Good Governance and Social Responsibility: Normative Ethical Theories, PNC PDF

Good Governance and Social Responsibility NORMATIVE ETHICAL THEORIES IN BUSINESS DECISION-MAKING Prepared by: CATHERINE B. BOLINTIAM, PhD OPENING PRAYER  Learning Objectives At the end of the topic, students should be able to: Explain the three types of n...

Good Governance and Social Responsibility NORMATIVE ETHICAL THEORIES IN BUSINESS DECISION-MAKING Prepared by: CATHERINE B. BOLINTIAM, PhD OPENING PRAYER  Learning Objectives At the end of the topic, students should be able to: Explain the three types of normative ethical theories; Discuss Kohlberg’s viewpoint on the six stages of moral reasoning; Elaborate the rules suggested by Machiavelli which could guide a leader; Interpret the utilitarian principle of Bentham; Evaluate the different categorical imperatives of Kant; Support the two important principles about justice of Rawls; Appraise the legal positivism of Hobbes; Assess the divine command theory; and Defend the ethical egoism of Rand. Normative Ethical Theories in Business Decision Making “Those ethical often are made every day at a time, minute by minute in ways that you may not even relate to ethics, so I’m going to walk them through the whole story from that perspective and hopefully they’ll be able to walk away with something good from it.” - Jayson Blair Nature of Normative Ethics  Approaches of Normative Ethics 1. Virtue Ethics – gives guidance as to the kind of characteristics and behaviors a good person will try to attain. Principles of virtue ethics include: a. If an action is being done by a virtuous person in the same situations, then it is right; b. A person who takes action virtuously is a virtuous person; c. Only when a person possess and live the virtues that he acts virtuously; and d. A virtue is a moral attribute that a person requires to live soundly. 2. Deontology – centers on the act being done. It is conscientiousness that makes a person abide with rules carefully despite several temptations not to follow in some cases. Immanuel Kant, a German modern philosopher who preserve this view and stated that the only means to find out the right set of moral rules is by following the dictates of reason which can make one to be truly free. 3. Consequentialism - an ethical theory that evaluates whether or not something is right by what its consequences are. Examples are: Utilitarianism holds that people have to act always in the manner that produces the greatest consequences. Hedonism means doing whatever brings the greatest amount of pleasure, regardless of any other effects. The goodness of a thing depends on whether it is instrumental or intrinsic. Instrumental goodness - brings about instrinsically good things. Instrinsic goodness - brings something valuable because it is good-in-itself. Kohlberg’s Stages of Moral Development  Machiavellian Principles Better to be feared than loved if one cannot be both Gradual reward and immediate punishment The lion and the fox Envy and drive The end justices the means Cycle management forms Promote criticism and frankness Always make a choice Don’t micromanage, but center on one goal Let passion be the basis of one’s business Capture the zeitgeist Niccolo Machiavelli, who viewed Make friends and avoid enemies entrepreneur or executive as an Be cautious of “yes” people innovator who could creates new and Deal with business threats promptly better ways of producing and Learn from the greats distributing products and services.  Utilitarianism of Jeremy Bentham Utilitarianism - focuses on outcomes in deciding right from wrong. In business, it is used in the analysis of cost and benefit wherein action should generate the greatest good for the greatest number. Jeremy Bentham, an English Philosopher who stated that, “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 another act the agent could have performed in its place.  Elements of Utilitarianism Consequentialism - means understanding the wrongness or rightness of actions is based on the actions themselves. Welfarism - connotes understanding that the wrongness or rightness operations based on how society’s idea of welfare. Individualism - holds that each person, as a human being, wants to experience happiness, thus, will employ actions that take advantage of utility. Aggregation - is the outlook that the wrongness or rightness of actions relies on their talent to average the benefits brought to all individuals.  Types of Utilitarianism Negative Utilitarianism - focuses on promoting the least suffering for the least number of people. Act Utilitarianism - views that the fatal flaw of an act is a failure to comprehend the bigger picture which serves as a vital aspect for any business. It exhibits “the end justifies the means” mindset. Rule Utilitarianism - makes an assessment of the utility of an action without taking into consideration individual acts. The end result lies beyond expectations, everyone should respect the rule set in place. Preference Utilitariansim - considers that the greatest good should also satisfy personal preferences. A business that uses it will not strive to achieve the greatest good if it affects others in the process.  