What is “ethics”? At its most basic level, ethics is concerned with how we act and how we live our lives.
Business Ethics
o Comprises principles and standards that guide behavior in the world of business.
o Whether a specific behavior is ethical or unethical is often determined by stakeholders: Investors, employees, customers, interest groups, legal system and community.
Why study Business Ethics?
o Reports of unethical behavior are on the rise.
o Society’s evaluation of right or wrong affects its ability to achieve its business goals.
o Studying business ethics is a response to FSGO (Federal Sentencing Guidelines for Organizations) and stakeholder demands for ethics initiatives.
o Individual ethics is not enough.
o Studying business ethic helps identify ethical issues to key stakeholders.
o Today, more concern on which ethics should guide business decisions and how ethic can be integrated within business, because ethics failures is equal to business failures.
Why care about ethics?
o Unethical behavior creates financial and marketing risks.
o A company can go out of business, and its employees can go to jail, if no one is paying attention to the ethical standards of the firm.
o A firm’s ethical reputation can provide a competitive advantage, or disadvantage.
o Consumer boycotts give even the most skeptical(怀疑的,多疑的) business leader reason to pay attention to ethics.
o Managing ethically can also pay significant dividends in organizational structure and efficiency.
o Trust, loyalty, commitment, creativity, and initiative(进取心) are just some of the organizational benefits that are more likely to flourish(繁荣,兴旺 ) within ethically stable and credible organizations.
Historical of BE
1. Before 1960: Ethics in Business
o Theological discussions of ethics emerged:
- Catholic social ethics included a concern for morality in business, workers’ rights and living wages.
- Protestants(新教的) developed ethic courses in their seminaries and schools of theology. (Also, the Protestant work ethic encouraged frugality(节约;朴素;节俭) and hard work.)
2. The 1960s: The Rise of Social Issues in Business
o Societal social consciousness emerged
- As well as an anti-business sentiment (eg boycott, not buying products)
o JFK’s Consumer Bill of Rights ushered in a new era of consumerism
- Right to safety, to be informed, to choose, and to be heard.
o Consumer protection groups fought (fight) for consumer protection legislation
- Ralph Nader
3. The 197os: Business Ethics as an Emerging Field
o Business professors began to write about social responsibility.
o Philosophers became involved in business ethics.
o Businesses became more concerned with their public image and addressed ethic more directly.
o Conferences were held and centers developed.
o Issues: Bribery, deceptive(虚伪的 ) advertising, product safety, environment (eg global warming), price collusion(共谋;勾结 ) (eg price war)
4. The 1980s: Consolidation
o Membership in business ethic organizations increased.
o Ethics centers provided:- Publications, courses, conferences and seminars.
o Firms established ethics committees.
o Defense Industry Initiatives emerged and became the foundation for the Federal Sentencing Guidelines for Organizations.
– Corporate support for ethical conduct
5. The 1990s: Institutionalization of Business Ethics
o The federal Sentencing Guidelines for Organizations set the tone for ethical compliance.
o These took preventative actions against misconduct; a company could avoid or minimize the potential penalties.
o The Federal Sentencing Guidelines for Organizations
- Standards and procedures capable of detecting and preventing misconduct
- High level oversight (eg. People in the high level will look on everything happen in an organization)
- Care in delegation of authority (eg. Every department have an official will handle on the ethics issue in the organization)
- Effective communication (training)
- Systems to monitor, audit, and report misconduct
- Consistent enforcement. (eg continuously checking)
- Continuous improvement
6. The 21st Century: A New Focus
o A move from legally based ethics initiatives to culturally or integrity-based programs
- However, legislation such as the Sarbanes-Oxley Act was passed to address the lack of confidence in financial reporting and corporate ethics.
o Realization that business ethics programs are good for business.
o Businesses working more closely together, globally, to establish standards of acceptable behavior.
Stakeholders Define Ethical Issues in Business
o Stakeholders are those who have a stake or claim in some aspect of a company’s products, operations, markets, industry and outcomes:
- Customers, employees, investors, suppliers, government agencies, communities
o Stakeholders provide tangible and intangible resources critical to a firm’s success.
Types of Stakeholders
o Primary stakeholders are those whose continued association is absolutely necessary for a firm’s survival.
- Employees, customers, investor, governments and communities
o Secondary stakeholders do not typically engage in transactions with a company and are therefore not essential to its survival.
- Media, trade associations, and special interest groups
Stakeholders
o Stakeholder orientation is the degree to which a firm understand and addresses stakeholder demands. Involves three activities:
- Generation of data about stakeholder groups
- Distribution of the information throughout the firm
- The responsiveness of every level of this to this intelligence. Eg how much the cost.
Relationship between Social Responsibility and Profitability
o Business ethic comprises principles and standards that guide behavior in business.
o Social responsibility is an organization’s obligation to maximize its positive impact on stakeholders and minimize its negative impact.
o Four levels of social responsibility
i. Economic
ii. Legal
iii. Ethical
iv. Philanthropic(博爱的)
Steps of Social Responsibility
1. Economic: maximizing stakeholder wealth value
2. Legal: abiding(持续的 ) by all laws and government regulations
3. Ethical: following standards of acceptable behavior as judged by stakeholders
4. Philanthropic: “giving back” to society
Corporate Citizenship
o Four interrelated dimensions of corporate citizenship:
- Strong sustained(持久的 ) economic performance
- Rigorous(精确的;严密的 ) compliance(顺从)
- Ethical actions beyond what is required by the law
- Voluntary contributions that advance reputation and stakeholder commitment
o How does the firm act on its commitment to the corporate citizenship philosophy? Does it measure the extent to which it follows through by implementing initiatives?
Corporate Governance
o The formal systems of accountability, oversight, and control
o Accountability: refers to how closely workplace decisions are aligned with a firm’s stated strategic direction
o Oversight: provides a system of checks and balances that limits employees and manages opportunities to deviate. (preventing something happen)
o Control: the process of auditing and improving organizational decisions and actions
o Corporate Governance Issues
1. Shareholder rights
2. Risk management
3. Executive compensation
4. Auditing and control
5. Organizational ethic programs
o Shareholder model- Founded in classic economic percepts, including the maximization of wealth for investors and owners
o Stakeholder model- Adopts a broader view of the purpose of business that includes satisfying the concerns of other stakeholders, from employees, suppliers, and governments regulators to communities and special interest groups
o Fiduciaries- Persons placed in positions of trust who use due care and loyalty in acting on the behalf of the best interests of the organization
o Both directors and officers of corporations are fiduciaries for the shareholders
o Issues related to corporate boards and directors
- Accountability, Transparency, Independence
The role of Boards of Directors
o Ultimate responsibility for their firms’ success or failure, as well as for the ethics of their actions
o Increased demands for accountability and transparency
o Trend toward “outside directors” chosen for their expertise, competence, and ability to improve strategic decision making
o Issue of executive compensation
- Evaluate the extent to which executive compensation is linked to performance
- Does performance-linked compensation lead to a short-term focus at the expense of long-term growth?
Implementing a Stakeholder Perspective
1. Assessing the corporate culture
2. Identifying stakeholder groups
3. Identifying stakeholder issues
4. Assessing organizational commitment to social responsibility
5. Identifying resources and determining urgency
6. Gaining stakeholder feedback
Employee rights
Three senses of employee rights are common in business
- There are legal rights granted on the basis of legal/judicial rulings
- There rights based on contractual agreements with employers
- There rights that exist as entitlements, resulting from out status as humans
The right to Work
o If work is necessary to secure such central primary goods as food, clothing and shelter(保护), a right to work seems a likely candidate for being a moral right.
o There are various understandings of the right to work
- Refers to a right to work without having to join a union
- Refers to employees right to a job
· Rationale 1: the instrumental value of work, providing means to acquire food and shelter, etc.
· Rationale 2: work is the expression of a meaningful life.
o Critics distinguish between rights and desirable states of affairs
· Right imply responsibility on the part of others to provide what is claimed by that right
· But does this perspective place an undue burden on private employers?
· If so, place the burden upon government to provide incentives and subsidies.
o But should government be placed in the position of providing jobs to any citizen who desires one?
o Wouldn’t placing government in this position produce too much inefficiency, thus creating economic and political turmoil(混乱 )?
o What if government supplied protection for jobs, rather than jobs?
o The belief seems to be that governments have a responsibility to encourage private sector employment for all its citizens. As a last resort, the government has a duty to supply jobs.
o There is another sense to a right to work: the right, once hired, to hold that job with some degree of security.
o This becomes a right to due process.
