BUSINESS ETHICS first, second and third session Gianfranco Rusconi - - PDF document

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BUSINESS ETHICS first, second and third session

Gianfranco Rusconi September 18-19 and October 2nd 2014

AMORALITY OF BUSINESS?

• 1) STEREOTYPE
• 2) AUTONOMY OR FREE ZONE OF

ETHICS=AMORALITY?

• 3) SMITH, FRIEDMAN, MAXIMIZATION AND

MORALITY

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AN ALMOST COMMON GROUND

• ALSO PEOPLE THINKING THAT MAXIMIZING PROFITS IS THE

ONLY (ALSO SOCIAL) DUTY FOR BUSINESS, MORE OR LESS IMPLICITLY, RECOGNIZE AT LEAST THAT: 1) IT EXISTS A SORT OF MORAL FRAME (PLUS OR MINUS FLEXIBLE ACCORDING TO THE VARIOUS PERSONAL ETHICS VIEWS) TO COMPLY WITH; 2) THE LAW HAS TO BE RESPECTED; 3) THE RICHNESS PRODUCING PROCESS (EMPLOYMENT, KNOWLEDGE AND WEALTH DIFFUSION) IS MORALLY APPRECIABLE.

NATURE OF BUSINESS ETHICS

• BUSINESS ETHICS STUDIES AND APPLICATIONS

WERE BORNE BECAUSE OF BEING SCHOLARS AND PRACTITIONERS AWARE THAT TO MAKE EXPLICIT ETHICS IN BUSINESS (AND ECONOMICS) IS NOT SO IMMEDIATE AND SIMPLE, ASKING FOR INTERDISCIPLINARY SKILLS.

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DIFFUSION OF BUSINESS ETHICS

• BUSINESS ETHICS DIFFUSED AFTER ALSO

IN EUROPE, THOUGH WITH SOME DIFFERENT CHARACTERISTICS FROM USA- CANADA,

• ALSO WHEN IN THE MORE RECENT TIMES,

DIFFERENT WORLD’S AREAS ARE GETTING BETTER HOMOGENOUS THANKS TO CONTINUOUS EXCHANGE OF PAPERS, CONFERENCES AND EXPERIENCES.

BUSINESS ETHICS AND SUBSECTORS

• IT COULD BE USEFUL TO DEFINE SUBSECTORS, THAT,

THOUGH ALWAYS INTERCONNECTED IN BUSINESS ETHICS STUDIES, COULD PRESENT MORE SPECIFIC STUDIES, FOR EXAMPLES DISTINGUISHING ETHICS OF MANAGEMENT AND BUSINESS ADMINISTRATION FROM ETHICS OF ECONOMICS;

• TO DO A FURTHER DIVISION, INTRODUCING (ALWAYS

SAVING BASIC KNOWLEDGE AND GENERAL INTERCONNECTIONS WITHIN BUSINESS ETHICS) MORE SPECIFIC STUDIES: ETHICS OF MARKETING OR ETHICS OF FINANCE, LABOUR AND ACCOUNTING.

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NEED OF BUSINESS ETHICS

• HISTORY
• SCANDALS
• BAD ETHICS AND AGENCY COSTS
• FALSE ACCOUNTING, SUBPRIME, PROBLEM OF

DERUVATIVES, HUMAN RIGHTS…..DAMAGES

BUSINESS ETHICS AND SCANDALS

• LOCKHEED AND ALIA ’70s, FOREIGN

CORRUPTING PRACTICES ACT (1977), BIG PRESSURE TO BUSINESS ETHICS DEVELOPMENT

• BEFORE IN USA AFTER IN EUROPE: “BIRTH”

OF SOCIETY OF BUSINESS ETHICS (NORDAMERICAN, SBE) AND EUROPEAN BUSINESS ETHICS NETWORK ( EBEN), other (EABIS,…international…)

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BUSINESS ETHICS AND SCANDALS 2

• AND BUSINESS ETHICS IS ALWAYS MORE AND MORE

CLAIMED, BUT ….

• ENRON, PARMALAT (2000): UNEXPECTED

BANKRUPCIES WITH FALSE ACCOUNTING

• BIG FINANCIAL CRISES (2007-8): THE (MORE OR

LESS) COLLAPSE OF FINANCIAL SYSTEM IN MANY COUNTRIES: USA, IRELAND, UK. SPAIN

NOVELTY OF BUSINESS ETHICS

• TO MAKE ETHICS EXPLICIT IS NOT SO EASY

AND IMMEDIATE: DILEMMAS, DIFFERENCES OF PRINCIPLES, ECC.

