10/13/2014
BUSINESS ETHICS first, second
and third session
Gianfranco Rusconi
September 18-19 and October 2nd
2014
AMORALITY OF BUSINESS?
• 1) STEREOTYPE
• 2) AUTONOMY OR FREE ZONE OF
ETHICS=AMORALITY?
• 3) SMITH, FRIEDMAN, MAXIMIZATION AND
MORALITY
1
10/13/2014
AN ALMOST COMMON GROUND
•
ALSO PEOPLE THINKING THAT MAXIMIZING PROFITS IS THE
ONLY (ALSO SOCIAL) DUTY FOR BUSINESS, MORE OR LESS
IMPLICITLY, RECOGNIZE AT LEAST THAT:
1) IT EXISTS A SORT OF MORAL FRAME (PLUS OR MINUS
FLEXIBLE ACCORDING TO THE VARIOUS PERSONAL ETHICS
VIEWS) TO COMPLY WITH;
2) THE LAW HAS TO BE RESPECTED;
3) THE
RICHNESS
KNOWLEDGE
PRODUCING
AND
WEALTH
PROCESS
DIFFUSION)
(EMPLOYMENT,
IS
MORALLY
APPRECIABLE.
NATURE OF BUSINESS ETHICS
• BUSINESS ETHICS STUDIES AND APPLICATIONS
WERE BORNE BECAUSE OF BEING SCHOLARS AND
PRACTITIONERS AWARE THAT TO MAKE EXPLICIT
ETHICS IN BUSINESS (AND ECONOMICS) IS NOT SO
IMMEDIATE
AND
SIMPLE,
ASKING
FOR
INTERDISCIPLINARY SKILLS.
2
10/13/2014
DIFFUSION OF BUSINESS ETHICS
• BUSINESS ETHICS DIFFUSED AFTER ALSO
IN EUROPE, THOUGH WITH SOME
DIFFERENT CHARACTERISTICS FROM USACANADA,
• ALSO WHEN IN THE MORE RECENT TIMES,
DIFFERENT WORLD’S AREAS ARE GETTING
BETTER HOMOGENOUS THANKS TO
CONTINUOUS EXCHANGE OF PAPERS,
CONFERENCES AND EXPERIENCES.
BUSINESS ETHICS AND SUBSECTORS
• IT COULD BE USEFUL TO DEFINE SUBSECTORS, THAT,
THOUGH ALWAYS INTERCONNECTED IN BUSINESS ETHICS
STUDIES, COULD PRESENT MORE SPECIFIC STUDIES, FOR
EXAMPLES DISTINGUISHING ETHICS OF MANAGEMENT
AND BUSINESS ADMINISTRATION FROM ETHICS OF
ECONOMICS;
• TO DO A FURTHER DIVISION, INTRODUCING (ALWAYS
SAVING BASIC KNOWLEDGE AND GENERAL
INTERCONNECTIONS WITHIN BUSINESS ETHICS) MORE
SPECIFIC STUDIES: ETHICS OF MARKETING OR ETHICS OF
FINANCE, LABOUR AND ACCOUNTING.
3
10/13/2014
NEED OF BUSINESS ETHICS
• HISTORY
• SCANDALS
• BAD ETHICS AND AGENCY COSTS
• FALSE ACCOUNTING, SUBPRIME, PROBLEM OF
DERUVATIVES, HUMAN RIGHTS…..DAMAGES
BUSINESS ETHICS AND SCANDALS
• LOCKHEED AND ALIA ’70s, FOREIGN
CORRUPTING PRACTICES ACT (1977), BIG
PRESSURE TO BUSINESS ETHICS
DEVELOPMENT
• BEFORE IN USA AFTER IN EUROPE: “BIRTH”
OF SOCIETY OF BUSINESS ETHICS
(NORDAMERICAN, SBE) AND EUROPEAN
BUSINESS ETHICS NETWORK ( EBEN), other
(EABIS,…international…)
4
10/13/2014
BUSINESS ETHICS AND SCANDALS 2
• AND BUSINESS ETHICS IS ALWAYS MORE AND MORE
CLAIMED, BUT ….
• ENRON, PARMALAT (2000): UNEXPECTED
BANKRUPCIES WITH FALSE ACCOUNTING
• BIG FINANCIAL CRISES (2007-8): THE (MORE OR
LESS) COLLAPSE OF FINANCIAL SYSTEM IN MANY
COUNTRIES: USA, IRELAND, UK. SPAIN
NOVELTY OF BUSINESS ETHICS
• TO MAKE ETHICS EXPLICIT IS NOT SO EASY
AND IMMEDIATE: DILEMMAS, DIFFERENCES
OF PRINCIPLES, ECC.