Defining the Parameters of Employment Relationship: Due Process
Philosophically, the right of due process is the right to be protected against the arbitrary use of authority
o In legal context, due process refers to the procedures that police and courts must follow in exercising their authority over citizens.
o Few dispute that the state, through its police and courts has the authority to punish citizens.
o This authority creates a safe and orderly society in which we all can live, work and do business.
o But that authority is not unlimited, it can be exercised only in certain ways and under certain conditions.
o Due process rights specify these conditions.
Due Process at Work
o Similarly, due process in the workplace acknowledges an employer’s authority over employees.
o Employers can tell employees what to do and when and how to do it.
o They can exercise such control because they retain the ability to discipline or fire an employee who does not comply with their authority. Because of the immense(极为) value that work holds for most people, the threat of losing one’s job is a powerful motivation to comply.
o However, basic fairness- implemented through due process- demand that this power be used justly.
Employment at Will
o Ironically, the law has not always clearly supported this mandate of justice.
o Much employment law within the US instead evolved in a context of a legal doctrine known as “Employment at Will.”
o Employment at Will (EAW) holds that, absent a particular contractual or other legal obligation that specifies the length or conditions of employment, all employees are employed “at will.”
o This means that, unless an agreement specifies otherwise, employers are free to fire an employee at any time and for any reason.
o In the words of an early court decision, “all may dismiss their employee at will, be they many or few, for good cause, for no cause, or even for cause morally wrong.”
o In the same manner, an EAW worker may opt to leave a job at any time for any reason, without offering any notice at all; so the freedom is theoretically mutual.
Reasons to Limit EAW
· Justice Argument: Even if EAW proved to be an effective management tool, justice demands that such tools not be used to harm other people.
· Property Argument: Even if private property rights grant managers authority over employees, the right of private property itself is limited by other rights and duties.
· Lack of Mutuality: Though the freedom to terminate the relationship is theoretically mutual, the employer is often responsible for the employee’s livelihood, while the opposite is unlikely to be true; so the differential creates an unbalanced power relationship between the two parties.
Due process: Other Employment Context
· Employees are under constant supervision and evaluation in the workplace, and such benefits as salary, work conditions, and promotions can also be used to motivate or sanction employees.
· Thus, being treated fairly in the workplace also involves fairness in such things as promotions, salary, benefits, and so forth.
· Because such decisions are typically made on the basis of performance appraisals, due process rights should also extend to this aspect of the workplace.
Downsizing
· Terminating worker- whether one or one hundred- is not necessarily an unethical decision.
· However, the decision itself raises ethical quandaries(窘境 ) since there may be alternative available to an organization in financial difficulty.
· Once the decision has been made, are there ways in which an organization can act more ethically in the process of downsizing?
· How might our earlier discussion on due process and fairness offer some guidance and/or define limitations in a downsizing environment?
Downsizing: The Legal Perspective
· The decision about whom to include in a downsizing effort must be carefully planned.
· If the firm’s decision is based on some criterion that seems to be neutral on its face, such as seniority, but the plan results in a different impact on one group than another, the decision may be suspect.
· To avoid this result, firms should review both the fairness of their decision-making process as well as the consequence of that process on those terminated and the resulting composition of the workforce.
· One of the most effective philosophical theories to employ with regard to downsizing decisions would be John Rawls’ theory of justice.
· Under his formulation, you would consider what decision you would make- whether to downsize or how to downsize- if you did not know what role you would be playing in the decision.
Health and Safety
· Within the US and throughout many other countries with develop economies; there is a wide consensus that employees have a fundamental right to a safe and healthy workplace.
· In some other regions, employees lack even the most basic health and safety protections, such as in working environments that are often termed “sweatshops”
· Even within the US, this issue becomes quite complicated upon closer examination.
· Not only is the very extent of an employer’s responsibility for workplace health and safety in dispute; there is also significant disagreement concerning the best policies to protect worker health and safety.
Health & Safety as “Acceptable Risk”
· Employers cannot be responsible for providing an ideally safe and healthy workplace.
· Instead, discussions in ethics about employee health and safety will tend to focus on the relative risks faced by workers and the level of acceptable workplace risk.
· In this discussion, “risk” can be defined as the probability of harm, and we determine “relative risks” by comparing the probabilities of harm involved in various activities.
· Therefore, both risks and relative risks are things that can be determined by scientists who compile and measure data.
· It is an easy step from these calculations to certain conclusions about acceptable risks.
· If it can be determined that the probability of harm involved in a specific work activity is equal to or less than the probability of harm of some more common activity, then we can conclude that this activity faces an “acceptable level of risk.”
From this perspective, a workplace is “safe” if the risks are “acceptable.”
Challenges with “Acceptable Risk” Approach
· This approach treats employees disrespectfully by ignoring their input as stakeholders. Such paternalistic decision-making effectively treats employees like children and makes crucial decisions for them, ignoring their role in the decision-making process.
· In making this decision, we assume that health and safety are mere preferences that can be traded-off against competing values, ignoring the fundamental deontological right an employee might have to a safe and healthy working environment.
· It assumes an equivalency between workplace risks and other types of risks when there are significant differences between them. Unlike many daily risks, the risks faced in the workplace may not be freely chosen, nor are the risks faced in the workplace within the control of workers.
· It disregards the utilitarian concern for the consequences of an unsafe working environment on the social fabric, the resulting product or service created, the morale of the workforce, the community and other large-scale results of an unhealthy workplace.
· Unlike some daily risks freely undertaken by each of us, the risks faced at work could be controlled by others and particularly by others who might stand to benefit by not reducing the risks.
Can we leave Health and Safety standards to the market?
· Individual bargaining between employers and employee would be the approach to workplace health and safety favored by defenders of the free market and the classical model of corporate social responsibility.
· On the account, employees would be free to choose the risks that they are willing to face by bargaining with employers.
· Employees would balance their preferences for risks against their demand for wages and decide how much they are willing to take for various wages.
· Those who demand higher safety and healthier conditions presumably(可能) would have to settle for lower wages; those willing to take higher risks presumably would demand higher wages.
Health and Safety as Market-Controlled
· In a competitive and free labor market, such individual bargaining would result in the optional distribution of safety and income.
· The market approach can also support compensation to injured workers when it can be shown that employers were responsible for causing the harms.
· The threat of compensation also acts as an incentive for employers to maintain a reasonably safe and healthy workplace.
Challenges to Market Control of Health and safety
· Labor markets are not perfectly competitive and free. Employees do not have the kinds of free choices that the free market theory would require in order to attain optimal satisfactions.
· Second, employees seldom, if ever, possess the kind of complete information required by efficient markets. If employees do not know the risks involved in a job, they will not be in a position to freely bargain for appropriate wages and therefore are not in a position to effectively protect their rights or ensure the most ethical consequences.
The Dialogue about Those Challenges
· Markets will, over time, compensate for such failures.
· Over time, employers will find it difficult to attract workers to dangerous jobs and, over time, employees will learn about the risks of every workplace.
· But this raises that we have previously described as the “first generation” problem. The means by which the market gathers information is by observing the harms done to the first generation exposed to imperfect market transactions.
· In effect, markets “sacrifice” the first generation in order to gain information about safety and health risks.
Government-Regulated Ethics
· In 1970, the US Congress establish the Occupational Safety and Health Administration (OSHA) and charged it with establishing workplace health and safety standards.
· Since that time, the dominant question has concerned the appropriateness of using cost-benefit analysis to set health and safety standards.
· Regulation are aimed at achieving the safest feasible standards, allowing a balancing approach between health and economics- industries are required to meet the highest standards attainable within technological and economic reason.
· Some critics charge that this approach does not go far enough and unjustly sacrifices employee health and safety. But the more influential business criticism has argued that these standards go too far.
· Critics in both industry and government have argued that OSHA should be required to use cost-benefit analysis in establishing such standards.
· From this perspective, even if a standard is technologically and economically feasible, it would still be unreasonable and unfair if the benefits did not outweigh the costs.
· These critics argue that OSHA should aim to achieve the optimal, rather than highest feasible, level of safety.
