BUSINESS ETHICS

What is ethics?
 Ethics is the branch of philosophy that focuses

on morality and the way in which moral principles are applied to everyday life. Ethics has to do with fundamental questions such as “What is fair?” “What is just?” “What is the right thing to do in this situation?” Ethics involves an active process of applying values, which may range from religious principles to customs and traditions.

What is business ethics?
 Business ethics focuses on what constitutes

right or wrong behavior in the world of business. Corporate business executives have a responsibility to their shareholders and employees to make decisions that will help their business make a profit. But in doing so, businesspeople also have a responsibility to the public and themselves to maintain ethical principles.

Although ethics provides moral guidelines, individuals must apply these guidelines in making decisions. Ethics that applies to business (business ethics) is not a separate theory of ethics; rather, it is an application of ethics to business situations. Although all people have ethical responsibilities, higher ethical standards are imposed upon professionals who serve as social models, such as physicians, attorneys, and businesspeople.

an action might be unethical.  Law and ethics are not the same thing. For example. it might be unethical to lie to your family.The Relationship Between Law and Ethics The law is an expression of the ethical beliefs of our society. Therefore. but it is not necessary illegal. yet not necessarily illegal. “Is an act legal?” is different from the question. “Is an act ethical?” The law cannot codify all ethical requirements. The question.  .

Mahatma Ghandi and others. Should an individual obey the law even if it would be unethical to do so? Under the theory of civil disobedience espoused by Martin Luther King. just because an act is illegal does not necessarily mean it is immoral. Similarly. Can you think of any examples of acts that would be illegal. Rosa Parks was acting illegally when she refused to give up her seat on the bus to a white male. an immoral law deserves to be disobeyed. but that does not necessarily mean she was acting unethically. yet arguably ethical? .

 Over the centuries. two different philosophical frameworks developed: ethical standards based on universal duties (deontology) and ethical standards based on consequences (utilitarianism). .THEORIES OF ETHICAL CONDUCT  Theories of ethics present standards by which a person can analyze and evaluate his or her own moral conduct.

Deontology  Deontology is the philosophical practice of defining and adhering to an absolute set of standards by which ethical behavior can be measured. a person can apply these universal standards to determine a course of action that is good. It tries to define universal duties that serve as moral guides to decision making. . When a moral dilemma arises.

An example of a set of deontological rules would be the Ten Commandments. A person decides upon actions by asking if a particular action is morally right or wrong. . a person fulfills absolute moral duties regardless of whether good comes from the actions. The act of carrying out that duty is important rather than the consequences of the act. In deontology.

. When encountering ethical dilemmas. An action that maximizes respect for human rights and minimizes their violation is morally correct. a person applying the rights model selects the action that minimizes the violation of stakeholder’s rights.The Rights Model  The rights model analyzes ethical issues by focusing on an action’s impact on human rights. Under this model. human rights are the rights all people have.

Thus. and (2) rights of wellbeing. two basic categories of human rights exist within the model: (1) rights of liberty. The two necessities to be fully human are freedom and well-being. .

Rights of Liberty  Privacy  Free consent  Free speech  Freedom of conscience  Right to life .

Rights of Well-Being  Employment  Food  Housing  Education .

Each person’s life has an infinite value. . each person possesses certain fundamental human rights because of the fact that they are a human being. Under the rights model.

Utilitarianism  Utilitarianism is an approach to establishing ethical standards based on the consequences of an action. a person selects the action that brings about the greatest amount of good for the greatest number of people. Many business people favor the “cost/benefit” approach of utilitarianism. . The model determines correctness in terms of social benefit. In an ethical dilemma.

 Determine to which extent each alternative respects the dignity and fundamental rights of stakeholders or violates their rights.  Identify the alternative courses of action.  .Applying the Rights Model Identify the facts.  Identify the ethical issues.  Identify the stakeholders.  Choose the alternative that maximizes the dignity of stakeholders and minimizes the violation of their rights.

 Choose that alternative which results in the greatest amount of good for the greatest number of stakeholders.  Identify the ethical issues.  . calculate the costs and benefits (identify who would be harmed and who would benefit).Applying Utilitarianism Identify the facts.  For each alternative.  Identify the stakeholders.  Identify the alternative courses of action.

Example #1  Cartoon: “The Difference Between Ethics and Business Ethics” .

or perform many of the other functions that she previously had performed and that are included in her job description. . she can no longer effectively type.Example #2  A secretary who has worked for your corporation for fifteen years is involved in a car accident in which she permanently loses the use of her right hand. file. Thus.

and you have been very satisfied with her work and dedication. The injured secretary has been very loyal to your corporation. . She wants to stay at her job. Your corporation has a very tight budget and does not have sufficient funds to pay for an additional secretary without reallocating budget items.

or find a way to retain her? In resolving this dilemma. she does not believe that she could find other employment at this time. apply: Utilitarianism The Rights Model Your own personal opinion . Should your corporation fire her. Moreover. lay her off with compensation.

it is regarded as a human rights violation.CAPITAL PUNISHMENT Apart from the United States. so no nation can be admitted to the European Union if it still has the death penalty on its books.  .  Only China and Iran execute more people than the U. Under the European convention for the Protection of Human Rights and Fundamental Freedoms.  No member of the European Union uses it. few countries use the death penalty.S.

the federal government had not used the death penalty for 38 years.  When he was governor of Texas. or any other American governor in modern times. . When President Bush was elected president. He reinstated it. and Bush signed 152 death warrants – more than any previous governor of Texas. that state had more executions than any other.

as governor of Texas. he made his life-and-death decision after a half-hour briefing with his legal counsel. . did he stop an execution.  Only once. Typically.

