Video Case Study

12/28/2020 Print Preview

https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentId=5835051934529006900868413293&eISBN=9781337614467&id=1034289154&nbId… 1/4

6-2b Teleology

Teleology (Refers to moral philosophies in which an act is considered morally right or acceptable if it produces some desired result, such as pleasure, knowledge, career growth, the realization of self-interest, utility, wealth, or even fame) (from the Greek word for “end” or “purpose”) refers to moral philosophies in which an act is considered morally right or acceptable if it produces some desired result, such as pleasure, knowledge, career growth, the realization of self-interest, utility, wealth, or even fame. Teleological philosophies assess the moral worth of a behavior by looking at its consequences, and thus moral philosophers today often refer to these theories as consequentialism (Teleological philosophies that assess the moral worth of a behavior by looking at its consequences) . Two important teleological philosophies that often guide decision making in individual business decisions are egoism and utilitarianism.

Egoism (Defines right or acceptable behavior in terms of its consequences for the individual) defines right or acceptable behavior in terms of its consequences for the individual. Egoists believe they should make decisions that maximize their own self-interest, which is defined differently by each individual. Depending on the egoist, self-interest may be construed as physical well-being, power, pleasure, fame, a satisfying career, a good family life, wealth, or something else. In an ethical decision making situation, an egoist will probably choose the alternative that contributes most to his or her self-interest. Many believe egoistic people and companies are inherently unethical, short-term oriented, and willing to take advantage of any opportunity for gain. Some telemarketers demonstrate egoism when they prey on elderly consumers who may be vulnerable because of loneliness or fear of losing their financial independence. Thousands of senior citizens fall victim to fraudulent telemarketers every year, in many cases losing all their savings and sometimes even their homes.

However, there also is enlightened egoism (A long-range perspective and allows for the well-being of others although their own self-interest remains paramount) . Enlightened egoists take a long-range perspective and allow for the well-being of others although their own self-interest remains paramount. An example of enlightened egoism is a person helping a turtle across a highway because if it were killed the person would feel distressed. Enlightened egoists may abide by professional codes of ethics, control pollution, avoid cheating on taxes, help create jobs, and support community projects not because these actions benefit others but because they help achieve some ultimate individual goal, such as advancement within their firms. An enlightened egoist might call management’s attention to a coworker who is making false accounting reports, but only to safeguard the company’s reputation and thus the egoist’s own job security. In addition, an enlightened egoist could

12/28/2020 Print Preview

https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentId=5835051934529006900868413293&eISBN=9781337614467&id=1034289154&nbId… 2/4

become a whistle-blower and report misconduct to a regulatory agency to receive a reward for exposing misconduct.

Let’s return to the hypothetical case of Sam Colt, who must decide whether to warn the bridge contractor that 3 percent of Midwest Hardware’s bolts are likely to be defective. If he is an egoist, he will choose the alternative that maximizes his own self-interest. If he defines his self-interest in terms of personal wealth, his personal moral philosophy may lead him to value a $25,000 commission more than a chance to reduce the risk of a bridge collapse. As a result, an egoist might well resolve this ethical dilemma by keeping quiet about the bolts’ defect rate, hoping to win the sale and the $25,000 commission. He may rationalize that there is a slim chance of an earthquake, that bolts would not be a factor in a major earthquake, and even if defective bolts were a factor, no one would actually be able to prove they caused the bridge to collapse.

Like egoism, utilitarianism (Seeks the greatest good for the greatest number of people) is concerned with consequences, but unlike the egoist, the utilitarian seeks the greatest good for the greatest number of people. Utilitarians believe they should make decisions that result in the greatest total utility, or the greatest benefit for all those affected by a decision. For instance, one might use a utilitarianism perspective to argue for companies who legally sell harmful products, such as tobacco, guns, or alcohol. It has been argued that despite their drawbacks, allowing them to be sold legally is less harmful than having them sold illegally and unregulated. Such an approach influenced similar forms of legislation, such as the laws in Alaska, California, Colorado, Maine, Massachusetts, Nevada, Oregon, and Washington permitting the regulated sale of recreational marijuana. Utilitarian decision making relies on a systematic comparison of the costs and benefits to all affected parties. Using such a cost–benefit analysis, a utilitarian decision maker calculates the utility of the consequences of all possible alternatives and then selects the one that results in the greatest benefit. For example, the U.S. Supreme Court ruled that supervisors are responsible for the sexual misconduct of employees, even if the employers knew nothing about the behavior, a decision that established a strict standard for harassment on the job. One of the justices wrote that the burden on the employer to prevent harassment is “one of the costs of doing business.” The Court decided the greatest utility to society would result from forcing businesses to prevent harassment.

