Transcript Business Ethics: Transcending Requirements through Moral

Business Ethics: Transcending
Requirements through Moral
Leadership
By Frank Cavico and Bahaudin Mujtaba
------Chapter 1 – Introduction to Ethics and Ethical Concepts
© Cavico & Mujtaba, 2005
CHAPTER 1 - INTRODUCTION TO
ETHICS AND ETHICAL CONCEPTS
A. Terminology and Methodology
B. Principles, Rules, Conventions, and Personal
Taste
C. Ethics Compared to the Sciences and the Law
D. Methodology
E. Socrates and the Socratic Method
F. Descartes: Cartesian Doubt and Method
G. Ethics as Religion
H. Ethics as Conscience and Intuition
© Cavico & Mujtaba, 2005
Definitions and Terminology in
Ethics
• Definitions can function as the first ethical
principles of moral reasoning. If one defines
terms carefully at the start or knows the
appropriate definitions and one applies them
consistently, one can draw moral conclusions
deductively from these incontrovertible first
ethical principles. One, therefore, can use
definitions and terms to decide what to do in
particular cases.
• We can start by understanding the terms values,
ethics and morals through a story of four friends.
© Cavico & Mujtaba, 2005
Promise Versus Action
Gary gave each of his three friends $20,000.00 asking them to put it in his coffin
during burial. Each friend, privately, agreed to do as he requested. Six
months later, Gary died and each friend said:
1. “Gary donated $10,000.00 to the local charity, and I know that if he
was alive he would have done the same thing this year. So, I gave
$10,000.00 to the charity under his name and put the other $10,000.00
in his coffin.”
2. “Gary actually owed me $6,000.00 for the two acres of land which he
bought from me and had not paid me yet. I knew he was going to pay
me soon, had he not died. So, I took my money and put the other
$14,000.00 in his coffin. I thought it was fair to do so.”
3. “I immediately deposited the money in my bank account and wrote him
a check for the full amount--$20,000.00.”
Do you see the relationship of values, ethics and morality in this case?
Who did the right thing and who is ethical? Why?
© Cavico & Mujtaba, 2005
Values, Ethics, and Morals
Values are core, self-chosen beliefs or desires that guide or
motivate one’s attitude and actions. What one values drives
his/her behavior. Some people value honesty or truthfulness in
all situations while others value loyalty to colleagues. Some
people value life in all of its forms while others limit it to an
extent.
Ethics is the branch of philosophy that theoretically, logically,
and rationally determines right from wrong, good from bad,
moral from immoral, and just from unjust actions, conducts,
and behavior. Some people define ethics as doing what you
say you would do or walking the talk.
Morals are judgments, standards, and rules of good conduct in
the society. They guide people toward permissible behavior
with regard to basic values.
© Cavico & Mujtaba, 2005
Philosophy
Philosophy is the study and analysis of such deeply
problematical and fundamental question, such as the
nature of reality, conduct, and thought. The field of
philosophy traditionally is divided into three parts:
the metaphysical, the political and ethical, and the
philosophy of knowledge.
A philosopher is a person with the conviction that
beneath the apparent chaos, multiplicity, confusion,
and change in the universe, there exists an
underlying permanence, unity, stability, identity, and
fundamental truth that reason may discover. A
philosopher is a person who seeks this truth.
© Cavico & Mujtaba, 2005
Moral Philosophy
Moral philosophy is the philosophical study of
morality; it is the application of philosophy to
moral thinking, moral conduct, and moral
problems. Moral philosophy encompasses various
theories that prescribe what is good for people and
what is bad, what constitutes right and wrong, and
what one ought to do and ought not to do. Moral
philosophy offers ethical theories that provide a
theoretical framework for making, asserting, and
defending a moral decision.
© Cavico & Mujtaba, 2005
Ethics
• Ethics is the theoretical study of morality. Ethical theories
are moral philosophical undertakings that contain bodies of
formal, systematic, and ethical principles that are committed
to the view that an asserted ethical theory can determine how
one should morally think and act.
• Moral judgments are deducible from a hierarchy of ethical
principles. It is the moral philosopher's task to articulate such
ethical principles and to insist upon their proper application.
Ethics is the sustained and reasoned attempt to determine
what is morally right or wrong. Ethics is used to test the
moral correctness of beliefs, practices, and rules.
• Ethics involves an effort both to define what is meant by
morality and to justify the way of acting and living that is
being advocated.
