Chapter 2 LGLS

What is business ethics?

The application of ethical principles and moral standards to business behavior, decision-making, and corporate culture

Ethical Corporate Culture

An ongoing development of the company's values and legal compliance. It involves stakeholder analysis, though not all stakeholders are treated equally.

Stakeholder Analysis

An important function within ethical corporate culture that examines how business decisions affect various parties (customers, employees, stockholders, suppliers, creditors, community, environment)

What is Due Diligence in business ethics?

Extensive legal review to assure legal compliance. A corporate culture must first be in legal compliance before it can be ethical. Legal counsel and the ethics/compliance officer work together to assure due diligence

Risk assesment in ethics

The process of identifying, evaluating, and prioritizing potential ethical and legal risks that could impact the organization

Compliance and Ethics Program

A formal program designed to ensure the organization follows laws and regulations while promoting ethical behavior throughout the company

Deontology (Duty Ethics)

An ethical theory derived from Greek words for "duty" (deon) and "science" (logos). It is duty-driven and based on doing what one ethically ought to do under the circumstances, regardless of the consequences

Teleology (Consequential Ethics)

An ethical theory derived from the Greek word "telos" (end or purpose). Also called consequentialism, it is purpose-driven and primarily concerned with the consequences of behavior.

Virtue Ethics (Aristotle)

An ethical theory that doesn't fit neatly into teleological or deontological categories. It is grounded in desirable human qualities (wisdom, prudence, justice, courage) as desired character traits and virtues of a business executive.

According to Aristotle's Virtue Ethics, which virtue is paramount and why?

Justice is paramount to other virtues (temperance, courage, prudence) because it provides well-being to others. This is especially useful in stakeholder analysis seeking fairness for all affected by business strategy.

What does Aristotle teach about justice?

Aristotle teaches that justice means giving people what they deserve

Natural Law (Aquinas)

An ethical theory holding tyhat regardless of cultural differences, all people have an innate abilitiy and duty to make raiton decisions that should be used in resolving ethical disputes. Basically a hybrid with teleogical foundation (human purpose) supporting a deontological system (rules and duties)

What does natural law suggest for business executives?

Business executives should rely on reasonable judgements when resolving ethical dilemmas

Kant’s Categorical Imperative

Deontological theory stating that your acts should be worthy of imitation

What does the Categorical Imperative mean in practice

Never treat people merely as a means to an end; always treat them as ends in themselves with inherent dignity and worth

Utilitarianism

A teleological ethical theory summarized as seeking the "greater good for the greater number"

Who are the two main philosophers associated with Utilitarianism?

Jeremy Bentham (1748-1832) and John Stewart Mill (1806-1873)

What is Rawls' Theory of Justice based on?

Four key concepts: 1) Original position, 2) Veil of ignorance, 3) Equal liberty principle, 4) Difference principle

What is Rawls' famous quote about justice?

"Justice is the first virtue of social institutions... Laws and institutions no matter how efficient and well-arranged must be reformed or abolished if they are unjust."

What is the "Original Position" in Rawls' theory?

A hypothetical situation where people make decisions about justice without knowing their place in society

What is the "Veil of Ignorance" in Rawls' theory?

The concept that when designing a just society, decision-makers should not know their own position, wealth, abilities, or circumstances to ensure fairness

List the philosophers and their ethical theories chronologically.

Aristotle (384-322 BC) - Virtue Ethics; Aquinas (1226-1274) - Natural Law; Kant (1724-1804) - Categorical Imperatives; Bentham (1748-1832) - Utilitarianism; Mill (1806-1873) - Utilitarianism; Ross (1877-1971) - Prima Facie Duties; Rawls (1928-2002) - Theory of Justice

Which ethical theories are Deontological?

Kant's Categorical Imperatives, W.D. Ross's Prima Facie Duties, and John Rawls' Theory of Justice

Which ethical theories are Teleological?

Utilitarianism (both Bentham and Mill's versions)

What is W.D. Ross known for?

Prima Facie Duties - a deontological ethical theory (1877-1971)

What is the relationship between legal compliance and ethics?

Legal compliance must come first - a corporate culture must be in legal compliance before it can be ethical

What is the significance of the Milgram experiments in business ethics?

They demonstrate how people can be influenced to act against their ethical judgment under authority, which is relevant to understanding ethical decision-making in corporate hierarchies

What does "doing the right thing" involve in business ethics?

It involves considering ethical theories, stakeholder impacts, legal compliance, and moral principles when making business decisions

What is the hybrid nature of Natural Law theory?

It combines a teleological foundation (focused on human purpose) with a deontological system (focused on rules and duties)

Why doesn't Virtue Ethics fit neatly into teleological or deontological categories?

Because it focuses on character traits and virtues rather than duties (deontology) or consequences (teleology), emphasizing what kind of person one should be rather than what actions to take