Bush has said: “Some advocates of life will challenge why I oppose abortion yet support the death penalty. Is it inconsistent to oppose the killing of embryos or fetuses. it’s the difference between innocence and guilt. To me. yet support the death penalty?  Not necessarily.” .

any legal system that puts large numbers of people to death will risk executing people innocent of the crimes for which they were charged. But to hold the two positions consistently. one would at least need to be very careful about supporting the death penalty. . Since humans are fallible.

S.  The Death Penalty Information Center has a list of 102 people wrongfully sentenced to death in the U. . and in some cases executed. who were later shown to be innocent. between 1973 and 2000. Several studies list people who have been condemned to death.

S. and in 4 of those cases there was evidence supporting their claim of innocence. between 1976 and 2000 found that at least 120 people were put to death while still proclaiming their innocence. An investigation by the Chicago Tribune of all 682 executions in the U. .

. When Florida Supreme Court Justice Gerald Kogan retired. he said that there were several cases in which he had “grave doubts” about the guilt of people executed in Florida.

 In 1999. Gov. a deathrow inmate for 16 years. was about to be executed. George Ryan of Illinois became concerned about the risk of putting innocent people to death when an investigation by a journalism class at Northwestern University proved that another man committed a murder for which Anthony Porter.President Bush’s attitude about the risk of putting to death innocent people is in sharp contrast to another Republican governor who was once a supporter of the death penalty.  .

over 3 years. concluded that 13 condemned prisoners were innocent.  Ryan stated.” . Ryan set up a commission that. error in determining guilt and error in determining who among the guilty should die. “Our capital system is haunted by the demon of error.

. Just before he left office. Ryan felt that he could no longer live with the risk of executing the innocent: he commuted all death sentences in Illinois to terms of imprisonment.

that at least one of the people executed during his tenure was innocent. he did spend 30 minutes reviewing each case before he signed the death warrant – it remains possible. if not probable. No matter how careful Bush may have been – after all. .

capital punishment is a deterrent against future violence and will save other innocent lives. Bush has said: “I support the death penalty because I believe.” . if administered swiftly and justly.

I think the reason to support the death penalty is because it saves other people’s lives.” . I don’t think that’s right. Let me finish that – I don’t think you should support the death penalty to seek revenge. In the third of his debates with Al Gore. “I do – that’s the only reason to be for it. Bush said. moderator Jim Lehrer asked Bush whether he thought that the death penalty actually deters crime.

. there is plenty of relevant data. The problem with this defense of capital punishment is that almost all of the evidence is against it. or in different jurisdictions that do or do not have the death penalty. Since it is easy to compare murder rates before and after the abolition or reinstitution of the death penalty.

In fact. These states have not had higher homicide rates than the states that did enact a law. a dozen states chose not to enact laws allowing it. after the 1976 USSC ruling that the death penalty is constitutional. . 10 of them have had homicide rates lower than the national average. For example.

the homicide rate is higher in the state that has the death penalty.South Dakota has it. Again. North Dakota does not.  Homicide rates have risen and fallen in roughly symmetrical patterns in states with and without the death penalty. indicating that the death penalty has little effect on the incidence of homicide.  Connecticut has it.  . Massachusetts does not. The homicide rate is higher in South Dakota.

His explanation: “I like the law the way it is. even if he or she did commit the crime. as governor of Texas.Executing the Mentally Retarded A person who is seriously mentally retarded is likely to be incapable of understanding right from wrong. Bush. and thus is morally innocent.”  . came out against a bill prohibiting the use of the death penalty against profoundly mentally retarded criminals (with IQs of less than 65).  As a national consensus against executing the mentally retarded began to build.

a thirty-three-year-old mentally retarded man with the communication skills of a 7-year-old. Bush denied an appeal for clemency on behalf of Terry Washington. Washington was executed.  In May 1997. a poll in 1998 showed that 73% of all Texans were opposed to executing the mentally retarded. Even in Texas. .

given the growing national consensus. . executing retarded persons is “cruel and unusual punishment” and hence a violation of the 8th Amendment. the USSC ruled that. In June 2002.

Go to http://wbl. Go to the homepage of a Fortune 500 company that has published its code of ethics on the World Wide Web. What ethical concerns does it cover? Is it a detailed document or general in its terms?  . select “Internet Applications.westbuslaw.” and then click on Chapter 40. Ethics in Business. 2.Internet Activities and Assignments  1.com . Do Activity 40-1.