IP: Business Ethics Organising Principles for an Ethical Framework.

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IP: Business Ethics IP: Business Ethics Organising Principles for Organising Principles for an Ethical Framework an Ethical Framework

Transcript of IP: Business Ethics Organising Principles for an Ethical Framework.

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IP: Business EthicsIP: Business Ethics

Organising Principles for an Ethical Organising Principles for an Ethical FrameworkFramework

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What is Ethics? Some classic What is Ethics? Some classic answersanswers

• Ethics is the way things are done around here.Ethics is the way things are done around here.AristotleAristotle

• Ethics is treating other people as you would be Ethics is treating other people as you would be treated.treated.

Confucius, St Paul, KantConfucius, St Paul, Kant

• Ethics is doing whatever brings the best results.Ethics is doing whatever brings the best results.Bentham, Mill, SingerBentham, Mill, Singer

• Ethics is becoming the right kind of person - Ethics is becoming the right kind of person - acquiring the virtues.acquiring the virtues.

Aristotle, MacIntyreAristotle, MacIntyre

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ObjectionsObjections

• Ethics is subjective/relative.

• If it’s legal, it’s ethical - at least for corporations.

• Ethics is about following rules. If you know the rules, that’s all you need to know.

• I don’t give a damn about ethics.

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IsIs Ethics subjective and relative? Ethics subjective and relative?

Everyone disagrees about ethics. Who is to Everyone disagrees about ethics. Who is to say what is right?say what is right?Ethics is relative to your culture, so it is Ethics is relative to your culture, so it is offensive to impose your values on to offensive to impose your values on to someone else.someone else.Clearly we Clearly we dodo differ, but do we not also differ, but do we not also share values?share values?

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A thought experimentA thought experiment

Think of someone who is an ethical Think of someone who is an ethical example to you and of the core ethical example to you and of the core ethical values they embody.values they embody. One word only (no hyphens)One word only (no hyphens) Serious (not punctual or polite)Serious (not punctual or polite) Non-religious (not pious or prayerful)Non-religious (not pious or prayerful) Non-legal (not law-abiding)Non-legal (not law-abiding)

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Our guess about your answersOur guess about your answers

HonestyHonesty

IntegrityIntegrity

FairnessFairness

CompassionCompassion

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Although history has long forgotten them, Lambini & Sons are generally credited with the Sistine Chapel floor.

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Law and ethics: a modelLaw and ethics: a model

Law is the floor, ethics the ceiling.Law is the floor, ethics the ceiling.

Ethics is a higher standard, but without law is Ethics is a higher standard, but without law is unlikely to be effective.unlikely to be effective.

Ethics and law are complementary: they Ethics and law are complementary: they cannot substitute for each other.cannot substitute for each other.

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Isn’t ethics just about following Isn’t ethics just about following rules?rules?

Rules are essential because they allow for predictability, Rules are essential because they allow for predictability, the definition of roles and responsibilities, and the the definition of roles and responsibilities, and the definition of boundaries.definition of boundaries.ButBut

Human conduct cannot be reduced to rules: Human conduct cannot be reduced to rules: rules are derived from conduct.rules are derived from conduct.

Rules date. Rules date. Rules cannot cover all contingencies. Rules cannot cover all contingencies. Rules must be tempered by judgment: there Rules must be tempered by judgment: there

can be many ways to get things wrong and can be many ways to get things wrong and more than one way to get them right.more than one way to get them right.

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Rules and standardsRules and standards

Rules are one way of proclaiming standards.

Standards are important for consistency, but they are a minimum.

Businesses and managers must have standards, but only as a minimum: they should aim higher, like an archer.

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Ethical defeatEthical defeat

Almost no one accepts that there is nothing Almost no one accepts that there is nothing ethical to be said for them, even if they ethical to be said for them, even if they have committed horrible offences.have committed horrible offences.

Tale of a New York drug dealer.Tale of a New York drug dealer.Stephen Cohen has called this resistance to Stephen Cohen has called this resistance to ethical defeat.ethical defeat.

