Ethical Business in Ancient Athens - Lecture Notes PDF

WEEK 4 TO 5 : CONCEPT OF ETHICAL BUSINESS THE CONCEPT OF ETHICAL BUSINESS IN ANCIENT ATHENS LEARNING OBJECTIVES By the end of this lesson, the students you will be able to: Identify the role of ethics in ancient Athens Explain how Aristotelian virtue ethics affected busine...

WEEK 4 TO 5 : CONCEPT OF ETHICAL BUSINESS THE CONCEPT OF ETHICAL BUSINESS IN ANCIENT ATHENS LEARNING OBJECTIVES By the end of this lesson, the students you will be able to: Identify the role of ethics in ancient Athens Explain how Aristotelian virtue ethics affected business practices  INTRODUCTION Ancient Athens profoundly influenced Western civilization through its art, literature, government, and ethical theories, particularly emphasizing ethics as a function of character in dealings with others, including commerce. The Golden Age of Athens saw the rise of philosophers like Socrates, Plato, and Aristotle, who explored fundamental questions of human existence and developed the concept of virtue, with Aristotle's virtue ethics emphasizing character formation. Aristotle's virtue ethics centers on the idea that everything has a purpose (telos), and for humans, it's eudaimonia or happiness, achieved through the exercise of reason and the pursuit of a virtuous life.  ARISTOTELIAN VIRTUE ETHICS Aristotle identified intellectual and moral virtues, with intellectual virtues like prudence guiding behavior and moral virtues like courage and self-control shaping character through practice and habit. The relationship between intellectual and moral virtues involves action preceding character, emphasizing that courage, for example, results from consistent, intentional behavior toward virtue. Virtue ethics views the individual as the fundamental agent of morality, living out their worldview publicly, making it important for businesses to act ethically, competently, and consider the individual, organization, industry, and society in its development and planning.  To give an oversimplified but practical application of Aristotelian thinking, a hiring manager acts prudently when assessing a pool of candidates based on knowledge of their backgrounds and on insight gained after years of working in that role. The manager may even use intuitive reason regarding a candidate, which Aristotle believed was another way of arriving at truth. Understood in this way, the manager’s intuition is an impression regarding character and someone’s potential fit in an organization. Among the intellectual virtues, prudence played the major role because it helped individuals avoid excess and deficiency and arrive at the golden mean between the two. Prudence has been translated as “common sense” and “practical wisdom” and helps individuals make the right decision in the right way at the right time for the right reason. In Aristotle’s view, only the truly prudent person could possess all the moral virtues.  ATHENIAN DEMOCRACY Athenian democracy differed significantly from modern democracy, as only adult men who owned property could vote, and resident aliens and women had limited rights. Slavery was a customary part of Athenian society, providing labor for agriculture and food production, despite the emphasis on virtue and honor. The belief that business and money were tainted reflected Plato's concept of the physical world being an imperfect expression of the ideal, with money seen as existing simply to replicate itself, fueled by avarice or greed. HONORABLE BEHAVIOR IN BUSINESS Business in ancient Greece had an invigorating effect, encouraging virtuous behavior through association and prudence, emphasizing honor as a foundational virtue and the cultural environment. Aristotle considered greed an irrational and ignoble act that could be avoided through honor and deliberative prudence. Reputation is a product of culture formed by individual and group effort, and to act dishonorably casts disrepute on all concerned, with ends and means needing to be aligned, especially in business.  THREE FORMS OF JUSTICE Along with honor, justice formed part of the cultural environment of Athenian society, with citizens relying on litigation to settle disputes. Justice existed in three forms: legal, commutative, and distributive.  THREE FORMS OF JUSTICE In legal justice, the city-state was responsible for establishing fair laws for the welfare of its citizens. Commutative justice characterized relationships among individuals. Courts attempted to correct harms inflicted and return what had been unlawfully taken away from plaintiffs. Distributive justice governed the duty of the city- state to distribute benefits and burdens equitably among the people.  