the only right and universally desirable end of human action.

Jeremy Bentham’s Version of Utilitariasm

An action is right from an ethical point of view if and only if the sum total of utilities produced by that act is greater than the sum total of utilities produced by any other act the agent could have performed in its place.

sum up all the values of all the pleasures. Sum up all pains find the balance

John Stuart Mill’s Version of Utilitarianism

John Stuart Mill’s version

of Utilitarianism

The creed which accepts as the foundation of morals, utility or the greatest happiness principle, holds that actions are right in

proportion as they tend to promote happiness, wrong as they tend to produce the reverse of

happiness

It is better to be a human being dissatisfied than a pig satisfied.

It is better to be Socrates dissatisfied than a fool satisfied. And if the fool or the pig are of a different opinion, it is because they know

only, their side of the question.

is

Utilitarianism Principle

It is stated as, “An action is right if and only if it produces the greatest balance of pleasure over pain for everyone.”

UtilitarianPrincipleInvolves

Consequentialism

Hedonism

Universalism

Maximalism

Classical Utilitarianism

Classical Utilitarianism

Needs todetermine

The amount of utility( balance of pleasure and pain for each individual affected by an action)

The amount of utility for a whole society

Two versions of Utilitarianism

Two versionsOf

Utilitarianism

Act Utilitarianism(AU): An action is right if and only if it produces the greatest balance of pleasure over pain for every one; simple theory and provides an

easily understandable decision procedure

Rule-Utilitarianism (RU): An action is right if and only if it conforms to a set of rules, the general

acceptance of which would produce the greatest balance of pleasure over pain for every one; gives finer grouped to the rules of morality and to roles obligations, which are problems of all teleological

theories.

Business Survival

BusinessSurvival

A . States legal regulations

B. Society’sMoral values

To complywith

Is not just to

Make profit but,

Business Prosperity

BusinessProsperity

Equity and responsibility in dealings with –employees,

customers, suppliers

Community involvement

Environmental Concern

Openness

Integrity and responsiveness to criticism

And complaint

Include

Points like

Kantianism: Ethics of DutyImmanuel kant (1724-1804): The most important ethician in the rationalistic school in

modern times. Good willThe notion of Good Will is the concept of Duty The imperatives of morality are not hypothetical but

categorical.The moral duty that binds us is unconditional.The core idea of his categorical imperative is that an action

is right if and only if we can will it to become a universal law of conduct.

Organizational Importance of Kantian Philosophy

In the ethical theories of egoism and moral utilitarianism humans are considered means to achieve the ends.

Kant gives more importance to individuals. an action has moral worth only when it is done from a

sense of duty. Reason is the final authority for morality. Blind beliefs or rituals cannot be the foundations of

morality.Two formulations of Kant:1. To act only in ways that would one would wish others to

act when faced with the same circumstances.2. Always treat other people with dignity and respect.

Theories of Business Ethics

Normative Theories of Business Ethics

Social Contract Theory

Stakeholder Theory

Stockholder Theory

Stakeholders of a Firm

Primary Secondary

Media Consumers Government Judiciary Competitors General Public/Society Political groups Activist groups Trade Unions Customer Advocacy Groups Trade Associations Financial Community Local Community Environment

Stockholders Employees Suppliers Creditors Customers

Survival of the firm depends on Those who affect or are affected by the Firm