Business Ethics HW Please see first attachment for requirement

Business Ethics

Lecture 1

I- Introduction

A) Is Business Ethics is an oxymoron? Perhaps the saying merely refers to how people tend to forget how they should behave when money and wealth are involved, or simply that people tend to ignore moral constraints in business. Or, it might mean something deeper, and more sinister, as some people argue moral principles don’t apply in business, or that business relationships are not subject to moral constraints. This position is also known as the “separation thesis.” To begin to formulate an answer to that question, consider the following:

1) Who are Sherron Watkins, Sam Waksal, Richard Grasso or Bernie Madoff? Do you own an Explorer? Ever heard of Vioxx or Merck?

2) What kind of problem do these people have on their hands? Put differently, from what different perspectives can we evaluate these situations and what should we take as evidence in these evaluations? If you were in their shoes, to whom would you turn for advice? In what way, if any, would you try to justify your decisions and your actions?

3) Are the people involved in the issues in #1 good people or bad people and why? What would make a person a good or virtuous person?

4) Perhaps a better question to ask is what harmful consequences followed these actions and what good would have resulted from other alternative actions.

5) Finally, maybe is there something about the actions themselves that should be referenced when talking about right and wrong, quite apart from the type of person who would tend to perform an action of one type, and quite apart from the good or bad consequences that result from an action. Such actions violate some moral principles, such as a prohibition on using other people as a mere means to your own ends or projects. Defrauding or stealing from the shareholders is wrong because it uses the shareholders as a mere means to enrich the thief.

B) The point of the class is to begin to understand the relationship between morality and business, that is, the requirements morality places on business. What actions are morally acceptable when selling iPhones, buying oil, selling your services to a boss, or when you have other people working for you? The method here will be to develop a way of analyzing some interesting questions and developing a decision procedure to help us answer these questions. We will use both the standard case method employed in many business schools as well as a more philosophical approach. We are interested in moral justifications, for some, the only kind of justification that matters, or at least the ultimate form of justification. First and foremost, this is a class in ethics, a subject which, whether it's taught in business schools, religious organizations and orders, philosophy departments, day care facilities, or by your mom, is about no less a subject than how we ought to live. And that seems like a subject worth studying and discussing at some length.

C) Roll/Admin

III - Moral Philosophy and The Philosophical Method

A) The word "Philosophy" comes to us from the ancient Greek and means, literally, the "love of wisdom." "Philo" - love and "sophos" - wisdom. It is somewhat unfortunate that strictly speaking, wisdom cannot be taught

To explain, the Greeks distinguished between wisdom and knowledge. When you watch CNN, attend a lecture on particle physics, or even look at a map, you gain knowledge. You know something more about the world and the facts within it than you did before. You gain knowledge in the form of what philosophers call justified, true, beliefs. Knowledge can be taught since it is based on good reasons to believe something, the justified part of a justified, true, belief. For example, I know that DC is 112 miles from Charlottesville and my justification can be either that I've driven the 112 miles to DC or I've looked on a map.

The problem here is that knowledge does not entail wisdom. Knowledge, for the Greeks, is a necessary, but not a sufficient condition for wisdom. Wisdom is comprised of understanding, good judgment, and the capacity to guide one's actions and conduct well. So, many otherwise well educated people can be very knowledgeable about anything from how to run a multi-national corporation to the intricacies of classical concert piano, but they can lack wisdom. In other words, both concert pianists and CEOs can fail to act wisely. Wisdom can be understood as knowledge plus the capacity for practical application, or simply good judgment. For the Greeks ethics, or moral philosophy, is the love of the pursuit of wisdom with regard to making moral choices.

If wisdom, including ethics and moral philosophy, cannot be taught then why take a class in business ethics or any ethics class? I'm here to teach business ethics, but I'm not going to be teaching strategy, organizational management, or debt investment instruments. And, according to the Greeks, I can't teach you ethics so what can I do? The answer to the paradox is that we can read what people, including philosophers, business persons, economists and others, have written about ethical matters in business, analyze these works, and we can discuss what we should learn from the reading and from each other. The best I can hope for is that I do something which encourages you to develop a love of both knowledge and wisdom about the matters we will be exploring in the class.

B) The Contemporary Philosophical Method

So far, we've been talking about philosophy as the Greeks did it. As you would hope, if not expect, philosophy has come a long way since ancient Greece. Contemporary academic philosophy, the kind done here at the University and in other philosophy departments in the Anglo-American tradition, is a vast discipline which encompasses many areas of thought. The unifying characteristic of each area is the method, which could be put as follows:" the systematic examination, through the application of rational, critical thinking, of the general nature of reality", or "the ordered and systematic exploration and scrutiny of all of our beliefs and their justifications." Philosophers, of course, have written whole books on just what philosophy is, and they often disagree. There is general agreement on one thing: philosophy is something you not only read, but it is something you do. It requires a specific kind of activity, namely speaking and thinking aloud. To take a philosophy class is to engage in the activity of doing philosophy through rational, consistent thinking and discourse.