THREE FORMS OF JUSTICE For instance, within the framework of commutative justice, businesses are often held responsible ethically and financially for any harm caused by their products. And distributive justice is debated in such hotly contested issues as corporate and individual tax rates, universal health coverage, state and federal income assistance, subsidized housing, social security eligibility, college tuition aid and similar programs designed to create a “safety net” for those least fortunate. Some safety net programs have been criticized for their excessive cost, inefficiency, and unfairness to those who pay into them while receiving no benefit or say in their administration.  HOW DID ATHENIAN ETHICAL THEORIES INFLUENCE MODERN PHILOSOPHIES? Athenian ethical theories, particularly those developed by philosophers like Socrates, Plato, and Aristotle, have profoundly influenced modern philosophies in several ways: 1. Foundation of Virtue Ethics: Aristotle's concept of virtue ethics emphasizes the importance of character and virtues (such as courage, honor, and justice) in ethical decision-making. This approach has persisted into modern ethical thought, influencing contemporary virtue ethicists who focus on the moral character of individuals rather than merely on rules or consequences. 2. Ethics as a Function of Being: Athenian philosophers believed that ethics is not solely about actions but about who a person is. This shift from a behavior-centric view to an identity-based understanding of ethics has shaped modern discussions around moral philosophy, emphasizing authenticity and integrity in both personal and professional contexts. 3. Importance of Deliberation and Prudence: The Athenian focus on prudence as a guiding principle for ethical behavior has influenced modern theories of decision-making, particularly in fields like business ethics and public policy. The idea that ethical actions should arise from thoughtful deliberation underscores many contemporary ethical frameworks that stress careful decision-making regarding potential outcomes and implications. 4. Justice as a Central Theme: The Athenian distinction between various forms of justice (legal, commutative, and distributive) serves as a precursor to modern theories of justice, including social justice, distributive justice, and the rule of law. This foundational understanding helps frame contemporary legal and moral debates, impacting areas such as human rights and social equity. 5. Civic Virtue and Community: The notion that individual ethical behavior is closely linked to the health of the community has strong echoes in modern social and political philosophy. Many contemporary theorists argue for the importance of civic engagement and community-mindedness, reflecting the Athenian belief that morality has public implications.  ETHICAL ADVICE FOR NOBLES AND CIVIL SERVANTS IN ANCIENT CHINA LEARNING OBJECTIVES By the end of this lesson, the students you will be able to: Identify the key features of Confucian virtue ethics Explain how Confucian virtue ethics can be applied to contemporary business  INTRODUCTION Confucian virtue ethics emphasizes relationships and how individuals can live well with others, differing from Aristotelian virtue. Confucius aimed to heal social divisions in ancient China by advocating a return to "li," the proper order of the universe, emphasizing collaboration and harmony. The widespread adoption of Confucius's teachings was due to offering a practical and empathetic approach, a "tough love" alternative to tyrannical realism and utopian idealism.  CONFUCIAN VIRTUE ETHICS Confucius stressed the virtuous life to create a "junzi," a gracious and cultured person, as crucial for China's survival. He identified "whole-hearted sincerity and truthfulness," the "constant mean," and "expediency" (quan) as means to improve people and stop inhuman behavior. The "constant mean" refers to balance, avoiding extremes through ritual acts, maintaining the five great relationships in Chinese society: parent/child, husband/wife, elder/junior sibling, master/apprentice, and ruler/subject.  A CONFUCIAN BUSINESS MODEL Righteousness, when directed outward, becomes justice, compelling all parties to act in good faith, enabling wealth creation, investment, and strategic planning. Wholeheartedness and sincerity can serve as models of risk assessment, requiring clearheaded thinking and action balanced with respect for markets, competitors, and stakeholders. Despite criticisms, Confucianism focuses on the character of decision-makers, proven important through business scandals, and is now integrated into leadership development programs.  