The Foundation Of The Principles Of
Business Ethics APPLICATION in BUSINESS ETHICS
ETHICAL SUBJECTIVISM
 is a theory that asserts that the basis of the
goodness or badness of an act is the human
agent himself- the one who decides to act, the
subject of action.
 It comes from the belief that every individual
has his or her own set of experiences that form
his or her moral values. It follows therefore,
that what is good for one person may not be
good for other person.
CULTURAL RELATIVISM
 a descriptive claim that ethical practices differ
among cultures, that, as a matter of fact, what
is considered right in one culture may be
considered wrong in another culture.
ETHICAL/MORAL RELATIVISM
 is the claim that what is really right or wrong is
what the culture says is right or wrong.
 Moral relativists accept cultural relativism as
true, but they claim much more. If a culture
sincerely and reflectively adopts a basic moral
principle, then it is morally obligatory for
members of that culture to act in accordance
with that principle.
 ethical relativism claims that the basis of the
goodness or badness of an act is the culture of
the society. What is good for one group of
people may not be good for another group of
people. What is right on one side of the river
may not be right on the other side of the river.
MORAL OBJECTIVISM
 maintains that there are moral principles that
have universal validity regardless of time,
place, and culture.
 moral objectivist claims that morality is neither
subjective nor culturally relative. Rather, it is
objective in the sense that there are ethical
principles that are common in all societies.
MORAL REASONING and its
Lawrence Kohlberg on Moral Reasoning
Let us now go to the specific levels and stages of
Kohlberg’s theory of moral development.
LEVEL ONE: PRE- CONVENTIONAL MORALITY
 the person is not yet fully aware of the various
ethical standards, laws, and customs agreed
upon and instituted by the community and the
society at large.
Stage One: Punishment-and-Obedience
Orientation
 children are driven to act rightly because
they are motivated by fear of punishment.
They understand that something is wrong or
bad when it has a corresponding physical
punishment.
Stage Two: Instrumental- Relativist Orientation
 this is also the moral disposition of children
who are not yet aware of the rules and
regulations of the community and the society
at large. Some authors also call this as the
reward orientation stage.
 children are more motivated to act if they
can get something in return, a sort of favor
or reward.
LEVEL TWO: CONVENTIONAL MORALITY
 it is during adolescence that majority of people
move from pre-conventional to conventional
morality.
 the person becomes conscious that he or she
is living in a society of countless people with
countless interests.
Stage Three: Interpersonal Concordance or
“Good boy- Nice girl” Orientation

 During this stage, the young adolescent
becomes conscious of his or her image
and identity; being too conscious about
the expectation of family and friends
 Applying this in the context of business
ethics, an employee might keep silent
about unethical conduct that he witnesses
in the workplace because he does not
want to “rock the boat”, or to be perceived
as a sycophant or “walang pakikisama.”
Stage Four: Law and Order
simply propelled by the RIGHT thing to do.
Example
Whistleblowing – A person who discloses the illegal
and unethical activities of his or her company or
organization may endanger not only his or her job
security but even his or her own life and that of his or
her family. However, he or she courageously carries
on blowing the whistle because he or she knows that it
is the right thing to do, that is what his or her
conscience is telling him or her, and that he or she is
now completely free and autonomous person
governed only by his or her personally adopted
universal ethical standards.

 he or she simply realizes that the law must

always be upheld, respected, and obeyed.

LEVEL THREE: POST-CONVENTIONAL

MORALITY

 The legalist mindset may be a sign of greater

maturity in moral reasoning compared with the
earlier stages, but a person can still advance in
moral development.

 In this level, the person is no longer

determined and conditioned by “ social
conventions” such as laws, written codes and
agreed standards.

Stage Five: Social Contract Orientation

 the adult person reasons out that laws are

social contract, that is, people in the
society agree to promulgate and be bound
by laws not only because it ensures order
and harmony. More importantly it is
because laws uphold human rights,
justice, and the common good.

Stage Six: Universal Ethical Principles

 This is the pinnacle of moral reasoning,

according to Kohlberg, only few people
reach this stage.

 the morally mature person is no longer

governed by fear of punishment, nor by
reward, by social expectations, by societal
laws and precepts, or by basic social
contracts.

 The person who operates on this stage is