Business Ethics Week 3 Revision PDF

BUSINESS ETHICS WEEK 3 AGENDA Theories in Ethics: -Absolutism & Relativism -Utilitarianism 2 KEYWORDS  Traditional Ethical Theories:  Teleological Theories: The Traditional ethical theories are Teleological class of theories concerned with what kinds of...

BUSINESS ETHICS WEEK 3 AGENDA Theories in Ethics: -Absolutism & Relativism -Utilitarianism 2 KEYWORDS  Traditional Ethical Theories:  Teleological Theories: The Traditional ethical theories are Teleological class of theories concerned with what kinds of provide one with a two-step actions are right and wrong, how approach to determining the right the world is and how it ought to course of action: first, determine be, what kinds of decisions are the proper end and then decide made and what kinds of decisions the means for achieving it. ought to be made. 3 KEYWORDS  Deontological Theories: The  Utilitarianism:Utilitarianism is deontological class of ethical often equated with the concept of theories states that people should “the greatest good for the greatest adhere to their obligations and number of people duties when engaged in decision making when ethics are in play. 4 TRADITIONAL ETHICAL THEORIES There are two schools of ethical theories: consequentialism (teleology) Non consequentialism (deontology) 5 6  TRADITIONAL ETHICAL THEORIES The word ‘teleology’ is derived from ‘teleos,’ meaning consequences or purpose (of our judgement/action),and ‘logus,’ meaning study. 7 TELEOLOGICAL APPROACH Whether a decision is right or wrong depends on the consequences or outcomes of that decision. As long as the outcome is right, then the action itself is irrelevant. 8 TELEOLOGICAL APPROACH This is a consequentialist theory. Whether a decision is right or wrong depends on the consequences or outcomes of that decision. As long as the outcome is right, then the action itself is irrelevant. 9 TELEOLOGICAL APPROACH There are two perspectives from which the outcome can be viewed: Egoism Sometimes thought of as the view 'what is best for me?'. An action is morally right if the decision maker freely decides in order to pursue either their short-term desires or longer- term interests. The egoist will also do what appears to be 'right' in society because it makes them feel better. Egoism does not always work because actions on all members of society cannot be determined. 10 TELEOLOGICAL APPROACH Utilitarianism Sometimes taught as the idea of 'what is best for the greatest number?'. An action is morally right if it results in the greatest amount of good for the greatest number of people affected by that action. It applies to society as a whole and not the individual. It is valuable in business decisions because it introduces the concept of 'utility' – or the economic value of actions. It is highly subjective. 11  TRADITIONAL ETHICAL THEORIES Deontological theory advocate for moral judgement/actions based on a sense of duty and responsibility. ‘Deontology’ comprises two words: ‘deont,’ meaning duty/responsibility, and ‘logus’, meaning study. 12 DEONTOLOGICAL APPROACH The motivation or principle is important. An action can only be deemed right or wrong when the morals for taking that action are known. 13 ABSOLUTISM WHAT IS ABSOLUTISM?  Absolutism is the idea that there is For example, one right answer, independent of context or perspective. the act of killing might be considered to always be unethical. In this theory,  There is only one right way to the action would be viewed from an represent something. Referring to absolute perspective, without something that is unchanging and dependency on context. always that way  Even if the act was in a scenario of survival or for the greater well- being of others. Killing something, whether it be a plant or an animal, might always be measured as immoral. WHAT IS ABSOLUTISM These universal laws are considered to be common moral standards. They are referred to as a fixed set of standards we can use to judge our actions. They are self-evident truths. Meaning, to support our belief, we don’t need any further evidence. 16 RELATIVISM 17 WHAT IS RELATIVISM? Relativism is the idea of using the context of different perspectives. We can say something is true relative to a point of view. Ethical relativism is not just about people having different moral thoughts. The moral standards can be different across groups, cultures, and time. 18 19 20  ACTIVITY 1 Write a short note about traditional ethical theories......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 21 NORMATIVE THEORIES OF BUSINESS ETHICS STAKEHOLDER THEORY All groups affected by business decisions have moral claims (stakeholders) Firms have moral duties to multiple stakeholders - customers, employees, community, environment, etc. Decisions should consider the interests of all relevant stakeholder groups Provides a holistic framework to integrate insights from multiple ethical theories 23 SOCIAL CONTRACT THEORY Businesses operate with the consent and according to the rules of society In return, businesses have a responsibility to act in society's interests Society defines the moral and legal boundaries within which businesses must operate Businesses exist to serve the common good, not just maximize profits 24 UNIVERSAL PRINCIPLES Ethical decisions should be guided by universality and consistency. Follow principles you'd want all businesses to follow in similar situations Promotes ethical principles like justice, dignity, human rights, and welfare Provides an objective standard for business ethics beyond self-interest 25 COMMON GOOD THEORY The primary purpose of businesses is to serve the common good of society as a whole Businesses should promote human flourishing, well- being and social progress Decisions should donate to the overall welfare of the society while respecting human dignity 26 IMPORTANCE OF ETHICAL THEORIES IN BUSINESS  Provide direction for  Establish firm's values: ethical decisions: Ethical Ethical theories inform theories offer frameworks and shape the core values and principles to guide that businesses adopt and decision-making and adhere to. They outline resolve ethical dilemmas what kinds of practices in businesses. They help and behaviors the firm determine what actions promotes. are right and wrong. 27 IMPORTANCE Justify ethical policies and codes: Ethical theories provide the underlying justification for firms to develop and execute ethical policies, codes of conduct, and compliance programs 28 IMPORTANCE Offer criteria for evaluating Promote good reputation: practices: Ethical theories Ethical theories help firms act as benchmarks or operate and behave in standards against which ethically sound ways that businesses can measure earn trust, loyalty, and a and assess their products, positive reputation with processes, and behaviors to stakeholders assess ethical quality.. 29 IMPORTANCE Mitigate legal and financial Improve organizational risks: Obeying principles culture: Ethical theories from ethical theories help support growing an ethical mitigate legal risks, culture and environment scandals, and financial within firms where moral losses due to evil rules. values shape daily operations and decision- making 30