li refers to doing those tasks in collaboration with others to achieve the mission of the organization. For Confucius, li was expressed through ritual acts. When the correct rituals were followed in the right way with the right intention for the right end, all was well. Of course, corporate rituals also exist, and like all ritual acts, they reinforce cohesion and identity within the group. Identifying them helps improve employee awareness, productivity, and, perhaps, happiness. One example of this would be new-employee orientation, which is intended to acclimate newcomers to the corporate culture, the company ethos, and the traditions associated with the way the firm does business. HOW CAN THE CONCEPT OF 'LI' BE APPLIED IN TODAY’S BUSINESS ENVIRONMENTS? The concept of "li," which refers to the proper order and rituals that govern social relationships and behavior, can be effectively applied in today's business environments in several ways: Establishing Ethical Standards: Incorporating "li" can guide organizations in establishing ethical standards that promote respect, integrity, and fairness among employees, clients, and partners. Businesses can adopt codes of conduct that reflect these values, ensuring that all actions align with a commitment to ethical behavior.  Enhancing Team Dynamics: "Li" emphasizes the importance of relationships, which can foster better teamwork and collaboration among employees. By recognizing and respecting the roles and responsibilities of each team member, companies can create a more harmonious and productive work environment that values cooperative efforts over individual competition. Guiding Decision-Making: The principle of "li" can inform decision-making processes that prioritize the well-being of the community and stakeholders rather than solely focusing on profit. This broader perspective can lead to more socially responsible business practices and long-term sustainability.  Balancing Interests: In line with the "constant mean," businesses can strive to find a balance between various interests—such as shareholder profit, employee welfare, and environmental sustainability—promoting a well-rounded approach to corporate responsibility. Building Trust and Loyalty: By embedding the principles of "li" in organizational culture, businesses can foster trust and loyalty among employees and customers. This can lead to enhanced brand reputation and customer retention, as stakeholders appreciate the commitment to ethical practices and mutual respect.  Rituals and Practices: Businesses can implement rituals that reflect and reinforce the values of "li," such as recognition programs that honor contributions to team success, or community engagement activities that show a commitment to social responsibility. These practices can help solidify a culture of ethics and integrity.  By applying the concept of "li," businesses can create a framework that not only enhances their internal operations but also positively impacts their external relationships and overall societal contributions. COMPARING THE VIRTUE ETHICS OF EAST AND WEST LEARNING OBJECTIVES By the end of this lesson, the students you will be able to: Compare the origins and goals of virtue ethics in the East and the West Describe how these systems each aimed to establish a social order for family and business Identify potential elements of a universally applied business ethic  INTRODUCTION Aristotle and Confucius both developed virtue-based ethical systems aimed at happiness and harmony, respectively, addressing individual stability and social order. Control is a central theme, influencing managerial ethics by balancing individual and collective responsibility to achieve organizational goals responsibly and profitably. Both philosophers valued profit that benefits humanity, but differed in focus: Aristotle on the individual's honorable purpose and Confucius on the family as the foundation of social order.  PERSONAL AND PROFESSIONAL ROLES Eastern and Western systems integrate personal and professional life, requiring consistent behavior in all settings, unlike the modern tendency to compartmentalize. Integrating personal and professional ideals prevents "dispersed personal accountability" and crises caused by greed. Motive, doing the right thing without expecting benefit, and awareness, recognizing the ethical dimension in all actions, are essential effects of this integration.  IS THERE A UNIVERSAL ETHICS? The fundamental question is whether universal, objective moral truths exist that cut across cultures, geographic settings, and time. Standards like The Generally Accepted Accounting Principles (GAAP) and ISO, along with governmental regulation, could form a basis for global ethical behavior in business, but must respect autonomy and sovereignty. Education focused on transformation, not just conformity, is crucial to internalize altruistic business practices and integrate personal and professional ethics, fostering honesty and respect.  