Utilitarianism and Business Ethics Case Studies

Podcast Beta

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What is a potential consequence of unethical behavior in businesses?

Enhanced company reputation

Financial and marketing risk (correct)

Improved employee morale

Increased consumer trust

Which of the following statements best describes the impact of ethical failures?

They can have immediate and isolated consequences.

They only affect the individuals directly involved.

They primarily impact community relations.

They can affect a wide range of stakeholders. (correct)

What aspect is included in the model of ethical decision-making?

Understanding the facts of the situation (correct)

Seeking public approval

Ignoring personal biases

Determining personal beliefs

How can ethical behavior influence a firm's operations?

By fostering trust and loyalty Signup and view all the answers

What was one of the significant impacts of Enron's unethical practices?

Shareholders lost $1 billion in stock value. Signup and view all the answers

What is the primary focus of utilitarianism in the workplace?

Maximizing workplace productivity and harmony Signup and view all the answers

What does principles-based ethics emphasize in the employer-employee relationship?

Treating employees well out of a sense of duty and rights Signup and view all the answers

How does due process relate to employee rights in the workplace?

It requires fair treatment against arbitrary authority use Signup and view all the answers

Which of the following accurately describes employment at will?

Employers can terminate employees at any time for any reason, barring agreements Signup and view all the answers

What fundamental issue arises from a lack of job security for employees?

Employees are at risk of considerable harm due to their lack of power Signup and view all the answers

What is the primary concern of utilitarianism in the context of business ethics?

Maximizing overall good for society Signup and view all the answers

What is a limitation of utilitarianism as mentioned in the content?

It can be difficult to quantify consequences Signup and view all the answers

What might be a negative effect of the government bailout of the auto industry?

Encouragement of riskier behavior by businesses Signup and view all the answers

In the context of free market economics, what is the primary goal of businesses?

To maximize profits for optimal resource allocation Signup and view all the answers

Which of the following describes a key question in utilitarian ethics regarding the means of achieving an end?

Are the means justified by the ends? Signup and view all the answers

What was the approximate cost of the bailout for the US auto industry?

$49.5 billion Signup and view all the answers

Which stakeholder group was NOT directly impacted by the US auto industry bailout?

Environmental activists Signup and view all the answers

What does free market economics aim to achieve?

Maximization of consumer demand satisfaction Signup and view all the answers

What is the main premise of the integrative model of CSR?

Social goals and economic goals can be aligned. Signup and view all the answers

What does enlightened self-interest in CSR suggest?

CSR can create advantages for both society and business. Signup and view all the answers

What risk does 'greenwashing' pose to companies practicing CSR?

Misleading stakeholders about true social practices. Signup and view all the answers

Which of the following is NOT a method to encourage companies to engage in more CSR?

Spontaneous self-regulation. Signup and view all the answers

What is a potential argument against CSR?

Companies are inherently motivated by profit maximization. Signup and view all the answers

How can consumers influence corporate behavior related to CSR?

By publishing negative reviews online. Signup and view all the answers

Which of the following best describes social enterprises?

Organizations that aim to earn profits while creating social value. Signup and view all the answers

What role does ethical leadership play in CSR?

Promotes voluntary CSR engagements within organizations. Signup and view all the answers

What is subliminal advertising primarily intended to do?

Influence consumers without their conscious awareness Signup and view all the answers

Which practice is considered ethically improper in advertising?

Appealing to fear and anxiety for persuasion Signup and view all the answers

What does the term 'dependence effect' refer to in advertising?

Consumer demand being shaped by what producers sell Signup and view all the answers

What does consumer vulnerability signify in the context of marketing?

A lack of intellectual capacity or maturity in decision-making Signup and view all the answers

What is a primary function of the Advertising Standards Authority of Singapore (ASAS)?

To promote ethical advertising practices Signup and view all the answers

Which of the following could be an example of stealth marketing?

Using influencers who do not disclose paid partnerships Signup and view all the answers

What should the Singapore Code of Advertising Practices (SCAP) ensure about advertisements?

They are legal, decent, honest, and truthful Signup and view all the answers

Which of the following is NOT a characteristic of ethical advertising?

Manipulating emotions to increase sales Signup and view all the answers

How does advertising shape consumer culture according to ethical perspectives?

By creating irrational and trivial wants Signup and view all the answers

What can be understood by 'disguised advertisements'?

Subtle marketing strategies that are not immediately identifiable Signup and view all the answers

Study Notes

Utilitarianism

Utilitarianism aims to maximize overall good
Free market economics is a key component
Businesses should maximize profits to ensure efficient allocation of resources
Public policy should be used to predict and maximize the overall good
Issues with utilitarianism include difficulties in quantifying and comparing consequences (e.g., happiness, health) and concerns about the distribution of benefits

Case Study: Bailout of the US Auto Industry

The US government bailed out the Big Three automakers in 2009 to prevent bankruptcy
Stakeholders involved included the government, taxpayers, auto companies, employees, suppliers, and consumers
The bailout cost the government 49.5billion,but49.5 billion, but 49.5billion,but39 billion was recouped
The bailout was intended to save 1.9 million jobs and support economic growth

Business Ethics

Ethical failures are business failures, potentially leading to bankruptcy, fraud, boycotts, and reputational damage
Ethical behavior can foster trust, loyalty, commitment, and creativity within organizations
Model of ethical decision-making:
- Determine the facts
- Consider utilitarian and principles-based ethics
- Treat employees fairly and with due process
- Ensure employees have protections against arbitrary use of authority

Integrative model of CSR combines social and economic goals
Enlightened self-interest suggests that CSR benefits society and the business
CSR can enhance a business's reputation and secure its place in society
Concerns about CSR:
- Companies may not voluntarily engage in CSR
- Government regulation, civil society, and consumers can encourage CSR

Ethics and Environment

Environmental ethics focus on responsible stewardship of natural resources
Marketing practices can be ethically questionable when:
- Targeting vulnerable populations
- Utilizing subliminal advertising
- Employing stereotypes and prejudices

Consumer Autonomy

Advertising can shape culture and individuals
The dependence effect suggests that consumer demand is created by producers
Advertising and marketing can create irrational wants and distort the economy
Vulnerable populations require special consideration in marketing, ensuring informed consent

Ethics in Technology

Privacy concerns are heightened in the digital age
Unauthorised use of online information for hiring decisions is unethical

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Description

This quiz explores the principles of utilitarianism and its application in public policy and business ethics. Specifically, it examines the US government bailout of the auto industry in 2009, including its economic implications and ethical considerations. Test your knowledge on maximizing overall good and the impact of ethical actions in business operations.