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This essay shall discuss what ethical theories are and why we need them. It will further discuss
what the two main families of western modernist ethical theories. Which ethical theory is
mostly used in business and the evidence to support the assertion.
Akinpelu, (1981: 6) states that, “The Ethics is the branch of philosophy that deals with the
principles of morality and the well-defined standards of right and wrong that prescribe the
human character and conduct in terms of obligations, rights, rules, benefit to society, fairness.”
It is a branch of philosophy that, at its core, seeks to understand and to determine how human
actions can be judged as right or wrong. We may make ethical judgments, for example, based
upon our own experience or based upon the nature of or principles of reason. Those who study
ethics believe that ethical decision making is based upon theory and that these theories can be
In other words, the ethics encompass the human rights and responsibilities, the way to lead a
good life, the language of right and wrong, and a difference between good and bad. This means
it is concerned with what is right or wrong for the individuals and society. The term “ethics”
have been derived from the Greek word “ethos” which means character, habit, disposition or
custom. One key example is utilitarianism. Utilitarianism says, roughly, that actions are good
when they are aimed at producing the best outcomes. This means maximizing pleasure or wellbeing across the population affected by your actions. So, lying to a friends is bad because it
tends to create hurt, whereas bluffing in poker is ethically OK because it is part of the game
and actually enhances the pleasure that comes from playing (Needham, 1984).
Theories are important as they go beyond unifying our favourite ethical intuitions. This ideally
also help us to sort through our intuitions, to sort out the “well-founded” ones from ones that
may be mere prejudices. And, ultimately, an ethical theory provide guidance, by pointing the
way on questions where we don’t have clear rules or intuitions already.
Whats more, ethical theories are needed as they help to provide an intellectual structure to the
way individual talk about ethical practice. Help to explain why a person believes that one action
is right or wrong. Drucker (1974: 37), states that, “ethic theories assist to understand and
analyse how people make ethical decisions.” It's not enough to say 'this thing here is wrong'
and 'this thing here is all right'. Things should be classified even that no-one has done yet, for
example, Should a self-aware computer be treated as a person? Are non-humans ever people?
Into 'ethical' and 'unethical.
If there is evil, the solution is simple, stop it, kill it, and destroy it. People have been doing that
since the dawn of time. Which is why the first thing that evil does is to masquerade as good.
Then evil people make up bogus moral rules and then get an exception for themselves. They
even portray good as evil sometimes. The first evil is a lie, so that good people do evil, thinking
they do good. Fighting evil people is doable. Fighting good people who do evil is pretty
difficult. Therefore, ethical theories identify what is good and what is evil. They don’t actually
destroy evil, they just prevent its spreading, and they allow for its destruction.
The two main main families of Western modernist ethical theories are natural rights theories,
and utilitarianism. Laurie, (1992: 36) states that, “The utilitarian theory insists that an action is
considered to be right or wrong based on the consequences of the action and its effects on
majority of the people.” This means that an action or practice is ethically correct when it
produces more positive consequences in comparison to negative ones to those who are
Therefore, utilitarianism goes by the rule that an action is evaluated to be ethical based on a set
of rules or principles that can bring the greatest usefulness to the greatest amount of people
(Heidegger, 2005). This is the total opposite to deontological ethics whereby utilitarian believes
that there should not be any compromising when it comes to determining the stand point of
morality. Tools such as cost benefit analysis and risk assessment are often depended on by
utilitarian for decision making purposes. However, there are some arguments regarding ‘the
greatest happiness principle’ that is set forth by utilitarianism. This is due to the difficulty in
measuring unit of happiness or in order to determine an action that will bring the most benefit
comparing to other actions.
Natural rights are perceived as the inherent and original rights of human nature, which equally
belong to all men without exception, and which are possessed solely because of their human
condition. They are held to stem from a concept of natural law, whatever definition may be
attributed to the term. Schuwarz, (1989: 53), says that, “The theory of natural law and natural
rights of man is, however, an obscure one.” It seems a strange law, which is unwritten, has
never been enacted, may even be observed without penalty, and imposes peculiar rights which
are entitled prior to all specific claims within an organised society. It may be just an example
of 'social mythology', but such an idea is still intriguing. For, to disregard it completely is to
deny all its evident psychological, political and legal effects, and to adopt it fully is to be blind
to man's own imperfections. That men are entitled to make certain claims by virtue simply of
their common humanity has been equally passionately defended and vehemently denied.
In business, as it turns out, business leaders will make decisions that are ethically significant
on a daily basis. Whenever they act, they will be acting according to some ethical theory,
whether they know it or not. But what, exactly, are the theories that affect our everyday
business practices. Probably the most widely understood and commonly applied ethical theory
is utilitarianism. In an organisational context, utilitarianism basically states that a decision
concerning business conduct is proper if and only if that decision produces the greatest good
for the greatest number of individuals.
Using utilitarianism, business men, focus on the rules for acting rather than on individual
actions themselves. For a rule utilitarian, a rule is morally correct when it provides more social
good than any alternative rule. A strong appeal of the utilitarian approach is its cost-benefit
character (Frankena, 2002). Business managers regularly weigh the pros and cons of alternative
economic and managerial actions. This approach to solving business problems is a staple of
many business courses so is therefore ingrained in the psyche of many managers.
Business executives appreciate the fact that most utilitarian’s recognize that not everyone will
benefit from a particular action. Hence, the emphasis in utilitarianism is on the net utility of the
set of outcomes resulting from a decision being considered.
The proof that business men use this theory can be seen in several years a pharmaceutical
company released the drug Accutane as a means for treating severe acne in young men. The
drug was very effective, but it was also known to cause life-threatening birth defects if pregnant
women were exposed to the drug (Heidegger, 2005).
The ethical principle of utilitarianism states that is ethically acceptable to release a drug like
Accutane with appropriate warning. The number of young men who will experience relief from
the skin condition will outweigh the few cases in which an individual will fail to adhere to the
warning. All pharmaceuticals have side effects, but utilitarianism provides moral permission
for their distribution anyway because the sum of their contributions are argued to be far greater
than the negative outcomes they cause.
In conclusion, ethical theories are important in everyday life as they are useful considering
what is right and wrong. They are also important as they are useful in business as well.
Akinpelu, J. A. (1981), An introduction to philosophy of Education. Oxford: Macmillan.
Drucker, P. (1974). The new realities (revised ed.). New Delhi; Sterling Publishers.
Frankena, W (2002). Philosophy of Education 2nd edition. New York, NY: Macmillan
Heidegger, M. (2005) The Essence of Human Freedom. New York: Continuum Print.
Laurie, S. (1992), schools of philosophy of education. New York: Burt Franklin Reprints.
Needham, J. (1984). The Teacher of Nations. Cambridge: Cambridge University Press.
Schuwarz, A. (1989), The philosophy of Existentialism. London: oxford university press.