Challenges in the Cost-Benefit Approach to Government-Regulated Health and safety
· The use of cost-benefit analysis in setting workplace health and safety standards commits us to treating worker health and safety as just another commodity, another individual preference, to be traded-off against competing commodities.
· It treats health and safety merely as an instrumental value and denies its intrinsic value.
· Cost-benefit required that an economic value be placed on one’s life and bodily integrity.
Managerial Responsibility & Conflicts of Interest
· A kickback is an illegal payment that occurs when a portion of some payment is paid back to the payer as an incentive to make the original payment.
· Soft money occurs when financial advisor receive payments from a brokerage firm to pay for research and analysts services that should be used to benefit the clients of those advisors.
Trust and Loyalty in the Workplace
· To trust someone is to be confident in and rely upon their judgment when one is vulnerable to their decisions. –Trustworthy managers develop and maintain professional competence and expertise.
· Loyalty, in business, is understood as a willingness to make personal sacrifices in the interest of the firm.
- To what degree do employees have responsibility to make personal sacrifices for the firm?
- Ronald Duska argue employees have no responsibility
· Claim for loyalty by the firm can often be little more than a disguised way to exploit employees’ willingness to make sacrifices for the firm.
· However, until and unless the firm is willing to sacrifice for employees, those employees have little reason to demonstrate loyalty to the firm.
· Is the case different for managerial employees?
- Sherron Watkins
- Andrew Fastow
· If loyalty means willing to sacrifice one’s own interest by going above and beyond ordinary responsibility, then we ought(该 ) to be suspicious(可疑的 ) of calls for employee loyalty.
Honesty, Whistle blowing & Insider Trading
· Honesty: are there situations in which dishonesty is common and acceptable?
· There are three reasons to explain the ethical responsibility to be honest:
- Dishonesty undermines the ability of people to communicate
- Honesty and trust create essential preconditions for all cooperative social activities
- A dishonest person must have more than one identity, which undermines his integrity.
· A bluff can only work as a bluff if the person being bluffed believes that it is true (is being deceived).
· While a dishonest act can have beneficial social consequences, routine dishonesty erodes(磨损) the trust that seems essential to social cooperation.
· A whistleblower is an employee or other insider who informs the public or a government agency of an illegal, harmful, or unethical activity done by business or institution.
-Whistle blowing puts the employee at risk
- Whistle blowing pits(使对立 ) responsibilities to third parties at odds(额外的) with employees’ responsibilities to their employer
· Richard DeGeorge argues three conditions must be met before whistle blowing is ethically permissible:
- There must be a real threat of harm that needs to be addressed
- The whistleblower should first seek to prevent the harm through channels.
- The whistleblower, if possible, should exhaust all internal procedures for preventing the harm
· Insider Trading generally refers to the practice of buying or selling securities on the basis of nonpublic information that one has obtained as an “insider”.
· Three arguments are cited in ethical criticism of insider trading:
- Property rights
- Fiduciary duties
- Unfairness claims
Right and Responsibilities in Conflict: Discrimination, Diversity and Affirmative Action
· With regard to the above issues, we are discussing several matters that remain open to debate by scholars, jurists and corporate leaders.
· The focus is on those subtle areas where perhaps the law has not yet become so settled, where it remains open to diverse cultural interpretations, strong minority interest, and value judgments.
· Through the courts are often forced to render judgment, their decisions might result from a non-unanimous(一致同意的) vote or through the reversal(颠倒) of a strong lower court opinion representing a contrary(对立的) perspective.
Philosophical Application
· From a Kantian, deontological perspective, there is not yet universal agreement on the fundamental rights that are implicated by these issues, or on their appropriate prioritization.
· From a utilitarian viewpoint, neither do these reasonable minds always agree on which resolution might lead toward the greatest common good, or even what that good should be ultimately.
· Distributive justice does not provide a clear cut solution as there is often an argument for fairness from each camp and other theories provide similar quandaries(为难).
Discrimination
· The courts have carefully construed legal precedent in the decades since Title VII of the US Civil Rights Act was passed in 1964 and crested the prohibited classes of discrimination.
· Though several specific areas of delicate and subtle quandaries remain, many of the original legal and ethical debates have been fought, offering business decision-makers arguably clear guidance on appropriate behavior in the workplace (ie sexual harassment).
The Case of Child Labor
· As we begin to understand the circumstances facing children worldwide, we can see that a simple prohibition might not offer us the best possible solution.
· But what options exist?
· Of course, many economically develop countries currently employ child and juvenile(青少年) labor, albeit(尽管) with restrictions, and so one should carefully review the social and economic structure within which the labor exists.
· While the easy answer may be to rid(从...清除) all factories of all workers less than 18 years of age, that is often not the best answer for the children or the families involved.
· In developing countries, children begin work at ages as young as three years. Though children may work in unhealthy conditions, they also live in unhealthy conditions.
· The labor opportunities that exist almost always preclude(妨碍) children from obtaining an education as children often work on a full time basis.
· However, if children are not working, their options are not as optimistic(乐观的) as those for children in develop economies. There are not always sophisticated(高度发展的) education systems or public schools.
· Often children who do not work in the manufacturing industry are forced to work in less hospitable(易接受的) “underground” professions such as drug dealing or prostitution(卖淫) simply in order to provide for their own food each day.
· Moreover, notwithstanding the possible educational alternatives in some environments, recommending removal of the child from the workplace completely ignores the financial impacts of terminating the employment of a youth worker.
· The income generated by the youth worker may, at the very least, assist in supporting that particular youth’s fundamental needs (food, clothing and shelter); and, at the very most, it may be critical in supporting the entire family.
Lack of Global Agreement
· There remains widespread disagreement on a global basis as to the rights of employees with regard to discrimination, the extent of protected classes and the more specific sub-topics such as diversity and affirmative(赞成) action.
· Even in the US, the concept of discrimination is one that remains one of the most intensely debated issues today.
· Employers continue to advocate for their rights to manage the workplaces and to be permitted to hire, retain and terminate without external influence or control.
· Employees fear unfair treatment and a loss of power based on reasons completely outside their control.
Discrimination Persists…
· Discrimination persists in the US with regard to race, as well as gender.
· Women often face challenges that are distinct from those faced by man.
· For instance, women and men are both subject to gender stereotyping, but suffer from different expectations in that regard.
-A woman who is aggressive in the workplace is often considered to be a bully, while a man is deemed to be doing what he needs to do to get ahead.
Affirmative Action
· Does one person deserve a position more than another person?
· For instance, efforts to encourage greater diversity may also be seen as a form of “reverse discrimination”- in other words, discrimination against those individuals who are traditionally considered to be in power or the majority, such as white men.
· A business that intentionally seeks to hire a candidate from underrepresented group might be seen as discriminating against white males, for example.
· A policy or a program that tries to respond to instances where there has been some past discrimination by implementing proactive measures in order to ensure equal opportunity today.
· It may take the form of intentional inclusion of previously excluded groups in employment, education or other environment.
· The use of Affirmative Action policies in both business and universities has been controversial for decades.
· In its first discussion of affirmative action in employment, the US Supreme Court found that employers could intentionally include minorities (and thereby exclude others) in order to redress past wrongs.
· However, the holding was not without great restrictions, of course, thereby leaving most employers with a great deal of confusion.
· Even today, the law does not provide extraordinary clarity and we are thus left values systems to instead provide direction, which we will discuss shortly.
How Affirmative Action Arises in the Workplace
1. Much of the law relating to affirmative action applies only to about 20% of the workplace- those employees of federal contractors with 50 or more employees who are subject to Executive Order 11246, which required affirmative action efforts to ensure equal opportunity.
2. Where Executive Order 11246 does not apply, courts may also impose require efforts through what is termed “judicial affirmative action” in order to remedy a finding of past discrimination.
3. A third of affirmative action involves voluntary affirmative action plans that are undertaken by employers in order to overcome barriers to equal opportunity.
In order to justify affirmative action efforts under either of these latter two options, there must be a demonstrated under-representation or finding of past discrimination.
Sexual and Racial Discrimination
o US and European laws prohibit businesses from discriminating on the basis of sex, race, religion or disabilities in their hiring, firing and promotion decisions. –Australia, obrigines.
o Discrimination is sometimes justified on the basis of culture norms and values. For example, businesswomen are rare in the Middle East.
o Discrimination remains one of the more prevalent concerns in international business.