• PAGE 3 OF MATERIALS 1

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IS FIRM A MORAL PERSON?

• TWO EXTREMES:
• FRENCH: autonomous Moral «Person» , not a

«sum» of Moral Persons

• LADD: Formal organization «as all sort of

bureaucracies, private and public», big companies included

IS A FIRM A MORAL PERSON?2

• MORE INTERMEDIATE
• GOODPASTER AND MATTHEW:
• Firms have some characteristics of human

person, but they have not a conscience. We can speak to a company like a person by analogy, also when we can not think to a company- person according to French

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ETHICS AND FIRM SYSTEM THEORY

• See page 7 of materials

RELATIVISM AND OBIECTIVISM

• INDIVIDUAL EXTREME RELATIVISM
• CULTURAL (MODERATE) RELATIVISM
• OBJECTIVISM
• See materials

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ONLY SOME SHORT REFERENCES

• 1) Business Ethics and religion
• 2) Business Ethics and law
• See materials

THREE BASIC IDEAS OF ETHICS TO APPLY TO BUSINESS ETHICS

• UTILITARIANISM (CONSEQUENTIALISM):
• DEONTOLOGY
• VIRTUE ETHICS

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INTRODUCTION TI BUSINESS ETHICS

• To help discussion

PAPER TO READ TO PREPARE FOURTH AND FIFTH LESSONS

• Andre Gustafson: Utilitarianism
• and Business Ethics
• Norman Bowie: A Kantian Approach to Business

Ethics

• Robert Solomon: Corporate Roles, Personal

Virtue: An Aristotelean Approach to Business Ethics

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UTILITARIANISM

• SOMETHING IS GOOD IF IT IS USEFUL (BENTHAM IN XIX

CENTURY), PROBLEMS: FOR WHOM? FOR ALL? FOR THE SINGLE? FOR THE MAJORITY?

• AND PRINCIPLES, HUMAN RIGHTS, ECC.
• VARIOUS FORMS OF UTILITARIANISM (ACT OR RULE

UTILITARIANISM)

• CONNECTION WITH CONSEQUENTIALISM: SOMETHING IS

GOOD IF IT HAS USEFUL CONSEQUENCES; CONNECTION WITH PRAGMATISTIC PHILOSOPHY

DEONTOLOGY

• ETHICS IN ALL (AND ALSO IN BUSINESS) IS

RESPECTING SOME GENERAL PRINCIPLES.

• FOR EXAMPLE: KANT
• ALSO BIG AND DIFFUSED RELIGIONS HAVE

SOME PRINCIPLES AS KEY ELEMENTS

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VIRTUE ETHICS

• TO BE ETHICAL IN BUSINESS IS NOT ONLY

RESPECTING SOME RULES AND PRINCIPLES, BUT BECOME ALWAYS MORE AND MORE VIRTUOUS AND EXCELLENT BY PRACTICING VIRTUE (INFLUENCE OF ARISTOTLE, ETICA NICOMACHEA)

Papers to analyse comment

• In addition prepare the papers of:
• We comment and in next two lessons:
• A kantian approach to business ethics (Bowie); Corporate

Roles, Personal Virtues….(Solomon) ; Gustafson about

• utilitarianism. To grasp essential not to study on

memory….NOW I GIVE YOU SOME INSIDES.

• A) central points of this paper B) in your opinion what are

possible consequences for ethics or for business of the applications of these papers?

• The last lesson will be an inside about stakeholder theory

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INTRODUCTION TO BUSINESS ETHICS by Donaldson and Wehrane

• ALL THESE PAPERS ARE AIMED AT BETTER EXAMINE

AND GRASP CONCEPTS, ISSUES AND DILEMMAS

• First impressions of students after reading this

paper:………

• My observations:
• What is the nature of an ethical action?
• The BASF investment in South Carolina: pollution vs.

employment in a poor area, economic and ethical dilemma for BASF

INTRODUCTION TO BUSINESS ETHICS by Donaldson and Wehrane 2

• 3 options
• To build with minimal pollution control?
• To build with maximal pollution control?
• Do not build
• Consequences:Consequentialism: Ethical

Egoism and Utilitarianism

• Duties: Deontology (Kantianis and

Contractarianism)

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INTRODUCTION TO ETHICAL REASONING

• EXAM AND DISCUSSION directly on the paper

in the classroom