Session 7A

Have you seen or experienced

utilitarianism happen in your work?
Enterprise Risk Management
Risk management is the identification, assessment, and prioritization of risks
(defined in ISO 31000 as the effect of uncertainty on objectives, whether positive
or negative) followed by coordinated and economical application of resources to
minimize, monitor, and control the probability and/or impact of unfortunate
events or to maximize the realization of opportunities. Risks can come from
uncertainty in financial markets, project failures (at any phase in design,
development, production, or sustainment life-cycles), legal liabilities, credit risk,
accidents, natural causes and disasters as well as deliberate attack from an
adversary, or events of uncertain or unpredictable root-cause. Methods,
definitions and goals vary widely according to whether the risk management
method is in the context of project management, security, engineering, industrial
processes, financial portfolios, actuarial assessments, or public health and safety.
Risk Management
• Define the relevant risks in the “risk universe”;
• Determine the: 1. probability and 2. severity;
• Identify strategies to manage the risk especially for those with both
HIGH PROBABILITY AND HIGH SEVERITY/IMPACT
• The strategies to manage risk typically include 1. transferring the risk
to another party; 2. avoiding the risk; 3. reducing the negative effect
or probability of the risk, or 4. even accepting some or all of the
potential or actual consequences of a particular risk.
Moral Imagination
Moral imagination includes an awareness of the various
dimensions embedded in a particular situation—in
particular, the moral and ethical ones. It entails the
ability to understand one’s situation from a number of
perspectives. Moral imagination enables managers to
recognize a set of options that may not be obvious from
within the overarching organizational framework;
evaluate these options from a moral point of view; and
actualize them.
Moral imagination is the ability to discover and evaluate possibilities
within a particular set of circumstances by questioning and
expanding one’s operative mental framework. In managerial moral
decision making, moral imagination entails perceiving the norms,
social roles, and relationships entwined in any situation.

Who is affected by
my actions and
behavior?
What is affected
by my action and
behavior?
 Takeaways!
Issue Recommendation
Failure to speak a • include individuals who understand and can translate multiple frameworks. In order to make good
common language decisions, firms must develop common systems that facilitate interaction between the various narratives
and mental models
Obedience to authority • Creating a culture of pushback; A tone must exist at the top that actively seeks out and listens to internal
voices of dissent

• Shared responsibility can be achieved when individuals author and participate in their own history and
narratives. No matter a person’s place in an organization, each person is responsible for helping to build
or change the culture.
Lesser of two evils • It is precisely when it seems there is no good option among our available choices that we should think
outside our current role and framework and imagine what a good choice or a better story might look
like.
Groupthink • Internalizing critics may be the best safeguard for organizational integrity

• Reaping the benefits of diversity with regard to race, gender, cultural background, and
personality/modes of thinking and expressing one’s self is of great value

• Consulting other leaders outside the firm is a great benefit to those in leadership positions
What does one do then in order to practice and
apply utilitarianism?
• Be objective
• Think not just of yourself/your company
• Increase knowledge, gain experience
• Widen perspectives, Keep open minds
• Challenge your paradigms
 Utilitarianism – Implications for Ethical Leaders
• Examine consequences
and options not just for
the short term.
• Examine options and
consequences to
discover hidden costs
and benefits.

• Do not express growth (and

losses) solely in monetary terms.
• Widen your sphere of analysis.
• Good information is critical.
 Case No. 2
Medico-Fast (Medi-fast) is a medical diagnostic testing center
operating in Quezon City. It offers all forms of medical testing from
blood chemistry, CBC, urinalysis, fecal analysis, radiological imagery,
etc. It has a staff of 20 people and has been enjoying a very
profitable run in the past 2 years.
This has prompted Dr. Wong and Dr. Reyes, the co-owners of the
facility to plan expansion of the center in order to accommodate the
growing number of customers. They plan to hire 10 more people to
meet this expanded demand.
As part of their plans, the two doctors want to institute a policy that
the new people to be hired should not have any tattoos on their
bodies. As regards the existing staff, they will all be enjoined from
adding any tattoos to their bodies, in case they have any such
tattoos.
Are these policies OK?
 Utilitarianism

Rights
right: something that one is entitled to do
or have on the basis of need, custom, law,
or intrinsic value.
karapatan: ang nauukol sa sarili o kapwa
batay sa pangangailangan, nakagawian,
batas, o likas na buti.
The Rights Approach

Other philosophers and ethicists suggest that the

ethical action is the one that best protects and respects
the moral rights of those affected. This approach starts
from the belief that humans have a dignity based
on our human nature per se or on our ability to
choose freely what we do with our lives. On the
basis of such dignity, we have a right to be treated as
ends and not merely as means to other ends. Also,
it is often said that rights imply duties -in particular,
the duty to respect others' rights.
Rights approach - implications

• Rights impose correlative duties on others (and on oneself),

duties of positive performance & non-interference.
• In other words, if there if a person possesses a right, you
have a corresponding OBLIGATION in relation to that right.
• Rights imbue individuals with autonomy and equality in the
free pursuit of their interests.
Immanuel Kant
Kant's Categorical Imperative
For Kant human beings as
moral agents are rational and
autonomous (free to make
choices). He thinks that as
rational beings we are able to
judge whether any action is
moral by asking if the action is
consistent with the
categorical imperative.
One formulation is: "Always act to
treat humanity, whether in
yourself or in others, as an end in
itself, never merely as a means."
What Kant means by this is that a
rational being should not be used
as a means to another person's
happiness; if we use another
person as a means to our ends
then we have removed that
person's autonomy.
• Another formulation of the categorical imperative is,
"Act only on that maxim (intention) whereby at the
same time you can will that it shall become a
universal law". What Kant means by this is that the
way that we judge an action to be moral is to
universalize it: If I want to know if telling a lie on a
particular occasion is justifiable, I must try to imagine
what would happen if everyone was to lie. Kant thinks
that any rational being would agree that a world in
which there is no lying is preferable to one in which
lying was common; in a society in which lying was
common no one could trust the word of anyone else.
 Find the answers. Group 1
• A policeman knocks on your door and
asks that he take a look at your clothes
cabinet. You do not want to let him in
but he insists. What do you do?
• You discover that your cellphone is
under surveillance and is “bugged”.
What do you do?
• You are arrested after being caught in
flagrante delicto (in the act) for stealing
a cellphone. In your detention area,
you are told that you will be held
without bail unless you confess. Is this
ok?
• For the crime of theft, bail was set for
your case at PhP20M. Ayos ba?
Group 2
• Your barangay government has allocated
P20,000 for the celebration of the
“Santacruzan” which is a festival that is largely
based on Catholic tradition. You are a member
of the INC. Is this right?
• Your company has issued a policy against the
formation of labor unions. Is this ok with you?
• You have requested data from the DND on
military spending. They have refused your
request. Is this right?
• In the past, smoking was allowed inside
designated areas in bars. The new law now
prohibits this and seeks to penalize those who
used to smoke inside bars and clubs. Is this ok?
Group 3
• You are arrested pursuant to a validly
issued warrant. Since you were guilty of
the crime you immediately signed a
prepared confession. Can this be used
against you in court?
• The government needs to buy your land
since it is needed for the expansion of
EDSA. Can you refuse to sell?
• A lawyer signs a confession without his
own lawyer. Can they use this
confession at his trial?
• You fail to pay a huge debt for use of
your credit card. They want to throw
you in jail. Can they do that?