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Ethics are trumpsEthics are trumps

Consider these reasons for accepting a bribe.Consider these reasons for accepting a bribe.• You would just be doing your job - only more You would just be doing your job - only more

quickly.quickly.• You wouldn’t be hurting anyone - you would be You wouldn’t be hurting anyone - you would be

helping someone.helping someone.• You and your family would be better off.You and your family would be better off.• If you didn’t do it someone else would.If you didn’t do it someone else would.• You deserve better pay anyway.You deserve better pay anyway.• It’s unethical.It’s unethical.

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Ethics presents the most serious Ethics presents the most serious kinds of reasonkinds of reason

That is why we are reluctant to ‘impose’ our That is why we are reluctant to ‘impose’ our views on others and vice-versa. People views on others and vice-versa. People become heated about ethical issues because become heated about ethical issues because they are serious.they are serious.We can’t impose our views, but we can We can’t impose our views, but we can argue hard and seriously for them. Why argue hard and seriously for them. Why wouldn’t we if they are truly important?wouldn’t we if they are truly important?

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An ethical opinion:An ethical opinion:

Is not just self-interestedIs not just self-interestedHas regard for othersHas regard for othersCould apply to anybody - is reversibleCould apply to anybody - is reversibleTakes account of contextTakes account of contextOverrides other considerationsOverrides other considerationsHas to be ‘lived with’.Has to be ‘lived with’.

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What is involved in ethical What is involved in ethical justification?justification?

Being accountable in terms ofBeing accountable in terms of– the lawthe law– professional codesprofessional codes– employer’s values statementsemployer’s values statements– common moralitycommon morality– informed ethical judgment (conscience)informed ethical judgment (conscience)

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TrustTrust

• Basic to humanity - we need to trust and be trusted. Trust builds trust.

• Basic to relationships - friendships of pleasure, utility and affinity.

• Allows confidence and predictability.• Reduces stress.• Lowers transaction costs and increases

productivity.• Encourages risk-taking; discourages risk-aversion.

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Underwriting trust: Underwriting trust: the Ring of Gygesthe Ring of Gyges

Gyges was a shepherd in Lydia who discovered a magic ring which made him invisible.

With this ring, he was able to seduce the queen, murder the king and take his kingdom.

Who would not do forbidden things if one could get away with them? (Plato, Republic)

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What the bagel man found outWhat the bagel man found out

Payment rates were higher when he was the known provider.

An open basket is a temptation. A money box is safer. People who steal bagels don’t steal the money boxes -

don’t perceive taking bagels as theft?Law firms and telecoms have notable failings and executives seem

to be the worst offenders!

Firms with high morale seem to be more honest. Smaller firms are more trustworthy - the shame factor?

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Bagel behaviourBagel behaviour

An office with low paying staff rarely An office with low paying staff rarely becomes an honest payer, and vice versa. becomes an honest payer, and vice versa. Hence Paul F. believes that honest people Hence Paul F. believes that honest people remain honest, and cheaters will cheat remain honest, and cheaters will cheat regardless of the circumstance. regardless of the circumstance.

Against Glaucon (Plato’s brother) who Against Glaucon (Plato’s brother) who tells the tale of Gyges, Paul F. knows that tells the tale of Gyges, Paul F. knows that people are honest 89% of the time. The people are honest 89% of the time. The bagels prove it.bagels prove it.

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A simple frameworkA simple framework

• Do no evil.Do no evil.

• Prevent evil.Prevent evil.

• Remove evil.Remove evil.

• Do good.Do good.

William FrankenaWilliam Frankena

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What is ethics?What is ethics?

The liberal might answer:The liberal might answer:““Ethics is the responsible use of freedom.”Ethics is the responsible use of freedom.”

Surely this is correct. Is not misconduct the Surely this is correct. Is not misconduct the irresponsible use of freedom, say, to irresponsible use of freedom, say, to damage others and look after ourselves?damage others and look after ourselves?But this definition is too limited: it does not But this definition is too limited: it does not commit us to anything in particular. What commit us to anything in particular. What goods matter to us ethically?goods matter to us ethically?

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Can we name these goods?Can we name these goods?