HOW DO ARISTOTLE'S AND CONFUCIUS'S VIEWS ON INDIVIDUAL VS. FAMILY ETHICS DIFFER? Individual Focus (Aristotle): Family Focus (Confucius): In contrast, Confucius places a Aristotle's ethical framework strong emphasis on the family centers on the individual, as the foundational unit for highlighting the importance social harmony and ethical of personal character and behavior. He viewed the family as essential in establishing virtue. He believes that order and relationships, individuals should strive to believing that ethical conduct fulfill their purposes honorably begins at home and extends and accept fate with dignity. to society. For Confucius, the ideal individual (a "gentleman" For Aristotle, achieving or "ru") demonstrates virtues happiness (eudaimonia) is that reflect familial ultimately tied to individual responsibilities and societal actions and moral reasoning, roles, promoting stability and harmony in both personal and where each person is communal life. expected to seek truth and virtue to live a fulfilled life.  WHAT ROLE DOES CONTROL PLAY IN THE MANAGERIAL ETHICS ? Control plays a significant role in the managerial ethics discussed in the paper, functioning as a framework for balancing individual and collective responsibilities within an organization. Here are the key aspects of this role:  PLAY OF CONTROL Balancing Responsibilities: Control in managerial ethics involves structuring relationships between management, employees, and the organization in a way that ensures accountability. A self-controlled and disciplined manager can navigate the complexities of bureaucracy and drive the organization towards its goals while maintaining ethical standards.  Achieving Organizational Goals: The concept of control is crucial for achieving organizational objectives without sacrificing ethical principles. Effective management not only aims for profitability but also seeks to enhance the organization’s mission and culture in a fair manner, benefiting all stakeholders involved. Preventing Ethical Failures: By instilling a sense of control, management can help prevent ethical failings and corporate scandals. The paper suggests that a lack of personal and professional integration can lead to "dispersed personal accountability," ultimately contributing to unethical decisions and actions. Control promotes an ethical environment where decisions are reflective of virtue and accountability, thus mitigating risks associated with greed and misconduct. For Aristotle, control manifested itself through the deliberative process of phrónēsis, resulting in virtuous living, harmony, and happiness. This application of practical wisdom was related to self-restraint, or temperance. In Confucian virtue ethics, control was a function of self-regulation; primitive instincts were held at bay and the person gained the capacity and courage to act more humanely (Figure 2.6). This achievement of control benefited not only the individual but also the family and, by extension, the nation. Self-regulation was Confucius’s way of establishing order. Figure 2.6 The Aristotelian and Confucian systems of virtue ethics have in common the theme of control, as this comparison shows. (attribution: Copyright Rice University, OpenStax, under CC BY 4.0 license)  UTILITARIANISM: THE GREATEST GOOD FOR THE GREATEST NUMBER LEARNING OBJECTIVES By the end of this lesson, the students will be able to: Identify the principle elements of Jeremy Bentham’s utilitarianism Distinguish John Stuart Mill’s modification of utilitarianism from Bentham’s original formulation of it Evaluate the role of utilitarianism in contemporary business  INTRODUCTION Jeremy Bentham advocated for various rights and freedoms, believing human behavior is driven by the pursuit of pleasure and avoidance of pain. John Stuart Mill refined Bentham's utilitarianism by incorporating human rights, leading to significant modifications. Utilitarianism aims for the greatest happiness for the greatest number, emphasizing consequences over character or motivation.  MAXIMIZING UTILITY Bentham aimed to quantify happiness for scientific evaluation, rejecting religious authority and focusing on utility as the fundamental unit of human action. Utilitarianism is universal, objective, rational, and quantifiable, using a "hedonic calculus" to measure the utility of actions based on intensity, duration, certainty, and probability. Utilitarianism is a consequentialist theory where actions are judged by their outcomes and potential to produce the most good for the most people, influencing law and policy.  WHAT IS UTILITY? Bentham’s fundamental axiom, which underlies utilitarianism, was that all social morals and government legislation should aim for producing the greatest happiness for the greatest number of people. Utilitarianism, therefore, emphasizes the consequences or ultimate purpose of an act rather than the character of the actor, the actor’s motivation, or the particular circumstances surrounding the act.  