FSU MAN 4701 - Understanding Ethics in Business

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Understanding Ethics in Business What is Ethics All About Commonly understood behavioral expectations that contribute to a good society by Making behavior more predictable Operationalizing commonly held moral values Contributing to trust and comfort in social interactions Why should businesses care about being ethical 1 Belief that ultimately ethical behavior will be rewarded and unethical behavior punished 2 Desire to maintain a positive public image 3 Desire to maintain a positive self image Basic Problems in Business Ethics How do you know what the expectation is When different stakeholders are affected differently how do you determine the ethical course of action Approaches to Ethics Ethics as a Character Virtue Ethics Ethics as Outcomes Utilitarianism Ethics as Duty Deontology Rights Justice Character Based Ethics Assumes that people will relay on basic personal characteristics and values when making decisions People who have internalized constructive behaviors virtues can be relied upon to do the right People who are governed by negative inclinations vices are not to be respected or trusted Integrity Consistency between Values and Ethics Ethical Behavior is instinctive in persons of good character Societies that fail to promote virtue by precept example and consequences will become less thing Virtue Ethics civilized Can Virtue Ethics elevate society Assumes a high degree of consensus regarding society The characteristics of a good society The specific nature of virtues and vices Assumes transparency of behavior if you re a liar people are going to know you re a liar Assumes the members of Society value virtue and honor in themselves and others Assumes the members of society are willing and able to attach meaningful consequences to individual acts of virtue and vice UTILITARIANISM Utilitarianism is referred to as consequentialist because it is based on the principle that the ethics of an action is determined by its consequences When making a decision the most ethical choice is that which produces the greatest good for the greatest number Originally conceived as an alternative to favoritism when making Civic decisions Assumptions of Utilitarianism 1 Foreknowledge it is possible to identify all parties who will be affected by an action and to determine how they will be affected 2 Comparability it is possible to accurately compare different outcomes people may experience 3 Equality of Interest there are no legitimate priorities among parties 4 Objectivity assumes decision makers will have no preferences or personal interest among the It is often not possible to identify all affected parties and how they will be affected In business decision there is no reason to assume that the interests of all stakeholders are equal It is often impossible to equate ones parties benefits to another parties costs There is no reason to assume business decision makers will be objective when their own interests possible outcomes Problems with Utilitarianism are involved No protection for the minority Critics of Utilitarianism 1 While it is often necessary to make decisions based on the anticipated consequences it is always 2 Undermines certainty since rights and agreements can be overruled by the interests of others 3 Less a guide to ethical decision than a rationalization based on public interest or the common subjective good 4 Desensitizes people to harm experienced by others Deontology Deontology defines ethics in terms of duties and rules that govern behavior between people Deontology differs from Utilitarianism Focuses on behavioral obligations and limits rather than consequences Recognizes that duties may be different for different people Recognizes the existence of ethical free space Rights and Duties Rights and Duties are inseparable concepts Duty a responsibility that constraints the treatment of others Right an expectation that one will be treated in a certain way Rights and Duties The term rights is commonly used to refer to two things Moral Rights areas of personal privilege of conscience or action that are inherent in ones humanity and must be respected Entitlements claims of value established by custom law or contract which normally apply only to some and often require some transfer of value While entitlements are not necessarily Moral Rights there is an Ethical Duty to honor obligations and commitments Sources of Moral Rights and Duties Contract specific agreements that apply only to the parties to the agreement Relationships Social Position culturally defined responsibilities based on social position or relationships Natural Rights responsibility to respect human dignity Social Contract established within a community based on common agreement Potential Problems with Rights 1 Civil society requires people to be responsible in the exercise of their rights and tolerant of the rights of others safety 2 The exercise of individual rights may sometimes need to be constrained in the interest of public 3 The establishment of broad social entitlements always involves a transfer of value which may 4 Despite any ethical and moral arguments individual rights exist only in societies where people create both practical and ethical problems claim them and protect them Justice Justice a duty to treat people fairly when allocating positive and negative outcomes Justice may be seen as a virtue a duty or as a fundamental characteristic of a good society Types of Justice The concept of Justice has four different but related applications in ethics Procedural Justice rules and procedures to insure fairness when resolving disputes between individuals or when individual rights are challenged by collective interests Distributive Justice Equity NOT EQUALITY in the allocation of outcomes Equity peoples outcomes are proportionate to their contributions Equality everyone receives the same outcomes regardless of contribution Compensatory Justice the right of those who suffer loss or harm because of willful act of another to restitution or compensation and the individual and societal duty to provide it Retributive Justice the societal duty to administer equitable consequences for abusing the rights of others or the rules of the community Retributive Justice should not be viewed as personal vengeance but as the consequence for harming Social Order Ethics Morals and Social Responsibility What is the difference between Morals and Ethics Morals Ethics Basic Standards of right and wrong Expectations of behaviors that


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FSU MAN 4701 - Understanding Ethics in Business

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