X [%:6Ou\Ng73Y 2 x 10 = 20 a. 1999-2023, Rice University. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution License . Business ethics theories include the moral principles or codes a company implements to ensure that all individuals working in the company act with acceptable behavior . A few different business ethics theories exist , such as the utilitarian , rights , justice , common good and virtue approach . WebBased on the expressed preferences of 163 undergraduate and graduate students of business ethics, this article briefly examines the two most popular theories, Universalism One model of ethical behavior, sometimes called the humanistic business model, may provide the answer for businesses that wish to achieve the dual goal of human flourishing and responsible profits. No matter our culture, geography, or time, could we identify some basic normative behaviors to govern business conduct in general? v a l p o . Before turning to organizational and systems levels of ethics, we discuss classical ethical principles that are very relevant now and on which decisions can be and are made by individuals, organizations, and other stakeholders who choose principled, responsible ways of acting toward others. (2015) Universalism | Definition, History, Beliefs, Salvation, & Facts There are some limitations to this ethic. Society and Business Anthology by Various Authors is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted. My Account 1. At the organizational level, principled and values-based leadership influences cultures that inspire and motivate ethical behavior and performance. OpenStax is part of Rice University, which is a 501(c)(3) nonprofit. Business ethics exists on three levels: the individual, the organizational, and the societal. Bribery was also at the heart of the FIFA (Fdration Internationale de Football Association) corruption scandal, in which soccer officials, marketing executives, and broadcasters were accused of racketeering, wire fraud, and money laundering by the U.S. Department of Justice in 2015. Business Ethics 2 x 7 = 14 a. Using creativity is also important when examining difficult moral decisions when sometimes it may seem that there are two right ways to act in a situation or perhaps no way seems morally right, which may also signal that not taking an action at that time may be needed, unless taking no action produces worse results. Except where otherwise noted, textbooks on this site Becoming familiar with these principles, then, can help inform your moral decision process and help you observe the principles that a team, work-group, or organization that you now participate in or will be joining may be using. If not, and if ethical standards are relative, are they worth having? Many leaders character and actions serve as examples of how character-based virtues work. As you read these, ask yourself which principles characterize and underlie your own values, beliefs, behaviors, and actions. The mainstream in business ethics has declared the collective and selfless end to be the ideal that must guide practice and research. Kant's Universalizability Theory One alternative is to put the humanities into business. (credit: Love Is All You Need Signage by Jacqueline Smith/Pexels, CC0), article Panama Papers FAQ: All You Need to Know About The 2016 Investigation on the Panama Papers and how journalists might hold the corporate world to account in cases of fraud and corruption, article on the LIBOR scandal and the consequences, https://openstax.org/books/business-ethics/pages/1-introduction, https://openstax.org/books/business-ethics/pages/5-4-are-the-values-central-to-business-ethics-universal, Creative Commons Attribution 4.0 International License, Explain the difference between relative and absolute ethical values, Discuss the degree to which compliance is linked with organizational responsibility and personal values, Identify the criteria for a system of normative business ethics. Ch. It is interesting to reflect on how many corporate disasters and crises might have been prevented had the leaders and those involved taken such questions seriously before proceeding with decisions. Corruption appears to exist everywhere, so it would seem to require a persistent and consistent answer everywhere. The justification for this rises from human nature, which is a shared vulnerability of suffering and demands universal reasoning. A result was enflamed widespread public protests from American youth and others. This principle has at least four major components that are based on the tenets that (1) all individuals should be treated equally; (2) justice is served when all persons have equal opportunities and advantages (through their positions and offices) to societys opportunities and burdens; (3) fair decision practices, procedures, and agreements among parties should be practiced; and (4) punishment is served to someone who has inflicted harm on another, and compensation is given to those for a past harm or injustice committed against them. Bias also rewards those who support and nurture the best