1. Ethical Decision Making and Ethical Theory Mgmt 621 Contemporary Ethical Issues in Management Jeffery D. Smith

2. Ethical Decision Making Applying ethical principles and values in concrete circumstances in order to justify a particular decision or course of action. awareness judgment and deliberation

3. Basic Ethical Principles for Business One ought to act honestly. One ought to treat others fairly. Laws ought to be respected. It is impermissible to steal. Human beings have freedoms that should be protected. One ought to exercise impartiality in objectivity in professional judgment. When feasible, one ought to protect and care for the interests of other human beings.

4. PARTICULAR JUDGMENT OR DECISION ETHICAL PRINCIPLES ETHICAL THEORY

5. Ethical Decision Making is not algorithmic Ethical Decision Making often involves a use of principles that are not subjective Ethical Decision Making is characteristically not simply self-interested Ethical Decision Making often involves a use of principles that are not socially or culturally relative Effective Ethical Decision Making is enabled through dialogue/discourse with others

6. Ethics and Self-Interest Psychological Egoism The thesis that human action and behavior is always (ultimately) motivated by the satisfaction of self-interest An empirically verifiable psychological claim It may be common to think that human action and behavior is motivated by other-regarding motives but, according to Psychological Egoism, this is false

7. Ethical Relativism Ethical Relativism Defined Ethical principles, values, decisions, or judgments are ultimately dependent upon, and relative to, one’s culture, society, or personal feelings. X is right=X is approved of by culture C X is right=X is approved of by society S X is right=X is approved of by person P

8. Ethical Relativism, cont’d Some Cautionary Remarks The fact that ethical matters are beyond absolute certainty and open to disagreement need not imply that ethical standards are merely expressions of cultural, societal, and personal preference. There is widespread commonality and agreement on core ethical values: child abuse, torture, genocide, slavery, etc.

9. Ethical Relativism, cont’d Some Consequences of Ethical Relativism It is possible for the same thing to be simultaneously ethically right and ethically wrong. Foreign cultural practices are not ethically inferior to one's home culture Ethical questions could be answered by merely consulting existing cultural, societal, or personal beliefs The notion of ethical "progress" loses its significance

10. “Principles and Priorities”: A 6 Step Procedure 1: Identify and Define the Problem 2: Analyze the Principles Relevant to the Problem 3: Analyze what Principles are the Most Decisive 4: Evaluate the Analysis in (1)-(3) 5: Make a Decision Expressing the Priorities 6: Assess the Consequences of Your Decision

11. CONSEQUENTIALISM actions are right insofar as they maximize good or beneficial consequences ethical egoism (self-interest) Utilitarianism (welfare—overall good) hedonic (pleasure) preference (preference satisfaction) eudaimonic (happiness)

12. Jeremy Bentham (1748-1832)

13. John S. Mill (1806-1873)

14. Deontology deontological: the logic or science of duty deon=duty logos=logic (sometimes science) A deontological ethical theory is one which holds that some acts are ethically required independently of their consequences. Generally speaking, we are obliged to refrain from killing, stealing, lying, etc., regardless of whether refraining from these things promotes, for example, human happiness, economic welfare, or preference satisfaction.

15. Immanuel Kant (1724-1804)

16. Actions are ethically right in so far as they are motivated by a good will. A good will is a will that is moved by reason and not wishes, desires, and preferences Ethical principles are imperatives, or commands of reason

17. The 2 Formulas of Kant's Categorical Imperative Act only according to that maxim by which you can at the same time will that it should become a universal law. (universal law formula) Act 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. (humanity formula)

18. Universal Law Formula 1. Form a maxim 2. Universalize the maxim 3. Determine rational acceptability

19. Humanity Formula Humans have inherent dignity and incomparable worth because they are rational creatures, capable of autonomy Never use the rational capacities of another human being to further your own interests.

20. Virtue Ethics An emphasis on the traits, dispositions, and inclinations needed to lead a life of moderation that balances the ends of overlapping roles and relationships in a community. Aristotle (384-322 BC)

21. TRUST SELF-CONTROL GENEROSITY TEMPERANCE IMPARTIALITY FAIRNESS TRUTHFULNESS Ian Maitland, “Virtuous Markets: The Market as a School of the Virtues,” Business Ethics Quarterly, 1997, p. 97.