How Companies Might Address Discrimination Issues
o Develop a company policy on discrimination
o Communicate the policy internally and externally
o Determine benchmarks for activities in which discrimination can arise
o Determine indicators of possible non-compliance
o Establish methods to identifying non-compliance
o Develop a plan and implement the plan
Human Rights
o Opportunistic use of child labor, payment of low wages, and abuses in foreign factories are a few of the concerns.
o Relationships with subcontractors have proven problematic for some firms.
o MNCs should view the law as a floor of acceptable behavior and strive for greater improvements in workers’ quality of life.
Advancing Human Rights
o Engage in an open dialog with workers and management.
o Be aware of human rights issues and concerns in each country in which the company engages in business.
o Adopt the prevailing legal standard, but seek to embrace a ‘best practices’ approach and standard.
Price Discrimination
o Occurs when a firm charges different prices to different groups of consumers – Allowable if justified, based on costs.
o Price gouging- a price increase exceeding the costs of additional expenses (taxes, etc.)
Bribery and the Foreign Corrupt Practices Act
o Bribes(行贿;受贿) and facilitating payments are acceptable in many cultures.
o The US Foreign Corrupt Practices Act prohibits American corporations from offering or providing payments to officials of foreign governments for the purpose of obtaining or retaining business abroad.
- This may place US businesses at a disadvantage
- This has been supported through global treaties(条约 ).
Bribery
o What constitutes bribery?
o Active bribery
o Passive bribery
o Facilitation payments
o Are some bribes acceptable?
Ø Bribery is the practice of offering something (usually money) in order to gain an illicit advantage.
Ø Therefore is defined as an unlawful act, but it can be a business ethic issue.
Ø Bribery can be defined differently in varying situations and cultural environments.
Ø Active Bribery/ active corruption- meaning that the person who promises or gives the bribe commits the offense.
Ø Passive Bribery- is an offense committed by the official who receives the bribe. It is not an offense, however, if the advantage was permitted or required by written law or regulation of the foreign public official’s country, including case law.
Ø Facilitation payments- made to obtain or retain business or other improper advantages do not constitute bribery payments.
Ø In some countries, such payments are made to induce public officials to perform their functions such as issuing licenses or permits.
Ø In many develop countries, it is generally recognized that employee should not accept bribes, personal payments, gifts, or special favors from people who hope to influence the outcome of a decision.
What is Marketing?
o The concept of an exchange between a seller and a buyer is central to the “market” and is the core idea behind marketing.
o Marketing involves all aspects of creating a product or service and bringing it to market where an exchange can take place
o Marketing ethics therefore examines the responsibilities associated with bringing a product to the market, promoting it to and exchanging it with buyers (method of payment).
The Four P’s
o All of the factors considered and each decision made throughout this process is an element of marketing.
- What, how, why, and under what conditions is something produced?
- What price is acceptable, reasonable, and fair?
- How can the product be promoted to support, enhance, and maintain sales?
- Where, when and under what conditions should the product be placed in the marketplace?
o These four general categories- product, price, promotion, placement- are sometimes referred to as the 4P’s of marketing.
The Ethical Questions raised by the 4P’s
Eg. MAS n AirAsia. MAS advertise prices compare with its competitor. Its name the competitors as X. Public know it is compared with AirAisa prices. Is this the right way to do so?
Eg. Target on vulnerable populations such as children or the elderly. Children want Chicky Meal is because the toys, not the meal, it is ethical?
Eg. The producer responsibilities when marketing products at foreign countries. McD not sell beef burger at India, it know Indian don’t eat beef, change all to chicken.
Responsibility for Products: Safety and Liability
Business has an ethical responsibility to design, manufacture, and promote their products in ways that avoid causing harm to consumers.
What do we mean by “responsibility?”
§ In one sense, to be responsible is to be identified as the cause of something.
- Thus, we say that hurricane(狂风) Katrina was responsible for millions of dollars in property damages in New Orleans.
§ In another sense, responsibility involves accountability.
- When we ask who will responsible for the damages caused by Katrina, we are asking who will pay for the damage.
§ A third sense of responsibility connected to but different from the sense of accountability, involves assigning fault or liability for something.
Responsibility
§ The hurricane example demonstrates how these three meanings can be distinguished.
§ Katrina was responsible for (caused) the damage, but cannot be held responsible (accountable for paying for the damages) nor can it be faulted for it.
§ Yet, many think that those who designed, built, or managed the levees in New Orleans were at fault and should be made to pay because their negligence caused much of the harm.
§ In other situations, an automobile crash for example, a careless driver would be identified as the cause of the accident and held accountable because he was at fault.
Responsibility in Business
§ The focus for much of the discussion of business’ responsibility for product safety in on assigning liability (fault) for harms caused by unsafe products.
§ The legal doctrine of strict liability is ethically controversial exactly because it holds a business accountable for paying damages whether or not it was at fault.
§ In a strict liability case, no matter how careful the business is in its product or service, if harm results from use, the business is liable.
Contractual Standard for Product Safety
§ The standard of caveat emptor (let the buyer beware) is in the background to many discussion of product safety.
§ The caveat emptor approach understands marketing on a simple model of contractual exchange between a buyer and seller.
§ This perspective assumes that every purchase involves the informed consent of the buyer and therefore it is assumed to be ethically legitimate.
§ Buyers have the responsibility to look out for their own interest and protect their own safety when buying a product.
From this perspective, business has only the responsibility to provide a good or service at an agreed-upon price.
Warranties
§ Even in the early years of product safety law, courts recognized an implicit promise, or implied warranty, that accompanies any product that is marketed.
§ What the law refers to as the “implied warranty of merchantability,” hold that in selling a product a business implicitly offers assurances that the product is reasonably suitable for its purpose.
§ Even without a verbal or written promise or contract, the law holds that business has a duty to insure that its products will accomplish their purpose.
Tort Standard for Product Safety
§ A second problem remains: If we hold business liable for only those promises made during the market exchange, then, as the consumer gets further separated from the manufacturer by layers of suppliers and retailers, there may be no relationship at all between the consumer who gets harmed and the ultimate manufacturer or designer who was fault.
Negligence
o Negligence, a concept from the area of law known as torts, provides a second avenue for consumers to hold producers responsible for their products.
o The distinction between contract law and tort law also calls attention to two different ways to understand ethical duties.
o Under a contract model, the only duties that a person owes are those that have been explicitly promised to another party. Otherwise, I owe nothing to anyone.
o Negligence is a central component of tort law.
o As the word suggests, negligence involves a type of ethical neglect, specifically neglecting one’s duty to exercise reasonable care not to harm other people.
o One can understand many of the ethical and legal issues surrounding manufacturers’ responsibility for products as the attempt to specific what constitutes negligence in their design, production, and sale.
The nature of Negligence
o Negligence can be characterized as a failure to exercise reasonable care or ordinary vigilance which results in an injury to another.
o In many ways, negligence simply codifies two fundamental ethical precepts: “ought implies can” (we cannot reasonably oblige someone to do what they cannot do) and “one ought not harm others”
o People have done an ethical wrong when they cause harm to others in ways that they can reasonably be expected to have avoided.
o Negligence includes acts of both commission and omission. Once can be negligent by doing something that one ought not (eg speeding in a school zone) or by failing to do something that one ought to have done (eg. Neglecting to inspect a product before sending it to market.)
Resolving Negligence
· Reasons such as these can lead us to interpret the reasonable person standard more normatively than descriptively.
· In this sense, a “reasonable” person assumes a standard of thoughtful (though what is the outcome after sell), reflective (made amendment on the product sold, eg Proton), and judicious decision making (made decision based on law).
· The problem with this, of course, is that we might be asking more of the average consumer than they are capable of giving. Particularly if we think that the disadvantaged and vulnerable deserve greater protection from harm, we might conclude that this is too stringent a standard to applied to consumer behavior.
· On the other hand, given the fact that producers do have more expertise than the average person, this stronger standard seems more appropriate when applied to producers than to consumers.
Strict Product Liability
o The negligence standard of tort law focuses on the sense of responsibility that involves liability or fault.
o But there are also cases in which consumers can be injured by a product in which there was no negligence involved.
o In such cases where no one was at fault, the question of accountability remains.
o The legal doctrine of strict product liability holds manufacturers accountable in such cases.