elements of a culture, whether corporate, social, or political. One distinctive understanding of universalism in ethics is that ethical principles are principles for everybody. e d u / j v b l)/Rect[230.8867 233.3227 360.5693 245.0414]/StructParent 5/Subtype/Link/Type/Annot>> Ethical Issues in the Provision of Health Care, 18. Based on the expressed preferences of 163 undergraduate and graduate students of business ethics, this article briefly examines the two most popular theories, Universalism (Kantian) and Utilitarianism (consequentialist), and presents a SWOT analysis of both. Cultural Diversity and Universal Ethics in a Global World Except where otherwise noted, textbooks on this site xref The Supreme Court upheld her and her staffs decision. At the organizational level, principled and values-based leadership influences cultures that inspire and motivate ethical behavior and performance. 0000001486 00000 n 129 20 Webundergraduate and graduate students of business ethics, this article briefly examines the two most popular theories, Universalism (Kantian) and Utilitarianism (consequentialist), WebMoral universalism (also called moral objectivism) is the meta-ethical position that some system of ethics, or a universal ethic, applies universally, that is, for "all similarly situated Ethical principles are different from values in that the former are considered as rules that are more permanent, universal, and unchanging, whereas values are subjective, even personal, and can change with time. WebWe believe that compliance and ethical behavior are everyones responsibility. Ethical relativism is really not a principle to be followed or modeled. 5.4 Are the Values Central to Business Ethics Universal? It is either less clear what to do or harder to do it because of constant pressure to increase the organizations profitability and the perception that everybody else is doing it.29. https://scholar.valpo.edu/jvbl/vol8/iss2/3, ValpoScholar Home Let us look at how it is possible to align business with human rights in such a way that both profitability and responsibility are honored across the globe. From a relativists perspective, moral values are only applicable within certain cultures and societies. Transparency, whistleblower programs, ethics training, and modeling of appropriate behavior by upper management can create the conditions for employees to act ethically, but conscience is a personal phenomenon. Richard DeGeorge (1933) of the University of Kansas describes what adding the humanities to business education entails: Students do not need psychosociological jargon in their business interactions. <>/Border[0 0 0]/Contents( \n h t t p s : / / s c h o l a r . So, although the work of national, regional, and international organizations can limit corruption through enforcement and the prosecution of cases (as was the case with the revelation of the so-called Panama Papers), corruption will not be reduced in any significant way unless efforts have been made to form individual conscience and teach practical ways to act on it. Web4.4 business ethics theories 4.4.4 Deontology or universalism theory The proponents of the deontology theory are Immanuel Kant who emphasises that the ends do not justify the means of an action; the right thing must always be done even if doing the wrong thing would do the most good for the most people (Weiss, 2009:107). Also, the issue arises, Who defines virtuous, especially when a complex act or incident is involved that requires factual information and objective criteria to resolve?, The common good is defined as the sum of those conditions of social life which allow social groups and their individual members relatively thorough and ready access to their own fulfillment. Decision makers must take into consideration the intent as well as the effects of their actions and decisions on the broader society and the common good of the many.20, Identifying and basing decisions on the common good requires us to make goals and take actions that take others, beyond ourselves and our self-interest, into account. From these systems has emerged a basic set of ethical norms for the business world. endobj However, no amount of rationalization of the fear of job loss, financial pressure, desire to please a supervisor, and the rest, can justify such behavior, because it diminishes moral agency, the self-awareness, freedom, and ability to make choices based on our perception of right and wrong. The influence of positive psychology is evident, and there is much to commend in this kinder approach to the job of management that makes an effort to establish sustainable human welfare.36 Personal responsibility is a different matter. Some limitations when using this principle are (1) it can be used to disguise and manipulate selfish and unjust political interests, (2) it is difficult to determine who deserves what when both parties are right, and (3) individuals can exaggerate certain entitlements at the expense of others. Many organizations focus on the letter of the law so that they can claim good faith in their effort to create an ethical environment. Can Martin Bubers notion of love play a role in business? Kantian Ethics - Overview, Categorical Imperatives, Morality CONCEPTS & THEORIES OF BUSINESS ETHICS VALUES Basic convictions that a specific mode of (Classical) Maximalism: A right action produces the greatest good consequences and the least bad. Creative Commons Attribution License Ultimately, the theory of universalism in business ethics helps to promote ethical behavior and responsibility in the business world, and can serve as a powerful tool for building trust and confidence in the operations of organizations around the world. As an Amazon Associate we earn from qualifying purchases. 