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View Notes - summary-book-business-ethics-andrew-crane-and-dirk-matten-chapter-1-5.pdf from ALL 101 at Stamford University Bangladesh. LOMoARcPSD|1303986 Business Ethics Summary Chapter 1 - 5. Business ethics MANAGING CORPORATE. IN THE AGE OF GLOBALIZATION second edition ANDREW CRANE DIRK MATTEN OXPORD UNIVERSITY PRESS. CONTENTS List of figures List of boxes Preface to the second edition Acknowledgements XIV. Business as an actor within the traditional context (Westphalian setting).

Presentation on theme: 'Crane and Matten Business Ethics (3rd Edition)'— Presentation transcript:

1 Crane and Matten Business Ethics (3rd Edition)
Chapter 3

2 Evaluating Business Ethics: Normative Ethical Theories
Lecture 3

3 Overview Locate the role of ethical theory
Highlight international differences in perspectivesProvide critical overview of traditional ethical theoriesExplore contemporary ethical theories

4 What are normative ethical theories?
Ethical theories are the rules and principles that determine right and wrong for any given situation Crane and Matten (2010)Normative ethical theories are those that propose to prescribe the morally correct way of actingAs opposed to descriptive ethical theories which seek to describe how ethics decisions are actually made in business

5 The role of ethical theory

6 The role of ethical theory
Two extreme positions (De George 1999)Ethical absolutism claims there are eternal, universally applicable moral principlesRight and wrong are objective qualities, can be rationally determinedTypically traditional ethical theoriesEthical relativism claims morality is context-dependent and subjectiveNo universal right and wrongs that can be rationally determined; depends on person making the decision & culture in which they are locatedTypically contemporary ethical theories

7 Normative ethical theories
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8 North American and European origins and differences
Differences between Anglo-American and European approaches based on philosophical argumentsIndividual versus institutional moralityUS tend to individualistic perspectiveEurope towards wider economic and governing institutionsQuestioning versus accepting capitalismUS tend to accept the capitalist frameworkEurope tend to question the ethical justification of capitalismJustifying versus applying moral normsUS tend to focus on application of moralityEurope focus on justification and ethical legitimation of normsIn contrast, Asian perspectives tend to be based on religion (e.g. Islam, Buddhism)

9 Western modernist ethical theories

10 Traditional ethical theories
Generally offer a certain rule or principle which one can apply to any given situationThese theories generally can be differentiated into two groupsMotivation/PrinciplesActionOutcomesConsequentialist EthicsNon-consequentialist EthicsSource: Crane and Matten (2010)

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11 Major normative theories
Non-consequentialistConsequentialistTypeMan is a being that is distinguished by dignityMan is a rational moral actorMan is controlled by avoidance of pain and gain of pleasure (“hedonist”)Man as an actor with limited knowledge and objectivesConcept of human beingsRespect for human beingsCategorical imperativeAct/rule utilitarianismMaximization of desires/self interestRulesRightsDutiesCollective welfareIndividual desires or interestsFocusJohn Locke John RawlsImmanuel KantJeremy Bentham John Stuart MillAdam SmithContributorsEgoismUtilitarianismEthics of dutiesRights & justiceSource: Crane and Matten (2010)

12 EgoismTheory of egoism - an action is morally right if the decision-maker freely decides an action to pursue either their (short-term) desires or their (long-term) interests.Adam Smith (1793): pursuit of individual interest morally acceptable as invisible hand of market creates benefit for allRelies on free competition and good information‘Enlightened egoism’However, markets do not function perfectlyAnti-globalisation movementSustainability debate

13 UtilitarianismAccording to utilitarianism, an action is morally right if it results in the greatest amount of good for the greatest number of people affected by the actionAlso called the ‘greatest happiness principle’Based on cost-benefit analysis

14 Problems with Utilitarianism
SubjectivityThis has led to refinement of theoryAct utilitarianismRule utilitarianismIssues around quantification and distribution of utility

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15 Act- and Rule-Utilitarianism
Act utilitarianismLooks to single actions and bases the moral judgement on the amount of pleasure and the amount of pain this single action causes.Rule utilitarianismlooks at classes of action and ask whether the underlying principles of an action produce more pleasure than pain for society in the long run.

16 Ethics of duties ‘Categorical Imperative’ (Kant) Maxim 1: Consistency
Act only according to that maxim by which you can at the same time will that it should become a universal law.Maxim 2: Human DignityAct so that you treat humanity, whether in your own person or in that of another, always as an end and never as a means only.Maxim 3: UniversalityAct only so that the will through its maxims could regard itself at the same time as universally lawgiving (would others agree? Would you be happy to see your decision reported in the press?)