© Cavico & Mujtaba, 2005
Ethical Principles
Ethical principles are very general, pervasive, basic, and
fundamental standards that are used to evaluate the
rightness or wrongness of behavior and to determine the
truth or falsity of moral issues.
– Ethical principles are the source or grounds of moral rules.
– Ethical principles establish, justify, and underlie moral rules; they
interpret a rule, determine its scope, and justify exceptions to a
moral rule.
– An example of an ethical principle is the principle of utility, which
evaluates the morality of a practice in terms of the net social
benefits it produces.
© Cavico & Mujtaba, 2005
Moral Rules
Moral rules are propositions that a certain kind of a action is
morally right or wrong. Moral rules, however, must be
understood with a qualification. They generally or usually
state what is right or wrong. A moral rule may not apply
in all circumstances. It is generally morally wrong to lie,
for example, but not always wrong. It may be morally
justifiable to break a moral rule against lying if, by giving
a truthful response, one would cause severe pain or injury
to another. It is immoral to violate a moral rule without a
legitimate reason. An act that violates a moral rule
requires justification-ethical justification.
© Cavico & Mujtaba, 2005
Social Conventions
• A convention is an accepted usage or an
established practice.
• "Social" entails living with others in a community
and encompasses the lives, welfare, and relations
among human beings in a community.
• Social conventions are the usages, practices, and
habits of the members of a social group or a
society. There are, of course, various practices
peculiar to different groups and societies.
Customs are social conventions regarded
collectively.
© Cavico & Mujtaba, 2005
Personal Taste
• Expressions of personal taste are the personal preferences,
likes and dislikes, and subjective opinions of a person
concerning objects and actions in question. An example is a
person's choice of ice cream flavors.
• So long as one is accurately reporting his or her tastes, what
one says must be true. One merely is making a statement
about oneself. There is no implication that anyone else should
feel the same way.
• When one, however, says that an action is morally right or
wrong, one not only needs reasons but also reasons that are
based on ethical principles and reasoning. If the reasons are
sound, a rational person must acknowledge their force. If
there is no good reason behind one's "moral" expression,
people will reject it as an arbitrary, unfounded, and subjective
opinion and pay no attention to it.
© Cavico & Mujtaba, 2005
Ethics and the Social Sciences
•
•
Anthropologists and sociologists study the various positions individuals, groups,
and societies take, and have taken, on various questions, including value
judgments and moral beliefs. Social scientists attempt to develop accurate
descriptions and explanations for people's views. Their purpose, however, is
primarily descriptive. Social scientists do not seek to determine whether or not
particular views, especially moral ones, are correct or incorrect. A sociologist, for
example, determines whether a certain society practices bribery and whether the
society's members believe it is right or wrong. He or she would not raise the issue
as to whether bribery is in fact right or wrong. The moral philosopher, however,
is concerned with, and does seek to ascertain, the rightness or wrongness of
bribery.
The purpose of ethics goes beyond merely reporting and classifying the various
views that people have, and have had, as to what is good and bad. Ethics attempts
to ascertain what the true good really is. The moral philosopher's challenge is to
provide some ethical theory to determine as far as possible whether a particular
moral judgment is correct. Ethics does not treat moral and value judgments
neutrally, as the social sciences do; it attempts to determine if they are right.
© Cavico & Mujtaba, 2005
Ethics and Law
Law is the set of public, universal commands that are capable
of being complied with, generally accepted, and enforced
by sanctions. Law describes the ways in which people are
required to act in their relationships with others in an
organized society.
Positive law is the law of a people's own making; it is the law
laid down by legislative bodies, courts, and other
governmental organs. Whenever any mention of "law" is
made, the term customarily refers only to positive law,
unless clearly stipulated otherwise. This is so because law
also may mean "natural" law. Consequently, there are two
theories of ethics that claim that morality depends on law:
positive law and a natural law theory.
© Cavico & Mujtaba, 2005
Characteristics of Law
• The common characteristics or variables associated with law
are: public; universal; command; accessibility,
comprehensibility, and compliability; acceptability; and
sanctions.
• Many business practices, for example, bribery, can be cast as
either legal or moral questions, or both. Managers probably
are more comfortable with such questions posed as legal
issues since managers have familiarity with, experience with,
and access to the law, the legal system, and lawyers. The
problem, of course, is how and when the manager decides
whether it is best to formulate a question as a legal issue and
turn it over to the legal department to decide, or to formulate
it as a moral issue and turn it over to the ethics department,
perhaps, to decide.
