Professional Ethics

HU-222

Instructor
Dr. Ehsan ul Hassan

Slides Courtesy
Mr. Ammar Ahmed
Ethics and
Business

Chapter 1
Lec # 6
 Objections to Business Ethics
Argument
Argument

Perfectly
First
First

Competitive
Markets
Argument

Loyal
Argument
Second
Second

Agent’s
Argument
Argument
Argument

Obligation
Third
Third

of Law
 4

Objections to Business Ethics

Argument
Argument

PROFIT The pursuit of profit will by itself ensure that the

First
First

BENEFITS
ALL members of society are served in the most
socially beneficial ways.

• Most industrial markets are not “perfectly competitive”.

• To be profitable, each firm has to produce only what the members of society
want and has to do so by the most efficient means available.
• The members of society will benefit most, then, if managers do not impose their
own values on a business, but instead devote themselves to the pursuit of profit.
By pursuing profit, they will efficiently produce what the members of society
value.
• “Managers should devote themselves to the single-minded pursuit of profits”
might involves unspoken and unproved moral standard.
 5

Objections to Business Ethics

• As a loyal agent of his or her employer, the

Argument

Loyal
Argument
Second
Second

Agent’s manager has a duty to serve the employer.

Argument
• An employer would want to be served in
whatever ways will advance his interests.

• The argument tries to show that ethics does not matter by Law of Agency
assuming an unproved moral standard. A law that specifies
• The loyal agent’s argument assumes that there are no limits the duties of persons
who agree to act on
to the manager’s duties to serve the employer. behalf of another
party and who are
• It is false to say that if a manager agrees to serve an authorized by an
agreement so to act.
employer, justifies whatever the manager does on behalf of
his employer.

The law of agency specifically indicates that an agent never has a duty to do what a client, employer, or
other principle asks the agent to do if it would require performing an act that is “illegal or unethical.
Objections to Business Ethics
• Example: Environmental Scanning

• One of the fastest-growing forms of environmental scanning is

competitor intelligence, involves screening information to detect
emerging trends by managers.

• which is gathering information about competitors that allows managers

to anticipate competitors’ actions rather than merely react to them.

• It seeks basic information about competitors: Who are they? What are
they doing? How will what they’re doing affect us?
• Managers do need to be careful about the way
information, especially competitive
intelligence, is gathered to prevent any
concerns about whether it’s legal or ethical.

“what’s considered legal and ethical and what’s

considered legal but unethical”
 8

Objections to Business Ethics

Argument
Argument

Obligation
Third

Business people should follow the law: If it is legal,

Third

of Law then it is ethical.

• Laws and moral standards overlap to a certain extent

• Law represents a minimum set of standards for producing a desired
human behavior
• Morality often represents a standard that exceeds the legal minimum
• Law has well defined boundaries while Morality has none.

Morality Ethics & Law Law

e.g. Parking laws e.g. Laws for murder, e.g. Pre-Civil war
Dress code, etc. Theft, fraud etc. Slavery laws

In such cases, law and morality coincide, and the obligation to obey such laws is the same as the
obligation to be moral. However, law and morality do not completely overlap.