• PAGE 3 OF MATERIALS 1
5
10/13/2014
IS FIRM A MORAL PERSON?
• TWO EXTREMES:
• FRENCH: autonomous Moral «Person» , not a
«sum» of Moral Persons
• LADD: Formal organization «as all sort of
bureaucracies, private and public», big
companies included
IS A FIRM A MORAL PERSON?2
• MORE INTERMEDIATE
• GOODPASTER AND MATTHEW:
• Firms have some characteristics of human
person, but they have not a conscience. We can
speak to a company like a person by analogy,
also when we can not think to a companyperson according to French
•
6
10/13/2014
ETHICS AND FIRM SYSTEM THEORY
• See page 7 of materials
RELATIVISM AND OBIECTIVISM
• INDIVIDUAL EXTREME RELATIVISM
• CULTURAL (MODERATE) RELATIVISM
• OBJECTIVISM
• See materials
7
10/13/2014
ONLY SOME SHORT REFERENCES
• 1) Business Ethics and religion
• 2) Business Ethics and law
• See materials
THREE BASIC IDEAS OF ETHICS TO
APPLY TO BUSINESS ETHICS
• UTILITARIANISM (CONSEQUENTIALISM):
• DEONTOLOGY
• VIRTUE ETHICS
8
10/13/2014
INTRODUCTION TI BUSINESS ETHICS
• To help discussion
PAPER TO READ TO PREPARE FOURTH
AND FIFTH LESSONS
• Andre Gustafson: Utilitarianism
• and Business Ethics
• Norman Bowie: A Kantian Approach to Business
Ethics
• Robert Solomon: Corporate Roles, Personal
Virtue: An Aristotelean Approach to Business
Ethics
9
10/13/2014
UTILITARIANISM
• SOMETHING IS GOOD IF IT IS USEFUL (BENTHAM IN XIX
CENTURY), PROBLEMS: FOR WHOM? FOR ALL? FOR THE
SINGLE? FOR THE MAJORITY?
• AND PRINCIPLES, HUMAN RIGHTS, ECC.
• VARIOUS FORMS OF UTILITARIANISM (ACT OR RULE
UTILITARIANISM)
• CONNECTION WITH CONSEQUENTIALISM: SOMETHING IS
GOOD IF IT HAS USEFUL CONSEQUENCES; CONNECTION
WITH PRAGMATISTIC PHILOSOPHY
DEONTOLOGY
• ETHICS IN ALL (AND ALSO IN BUSINESS) IS
RESPECTING SOME GENERAL PRINCIPLES.
• FOR EXAMPLE: KANT
• ALSO BIG AND DIFFUSED RELIGIONS HAVE
SOME PRINCIPLES AS KEY ELEMENTS
10
10/13/2014
VIRTUE ETHICS
• TO BE ETHICAL IN BUSINESS IS NOT ONLY
RESPECTING SOME RULES AND PRINCIPLES,
BUT BECOME ALWAYS MORE AND MORE
VIRTUOUS AND EXCELLENT BY PRACTICING
VIRTUE (INFLUENCE OF ARISTOTLE, ETICA
NICOMACHEA)
Papers to analyse comment
• In addition prepare the papers of:
• We comment and in next two lessons:
• A kantian approach to business ethics (Bowie); Corporate
Roles, Personal Virtues….(Solomon) ; Gustafson about
utilitarianism. To grasp essential not to study on
memory….NOW I GIVE YOU SOME INSIDES.
• A) central points of this paper B) in your opinion what are
possible consequences for ethics or for business of the
applications of these papers?
• The last lesson will be an inside about stakeholder theory
11
10/13/2014
INTRODUCTION TO BUSINESS ETHICS
by Donaldson and Wehrane
• ALL THESE PAPERS ARE AIMED AT BETTER EXAMINE
AND GRASP CONCEPTS, ISSUES AND DILEMMAS
• First impressions of students after reading this
paper:………
• My observations:
• What is the nature of an ethical action?
• The BASF investment in South Carolina: pollution vs.
employment in a poor area, economic and ethical
dilemma for BASF
INTRODUCTION TO BUSINESS ETHICS by
Donaldson and Wehrane 2
•
•
•
•
•
3 options
To build with minimal pollution control?
To build with maximal pollution control?
Do not build
Consequences:Consequentialism: Ethical
Egoism and Utilitarianism
• Duties: Deontology (Kantianis and
Contractarianism)
12
10/13/2014
INTRODUCTION TO ETHICAL
REASONING
• EXAM AND DISCUSSION directly on the paper
in the classroom
13