WHAT IS UTILITY? It has these characteristics: (1) universality, because it applies to all acts of human behavior, even those that appear to be done from altruistic motives; (2) objectivity, meaning it operates beyond individual thought, desire, and perspective; (3) rationality, because it is not based in metaphysics or theology; and (4) quantifiability in its reliance on utility. SYNTHESIZING RIGHTS AND UTILITY Critics argued utilitarianism disregarded natural rights, reduced humans to utility functions, and was impractical. John Stuart Mill combined natural rights with utility, emphasizing individual freedom and protecting minority rights, introducing the "harm principle". Mill's utilitarianism sought to temper facts with compassion, viewing free expression as the foundational right for achieving truth and utility.  ROLE OF UTILITARIANISM IN CONTEMPORARY BUSINESS Utilitarianism is used in business for decisions like expansion and layoffs, resembling a cost-benefit analysis when considering gains and losses. Bentham's system plays a role in risk management, with the utility function translated into decision-making, risk assessment, and strategic planning. Mill’s harm principle is used by businesses to consider whether their actions harm others, balancing utility with freedom. DIFFERENCE BETWEEEN BETHAM AND MILL OF UTILITARIAN 1. Nature of Rights Bentham: Bentham was skeptical of natural rights, famously referring to them as "nonsense upon stilts." He believed rights could be created or altered by laws and social agreements. Mill: Mill integrated the concept of natural rights into utilitarianism, stressing the importance of individual rights and the protection of minorities. He introduced the "harm principle," which asserts that the only justification for exercising power over an individual is to prevent harm to others. 2. Approach to Consequences: Bentham: In Bentham's view, the rightness of an action is determined solely by its consequences in terms of overall happiness or utility produced. Mill: While Mill also focused on consequences, he placed greater emphasis on the quality of outcomes and considered moral dimensions, arguing for a balance between utility and individual freedoms. 3. Methodology: Bentham: He sought to create a formulaic approach to utilitarianism, relying heavily on quantification and empirical measurement of utility that could be applied across situations. Mill: Mill valued reasoned discussion and qualitative assessments, emphasizing that understanding human experiences and social contexts is crucial for achieving true utility.  HOW DID HISTORICAL EVENTS SHAPE THE DEVELOPMENT OF UTILITARIAN THOUGHT? The Enlightenment: The Enlightenment emphasized reason, individual rights, and empirical evidence, which influenced philosophers like Jeremy Bentham and John Stuart Mill. This intellectual climate encouraged the development of ethical systems that relied on rationality rather than tradition or religious authority. Bentham’s utilitarianism sought to apply the scientific method to ethics, aiming to quantify happiness and good in a systematic way.  Political Revolutions: The American Revolution and the French Revolution, both of which emphasized liberty and equality, provided a backdrop for utilitarian thought. The Bill of Rights and the Déclaration des Droits de l’Homme (Declaration of the Rights of Man) highlighted basic human rights and freedoms, concepts that Bentham initially criticized but that Mill later integrated into his version of utilitarianism. These movements raised questions about the purpose of government and the rights of individuals, which were central to Mill's synthesis of utilitarianism and human rights.  Industrial Revolution: The Industrial Revolution transformed society from agrarian to industrial economies, leading to changes in work, family structures, and social relationships. This rapid change called for new ethical considerations regarding business practices, labor rights, and social welfare. Both Bentham and Mill addressed the implications of industrialization, with Mill advocating for individual rights amidst the growing power of corporations and the state.  Social Reform Movements: The rise of various social reform movements during the 19th century—including those advocating for labor rights, women's rights, and the abolition of slavery—was influenced by utilitarian principles. Bentham's progressive views on issues such as decriminalization of homosexuality and the abolition of the death penalty stemmed from his utilitarian belief in maximizing happiness and reducing suffering. Mill’s experiences with social reform movements, especially the push for women's rights, further shaped his beliefs about equity and the protection of individual liberties.