1. Introduction to Business Ethics 1: Introduction Santi Martínez, 2013

2. Let’s start with a story… Introduction to Business Ethics 2013 – Santi Martínez

3. Today’s agenda  Presentation and introduction  Contents of the course and learning objectives  Practical issues  Paradox  What is Ethics?  The main schools in normative ethics (I) Introduction to Business Ethics 2013 – Santi Martínez

4. Introduction: me  M. Soc. Sciences (Univ. of Helsinki) ja MBA (HSE)  Partner and trainer at Providentia Oy  www.hyvejohtajuus.fi  Expectations on this course Introduction: you Introduction to Business Ethics 2013 – Santi Martínez

5. Learning objectives  Learn the basic theories and concepts of Business Ethics.  Get the sensibility to grasp the presence of ethical dimensions.  Get the capability to analyse coherently and constructively ethical theories and ethical challenges in business.  Get the ability to discuss ethical challenges and dilemmas.  Get the ability to make the right decisions in real life under preassure. Introduction to Business Ethics 2013 – Santi Martínez

6. Description of the course  Introduction. Main schools of normative ethics (I)  Corporate Social Responsibility (I)  Corporate Social Responsibility (II)  Main schools of normative ethics (II)  Ethical excellence at business (I): managerial and subordinate skills  Ethical excellence at business (II): decision making & communication Introduction to Business Ethics 2013 – Santi Martínez

7. Completion of the course  Lectures 18 h  Active participation  max 1 extra point to the final mark (0-5)  Essays (2 pcs)  ”Reaction paper” on two well-known articles  Final ”reflexion essay”  Minimum requirement: 1 point from each essay Introduction to Business Ethics 2013 – Santi Martínez

8. Lectures  3 h = 9 – 12 1. Monday 11.3. 2. Monday 18.3. 3. Monday 8.4. 4. Monday 15.4. 5. Monday 22.4. 6. Monday 29.4. Introduction to Business Ethics 2013 – Santi Martínez

9. Instructions for the essays  Essay 1: Friday 18.4 (by 23.55)  Essay 2: Monday 16.5 (by 23.55)  Reccomended length: approx. 4-5 pages  Delivery: a) Hard copy during the lectures b) Sent by e-mail to santi.martinez@providentia.fi Introduction to Business Ethics 2013 – Santi Martínez

10. Paradox: Basic Question  Where does unethical behaviour come from?  The desire to obtain a benefit at the expense of others  Human weakness and human freedom  Wrong incentives and preassure to get results  Deformed values  Moral illness Introduction to Business Ethics 2013 – Santi Martínez

11. Paradox: Basic Starting Challenges  ”Business is a game”  ”Business relations are a special category of human relationships. Their basic elements are competition, profit maximization and personal success.”  “Business is therefore a kind of game, like football or boxing.”  “In games, you don’t follow general moral principles, but the rules of the game.”  “Therefore, in business you don’t follow general moral principles, but the rules of business, which are competition, profit maximization and personal success.” Introduction to Business Ethics 2013 – Santi Martínez

12. Paradox: Basic Starting Challenges Introduction to Business Ethics 2013 – Santi Martínez

13. Paradox: Starting Challenges Official corporate culture Official mission Ethical values and codes Memos, manuals, etc. Real corporate culture Role models Expectations Personal values Dreams, feelings Real behaviour The company’s own history vs.  Cases: Enron, Arthur Andersen… Introduction to Business Ethics 2013 – Santi Martínez

14. Paradox: Starting Challenges Introduction to Business Ethics 2013 – Santi Martínez

15. What is Ethics all about?  What did the story tell you? http://www.justiceharvard.org/ Introduction to Business Ethics 2013 – Santi Martínez

16.  Ethics -> greek ”ethos” (costume, habit)  Morals -> latin ”mos-moris” A part of philosophy that studies the behaviour of man, from the point of view of whether it is good or evil, right or wrong.  INDIVIDUAL  What is Ethics all about? Introduction to Business Ethics 2013 – Santi Martínez

17. What is Ethics all about? GOOD NORMS PRACTICE THEORY Introduction to Business Ethics 2013 – Santi Martínez

18. What is Ethics all about? GOOD NORMS PRACTICE THEORY Part of philosophy that teaches how man can reach a good life. Introduction to Business Ethics 2013 – Santi Martínez

19. How Business and Ethics are linked together?  The triple ”E” of excellence Efficiency Efficacy Ethics Introduction to Business Ethics 2013 – Santi Martínez

20. Why Business Ethics? Individual Ethical decision making Motivation at work Organization Ethical cooperation Environmet Good image TRUST Introduction to Business Ethics 2013 – Santi Martínez

21. Teleology: consequentialism ( telos = end, purpose) GOOD NORMS PRACTICE THEORY Introduction to Business Ethics 2013 – Santi Martínez

22. Teleology: consequentialism  Jeremy Bentham (1748-1832)  An Introduction to the Principles of Morals and Legislation (1789)  Consequentialism: The moral value of an action depends on its consequences. Introduction to Business Ethics 2013 – Santi Martínez

23. Teleology: utilitarianism  John Stuart Mill (1806-1873)  Utilitarianism (1861) UTILITY: HAPPINESS ”It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied.” Introduction to Business Ethics 2013 – Santi Martínez

24. Teleology: consequentialism and utilitarianism  The objective of morals is the promotion of the good of society.  The good of society is the sum of its individuals’ happiness.  A moral priciple is ideally valid if, and only if, it maximises the good of society. UTILITY BASED THINKING Introduction to Business Ethics 2013 – Santi Martínez

25. Teleology: consequentialism and utilitarianism  Utilitarianism strongly present in:  The planning of the welfare politics  Cost-benefit -analysis Introduction to Business Ethics 2013 – Santi Martínez

26. Teleology: a criticism of consequentialism  Difficult to define and measure utility and happiness.  What should be done?  Consequentialism does not make a difference between desired and foreseen consequences.  The moral value of any choice/action is known only after it is made/done.  ”I do not learn as long as I am lucky.”  It allows hypocracy. Introduction to Business Ethics 2013 – Santi Martínez

27. Deontology: rule –based ethics (deon = obligation) GOOD NORMS PRACTICE THEORY Introduction to Business Ethics 2013 – Santi Martínez

28. Deontology: rule –based ethics  Immanuel Kant (1724-1804)  Critique of Pure Reason (1781)  Groundwork of the Metaphysic of Morals(1785)  Critique of Practical Reason (1788)  Metaphysics of Morals (1797) Introduction to Business Ethics 2013 – Santi Martínez

29. Deontology: rule –based ethics  An inconditional obligation that binds all rational beings. CATEGORICAL IMPERATIVE For an action to have moral value, it must be done for the sake of duty. Introduction to Business Ethics 2013 – Santi Martínez

30. Deontology: rule –based ethics  “Always act according to that maxim whose universality as a law you can at the same time will.”  “The rational being must be trated as an end in itself.”  “Act as if your maxims should serve at the same time as the universal law.” Introduction to Business Ethics 2013 – Santi Martínez

31. Deontology: rule –based ethics  Deontology strongly present in:  Human rights related issues  Issues related to distributive justice. Introduction to Business Ethics 2013 – Santi Martínez

32. Deontology: a critic of rule –based ethics  Law is good because it obliges: duty is good.  What is the foundation of absolute principles?  ”I don’t care as long as I don’t get caught”: rules are outside me. Introduction to Business Ethics 2013 – Santi Martínez