Ethical debates on Product Liability
o It is fair to say that the business community is a strong critic of much of the legal standards of product liability.
o Liability standards, and the liability insurance costs in which they have resulted, have imposed significant costs on contemporary business.
o In particular, the strict product liability standard is singled out as being especially unfair to business because it holds business responsible for harms that were not the result of business negligence.
The defense to the Strict Product Liability Standard
1. By holding business strictly liable for any harms their products cause, society creates a strong incentive for business to produce safer goods and services.
2. Given that someone has to be accountable for the costs of injuries, holding business liable allocates the costs to the party best able to bear the financial burden.
Each rationale is open to serious objections
Objections to the Strict Product Liability Standard
o The incentive argument seems to misunderstand the nature of strict liability. Holding someone accountable for harm can provide an incentive only if they could have done otherwise.
o But this means that the harm was foreseeable and the failure to act was negligent.
o Surely this is a reasonable justification for the tort standard of negligence. But strict liability is not negligence and the harms caused by such products as DES(Delivered Ex Ship 【商】目的地船上交货条件) and asbestos (【矿】石绒;石棉)were not foreseeable.
o Thus, holding business liable for these harms cannot provide an incentive to better protect consumers in the future.
o The second rationale also suffers a serious defect.
o This argument amounts to the claim that business is best able to pay for damages.
o Yet, as the asbestos case indicates, many businesses have been bankrupted by product liability claims.
Then, what to do? What is to pay?
o Yet, if it is unfair to hold business accountable for harms caused by their products, it is equally if not more unfair to hold injured consumers accountable.
o Neither party is at fault, yet someone must pay for the injuries.
o A third option would be to have government, and therefore all taxpayers, accountable for paying the costs of injuries caused by defective products.
o But this, too, seems unfair.
Ethics and Pricing
A fair price is a price that both parties to an exchange agree upon … …but a product’s price also affects third parties, thus… … fairness and equal opportunity are relevant to pricing ethic
o Informed consent can be missing in some pricing situations
- Price gouging
- Monopolistic pricing
- Price fixing
o Price gouging occurs when the buyer has few purchase options for a needed product and the seller uses this situation to raise prices significantly.
- Energy companies
- Gasoline station and 9/11 (one station set higher price, other station will do so, then consumer will affected.)
o Monopolistic pricing and pricing-fixing are similar
· Either individual companies or a group of conspiring companies use their market power to force consumers to pay a higher price than they would have if there were real competition in the marketplace
- Microsoft and Windows Operating System
- Prescription Drugs
- Credit Card Interest Rates
o Predatory (掠夺成性的)pricing occurs when a product is temporarily priced below the actual costs as a means of driving competitors out of business.
o The price of economic efficiency may involve social and political “costs” to the wider community.
Responsibility for products: Advertising and Sales
o A major element of marketing is sales promotion, the attempt to influence the buyer to complete a purchase.
o Target marketing and marketing research are two important elements of product placement, seeking to determine which audience is most likely to buy, and which audience is mostly likely to be influenced by product promotion.
The Ethical way and the Unethical Way
o There are, of course, ethically good and bad ways for influencing others.
o Among the ethically commendable ways to influence another are persuading, asking, informing, and advising.
o Unethical means of influence would include threats, coercion, deception, manipulation, and lying.
o Unfortunately, all too often sales and advertising practices employ deceptive or manipulative means of influence, or are aimed at audiences that are susceptible(易动感情的) to manipulation or deception(欺骗).
Manipulation: Good or bad?
o To manipulate something is to guide or direct its behavior.
o Manipulation need not involve total control and in fact it more likely suggests a process of subtle direction or management.
o Manipulating a person implies working behind the scenes, guiding their behavior without their explicit(清楚的) consent or conscious(觉察到的) understanding.
o In this way, manipulation is contrasted with persuasion and other forms of rational influence.
Deception
o One of the ways in which we can manipulate someone is through deception (perhaps through an outright lie). We can also manipulate someone without deception.
o The more one knows about psychology- your motivations, interests, and desires, beliefs, dispositions, and so forth the better able they will be to manipulate your behavior.
o Knowing such things about another person provides effective tools for manipulating their behavior.
Manipulation, Deception and Marketing
o Critics charge that many marketing practices manipulate consumers
o Clearly, many advertisements are deceptive, and some are outright lies.
o We can also see how marketing research plays into this. The more one learn about customer psychology, the better able one will be to satisfy their desires, but the better able one will also be to manipulate their behavior.
o Critics charge that some marketing practices target populations that are particularly susceptible to manipulation and deception.
Ethical issues in Advertising
o The general ethical defense of advertising reflects both utilitarian and Kantian ethical standards.
o Advertising provides information for market exchanges and therefore contributes to market efficiency and to the overall happiness.
o Advertising information also contributes to the information necessary for autonomous individuals to make informed choices.
o But note that each of these rationales assumes that the information is true and accurate.
Kant Meets the Ad World
o The deontological tradition in ethic would have the strongest objections to manipulation.
o When I manipulate someone, I treat them as a means to my own ends, as an object to be used rather than as an autonomous person in their own right.
o Manipulation is a clear example of disrespect for persons since it bypasses their own rational decision-making.
o Because the evil rests with the intention to use another as a means, even unsuccessful manipulations are guilty of this ethical wrong.
Marketing toward Greatest Happiness?
o As we might expect, the utilitarian tradition would offer a more conditional critique of manipulation, depending on the consequences.
o There surely can be cases of paternalistic (温和的专制主义的) manipulation in which someone is manipulated for their own good. But even in such cases, unforeseen harms can occur.
o Manipulation tends to erode bonds of trust and respect between persons.
o It can erode one’s self-confidence and hinder the development of responsible choice among those manipulated.
o In general, because most manipulation is done to further the manipulator’s own ends at the expense of the manipulated, utilitarian’s would be inclined to think that manipulation lessens overall happiness.
o A general practice of manipulation, as critics would charge occurs in many sales practices, can undermine the very social practices (eg sales) that it is thought to promote as the reputation of sales is lowered.
Marketing to the Vulnerable
o A particularly egregious(极坏的) form of manipulation occurs when vulnerable people are targeted for abuse.
o Cigarette advertising aimed at children is one example that has received major criticism in recent years.
o Marketing practices targeted at elderly populations for such goods and services as insurance (particularly Medicare supplemental insurance), casinos and gambling, nursing homes, and funerals(葬仪的), have been subjected to similar criticisms.
Marketing Ethics and Consumer Autonomy
o Defenders of advertising argue that despite cases of deceptive practices, overall advertising contributes much to the economy.
o The majority of advertisements provide information to consumers, information that contributes to an efficient function of economic markets.
o These defenders argue that over time, market forces will weed out deceptive ads and practices.
o They point out that the most effective counter to a deceptive ad is a competitor’s ad calling attention to the deception.
What does advertising do to People?
o People may well benefit from business’ marketing of its products.
o People learn about products that they may need or want, they get information that helps them make responsible choices, and they even sometimes get entertained.
o But marketing also helps shape culture, some would say dramatically so, and the individuals who develop and are socialized within that culture.
o Marketing can have direct and indirect influence on the very persons we become.
o How it does that, and the kind of people we become as a result, is of fundamental ethical importance.
o Critics of such claims either deny that marketing can have such influence or maintain that marketing is only a mirror of the culture of which it is a part.
Influence on Consumer Autonomy
o John Kenneth Galbraith’s Perspective: advertising and marketing creates the very consumer demand that production then aims to satisfy.
o Dubbed (译制)the “dependence effect,” this assertion holds that consumer demand depends on what producers have to sell.
Implications of the Dependence Effect
1. By creating wants, advertising is standing the “law” of supply and demand on its head. Rather than supply being a function of demand, demand turns out to be a function of supply.
2. Advertising and marketing tends to create irrational and trivial(无价值的) consumer wants and this distorts the entire economy.
· A society that cannot guarantee vaccinations(种痘;接种) and minimal health care to poor children, spends millions annual for cosmetic surgery to keep its youthful appearance.
3. By creating consumer wants, marketing practices violate consumer autonomy. Consumers who think themselves free because they are able to purchase what they want, are not in fact free if those wants are created by marketing.