John Finnis has nominated the following:John Finnis has nominated the following:LifeLife - health, security - health, securityFriendshipFriendship - friends, community - friends, communityFreedomFreedom - personal, political, economic - personal, political, economicKnowledgeKnowledge - many forms - many formsAestheticsAesthetics - art, nature - art, naturePlayPlay - spontaneous, organised - spontaneous, organisedBelief systems Belief systems - like religion- like religionTrustTrust

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Ethics and impartialityEthics and impartiality

The house next door is on fire.The house next door is on fire.Your children are in the house. You rush Your children are in the house. You rush into the fire to rescue them. Other children into the fire to rescue them. Other children are in the house too.are in the house too.Does ethics require you to rescue the Does ethics require you to rescue the children impartially, i.e. without special children impartially, i.e. without special regard for saving your own children? regard for saving your own children?

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Do we not properly favour those Do we not properly favour those whom we recognise?whom we recognise?

Peter Singer argued that favouring kin was Peter Singer argued that favouring kin was a survival device of evolutionary biology a survival device of evolutionary biology that fairness and justice should now that fairness and justice should now supercede.supercede.But what of loyalty, love, affection and But what of loyalty, love, affection and intimate knowledge of the good in those we intimate knowledge of the good in those we know?know?These values relate less to ‘favouring’ than These values relate less to ‘favouring’ than to the ethics of care.to the ethics of care.

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What principles should steer What principles should steer ethical judgment?ethical judgment?

Four accounts:Four accounts:1. A1. Acts are intrinsically right or wrongcts are intrinsically right or wrong. Ethical. Ethical requirements requirements

areare expressed in duties expressed in duties – – deontologydeontology (Kant) (Kant)2. R2. Right and wrong ight and wrong means producing ameans producing a surplus of good over surplus of good over

evilevil consequences - consequences - consequentialismconsequentialism, e.g. , e.g. ‘utilitarianism’‘utilitarianism’ (Mill)(Mill)

3. The ethics of care.3. The ethics of care.4.4. Virtue and character.Virtue and character. Human endowments can be improved Human endowments can be improved

by the acquisition of virtues that can be learned. by the acquisition of virtues that can be learned.

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Intentions are basic to Intentions are basic to responsibilityresponsibility

Think of Bratman’s examples.If we intend to kill, it doesn’t matter if we

actively kill or passively let die.Intention changes the nature of acts.Intention introduces responsibility

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Results are integral to ethicsResults are integral to ethics

Ethics is about consequences even if it is not Ethics is about consequences even if it is not onlyonly about consequences. about consequences.

If there were no significance to consequences, If there were no significance to consequences, ethics would matter little. It is because ethics would matter little. It is because ethics guides conduct that it matters.ethics guides conduct that it matters.

It is also because of this that ethics links with It is also because of this that ethics links with economics.economics.

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Management EthicsManagement Ethics

Management excellence requires human virtues.Management excellence requires human virtues.

All social virtues built on friendship, but All social virtues built on friendship, but professional virtues include:professional virtues include:– High practice standardsHigh practice standards

– Trustworthiness and honestyTrustworthiness and honesty

– IntegrityIntegrity

– CompassionCompassion

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LAURA NASH’S MODEL OF LAURA NASH’S MODEL OF ETHICAL DECISION MAKING ETHICAL DECISION MAKING

1.1. Have you defined the problem accurately?Have you defined the problem accurately?

2.2. How would you define the problem if you stood How would you define the problem if you stood on the other side of the fence?on the other side of the fence?

3.3. How did this situation occur in the first place?How did this situation occur in the first place?

4.4. To whom and to what do you give your loyalty To whom and to what do you give your loyalty as a person and as a member of the organisation?as a person and as a member of the organisation?

5.5. What is your intention in making this decision?What is your intention in making this decision?

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6. How does this intention compare with the probable results?7. Whom could your decision or action injure?8. Can you discuss the problem with the affected parties before you make your decision?9. Are you confident that your position will be as valid over a long period of time as it seems now?10. Could you disclose without qualm your decision or action to your boss, your CEO, your family, society as a whole?11. What is the symbolic potential of your action if understood? If misunderstood?12. Under what conditions would you allow exceptions to your stand?

Laura Nash, “Ethics without the sermon”, Harvard Business Review, 59, 1981, 79-90.