business ethics final

Caveat emptor

It means 'let the buyer beware'—consumers are responsible for checking the quality and suitability of goods before purchase.

Strict liability

Even if the seller was not negligent, they are legally responsible for any injuries caused by defective or dangerous products.

Ethical issues in advertising

Common issues include misleading or exaggerated claims (e.g., Red Bull giving you wings), reinforcing harmful stereotypes (e.g., gender or racial norms), and creating unnecessary desires.

Ethical issues in pricing

Includes practices like price gouging during emergencies, price fixing between competitors, deceptive pricing with hidden fees, and predatory pricing to eliminate competition.

Ethical issues in marketing strategy

Unethical strategies include targeting vulnerable populations (e.g., children or teens), excluding low-income consumers, and exploiting cultural trends irresponsibly.

Consumer sovereignty test

An ethical marketing framework that asks: 1) Is the consumer capable of informed decisions? 2) Is sufficient, truthful information provided? 3) Do they have other choices?

Ethical consumption

Consumers make buying choices based on ethical values, such as environmental impact, labor practices, or animal welfare. It reflects conscious consumerism.

Sustainable development

Development that meets current needs without compromising future generations' ability to meet their own needs, from the 1987 Brundtland Report.

IPAT equation

Environmental Impact = Population × Affluence × Technology. It's used to understand how these factors contribute to ecological strain.

Problems in a 'hot, flat, and crowded' world

Rapid population growth, resource shortages, climate change, and mass consumerism are stressing ecosystems and creating global inequality.

Environmental justice

The fair treatment and involvement of all people—regardless of race or income—in environmental policies and practices.

ESG reporting

It refers to a company's disclosure of Environmental, Social, and Governance impacts. It helps investors assess long-term sustainability and ethical risk.

Double materiality

A framework that evaluates both how sustainability issues affect a company (financial materiality) and how the company affects society/environment (impact materiality).

Aristotle's definition of happiness

Happiness is the ultimate goal of human life. Unlike pleasure, it is achieved by living a life of virtue and fulfilling our purpose (telos).

Eudaimonia

A Greek word for 'flourishing'—living a full and virtuous life. It's not just about feeling good, but about being the best version of oneself.

Practical wisdom

The ability to choose the right virtue in the right amount at the right time. It balances courage with caution, generosity with prudence, etc.

Development of virtues

Virtues are cultivated like habits—through repetition, role models, and reflection. Practical experience helps us refine them.

Limitations of virtue ethics

Critics argue it's vague (what counts as a virtue?), subjective, and hard to apply to large-scale or global ethical issues with conflicting values.

Key issues in AI ethics

Concerns include lack of transparency (black-box algorithms), data bias, privacy violations, job displacement, and power imbalances in decision-making.

Ethics of care

A moral theory prioritizing empathy, relationships, and interdependence over rigid rules. It's often applied in workplace settings involving emotional labor.

Ethics of justice (Rawls)

Emphasizes fairness and equality. Rawls' 'difference principle' says social and economic inequalities are just only if they benefit the least advantaged.

AI increase inequality

High-income workers benefit most from AI productivity, while automation displaces low-wage jobs. It can also shift income from labor to capital (investors/owners).

Animals in AI ethics

Because animals can suffer and feel pleasure, they deserve moral consideration. AI development can harm or help animals, so we must include them in ethical planning.

AI impact on animals

Self-driving cars may hit animals, AI-generated trends can exploit them, and tech can be used for wildlife conservation (e.g., drones or detection algorithms).

Ethical issues in AI and animals

Include: 1) Responsibility—humans must take moral ownership. 2) Bias—some species seen as less valuable. 3) Communication—animals can't speak for themselves. 4) Equal consideration.

Stakeholder theory

This theory argues companies should consider all stakeholders (employees, customers, environment) in decisions—not just shareholders.

Utilitarianism

A theory focused on maximizing overall happiness or utility. The right action is the one that produces the greatest good for the greatest number.

Ethics of Duties (Kant)

• Universal principles of what is right and wrong. (Fixed, no compromise)

• Important to protect human dignity

3 Question Principle Test for Kant's Ethics of Duties

1. What if everyone did it? (Universality)

2. Does this disrespect anyones human dignity or rights?

3. What if the media got ahold of this info?

Tragedy of the commons

A situation where individuals overuse a shared resource for personal gain, leading to its depletion, even though it harms the group in the long run. Example: overfishing or deforestation.

Cap-and-trade system

An environmental policy tool that sets a pollution limit (cap) and allows companies to buy and sell allowances (trade) for emissions, incentivizing reductions.

Pros and cons of regulations for sustainability

Pros: Reduces pollution, applies uniformly, deters bad behavior. Cons: Expensive to implement, may slow business, can be corrupt or confusing across countries.

Pros and cons of market forces for sustainability

Pros: Business-friendly, incentivizes innovation. Cons: Slower change, risk of greenwashing, not guaranteed to reduce environmental harm.

Greenwashing

A deceptive practice where companies falsely advertise products or policies as environmentally friendly without meaningful actions to back them up.

Ethics of feminist care

Focuses on empathy, relationships, and emotional intelligence. It values care over rules or utility and critiques traditional male-centered ethics models.

Moral limit of markets

The idea that some things—like human rights, justice, or political access—should not be bought or sold, as this can erode fairness and equality.

Ethical concerns with AI in business

AI can amplify digital bias, make unfair hiring decisions, create cybersecurity risks, and exclude marginalized groups. Ethics requires inclusive design and accountability.

Double materiality in ESG reporting

It means companies must report both how sustainability issues affect them financially and how their operations impact the environment and society.

Consumers contribute to sustainability

By reducing consumption, choosing ethical brands, recycling, and supporting companies with strong ESG practices. Ethical consumption is a form of activism.

Shareholder rights

Clearly defined

Manager's duties

Ill Defined (Managers have general guidelines)