In evaluating an action’s consequences, utilitarians must consider all of the potential costs and benefits for all of the people affected by a decision. For example, General Motors’ engineers noticed during testing that there were ignition control switch problems in some of its car models, including the Saturn Ion and Chevrolet Cobalt. Recommendations for redesigning the switch or the keys went unheeded due to cost concerns. Nearly a decade passed before recalls were implemented on these earlier models. By this time, an estimated 40 people had died in crashes thought to have been caused by ignition failures. GM recalled more than 2.5 million vehicles and the CEO had to testify before Congress as to why GM did not take action sooner when the problems were initially discovered. If GM had done a utilitarian analysis and included the costs associated with massive recalls, penalties, and consumer injuries, it might have chosen to fix the problem despite the initial costs.

12/28/2020 Print Preview

https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentId=5835051934529006900868413293&eISBN=9781337614467&id=1034289154&nbId… 3/4

Utilitarians use various criteria to evaluate the morality of an action. Some utilitarian philosophers argue that general rules should be followed to decide which action is best. These rule utilitarians (Argue that general rules should be followed to decide which action is best) determine behavior on the basis of principles or rules designed to promote the greatest utility, rather than on individual examinations of each situation they encounter. One such rule might be “Bribery is wrong.” If people felt free to offer bribes whenever they might be useful, the world would become chaotic; therefore, a rule prohibiting bribery would increase utility. A rule utilitarian would not bribe an official, even to preserve workers’ jobs, but instead would adhere strictly to the rule. Rule utilitarians do not automatically accept conventional moral rules, however; if they determined an alternative rule would promote greater utility, they would advocate its use instead.

Other utilitarian philosophers have argued that the tightness of each individual action must be evaluated to determine whether it produces the greatest utility for the greatest number of people. These act utilitarians (The rightness of each individual action must be evaluated to determine whether it produces the greatest utility for the greatest number of people) examine specific actions, rather than the general rules governing them, to assess whether they will result in the greatest utility. Rules such as “Bribery is wrong” serve only as general guidelines for act utilitarians. They would likely agree that bribery is generally wrong, not because there is anything inherently wrong with bribery, but because the total amount of utility decreases when one person’s interests are placed ahead of those of society. In a particular case, however, an act utilitarian might argue that bribery is acceptable. For example, sales managers might believe their firm will not win a construction contract unless a local government official gets a bribe, and if the firm does not obtain the contract, it will have to lay off 100 workers. The manager might therefore argue that bribery is justified because saving 100 jobs creates more utility than obeying a law. For example, Goodyear Tire & Rubber paid $16 million to settle charges of bribery. According to the SEC, two African subsidiaries of the firm paid more than $3.2 million to gain tire sales in Kenya and Angola. These bribes were recorded as legitimate business expenses. These Goodyear subsidiaries may have decided winning the contracts generated the most utility for the company.

Now suppose that Sam Colt, the bolt salesperson, is a utilitarian. Before making his decision, he would conduct a cost–benefit analysis to assess which alternative would create the greatest utility. On the one hand, building the bridge would improve roadways and allow more people to cross the Mississippi River to reach jobs in St. Louis. The project would create hundreds of jobs, enhance the local economy, and unite communities on both sides of the river. Additionally, it would increase the revenues of Midwest Hardware, allowing the firm to invest more in research to lower the defect rate of the bolts it produces in the future. On the other hand, a bridge collapse could kill or injure as many as 100 people. But the bolts have only a 3 percent defect rate, there is only a 50 percent probability of an earthquake somewhere along the fault line, and there might be only a few cars on the bridge at the time of a disaster.

12/28/2020 Print Preview

https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentId=5835051934529006900868413293&eISBN=9781337614467&id=1034289154&nbId… 4/4

After analyzing the costs and benefits of the situation, Sam might rationalize that building the bridge with his company’s bolts would create more utility (jobs, unity, economic growth, and company growth) than telling the bridge contractor the bolts might fail in an earthquake. If so, a utilitarian would probably not alert the bridge contractor to the defect rate of the bolts.

© 2020 Cengage Learning Inc. All rights reserved. No part of this work may by reproduced or used in any form or by any means - graphic, electronic, or mechanical, or in any other manner - without the written permission of the copyright holder.