Kantian Ethics of Immanuel Kant Kantian Ethics - deals with standards of behavior which determine the morality of an action based on the reasons for doing it. A person is good or bad from the motivation of his actions and not on the righteousness of the consequences of those actions. Categorical imperatives - are simply commands that are unconditional. They Immanuel Kant, a foremost deontologist introduced the categorical imperatives which articulate that the action is considered are considered the basic principles to necessary for itself, without prejudice, with determine whether one’s action is no other purpose. reasonably to be ethically correct.  3 Categorical Imperatives 1st categorical imperative: “An action can only be considered as ethically correct if it can be accepted or made into a universal law.” 2nd categorical imperative: “A person should be treated as an end and not the means to achieve an end.” 3rd categorical imperative: “Each rational individual to act as a member of an ideal kingdom where he or she is both the ruler and subject at the same time.”  Principles of Justice by John Rawls Justice - means giving each person what he deserves or giving each person his due. Principles of Justice - supports equality among every one. It is a moral obligation of every person to acknowledge the existence of every other individual. John Rawls, known for his theory of justice and fairness which builds up principles of justice to direct contemporary social order.  Types of Justice 1. Distributive - refers to the extent to which society’s institutions ensure that benefits and burdens are distributed among society’s members in ways that are fair and just. 2. Redistributive - refers to the extent to which punishments are fair and just. 3. Compensatory - refers to the extent to which people are fairly compensated for their injuries by those who have injured them.  2 Principles of Justice 1. Principle of Equal Liberty - states that each person must have an equal right to the most extensive total system of equal basic liberty for all. 2. Principle of Inequality - says that social and economic inequalities are arranged so that they are both: - to the greatest benefit of the least advantaged - attached to office and positions open fairly and equally to all  Legal Positivism by Thomas Hobbes Legal Positivism - a legal philosophy that expresses the will of that authority who crafted these laws. It disregards higher morality especially when the would be disagreement with the laws. Thomas Hobbes, a philosopher and a supporter of legal positivism who developed his interest to understand why citizens permitted themselves to be ruled.  Concepts of Legal Positivism 1. Positive law is the belief that law is created by the state, for the benefit of the state as one. 2. Positive law has no moral rationale besides making certain the continued existence of the country and its citizens. 3. Obedience to the law is no longer a matter of conscience, which is contrary to what Socrates or Aquinas believes resulting to comply with the law was a crime and anyone who broke it was given a punishment. 4. In positive law there is no disimilarity between law and justice. Justice means conformity of the law. Law and justice are one and the same. 5. The condition that human laws follow certain standards of morality and justice in order to be legitimate is discarded. The only real morality is in human compliance to state law. 6. There was no longer a dispute over who had influence over the law, the church or the state. For this reason, the church would always be submissive to the laws recommended by the state.  Divine Command Ethics Divine Command Theory - says that an act to be considered moral must follow the command of God which dictates what is right and wrong. Things are ethically good or bad, or ethically obligatory, acceptable, or forbidden, only because of God’s will or commands. The theory is based on the assumptions, namely: 1. There is a God; 2. God commands and prohibits some acts; 3. An action is correct if God commands it; and 4. People determine what God commands or prohibits.  Ethical Egoism of Ayn Rand Ethical Egoism - is the moral doctrine which considered that the search of one’s self-interest should always be an individual’s main goal. It emphasizes about how people should behave rather than how they actually behave. It is likened with selfishness for reason that Ayn Rand, promoted the principle of it focuses on one’s self interest to help egoism which is one of the most others or to refrain from harming them. important ethical theories in the field of normative ethics.  Activity: Ethical Reflection Applying Utilitarianism in Business source: https://www.academicwritersbureau.com/samples/219-applying-utilitarianism-in-business Questions to Ponder: 1. What are the components of utilitarianism in business?Name them and explain each. 2. If you are the employer of a business tablishment, how will you apply utilitarianism using these components? Give examples of each.