Master class on business
ethics
Andy Crane
Dirk Matten
You are in for a treat!
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A new paradigm of business ethics
Think outside the box
Categorical imperatives of truth and reason
Shared vision of core values:
–Common purpose
–Responsibility
–Accountability
–Principled behaviour
Business ethics…I didn’t think there
were any!
“Business ethics? There’s no such thing!”
“A book on business ethics? Well that must be a
quick read!!”
“A course on business ethics? Well that’s easy,
there are none!”
“A professor of business ethics? Well what on earth
do you do all day?!”
Oxymoron
def. 1. a combination of
contradictory terms, also
considered a paradox. 2.
a contradiction in terms
Is business ethics an oxymoron?
• Ethics = doing what’s right, building better
societies
• Business = playing to win, doing what’s good for
the firm
• So are we really Professors of Oxymoronity??!!
Understandable cynicism
• One in four UK employees says that they have
felt pressure to compromise their own or their
organization’s ethical standards
• One in five has noticed behaviour by their
colleagues that violates the law or does not
accord with expected ethical standards
Institute of Business Ethics, Ethics at Work survey, 2005
Types of misconduct
Type of misconduct observed
Employees
observing it
Lying to employees, customers, vendors, or the public
26%
Withholding needed information from employees,
customers, vendors or public
25%
Abusive or intimidating behaviour towards employees
24%
Misreporting actual time or hours worked
21%
Discrimination on basis of race, gender, etc
17%
Sexual harassment
13%
Stealing, theft, or related fraud
12%
Breaking environmental and safety laws/regulations
12%
Scandals and collapses
• Enron, Worldcom, Andersen etc
collapsing due to huge financial
irregularities
• Shell’s mis-booking of oil
reserves, price-fixing at
Sotheby’s & Christies, corruption
at BAE in Saudi Arabia?
• A handful of greedy executives?
The tip of the iceberg? Or a
rotten corporate system?
Degree of trust in specific
organisations in the USA and Europe
Figure 10.6: Degree of trust in specific organizations in US and Europe
80
70
60
50
40
30
20
10
0
Microsoft
Exxon
Nike
Ford
USA (%)
Greenpeace
Amnesty
WWF
Europe (%)
Source: Wootliff and Deri (2001). NGOs: the new super brands. Corporate Reputation Review, 4/2:157-65
Degree of trust in different types of organisation in the
USA and Europe
50
45
40
35
30
USA (%)
25
Europe (%)
20
15
10
5
0
Business in general
NGOs in general
Government in general
Source: Wootliff and Deri (2001). NGOs: the new super brands. Corporate Reputation Review, 4/2:157-65
Perceived credibility of corporations and NGOs
regarding specific issues
80
70
60
50
40
Environmental
issues
Human rights
issues
30
USA
Europe
20
10
0
NGO
Corporation
NGO
Corporation
Source: Wootliff and Deri (2001). NGOs: the new super brands. Corporate Reputation Review, 4/2:157-65
A constant media spotlight
• Drinks industry and binge
drinking
• Clothing and footwear companies
and labour conditions
• Confectionery companies, poverty
wages and slave labour
• Energy industry and global
warming
• Fast-food companies and obesity
So what can we do….?
Pitfalls of preaching
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Impossibility of conversion
Being certain ≠ being right
Creating moral robots
Knowing right from wrong isn’t the problem
Ethical decision making as balancing
R
R
R
W
W
W
A brief personal example
Or a word from our sponsors….?
The case against
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‘Dirty money’
Preventing academic criticism
Hypocrisy
Corrupting the corporate social responsibility
agenda
• Legitimating tobacco industry
Resolving a personal ethical dilemma
• Academic freedom
• Using resources for positive change
• Appropriate openness, governance, and
accountability
• Living with irony
• A leap of faith
An alternative approach to business
ethics?
• Identifying the opportunities for change and the
‘structures of constraint’
• Enhancing moral imagination
– Recognising and understanding different
moral perspectives
– Explaining and rationalising these
perspectives
• Developing new ways of considering
responsibilities of business in society
Structures of constraint
• Businesses already have a
powerful set of ethics embedded
within their DNA
• Organizational life is often
characterised by amoralization
and moral muteness
• Leaders set the ethical tone in
organizations
• People do what’s rewarded … and
what they think they ‘should’ do
Opportunities for change
• Acknowledging and understanding the barriers
• Encouraging moral awareness and literacy –
going beyond the business case
• Providing the tools for ethical decision-making
• Fostering creativity and moral imagination
• Walking the talk
A short experiment…
On a scale of –5 (very wrong) to +5 (very right),
how would you rate:
• Pretending to be a customer to get information
about a competitor
• Outsourcing of call centre jobs from Ireland to
India
Normative theories
• Consequentialism and cost-benefit analysis
• Duty or rights based approaches
Typical Perspective
Ethical
Dilemma
Single normative consideration
for solving the ethical dilemma
‘Lens’ of ethical theory
The value of ethical theories in facing
ethical dilemmas in business
If the Professor of Business Ethics
just talks about different
perspectives or considerations….
….then can we ever say if something
is actually right or wrong?
New ways of considering
responsibilities of business in society
• Morality is about meeting expectations … but also
about challenging them
• Identifying broadly agreed upon norms or ‘moral
minimums’
• Seeking consensus rather than just moral
absolutes
• Process of decision-making rather than just the
decisions themselves
• Ensuring personal engagement rather than
conformity and compliance
Some conclusions…
• There are ethics in business … they’re just not
always visible, and don’t necessarily lead to the
kinds of behaviour we’d like
• Morally motivated behaviour is possible in
business, but is subject to considerable, and
quite rigid structures of constraint
• There are few right and wrong answers, just
better or worse decisions, or more widely
acceptable behaviours
• Being ethical in business is a creative endeavour
not just a rational one