C) Philosophy and Its Sub-disciplines

i) Metaphysics - the study of ontology or theories about what exists, causation, mind/body problems and other issues

ii) Epistemology - the study of theories of knowledge and justification.

iii) Logic - valid formal and informal reasoning, truth value and truth preservation in arguments

iv) Value Theory - ethics, political philosophy, and aesthetics.

Ethics falls under iv, though it is not entirely independent of the other three sub-disciplines. Ethics is the section of value theory which deals with both what is good and bad, and what is right and wrong. Ethics deals with these issues from what we call the "Moral Point of View." In ethics, there are two kinds of propositions: 1) evaluative propositions, statements, or judgments and 2) prescriptive propositions, statements or judgments. These two kinds of propositions fall under the broader rubric of normative statements. Ethics can be said to be an enterprise in normative theory.

Notice that not all normative statements are ethical. For example, "A Ferrari is a good car" is both evaluative and normative. It expresses an evaluation of the quality of the car made by Ferrari, but it does not express an ethical proposition. "One ought to drive a Ferrari" is a prescriptive statement, and it is also a normative statement, but it is not an ethical statement. Both statements express propositions from an aesthetic point of view.

What makes a statement an ethical statement is somewhat complicated and it seems best to start with clear cases like "unnecessary pain is bad" and "one ought not kill human babies just for the fun of it." The first is morally evaluative and the second is morally prescriptive. One necessary condition for being an ethical statement is that the statement be issued from what is known as the moral point of view. Unlike the above aesthetic judgments directing one to drive a Ferrari, one cannot opt out, deny the truth of the statements, or resist the prescription and remain rationally consistent when directed to refrain from the recreational killing of human babies. Put differently, the statements about Ferraris only direct or prescribe hypothetically, that is, the prescriptive statement would only direct someone who cares about the aesthetics of cars. Ethical statements are thought to be prescriptive and evaluative for all moral agents. A person can fail to follow these prescriptions or agree with the evaluative judgments, but to do so would be morally wrong.

D) Ethics and Its Sub-Divisions

1) Meta-ethics - Meta-ethics evolved around the turn of the 20th century when philosophers became very interested in the use of language and the relation between language and the world. At the time, they were very concerned with how language and the words we use could be said to hook-up or correspond to the world around us. Philosophers who work in meta-ethics debate how we might know not only what "good" means and how it is used in our language, but also if "good" refers to anything actually in the world. For example, I may say "Sally is a good person." Meta-ethics would compare that statement to others like "Sally has shoes on her feet" and ask if both statements have parallel truth conditions and whether or not goodness can be said to be in the world in the way that shoes can be said to be in the world.

2) Normative Ethics - This field of ethics engages in deriving and formulating principles of right and wrong actions, as well as good and bad events or actions or things. Normative ethics also develops and explores solid justifications for these principles.

3) Applied Ethics - At last we come to the field of philosophy where business ethics resides. Applied ethics concerns itself with rightness and wrongness, as well as goodness and badness in actual applied cases. Applied ethics includes not only business ethics, but also bio or medical ethics, as well as a large range of professional ethics. The important thing to remember is that at even the applied level, some stance on all of the above areas of philosophy must be taken. For example, one cannot avoid a stance on meta-ethics and engage in ethical debate. You must at least think ethical terms have some meaning, even if you think they are empty place holders or some such non-sense. In other words, you operate with a meta-ethical theory when you use ethical terms, whether you've considered you position on the meaning of ethical terms or you have not.

E) Normative, Especially Ethical, Thinking

Thinking in normative terms might be new to some of you. In particular, thinking in normative terms and evaluating not only your ethical beliefs, but also the justifications or reasons for your ethical beliefs may be difficult at first. This is sometimes called "feeling the ground move beneath you." Where once you felt steady and sure in your thinking, you might find yourself on shaky ground and unsure of what to do. Remember, changing your mind in the face of new evidence is not a weakness, but stubbornly redrawing and restating the same position is

As we have seen, ethics deals with normative statements. Few parts of the academy try to instruct you in this kind of thinking. Most academic disciplines deal with descriptive statements and understanding what it means to describe the world in a certain way. These two kinds of statements are often juxtaposed, in philosophy as well as in other disciplines:

1) "Kenneth was the CEO of Enron" is obviously descriptive.

2) "Kenneth did a poor job as CEO" is normative and evaluative.

3) "Kenneth should have resigned his post and donated his wealth to the shareholders before he died" is normative and prescriptive.

As you can imagine, we will be concerned with building to statements, or directives, like 3, though both 1 and 2 will be helpful in formulating statements like 3.