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ChapterThree:PhilosophicalEthicsandBusinessCopyright?2021McGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.ChapterObjectives1Afterreadingthischapter,youwillbeableto:Explaintheethicalframeworkofutilitarianism.Describehowutilitarianthinkingunderlieseconomicandbusinessdecisionmaking.Explainhowthefreemarketisthoughttoservetheutilitariangoalofmaximizingtheoverallgood.Explainsomechallengestoutilitariandecisionmaking.Explaintheprinciple-based,orrights-based,frameworkofethics.ChapterObjectives2Explaintheconceptofhumanrightsandhowtheyarerelevanttobusiness.Distinguishmoralrightsfromlegalrights.Explainseveralchallengestoprinciple-basedethics.Describeandexplainvirtue-basedframeworkforthinkingaboutethicalcharacter.PhilosophicalEthicsandBusiness1Theunexaminedlifeisnotworthliving.Socrates,Apology,Plato’sAccountoftheTrialofSocrates(TranslatedbyBenjaminJowett)EthicalFrameworks1Anethicalframeworkisnothingmorethananattempttoprovideasystematicanswertothefundamentalethicalquestion.Howshouldhumanbeingslivetheirlives?Ethicsattemptstoanswerthequestionofhowweshouldlive,butitalsogivesreasonstosupporttheanswers.EthicalFrameworks2Anyonecanofferprescriptionsforwhatyoushoulddoandhowyoushouldact,butaphilosophicalandreasonedethicsmustanswerthe"why?"questionaswell."Why"mattersbecausewithoutofferingreasons,oneisgivinganopinion."Why"mattersbecausesuperficialagreementcanmaskunderlyingdisagreement.Manypeopleattempttoanswer“why”inreligiousterms,butreligionsdifferfromculturetoculture.Philosophicalethicsprovidesjustificationsapplicabletoallpeopleregardlessoftheirreligiousstartingpoints.EthicalFrameworksEthicsisnotcomprisedofasingleprincipleorframework.Ethicalframeworksthathaveproveninfluentialinthedevelopmentofbusinessethicsandthathaveapracticalrelevanceinevaluatingethicalissuesinmodernbusiness.Utilitarianismisanethicaltraditionthatdirectsustodecidebasedonoverallconsequencesofouracts.Theprinciple-basedframeworkdirectsustoactonthebasisofmoralprinciplessuchasrespectinghumanrights.Virtueethicstellsustoconsiderthemoralcharacterofindividualsandhowvariouscharactertraitscancontributeto,orobstruct,ahappyandmeaningfulhumanlife.PhilosophicalEthicsandBusiness2It’sbettertohangoutwithpeoplebetterthanyou.Pickoutassociateswhosebehaviorisbetterthanyoursandyou’lldriftinthatdirection.

WarrenBuffettUtilitarianism:EthicalConsequences1Utilitarianism’sfundamentalinsightisthatoutcomesmatter,andsoweshoulddecidewhattodobyconsideringtheconsequencesofouractions.Inthatsense,utilitarianismhasbeencalledaconsequentialist

approachtoethicsandsocialpolicy.Weshouldactinwaysthatproducebetterconsequencesthanthealternatives.Whatismeantbybetterconsequences?Betterconsequencesarethosethatpromotehumanwell-being:thehappiness,health,dignity,integrity,freedom,andrespectofallthepeopleaffected.Utilitarianism:EthicalConsequences2Utilitarianismiscommonlyidentifiedwiththeruleofproducing"thegreatestgoodforthegreatestnumber."Theemphasisonproducingthegreatestgoodforthegreatestnumbermakesutilitarianismasocialphilosophythatopposespoliciesthataimtobenefitonlyasmallsocial,economic,orpoliticalminority.Utilitarianstendtobeverypragmaticthinkers,andnoactiseverabsolutelyrightorwronginallcasesineverysituation.Utilitarianreasoningusuallyacknowledgessomesupportforcompetingavailablealternatives.Utilitarianpositionisthathappinessistheultimategood,theonlythingthatisandcanbevaluedforitsownsake.UtilitarianismandBusinessThefreemarketisdecidedlyutilitarian.So,utilitarianismhasastrongimpactonbusinessandbusinessethics.Howtoachievethegoalofmaximizingtheoverallgood?Twoanswersproveespeciallyrelevantinbusinessandbusinessethics.SomeutilitariansagreewithAdamSmith,claimingthatfreeandcompetitivemarketsarethebestmeansforattainingthegoal.Policyexpertsinpredictinghumanactionarefamiliarwiththespecificsofhowsocietyworks,andtheythereforeareinapositiontodeterminewhichpolicywillmaximizetheoverallgood.Thedisputebetweenthe"market"andthe"administrative"versionsofutilitarianismcharacterizemanydisputesinbusinessethics.Egoismisalsoaconsequentialisttheory,butitfocusesexclusivelyonthehappinessoftheindividualmakingthedecision.ChallengestoUtilitarianEthics1Problemsconcerntheneedtocount,measure,compare,andquantifyconsequences.Utilitariansdeterminebothethicalandunethicalactsbytheirconsequences—sotheendjustifiesthemeans.Thisseemstodenyoneoftheearliestethicalprinciplesthattheenddoenotalwaysjustifythemeans.Wehavecertaindutiesorresponsibilitiesthatweoughttoobeyevenwhendoingsodoesnotproduceanetincreaseinoverallhappiness.ChallengestoUtilitarianEthics2Utilitarianreasonscontributestoethicaldecisionbyrequiringthatweconsidertheconsequencesofouractions.Importanttorememberthatutilitarianreasoningdoesnotexhausttherangeofethicalconcerns.Responsibleethicaldecisionmakingalsoinvolvesduties,principles,andpersonalintegrity.AnEthicsofPrinciplesandRights1Somedecisionsshouldbeamatterofprinciple,notconsequences—theendsdonotalwaysjustifythemeans.Whichprinciplesshouldbefollowed?Whendoesaprincipleoutweighproducinggoodconsequences?Theethicalframeworkthatwillprovecrucialforbusinessethicsbeginswiththeinsightthatweshouldmakesomeethicaldecisionsasamatterofprincipleratherthanconsequences.Principlesareethicalrulesthatputvaluesintoaction.Principlescreateethicaldutiesthatbindustoactordecideincertainways.AnEthicsofPrinciplesandRights2Whatprinciplesorrulesshouldguideourdecisions?Legalrules.Organizationalrules.Role-basedrules.Professionalrules.Ethicaldutiesshouldbecategoricalimperativesratherthanhypothetical.Acategoricalimperativeisanoverridingprincipleofethics.AnEthicsofPrinciplesandRights3Hypotheticalduties.Couldincludeaprofessionalcodeofconductthatbindsyouonlyifyouinthatprofession.Categoricalduties.Donotcontainan"if"clause.Ishouldormustobeyafundamentethicalrulenomatterwhat.HumanRightsandDuties1Arethereanyfundamentalor"categorical"duties?ImmanuelKantbelievedweallhaveadutytotreateachpersonasanendinthemselvesandneveronlyasmeanstoourownends.Personsmustneverbetreatedasmeretools.TheU.S.DeclarationofIndependencespeaksof"inalienablerights"thatcannotbetakenawaybygovernment.Human,ormoralrightsiscentraltoprinciple-basedethics.Theinherentdignityofeachindividualmeansthatwecannotdowhateverwechoosetoanotherperson.HumanRightsandDuties2Humanrightsprotectindividualdignity.Rightsimplythatsomeactsandsomedecisionsare"off-limits."Ourmoraldutyistorespectthehumanrightsofothers.Humansaresaidtohaveafundamentalhumanrightofautonomy,or"self-rule."HumanRightsandSocialJustice1Tworightsemergedasfundamentalcomponentsofsocialjustice—libertyandequality.Morefundamentalandpersistentthanlegalrightscreatedbygovernmentsandcommunities.Theyareparticularlyfundamentaltotheoriesofsocialjusticeuponwhichdemocraticsocietiesandcapitalisteconomieshavebeenbuilt.Crucialtoanunderstandingofbusinessethics.HumanRightsandSocialJustice2LibertarianHere,individuallibertyisthecentralelementofjustice.Ajustsocietyisoneinwhichindividualsarefreefromgovernmentintrusionaslongastheyarenotharmingothers.Ethicalbusinesspursuesprofitwithinthelaw.Unethicalbusinesseswouldincludefraud,deception,andanticompetitivebehavior.EgalitarianHere,equalityisthecentralelementofjustice.Socialistegalitariantheoriesargueforequaldistributionofbasicgoodsandservices.Othertheoriesarguethatequalopportunityiscrucial.Supportsgreatergovernmentalresponsibilityintheeconomytoguaranteeequalityofopportunityoutcomes.HumanRightsandLegalRights1Whatisthedifferencebetweenhumanrightsandlegalrights?Usingemployeerightsasanexample,therearethreekindsofemployeerightscommoninbusiness.First,therearethoselegalrightsgrantedtoemployeesonthebasisoflegislationorjudicialrulings.Minimumwageandequalopportunityaresomeexamples.Second,employeeshaverightstothosegoodsthattheyareentitledtoonthebasisofcontractualagreementswiththeemployer.Healthcare,pension,andpaidholidaysareexamples.Finally,employeeshaverightsgroundedinmoralentitlementstowhichemployeeshaveaclaimindependentlyofanyparticularlegalorcontractualfactors.Examplesincludetherightnottobebullied,rightnottobeliedto,andtherightnottobesexuallyharassed.HumanRightsandLegalRights2Legalrightsplacecertainissuesoutsidetherealmoftheemploymentcontract.Suchlegalrightssetthebasiclegalframeworkwithinwhichbusinessoperates.Humanrightslieoutsidethebargainingthatoccursbetweenemployersandemployees.ChallengestoanEthicsofRightsandDutiesTherearetwobigchallengestothisethicaltradition.Thereisdisagreementaboutwhatrightstrulyarebasichumanrights.Itisunclearhowtoapplythisapproachtopracticalsituations,especiallyincaseswhererightsappeartoconflict.Criticschargethatunlessthereisaspecificpersonorinstitutionthathasadutytoprovidethegoodsidentifiedas“rights,”talkofrightsamountstolittlemorethanawishlistofthingsthatpeoplewant.PhilosophicalEthicsandBusinessAbusinessthatmakesnothingbutmoney,isapoortypeofbusiness.

HenryFordVirtueEthics:IntegrityandCharacter1Virtueethicsseeksafullanddetaileddescriptionofthosecharactertraitsthatconstituteagoodandfullhumanlife.Virtuesarethosecharactertraitsthatwouldconstitutepartsofagoodandmeaningfulhumanlife.Thebestplacetoseetheethicsofvirtueisinthegoalofeverygoodparentwhohopestoraisehappyanddecentchildren.Tounderstandhowvirtueethicsdiffersfromutilitarianandprinciple-basedframeworks,consideregoism.Thereisagapbetweenself-interestandaltruism.Ethicsrequiresustoactforthewell-beingofothersattimes,somethingegoismclaimsisnotpossible.VirtueEthics:IntegrityandCharacter2Anethicsofvirtueshiftsthefocusfromquestionsofwhatapersonshoulddo,toafocusonwhothatpersonis.Aperson’scharacterisnotindependentofthatperson’sidentity.Character:Thosedispositions,relationships,attitudes,values,andbeliefsthatpopularlymightbecalleda"personality."Thisshiftchangesthenatureofjustificationinethics.Ethicalcontroversiesofteninvolveaconflictbetweenself-interestandethicalvalues.Howmuchweactforthewell-beingofothersdependsonourcharacter.VirtueEthics:IntegrityandCharacter3Virtueethicsrecognizesthathumanbeingsactaccordingtowhotheyare,accordingtotheircharacter.Giventhatcharacterplaysakeyroleinourbehaviorandgiventhatourcharactercanbeshapedbycontrollablefactors,virtueethicsseekstounderstandhowthosetraitsareformedandwhichtraitsareconducivetoandwhichonesundermineameaningful,worthwhile,andsatisfyinglife.Virtueethicsofferusamorefullytexturedunderstandingoflifewithinbusiness.Virtueethicsremindsustoexaminehowcharactertraitsareformedandconditioned.Manyindividualmoraldilemmasarisewhentensionbetweenwhoweseektobeandthetypeofpersonbusinessexpectsustobe.VirtueEthics:IntegrityandCharacter4Virtueethicsshouldleadustoaskquestionsaboutthechoiceswemakeandhowthosechoicesaffectourcharacter.First,notethateachdecisionyoumakehasasubtlebutmeaningfulimpactonsubsequentdecisions.Thissuggestsareciprocalrelationshipbetweencharacterandaction.Ourcharacteraffectshowweact,buthowweactendsupaffectingourcharacter. Thesecondwayinwhichourchoicesaffectchara

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