© Cavico & Mujtaba, 2005
Deductive Reasoning
• In order to ascertain objective truth, one must concern
oneself with method. Method involves theory, logic, and
practice and entails two principal types of reasoning:
deductive and inductive.
• Deductive reasoning involves reasoning from general
principles or definitions. One starts with a clearly defined
general principle which is, or is deemed to be, self-evident.
One takes the general principle and applies it to a particular
set of facts. One then reasons to draw a conclusion. One
thereby can make successive approximations to the truth.
Each new stage can be warranted as true given the validity of
the premises and prior steps from which it is derived. It is
possible, therefore, to discover truths about the world by first
noting what is self-evident and then using deductive logic.
© Cavico & Mujtaba, 2005
Inductive Reasoning
• Inductive reasoning starts with careful observation of
particular facts. One collects data through experience and
interprets this data by the study of likenesses and
differences among things, codifying the materials
rationally. One then moves, by using reason, from the
numerous bits of data to conclusions that will explain the
data collected. The conclusions serve as a basis for general
principles. One, finally, renders the general principles into
a consistent and unified whole. It therefore becomes
possible to discover the "laws" of the world by using
particular examples to point to some general principle.
© Cavico & Mujtaba, 2005
Socrates and the Socratic Method
• Socrates' philosophy focused attention on the problems of
human life as opposed to the speculations about the nature of
the physical world that had been prevalent in Greek
philosophy. Socrates stressed the importance of
comprehending what it means to be a human being, how one
should live in the world, and for what purpose.
• In making the change from natural to moral philosophy,
Socrates confronted a great deal of confusion in the moral
thought of his time, particularly the wide variety of general
terms used that purported to express moral notions. Socrates'
main contribution to philosophy was to "bring it down from
the skies"; that is, to demand precise, workable definitions
and to enunciate a procedure for formulating such definitions.
© Cavico & Mujtaba, 2005
Socrates and the Sophists
•
•
•
Socrates believed it was extremely harmful for people to use continually a wide variety of
very general terms, especially terms intending to describe moral ideas. Even more
dangerous were the Sophists, who taught an extreme personal relativism. Socrates deplored
the Sophists' declaration that moral terms, such as “justice,” had no basis in reality and that
whatever any person thought was just was "just" for him or her. The lack of any fixed
meaning, the inability of people to provide proper explanations, the individualistic,
expedient decision making, and the Sophists' emphasis on rhetoric and persuasion
engendered relativism, skepticism, and a great deal of confusion, particularly in the
meanings attached to moral terms.
Perhaps the Sophists were right and the terms had no meaning; but if so, then people should
not use them. Yet, if the terms do have permanent, objective meaning, then the people who
do use them ought to be able to say what they mean. It is not only wrong but also quite
unhelpful to discuss whether a person's conduct was just or unjust, moral or immoral, or
good or bad unless there is some agreement as to what justice, morality, and goodness are.
If there is no agreement, people are using the same words to mean different things. They
then will be talking at cross purposes and their discussions will make no progress, either
intellectually or morally. Only confusion, skepticism, chaos, and perhaps even conflict will
ensue.
The Sophists maintained that knowledge was impossible; they viewed life as a contest in
which one must be prepared to win. Socrates held that knowledge was attainable; he
viewed life as a positive, common search for knowledge, but one that could begin only if the
confusing, misleading, and dangerous tendencies were eliminated and people understood the
right way to achieve the goal.
© Cavico & Mujtaba, 2005
The Socratic Method
• Socrates realized that many people have strong opinions on moral issues;
but he also recognized the serious problem caused by the fact that most
people are capable neither of adequately justifying their opinions nor of
defining their essential terms. For Socrates, morality must be subject to a
rigorous scientific method that would reveal ultimate knowledge and
universal truth.
• The Socratic Method is a means of obtaining knowledge in three stages:
questions and answers, inductive argument, and general definitions.
Socrates asks a general question, for example, "What is justice?" The
answer provided by the respondent will be an instance where justice was
or was not present. Socrates then proceeds to refute each instance by
offering a counterexample designed to show that the respondent's answer
was too narrow or broad, uninformed, or wrong. Once the answer is
negated, a new, more precise answer must be given to cover this instance.