17 Problems with ethics of duties
Undervaluing outcomesComplexityMisplaced optimism?

18 Ethics of rights and justice
Natural rightsCertain basic, important, unalienable entitlements that should be respected and protected in every single action.Based on consensus about nature of human dignityStrongly based in western view of moralityJusticeThe simultaneously fair treatment of individuals in a given situation with the result that everybody gets what they deserveFair procedures (procedural justice)Fair outcomes (distributive justice)

19 John Rawls’s ‘Theory of Justice’
Each person is to have an equal right to the most extensive total system of basic liberties compatible with a similar system of liberty for all.Social and economic inequalities are to be arranged so that they are both:to the greatest benefit of the least advantaged;attached to offices and positions open to all under conditions of fair equality of opportunity.

20 Limits of traditional theories
Too abstractToo reductionistToo objective and elitistToo impersonalToo rational and codifiedToo imperialist

21 Alternative perspectives on ethical theory

22 Approaches based on character and integrity
Virtue ethicsContends that morally correct actions are those undertaken by actors with virtuous characters. Therefore, the formation of a virtuous character is the first step towards morally correct behaviourAcquired traitsIntellectual virtuesMoral virtues

23 Approaches based on ethics and responsibility
Feminist ethicsAn approach that prioritizes empathy, harmonious and healthy social relationships, care for one another, and avoidance of harm above abstract principlesKey elementsRelationshipsDecisions taken in context of personal human interrelationsResponsibilityActive ‘taking’ of responsibility, rather than merely ‘having’ itExperienceLearn and develop from experience

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24 Approaches based on procedures of norm generation
Discourse ethicsAims to solve ethical conflicts by providing a process of norm generation through rational reflection on the real-life experiences of all relevant participantsKey elementsUltimate goal of ethical issues in business should be the peaceful settlement of conflictsDifferent parties in a conflict should sit together and engage in a discourse about the settlement of the conflict, and ultimately provide a situation that is acceptable to all‘ideal discourse’ criteria

25 Approaches based on empathy and moral impulse
Postmodern ethicsAn approach that locates morality beyond the sphere of rationality in an emotional ‘moral impulse’ towards others. It encourages individual actors to question everyday practices and rules, and to listen to and follow their emotions, inner convictions and ‘gut feelings’ about what they think is right and wrong in a particular incident of decision-making.

26 Postmodern business ethics
Postmodern business ethics emphasises (Gustafson, 2000:21)Holistic approachExamples rather than principles‘Think local, act local’Preliminary character

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27 Towards a pragmatic use of ethical theory
SummaryTowards a pragmatic use of ethical theory

28 Typical Perspective Ethical Dilemma Single normative consideration
for solving the ethical dilemmaEthical Dilemma‘Lens’ of ethical theory

Crane Matten Business Ethics

29 Pluralistic Perspective

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30 Pluralism?Crane and Matten (2010) argue that for the practical purpose of making effective decisions in business:Not suggest one theory or one approach as the best or true view of a moral dilemmaSuggest that all these theoretical approaches throw light from different angles on one and same problemComplementary rather than mutually exclusiveAdvocate position of pluralismMiddle ground between absolutism and relativism

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31 Considerations in making ethical decisions: summary of key insights from ethical theories
Typical question you might ask yourselfTheoryOne’s own interestsIs this really in my, or my organization’s, best long-term interests? Would it beacceptable and expected for me to think only of the consequences to myself in thissituation?EgoismSocial consequencesIf I consider all of the possible consequences of my actions, for everyone that isaffected, will we be better or worse off overall? How likely are theseconsequences and how significant are they?UtilitarianismDuties to othersWho do I have obligations to in this situation? What would happen if everybodyacted in the same way as me? Am I treating people only to get what I want formyself (or my organization) or am I thinking also of what they might want too?Ethics of dutyEntitlements ofothersWhose rights do I need to consider here? Am I respecting fundamental humanrights and people’s need for dignity?Ethics of rightsFairnessAm I treating everyone fairly here? Have processes been set up to allow everyonean equal chance? Are there major disparities between the ‘winners’ and ‘losers’that could be avoided?Theories of justiceMoral characterAm I acting with integrity here? What would a decent, honest person do in thesame situation?Virtue ethicsCare for others andrelationshipsHow do (or would) the other affected parties feel in this situation? Can I avoiddoing harm to others? Which solution is most likely to preserve healthy andharmonious relationships among those involved?Feminist ethicsProcess of resolvingconflictsWhat norms can we work out together to provide a mutually acceptable solutionto this problem? How can we achieve a peaceful settlement of this conflict thatavoids ‘railroading’ by the most powerful player?Discourse ethicsMoral impulse aemotionsAm I just simply going along with the usual practice here, or slavishly followingthe organization’s code, without questioning whether it really feels right to me?How can I get closer to those likely to be affected by my decision?What do myemotions or gut feelings tell me once I’m out of the office?Postmodern ethics