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3(a)-Basics of Corporate Governance & Business Ethics.

Universalism & Utilitarianism.

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ultimately. The Duties and Obligations of an Individual is termed as Deontology. • Personal Duties and Obligations of an Individual are Universal. only when a Code of Behavior can be Universally applied. Deontology is sometimes also referred to as Ethics based on the Act and whether or not the Act is Right. The approach of Universalism states that the Moral Worth of an action of an Individual should be judged by the Intentions of the person performing the action. . It focuses on Individuals not as Means but as Ends in themselves. The underlying Philosophy of this Concept is that good intentions should always result in good outcome. then the action is termed to be a good action. • In other words it is also very closely related to the Non-Consequestionalist Theory of Ethics. • Even if the Outcome is not as desired. Thus. if not immediately. and not by the Outcomes or Consequences of the action. Hence this Deontological Theory is termed as Universalism. No One can escape from discharging these Duties and Obligations.Universalism. should it 2 be considered Ethically Correct. Worthy of Dignity and Respect. • The Theory of Universalism is based on Duties or Obligations of an Individual in the Society. but the Intention of the person was good.

While praiseworthy in Theory. Similarly. one should act only in ways that one would wish all others to act. Hence. the Universalism approach finds itself in difficulty during practical application. Then it would be difficult to reconcile these two benefits. others may believe that Piece Rate System where everybody is paid by results. for its interpretation. would be Equitable.Universalism (Cont’d). rather than the Means in the pursuit of Corporate Excellence. “Do unto others as thou would have others do unto thou”. and also to treat others with Dignity and Respect. no one’s Rights should be subordinated to those of others. which helps to evaluate an Individuals Moral Conduct. it will be difficult for the Firm to think of its Employees as Ends in themselves. Everyone’s Value is Equal. Again. though some people may prescribe to the Time Rate System of payment. 3 • • • • . What is morally Right for oneself must be Morally Right for others as well. That basically follows the Tenant that we should not do anything which we would not like to be done to us in similar circumstances. It depends to a large extent. upon the situation that the individual finds himself in. According to it. Not all people may agree on the same Moral Standards. • Immanuel Kant (1724-1804) proposed the Categorical Imperative. said Jesus Christ. as everybody’s belief is of Equal Importance according to the System of Universalism. almost Two Thousand Years ago. faced with the same set of circumstances.

Thus Utilitarianism is concerned with Maximizing Welfare for the Society. which is concerned not with an act itself. The Utilitarianism theory was originated by British thinker Jeremy Bentham (1748-1832). That is why this is sometimes referred to as “Consequentialism” or “Ends-Based” Ethics.Utilitarianism. A Special version of Teleology is Utilitarianism. who held that Moral Worth of an Individuals Conduct can be determined by the outcome or Consequences of that Behavior. this System fails to provide a balance between the benefits of the Majority against the Sacrifices of a minority. which aims at creating the greatest degree of Benefits for the largest number of people while incurring least amount of harm possible. an action is good if it results in benefits for Society. and it is bad if it leads to damages or harms the society. In situations where the outcomes can be measured in Financial Terms. As a determinant of Moral action. Thus the emphasis is on the Outcome of Individual actions and not on the Intent of the Individual. Utilitarianism has great merit. It found support among most of the Philosophers in its time. However. • This approach to Ethics comes from Teleology. but with the Consequences of the act. the Utilitarianism System has certain limitations also. 4 • • • • . According to Utilitarianism.

despite its great benefits to a Huge Majority. it is very difficult to reconcile “Greatest Good” with “Greatest Number” of People. a Manager will face some difficulties as under: It is very difficult to Foresee all the Consequences of a Business Decision. is not provided by Utilitarianism. should lie in the Sacrifice of only one person. In most cases. • Dostoevsky I his book titled. Utilitarianism prescribes “the Greatest Good for the Greatest Number”. And the degree to which this Trade-Off will be possible. if the Happiness of the whole Human Race forever. Accurate Forecasts of outcomes are required in situations. “Brother Karamazov” asked what would be the Moral action of the Society. where little data is available. and often lack common measurement units. There has to be a certain Trade-Off somewhere. Many Decisions have Consequences that are not easily measured. Such an action would obviously be Morally “Wrong”. a completely innocent child. Maximizing Net Utility may require actions that cause harm to 5 some people (may be minority). who should be tortured to death.Utilitarianism (Cont’d). Moreover. • • • • 1) 2) 3) . By using a Utilitarianism/Consequentialism approach.