In short, consumers are being manipulated by advertising.
Ethical Implications of the Dependence Effect
o Ethically, the crucial point is the assertion that advertising violates(违犯) consumer autonomy.
o The law of supply and demand is reserved, and the economy of the affluent society is contrived and distorted, only if consumer autonomy can be violated, and consumers manipulated, by advertising’s ability to create wants.
Marketing to Vulnerable Populations
o Consider two example of target marketing.
o In one case, an automobile retailer learns that the typical customer is a single woman, between the age of 30-40 old with annual income over $30,000 and who enjoy outdoor sports and recreation.
o Knowing this information, the dealer targets advertising and direct mail to this audience. Ads depict attractive and active young people using their product and enjoy outdoor activities.
o A second targeted campaign is aimed at selling an emergency call device to elderly widows who live alone.
o This marketing campaign depicts an elderly woman at the bottom of a stairway crying out “ I’ve fallen and can’t get up!”
o These ads are placed in media likely to been seen or heard by elderly women.
o Are these marketing campaigns on an equal ethical footing?
o The first marketing strategy appeals to the considered judgments which consumer purchases. Target marketing in this sense is simply a means for identifying likely customers based on common beliefs and values.
Can everyone be Vulnerable? “Stealth Marketing”
o One final form of marketing to vulnerable population involves potentially all of us as consumer targets.
o We are each vulnerable when we are not aware that we are subject to a marketing campaign.
o This type of campaign is called “stealth” or “undercover” marketing and refers to those situations where we are subject to directed commercial activity without our knowledge.
Stealth Marketing
o Certainly we are subjected to numerous communications on a regular basis without paying much attention, such as the billboards at which we might glance sideways as we speed past on a highway. That is not undercover marketing.
Ethic in the Supply Chain
o In creating a product, promoting it, and bringing it to the market, the marketing function of business involves a wide range of relationships with other commercial entities.
o In recent decades, the ethical spotlight has focused on the responsibility that a firm has for the activities of the other entities, what we shall refer to as supply-chain-responsibility.
Ethical relativism and Reasoning
o In Ethic the “right” answer is not found in books; it cannot be calculated like a math problem.
o One cannot prove the truth of an ethical judgment in the way that one can offer a proof in geometry.
o People differ about ethical judgments, and there seems to be no way to decide between competing conclusions.
o Ethical issues seem based on personal feelings and emotions
o Ethical relativism holds that ethical values and judgments are ultimately dependent upon, or relative to, one’s culture, society, or personal feelings.
o Relativism denies that we can make rational or objective ethical judgments.
o If relativism is correct there is no reason to continue our study of ethics. All opinions are equally valid.
o If relativism is correct, we cannot evaluate the culture or social values that the cultural or social values that underlie our ethical judgments.
o Consider child labor…
o Some Western businesses have been criticized for using supplier who relies on child laborers working under harsh conditions for long hours and very low wages.
o Response: Such working conditions are accepted in the host country; therefore Western critics have no justification for imposing their own cultural values/norms on others.
o The relativist would argue that values such as equality, fairness, integrity, self-respect, and freedom are all a matter of personal or social opinion.
o Let’s look at sexual harassment…
o Imagine a male manager telling a female job applicant that she would be hired IF she submitted to his sexual advances.
o The relativist may argue that criticism of harassment is merely a matter of opinion.
o While a woman may feel that harassment is wrong, the male manager may feel that it is right.
o Each opinion or feeling is equally valid.
Is there any way to defend the claim that harassment is unethical?
- We might argue that sexual harassment would subject a woman to unfair workplace discrimination.
- The inequality of power in this situation places a woman in the unacceptable position of having to choose between her livelihood and her own sexual integrity.
- Such a choice is coercive and threatening.
o We would explain the psychological good of self-respect.
o We could point out the crucial importance that jobs play in our lives.
o We could take a social perspective and consider the present status of women in the workplace.
o We would employ rules of logic in our reasoning.
o The cost of relativism-what you need to give up maintaining it- is very high: every principle, every belief, every logical reason we proposed.
o A conclusion that is reached through careful logical analysis and reasoning is better than one that is simply asserted.
o The traps of relativism
- We should be careful not to hold ethics to too high a standard of proof.
- Do not confuse the fact that there is wide disagreement about values with the conclusion that no agreement is possible.
- Do not confuse values such as respect, tolerance, and impartiality with relativism.
Teleology
o Considers acts as morally right or acceptable if they produce some desired result such as pleasure, knowledge, career growth, the realization of interest, or utility.
o Assesses moral worth by look at the consequences for the individual.
Categories of Teleology
o Egoism
- Right or acceptable behavior defined in terms of consequences to the individual
- Maximizes personal interest
Enlightened (有知识的) egoists take a longer term perspective and allow for the well being of others.
o Utilitarianism
- Concerned with consequences
- Considers a cost/benefit analysis
- Behavior based on principles of rules that promote the greatest utility rather than on an examination of each situation (greatest good for greatest number of people.)
Utilitarian Ethic
o Roots of utilitarian thinking can be found in Thomas Hobbes (1588-1679), David Hume (1711-1776), and Adam Smith (1723-1790).
o Classic formulations of Utilitarianism are found in the writings of Jeremy Bentham (1748-1832) and John Stuart Mill (1806-1873).
o The theory tells us that we can determine the ethical significance of any action by looking to the consequences of that act
o Maximizing the overall good or The Greatest Good for the Greatest Number of People.
o Utilitarianism provided strong support for democratic institutions and policies.
o Government and social institutions exist for the well-being of all people, not to further the interest of the monarch- or the wealthy elite.
o The economy exists to provide the highest standard of living for the greatest number of people, not to create wealth for a privileged few.
o Utilitarianism looks at the consequences of actions.
o Utilitarianism is pragmatic(实际的): no one is ever right or wrong in every situation. It all depends on the consequences.
o Utilitarian’s knowledge two kinds of value: instrumental(有帮助的) value and intrinsic(固有的) value.
o If we judge our acts in terms of their consequences, then we must have some independent standard for deciding between good and bad consequences. There must be some intrinsic value by which we can judge the consequences of our acts.
o Utilitarianism differs from egoism: utilitarian acts are judge by their consequences for the general and overall good. The good includes the well-being of each individual affected by the action.
o Egoism focuses only on individual self-interest.
o Mill defended a different understanding of happiness:
o There is a qualitative dimension to happiness:
Ø Happiness is not hedonism(快乐主义). Humans are capable of enjoying a variety of experiences that produce happiness- social and intellectual pleasures in addition to physical.
o To decide which pleasures and what type of happiness is better we should consult with someone with the experience of both.
o Thus Mill acknowledges that not all opinions are equal. Some people are more competent to decide what is good than others.
o Mill’s utilitarianism does not support an uncritical majority rule in which every opinion is treated equally.
o The best way to develop competent judges is through experience and education
o Once people are educated and experienced, then majority-rule democracy is the best way to make decisions.
o Implications for Business and Economics: Economic transactions occur when people seek their own happiness. If people make mistakes and buy products that fail to bring them satisfaction, they learn from those mistakes and no longer buy the product. Market forces eventually eliminate unsatisfactory products.
o Free market economics is a form of “preference utilitarianism” where the utilitarian goal is the maximum satisfaction of preferences.
o Efficiency structures our economy.
o We allow individuals the freedom to bargain for themselves.
o Agreements occur only when both parties believe a transaction will improve their own position.
o Competition works to improve the overall good.
Challenges to Utilitarianism
o Problems from within:
o Finding ways to measure happiness
o Differing versions of the good and implications for human freedom
o Problem from outside
o The principle of consequentialism means that the ends justify the means, but there are certain rules we must follow no matter what the consequences.
Utilitarianism and Business Policy
o Utilitarianism is a social philosophy.
o There are disputes(争论) between two versions of utilitarian policy: expert and market.
o The utilitarian emphasis on measuring, comparing and quantifying re-enforces the view that policy makers should be neutral.
Utilitarian asks us to consider not only the consequences that our acts might have for ourselves, but also the consequences of our acts for all parties affected by them.