2. GRILL3BB. <>/Metadata 127 0 R/Outlines 88 0 R/Pages 124 0 R/StructTreeRoot 93 0 R/Type/Catalog/ViewerPreferences<>>> 0000004093 00000 n Until that time, international firms doing business in South Africa were expected to abide by the apartheid policy and its underlying values. 0000006541 00000 n Business 1 Quiz Canvas. Business Ethics And such agency needs to be at the heart of business ethics. Intellectual, emotional, and social biases affect all decision-making, including those of an ethical nature. In the United States, companies spend more than $70 billion annually on ethics training; worldwide, the figure is more than double that.30 This principle is grounded in both legal and moral rights. The 2017 conviction for bribery and embezzlement of Lee Jae-yong, heir to the Samsung electronics empire, was part of a widespread corruption scandal that brought down the president of South Korea. In addition, we are sometimes faced with the question, Who has the moral authority to punish to pay compensation to whom? Still, as with the other principles discussed here, justice stands as a necessary and invaluable building block of democracies and freedom. Universalism vs. Relativism and you must attribute OpenStax. endobj It focuses on the type of person we ought to be, not on specific actions that should be taken. The Worlds Most Ethical Companies also provides examples of workforce and workplace legal and moral rights. Business 0000003899 00000 n Available at: *$nMY9s:SZC;>M:yREn\rDk~iG']rDn>v]1m7@u,sI>wQZVmb^emU(W y Q)\u58y.? Theories philosophy could add a critical element to business education, an element that would keep business education always alive and prevent it from becoming an accepted, orthodox ideology.38. Webmoral relativism theory or more similar to the moral universalism theory and if there are any differences between the arguments. Ethical relativism is really not a principle to be followed or modeled. Many people question the place of love in a business setting. An example of bias occurs when employees engage in unethical activity because it has been sanctioned by higher-ups. For example, the famous Warren Buffett stands as an icon of good character who demonstrates trustworthy values and practical wisdom. Although ethical practice has been directly influenced by religion, as noted, ethics is not religion and religious belief is not a prerequisite for a commitment to business ethics. Ethics Theory and Business Practice (3) Who gets hurt? Sexual Identification and Orientation, 31. Ethical relativism is the theory that holds that morality is relative to the norms of one's culture. Our mission is to improve educational access and learning for everyone. The focus still seems to be on organizational responsibility and compliance as opposed to individual responsibility and the formation of ethical conscience. endobj Feelings may come and go, but the solidarity that people have with each other and the care they take with one another define them as human beings (Figure 5.8). Are the Values Central to Business Ethics Universal? Thus, love, as responsibility, depends on relationships based on good faith and concern. When we present the specifics and facts of a situation, this and the other principles begin to make sense, although judgement is still required. Utilitarianism Theories of Business Ethics. (credit: Happiness Is a Piece of Cake Close Up Photography by Antonio Quagliata/Pexels, CC0), If there is anything that transcends time, place, and culture, it is love. 5. We recommend using a It simply emphasizes the other side of the twofold purpose of business (profit and responsibility). Universalism, belief in the salvation of all souls. Universalism in ethics may be identified with claims about the form, scope or content of ethical principles, or with the very idea that ethical judgment appeals to principles, rather than to particular cases. c. It also involves religion mandates and existing moral codes. However, happy employees are one thing; the human flourishing identified by Aristotle and John Stuart Mill is quite another. "Universalism and Utilitarianism: An Evaluation of Two Popular Moral Theories in Business Decision Making," Universalism and particularism: principles and judgment, Fundamental principles: Kantian universalizability. Before turning to organizational and systems levels of ethics, we discuss classical ethical