© Cavico & Mujtaba, 2005
Cartesian Doubt and Method
• The French philosopher, Descartes (1596-1650), also insisted on
beginning philosophy anew. His procedure to achieve this goal is his
famous "method of doubt." In order to have a firm foundation for
philosophizing, one must resolve oneself to doubt everything. Accept
nothing as true unless one clearly, distinctly, and without any doubt
recognizes it as true. The objective is to reach down by way of doubt
to what can be demonstrated with certainty. Taking this process as far
as it would go, Descartes reached a point where there remained
something he could not doubt. What remained beyond all doubt, even
as to the existence of his body, was the fact that he was doubting, that
is, thinking. The unmistakable truth thus appeared as: "I think,
therefore I am." From this truth, Descartes found his first principle of
philosophy as well as the means to explore, create, and rebuild himself
and the world.
© Cavico & Mujtaba, 2005
Ethics and Religion
• A religious ethics theory defines morality in terms
of God's will. What is morally right is
commanded by God; what is morally wrong is
forbidden by God. Moral standards, therefore, are
the set of laws or commands sanctioned by God.
What ultimately makes an action right or wrong is
its being commanded or forbidden by God.
• Religion once had, and still does in some spheres,
the authority to regulate people's affairs, including
their business activities, in accordance with their
spiritual welfare.
© Cavico & Mujtaba, 2005
Ethics as Conscience and Intuition
• Ethics as conscience and intuition is a notion radically dissimilar from
any "scientific" version of ethics. The content of ethical principles and
the answer to moral questions are determined not by the application of
reason and rational argumentation, but through the operation of one's
conscience and intuition.
• According to this ethical interpretation, people possess inborn,
instinctive knowledge of morality and are able to apprehend moral
truths merely by consulting their moral sense. One's conscience and
intuition are unfailing, trustworthy, and self-vindicating guides to good
and bad conduct. Consequently, one need only follow one's
conscience and intuition, as opposed to one's reason, in order to be
right. Moral truths, moreover, not only instantly are discerned, but
also are evident for reasons that cannot, and need not, be explained
further.
© Cavico & Mujtaba, 2005
Summary
• If one views morality as not to be intuited, but to be
rationally ascertained, then one must determine what moral
standards to adopt. The moral conclusions reached will
reflect one's ethical reasoning and also may encompass any
moral conscience or intuition. Moral beliefs, if urged by
conscience and sensed by intuition, may provide a starting
point for the application of a principled ethical theory.
One's conscience, for example, could present a person with
a number of proscriptions against unconscionable
behavior. One would then reflect on these insights in a
critical ethical manner and apply a principled ethical
theory to insure that one's intuited moral beliefs are really
right.
© Cavico & Mujtaba, 2005
Character & Integrity
What you are shouts so loudly in my
ears I cannot hear what you say.
Ralph Waldo Emerson
American Poet and Essayist
© Cavico & Mujtaba, 2005
Personal & Professional Codes of
Ethics
A code of conduct can personify the ethical position of an organization as
well as the individual. Such a statement is critical in setting the ethical
and moral boundaries upon which the organization and its agents can
rely upon as a guide for decision making. Considering oneself as “Self,
Incorporated,” individuals can develop a code by which they live both
personally and professionally. For example, a person’s code of
conduct may include the following:
– Treat others fairly (the Golden Rule) and/or as they would like to be
treated (the Platinum Rule).
– Never attach important moral decisions to material gains or lack thereof.
– Listen actively to everyone, even when one disagrees with the beliefs
being presented, because more can be learned from diverse perspectives.
– Be honest and stand for good causes because integrity counts even when it
comes at a personal cost.
– Be a principled person. Stand for causes that advance the organization and
the society in general.
© Cavico & Mujtaba, 2005
Conclusion
Social problems and ethical
challenges that affect our
workforce productivity in
business must be appropriately
and collectively addressed in
order for the economy and
country to be competitive.
We all can individually “model”
good character as a start while
enforcing high ethical
standards.
© Cavico & Mujtaba, 2005
References
Cavico, F. & Mujtaba, B., (2005). Business Ethics: Transcending Requirements
through Moral Leadership. Pearson Custom Publications. U.S.A. ISBN: 0536-85783-0. Address: 75 Arlington Street, Suite 300. Boston Mass, 02116.
Phone: (800) 374-1200. Or: (800) 922-0579.
DeGeorge, R. T., (1995). Business Ethics. 4th.ed. Prentice Hall.
Mujtaba, B., (1997). Business Ethics Survey of Supermarket Managers and
Employees. UMI Dissertation Service. A Bell & Howell Company. UMI
Number: 9717687. Copyrighted by UMI. UMI: 300 North Zeeb Road. Ann
Arbor, MI 48103. Phone: (313) 761-4700. (800) 521-0600.
© Cavico & Mujtaba, 2005