Deontological Ethics
o Sometimes the correct path is determined not by consequences but by certain duties.
o Duties= Obligations, Commitments, and Responsibilities
o Deontology denies the utilitarian belief that the ends do justify the means. There are just some things we should do, or should not do, regardless of the consequences.
o Deontological Ethics focuses on the dignity of individuals. Individuals have rights that should not be sacrificed simply to produce a net increase in the collective good.
o Immaneul Kant and the Categorical Imperative: Our primary duty is to act only in those ways in which the maxim of our acts could be made a universal law.
o Maxim=Intention: What am I doing?
o Kant: Ethic requires us to treat all people as ends, not as means to ends.
o Human are subjects that have their own purposes and ends(目的;目标), and should not be treated merely as the means to the ends of others.
o Our ultimate ethical duty is to treat people with respect.
o If our duty is to treat every person with respect, then we can argue that each person has a right to be treated in a respectful fashion.
o My right establishes your duties and my duties correspond to the rights of others.
o Duties establish the ethical limits of our behavior. Duties are what we owe to other people.
o Others have a claim upon our behavior.
o Rights are protecting interests.
o Wants and interests are different from each other. Wants are desires. Interests work for a person’s benefit and are objectively connected to what is good for that person.
o People don’t always want what is good for them.
o Humans make free choices.
o Human have autonomy.
o Humans originate action for their own ends.
o To treat someone as a means to an end is to negate their autonomy-their ability to make free choices.
Deontological approaches insist that some things should be done and some things should not be done – regardless of the consequences. Respecting individual rights and fulfilling out ethical obligations can set limits on decisions aimed at producing good consequences.
Social Justice: Rawlsian Justice as Fairness
o The American philosopher John Rawl has developed one of the most powerful and influential accounts of justice.
o Rawl offers a contemporary version of the social contract theory that understand basic ethical rules as part of an implicit contract necessary to insure social cooperation.
o Rawl’s theory of justice consists of two major components: a method for determining the principles of justice that should govern society, and the specific principles that are derived from that method.
Rawlsian Justice as Fairness: Application of the Method
· Imagine rational and self-interested individuals having to choose and agree on the fundamental principles for their society.
· The image of members of a constitutional convention is a helpful model for this idea.
· To ensure that the principles are fair and impartial, imagine further that these individuals do not know the specific details or characteristics of their own lives.
· They do not know their abilities or disabilities and talents or weaknesses; they have no idea about their position in the social structure of this new society.
Rawlsian Justice Fairness: Veil of Ignorance
· They are, in Rawl’s terms, behind a “veil of ignorance” and must choose principles by which they will abide when they come out from behind the veil.
· To ensure that each individual is treated as an end and not as a means(意图), imagine finally that these individuals must unanimously (全体一致地)agree on the principles.
· These initial conditions of impartiality, what Rawls calls the “original position,” guarantee that the principles chosen are fair- the primary value underlying for Rawls’ concept of justice.
Rawlsian Justice as fairness: The Original Position
o The idea of this “original position,” of having to make decisions behind a veil of ignorance, is at the heart of Rawls’ theory that fairness is the central elements of a just decision or just organization.
o He contends that our decisions ought to be made in such a way, and our social institutions ought to be organized in such a way, that they would prove acceptable to us no matter whose point of view we take.
o He would argue that the only way we can reach this conclusion is to seek out this original perspective from behind a veil of ignorance, to strive towards a perspective of ignorance with regard to our position and instead to strive toward impartiality.
Reality check: Sharing the pie
o Imagine your favorite dessert. You can cut a pie before the arrival of the guests, you don’t know which slice will be yours once, and your guests are allowed to choose their first. (This is comparable to having to decide behind the veil of ignorance.)
o So, you are likely to cut each slice the same size so that you will at least end up with a slice as large as everyone else and, at least, no smaller. The same will be true, Rawl would argue, with the distribution of goods and services in a social group.
o If you are not certain in which group you might fall once the hypothetical (假设的) veil is lifted, you are most likely to treat each group with the greatest care and equality in case that is the group in which you later find yourself.
Rawlsian Justice: Lessons Learned for Economics and Business institutions
o Rawls derives two fundamental principles of justice from this original position.
o The first principle states that each individual is to have an equal right to the most extensive system of liberties(自由权)- equal rights are a fundamental element of social justice.
o The second principle that is derived from the veil of ignorance holds that benefits and burdens of a society should generally be distributed equally.
Virtue That Support Business Transactions
· Trust, Self-control, Empathy(【心】神入;移情), Fairness, Truthfulness, Learning, Gratitude(感激之情), Civility(礼貌 ), Moral leadership.
Virtue Ethic: Making Decisions based on Integrity and Character
· Ethics also involves questions about the type of person one should become.
· Virtue Ethics is a tradition within philosophical ethics that seeks a full and detailed description of those character trait(特征 ), or virtues(美德), that would constitute(构成) a good and full human life.
Virtue Ethics
· An ethics of virtue shifts the focus from questions about what a person should do, to a focus on who that person is.
· Implicit in this distinction is the recognition that our identity as a person is constituted in part bu our wants, beliefs, value and attitudes.
· Character is identical to a person’s most fundamental and enduring dispositions, attitudes, value, and beliefs.
· Virtue ethics recognizes that human beings act in and from character.
· By adulthood, these character traits typically are deeply ingrained and conditioned within us.
· Virtue ethics seeks to understand how our traits are formed and which traits bolster and which undermine a meaningful, worthwhile, and satisfying human life.
· Rather than simply describing people as good or bad, right or wrong, an ethics of virtue encourages a fuller description.
· Faced with a difficult dilemma, we might ask what would a person with integrity(廉正) do?
In other words, you might consider someone you believe to be virtuous(有道德的) and ask yourself what that person would do in this situation.
Three Types of Justice
· Distributive justice
o An evaluation of the outcomes or results of a business relationship (evaluating benefits derived/equity in reward)
· Procedural justice
o Based on the processes and activities that produce the outcomes or results (evaluating decision making processes and level of access, openness and participation)
· Interactional justice
o Based on an evaluation of the communication processes used in business relationships (evaluating accuracy of information and truthfulness, respect and courtesy(礼貌 ) in the process)
Applying Moral Philosophy to Ethical Decision Making
· Evidence suggests that individuals use different moral philosophies depending on the context (personal versus work decisions).
- Pressures at work are different from personal pressures.
- Decision making is affected by the corporate culture at work (rules, work group, etc)
· Moral philosophies should be assessed on a continuum.
Cognitive Moral Development
· Kohlberg’s model consist of 6 stages:
1. Punishment and obedience(服从)
2. Individual instrumental purpose and exchange
3. Mutual interpersonal expectations, relationships, and conformity(遵从)
4. Social system and conscience(善恶观念) maintenance
5. Prior right, social contract or utility(效用,功利)
6. Universal ethical principles
Kohlberg’s Model
· Kohlberg’s 6 stages can be reduced to 3 different levels of ethical concern:
I. Concern with immediate interests and with rewards and punishments
II. Concern with “right” as expected by larger society or some significant reference group
III. Seeing beyond norms, laws, and the authority of groups or individuals
Important of Kohlberg’s Theory
· Provides encouragement that individuals in a company can change or improve their moral development
· Support management’s development of employees’ moral principles through applicable strategies
· Indicates that the best way to improve employees’ business ethics is to provide training for cognitive moral development
White-collar Crime
· An individual or group committing an illegal act in relation to his/her employment
· Highly educated, in a position of power, trust, respectability, and responsibility
· Abuses the trust and authority normally associated with the position for personal and/or organizational gains
· Eg. Unnecessary repair, credit card fraud, exchange account fraud, false stockholder information.
The Right to Privacy: What right?
· Privacy is a surprisingly vague and disputed value in contemporary society
· Calls for greater protection of privacy have increased, yet, there is widespread confusion concerning the nature, extent, and value of privacy.
What is privacy? Two general and connected understandings of privacy can be found in the legal and philosophical literature on this topic: Privacy as a right to be “let alone” within a personal zone of solitude, and Privacy as the right to control information about oneself.
The Value of Privacy
· Privacy is important because it serves to establish the boundary between individuals and thereby serves to define one’s individuality.
· The right to control certain extremely personal decisions and information help determine the kind of person we are and the person we become.
· To the degree that we value the inherent dignity of each individual and treating each person with respect, we must recognize that certain personal decisions and information is rightfully the exclusive domain of the individual.
What is privacy?