principles that are very relevant now and on which decisions can be and are made by individuals, organizations, and other stakeholders who choose principled, responsible ways of acting toward others.17. The film The Post, based on fact, portrays how the daughter of the founder of the famed newspaper, the Washington Post, inherited the role of CEO and was forced to make a decision between publishing a whistle-blowers classified government documents of then top-level generals and officials or keep silent and protect the newspaper. The UN Convention Against Corruption has called corruption an insidious plague that exists everywhere and hurts the poor disproportionately by diverting funds intended for development, undermining a Governments ability to provide basic services, feeding inequality and injustice and discouraging foreign aid and investment.27 universal Applying the common good principle can also be asked by a simple question: How will this decision or action affect the broader physical, cultural, and social environment in which I, my family, my friends, and others have to live, breathe, and thrive in now, next week, and beyond?. The main principles of business ethics are based in academia and on academic writings on proper business operations. Universal business ethic is an attempt to formulate common business ethic principles that are acceptable by all rational agents and applied to all countries beyond Practical wisdom, however, is often required to be virtuous. Still, legal requirements are usually clear, as are the ways an organization can exceed them (as do, for example, companies such as Whole Foods, Zappos, and Starbucks). b. Differentiate "ethics" and "values". Using creativity is also important when examining difficult moral decisions when sometimes it may seem that there are two right ways to act in a situation or perhaps no way seems morally right, which may also signal that not taking an action at that time may be needed, unless taking no action produces worse results. 0 CONCEPTS & THEORIES OF BUSINESS ETHICS VALUES Basic convictions that a specific mode of (Classical) Maximalism: A right action produces the greatest good consequences and the least bad. At the organizational and societal levels, laws, regulations, and oversight can go a long way toward curtailing illegal activity. Chapter 9 The mainstream in business ethics has declared the collective and selfless end to be the ideal that must guide practice and research. Business Ethics then you must include on every physical page the following attribution: If you are redistributing all or part of this book in a digital format, Download for free at http://cnx.org/contents/aa9071d5-2ea4-4db3-b476-be94bb9d5ef9@5. Scandals. What responsibilities do companies have regarding justice and care? b. WebBusiness ethics exists on three levels: the individual, the organizational, and the societal. 139 0 obj Universalism Becoming familiar with these principles, then, can help inform your moral decision process and help you observe the principles that a team, workgroup, or organization that you now participate in or will be joining may be using. The OpenStax name, OpenStax logo, OpenStax book covers, OpenStax CNX name, and OpenStax CNX logo However, middle managers and employees often complain their ethics training consists of passing a computerized sexual harassment or fraud program once a year but that nothing is done to address issues in a substantive way or to change the culture of the organization, even those that have experienced problems.31 Practical wisdom, however, is often required to be virtuous. 135 0 obj First, some individuals may disagree about who is virtuous in different situations and therefore would refuse to use that persons character as a principle. What Is Universalism and Why Is It Fatally Flawed? - Learn Religions As a theory for justifying moral practices and beliefs, ethical relativism fails to recognize that some societies have better reasons for holding their views than others. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution License . List of philosophies Images. It is not only a method to make a decision; it is a way of incorporating a humane consideration of and for individuals and groups when deciding a course of action. JN9u4 0-FR1.ke4 nzG q57:6H*U*N5"T] t@L0fCf%gUc !` HpT!e0IyF'Xd)W8>dn>DR()p0^. The problem is that if anything flourishes in this model, it is often the business rather than the employees. In fact, John Mackey, the founder of Whole Foods, has said that love has been the basis of his success in business, which translates into care and concern for customers beyond profit and for workers beyond productivity (Figure 5.8).39, Recall the statement by IBM quoted earlier in the chapter: [IBM] remain[s] dedicated to leading the world into a more prosperous and progressive future; to creating a world that is fairer, more diverse, more tolerant, more just.40. First, some individuals may disagree about who is virtuous in different situations and therefore would refuse to use that persons character as a principle.