Many people believe that a right to be let alone is much too broad to be recognized as a moral right. This has led some people to conclude that a better understanding focuses on privacy as involving control of personal information.
From this perspective, the clearest case of an invasion of privacy occurs when others come to know personal information about us, as when a stranger reads your email or ease drops on a personal conservation. Yet, this also might be too broad of an understanding if we are to claim a right of privacy implies a right to control all personal information.
Ethical Sources of a right to Privacy: privacy as a Universal Right
· The right to privacy is founded in the individual’s fundamental, universal right to autonomy, in our right to make decisions about our personal existence without restriction.
· This right Is restricted by a social contract in our culture that prevents use from infringing on someone else’s right to her or his personal autonomy.
Property rights as a source of privacy right
· Finally, legal analysis of privacy using a property right perspective yields additional insight.
· “Property” is an individual’s life and all non-proactive of her or his life. Derivatives may include thoughts and idea, as well as personal information.
· The concept of property right involves a determine of who maintains control over tangible and intangible, including therefore personal information.
· Property rights relating to personal information therefore define actions that individuals can take in relation to other individuals regarding their personal information.
· If one individual has a right to her or his personal information, someone else has a equivalent duty to observe that right.
Legal Sources of a Right to privacy
There are three ways in which privacy may be legally protected:
· By the Constitution (federal or state)
· By federal and/pr state statutes, and
· By the Common Law.
Constitutional Protections
· The Constitution’s Fourth Amendment protection against an unreasonable search ans seizure governs only the public sector workplace through the Constitution’s application only to State action.
· Therefore, unless the employer is the government or other representative of the State, the Constitution generally will not apply.
Statutory Protections
· From a statutory perspective, there is little, if any, protection from workplace intrusions.
· The Electronic Communications Privacy Act of 1986 (ECPA) prohibits the “interception” or unauthorized access of stored communications.
· However, courts have ruled that “interception” applies only to messages in transit and not to messages that have actually reached company computers.
· Therefore, the impact of the EPCA is to punish electronic monitoring only by third parties and not by employers.
Common Law Protections
· The “invasion of privacy” claim with which most people are familiar is one that developed through case law called “intrusion into seclusion.”
· This legal violation occurs when someone intentionally intrudes on the private affairs of another when the intrusion would be “highly offensive to a reasonable person.”
What is Reasonable? Most recent decisions with regard to monitoring specifically seem to depend on whether the worker had notice that the monitoring occurs. Since the basis for finding an invasion of privacy is often the employee’s legitimate and reasonable expectation of privacy, if an employee has actual notice, then there truly is no real expectation of privacy.
Whom can you trust?
· That trust is truly the crux [(问题的)中心] of the issue with the introduction of new technology.
· When consumers rely on technology provided by a business- from email to internet access and from cell phones to medical labs- they might easily assume that the business will respect their privacy.
· Most average email users do not understand the technology behind the process.
· One would like to believe that those responsible for the technology are, themselves, accountable to the user. That would be the ideal.
Recommended Moral Requirements
Economist Antonio Argandona contends that, if new technology is dependent on and has as its substance information and data, there should be significant moral requirements imposed on that information. He suggest the following as necessary elements:
· Truthfulness and accuracy: The person providing the information must ensure that it is truthful and accurate, at least to a reasonable degree.
· Respect for privacy: The person receiving or accumulating information must take into account the ethical limits of individuals’ (and organizations’) privacy. This would include issues relating to company secrets, expionage, intelligence gathering.
· Respect for property and safety rights: Areas of potential vulnerability, including network security, sabotage, theft of information and impersonation, are enhanced and must therefore be protected.
· Accountability: Technology allows for greater anonymity and distance, requiring a concurrent increased exigency for personal responsibility and accountability.
Business reasons to Limit Monitoring
· Monitoring may create a suspicious and hostile workplace.
· Monitoring may arguably constrain effective performance since it can cause increased stress and pressure, negatively impacting performance and having the potential to cause physical disorders such as carpal tunnel syndrome.
· Stress might also result from a situation where workers do not have the opportunity to review and correct misinformation in the data collected. These elements will lead not only to an unhappy, disgruntled worker who perhaps will seek alternative employment but to lower productivity and performance that will reap higher costs and fewer returns to the employer.
· Finally, employees claim that monitoring is an inherent invasion of privacy in violation of their fundamental human right to privacy.
Balancing Interest: Employer/Employee
· It has been suggested that due notice given to employees that they will be monitored, plus the opportunity to avoid monitoring in certain situations would solve the ethical problems.
· Perhaps the most effective means to achieve monitoring objectives while remaining sensitive to the concerns of employees is to strive towards a balance that respects individual dignity while also holding individuals accountable for their particular roles in the organization.
What would a “Balanced” Monitoring program Look Like?
· A monitoring program developed according to the mission of the organization (eg with integrity), then implemented in a manner that remains accountable to the impacted employees, approaches that balance.
- No monitoring in private areas (eg restroom)
- Monitoring limited to within the workplace
- Employees should have access to information gathered through monitoring
- No secret monitoring- advance notice required
- Monitoring should only result in attainment of some business interest
- Employer may only collect job-related information
- Agreement regarding disclosure of information gained through monitoring
- Prohibition of discrimination by employers based on off-work activities.
A balanced Monitoring Program. The parameters on the previous slide allow the employer to effectively and ethically supervise the work done by her or his employees, to protect against misused of resources, and to have an appropriate mechanism by which to evaluate each worker’s performance, thus respecting the legitimate business interest of the employers.
Monitoring Employees through Drug testing
· With regard to drug or other substance testing, the employer has a strong argument in favour of testing based on the law.
· Since the employer is often responsible for legal violations of its employees committed in the course of their job, the employer’s interest in retaining control over every aspect of the work environment increases.
· On the other hand, employees may argue that their drug usage is only relevant if it impacts their job performance.
· Until it does, the employer should have no basis for testing.
Legality of Drug Testing
· In the seminal legal case on the issue, Skinner v. Railway Labor Executives’ Ass’n, the Court addressed the question of whether certain forms of drug and alcohol testing violate the Fourth Amendment.
· In Skinner, the defendant justified testing railway workers based on safety concerns- “to prevent accidents and casualties in railroad operations that result from impairment of employees by alchohol or drugs.”
· The court held that “ the Government’s interest in regulating the conduct of railroad employees to ensure safety, like its supervision of probationers or regulated industries, or its operation of a government office, school, or prison, likewise present ‘special needs’ beyond normal law enforcement that may justify departures from the usual warrant and probable-cause requirements.”
· It was clear to the Court that the governmental interest in ensuring the safety of the traveling public and of the employees themselves “plainly justifies prohibiting covered employees from using alcohol or drugs on duty, or while subject to being called for duty.”
The issue then for the Court was whether, absent a warrant or individualized suspicion, the means by which the defendant monitored compliance with this prohibition justified the privacy intrusion.
· In reviewing the justification, the Court focused on the fact that permission to dispensed with warrants its strongest where “the burden of obtaining a warrant is likely to frustrate the government purpose behind the search.”
· The court recognized that “alcohol and other drugs are eliminated from the bloodstream at a constant rate and blood and breath samples taken to measure whether these substance were in the bloodstream when a triggering event occurred must be obtained as soon as possible.”
The Court therefore concluded that the railway’s compelling interests outweighed privacy concern since the proposed testing “is not an undue infringement on the justifiable expectations of privacy of covered employees.”
Ethics of Drug Testing
· Where public safety is at risk, there is arguably a compelling public interest claim from a utilitarian perspective that may be sufficiently persuasive to outweigh any one individual’s right to privacy or right to control information about oneself.
Other forms of Monitoring
· Employers are limited in their collection of information through other various forms of testing, such as polygraphs or medical tests.
· Employers are constrained by a business necessity and relatedness standard or, in the case of polygraphs, by a requirement of reasonable suspicion.
· With regard to medical information specifically, employer’s decisions are not only governed by the Americans With Disabilities Act but also restricted by the Health Insurance Portability and Accountability Act (HIPAA).
· HIPAA stipulates that employers cannot use “protected health information” in making employment decisions without prior consent.
· Protected health information includes all medical records or other individually identifiable health information.
The Future of Testing
· Genetic testing and screening of both employees and consumers, is another new technology that will offer businesses a wealth of information about potential employees and customers.
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