This is the chapter 8 lecture for the course “Business and Society” taught at
De Anza College in Cupertino, California. My name is Byron Lilly.
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In chapter 8, the authors of your textbook spend the majority of their time presenting
14 ethical principles or traditions. Here they are:
(Read them)
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(Continue reading)
3
(Finish reading)
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Here are the primary questions I would like to address in this lecture.
(Read them)
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Here are some provisional answers. (Read bullets.)
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(Read slide)
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Why Study the 14 Ethical Principles? So we can masterfully apply ethical reasoning
both to our own behavior and to the behavior of others. When we apply ethical
reasoning to an analysis of our OWN behavior, solely for the purposes of deciding
whether that behavior was unethical and we should change it, I call that “inwarddirected ethical reasoning.” When we use ethical reasoning to JUSTIFY our
behavior to others, or to judge THEIR behavior, I call that outward-directed ethical
reasoning. All three are useful and valid reasons to study ethical principles.
8
(Read slide)
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(Read slide, then say)
I’ll come back to Dr. Haidt’s schema later in the lecture and tell you more about it.
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By the way, we want to study and learn about and get practice using not JUST the
14 ethical principles, but a much, much longer list of ethical maxims. I introduced
ethical maxims in chapter 7, where I said that our ethical reasoning is largely guided
by that subset of the universe of ethical (note: in the lecture, you mistakenly say
“legal” here) maxims which we ourselves personally have bought into at a deep,
subconscious level.
Here are some examples of ethical maxims to illustrate what I’m talking about.
Humbly and sincerely serving others is a noble thing to do. Not everyone is bought
into this one, but some people have. I have, for example.
Hurting someone else’s feelings without provocation is wrong. Virtually everyone
has bought into this one. Only a very few people in the population, fewer than one
percent in my opinion, haven’t bought into this. My advice to you is that if one of
your friends is one of those people, you should stop being friends with them. For a
really good book on this topic, read “The Sociopath Next Door” by Martha Stout.
It is wrong to kill humans. At the bottom of the slide, I have a footnote on that one
that says “in most circumstances.” By that I mean, except for a clean, merciful kill in
time of war, it is wrong to kill humans. Most people would add the death penalty to
their list of allowable exceptions. Most people would add killing someone while
participating in a professional boxing match to their list of exceptions, provided you
were following all the rules of boxing at the time. And most people would add that
killing someone by accident while doing something that no reasonable person could
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have anticipated would cause a risk of death in that other person to their list of
exceptions.
It is wrong to kill animals. I picked this one on purpose because of course, fewer
people are bought into this one than number 3. Most people feel a bit differently
about a deliberate killing of an animal than they do about a deliberate killing of a
human. Their list of exceptions – situations where it’s OK to kill an animal
deliberately – will be longer. But for most people, they can still think of many
situations where deliberately killing an animal would not be O.K. with them. For
example, most people would say it’s not O.K. to kill somebody else’s pet on purpose,
with very, very few exceptions. Like the dog has rabies and its charging you. And its
big. Or it’s a mercy killing of some kind. Most people feel its OK to kill farm animals
for food, provided you do it reasonably mercifully. Some would raise the bar and say
you have to do it VERY mercifully, with no exceptions. Some say we shouldn’t kill
animals for food. Not many. Some say killing fish and fowl is OK, but not sheep,
cows, or pigs. Some say everything except pigs is OK.
So when I say that the ethical maxims we have bought into guide our reasoning, and
that we can use them to argue with others about our behavior and theirs, I mean the
full versions of the maxims with all the exceptions built into them. I call them maxims
and I show you the short versions on my slides because they fit better, but we don’t
reason with the short versions, we reason with the long versions.
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So now I’m going to go through 10 of the 14 ethical principles discussed in chapter
8 and say a little bit about each one of them. Before I do that, I want to say a few
words about the four I’m NOT going to talk about. In my opinion, these are either
duds or semi-duds. By that, I mean either they do not accord with anyone’s intuitive
sense of right and wrong, or they are so darned complicated that people just can’t
wrap their head around them, or in some cases both. That means they will not be
very persuasive, either to us or to others. So they are, in my opinion, largely a
waste of time to study and discuss. Now that doesn’t mean there won’t be any
questions about them on the final exam. I still want you to be able to understand
them and be able to answer questions about them, but virtually nobody reasons this
way, so if you try to use these to persuade others either that your behavior is right or
that their behavior is wrong, they aren’t going to be very convinced. It’s not going to
capture their hearts – that’s what I mean. And I’m going to guess that the top three
are not going to capture your heart either.
The Theory of Justice is the most worthy of the bunch, but it’s really complicated,
and it’s not going to make the cut in terms of the ones I want to say something
about in this lecture. Worth studying sometime, but I’m not gonna touch it in this
class. We’ve got too much better material to talk about.
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The Conventionalist Ethic says that Business is like a game with permissive ethics,
and all actions that do not violate the law are permitted. Your book gives an
example of a man who is age 58 and is worried about age discrimination, so he
dyes his hair and reports his age on his resume as 45. Most people would find this
level of “bending the rules” acceptable. This is not against the law by the way.
But what about what David Geffen did: claim on his resume that he had a degree
from UCLA when he in fact had no college degree? That’s also not illegal, but is it
unethical?
And what about what the new investors who loaned $60 million to A123 Systems in
May and July of 2012 subsequently did to the old investors, which was to sell their
shares into the market all at once to drive the stock price down and triple the
number of shares they ended up getting? Is that ethical? In the chapter 7 lecture, I
tried to make the case that it was not.
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I’ll give two more examples.
What about Running ads for womens’ clothing with super-slim models, even though
it has the effect of making many women feel that their bodies are inadequate? Is
that ethical? It’s legal, so does that mean its ethical, automatically?
And what if Merck had decided not to develop Ivermectin for use against river
blindness in humans? Would that have been ethical?
So depending on what specific behavior you are condoning with this principle, you
will find you are able to persuade more or fewer people to your point of view.
This principle is Popular with people who are, at an intuitive level, libertarians,
because it tends to preserve individual liberty and freedom in the sense that it gives
businesspeople the widest possible latitude to decide what actions to take in
running their businesses.
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The disclosure rule says “a thing is ethical if you would have no qualms revealing
your actions to the tv-viewing public, close members of your family such as your
parents, spouse, and/or children, or a judge.” That you wouldn’t feel guilty or
awkward disclosing it to any of these people.
Lots of companies include the disclosure rule as a helpful guide to their employees
in their ethics training brochures or manuals. It’s very popular. I LIKE it, because it
ties in so tightly with the natural purposes of ethical rules and principles. It
harnesses our natural desire to FEEL like we are honorable people. If, when we
contemplate revealing this behavior to others, we suddenly feel embarrassed or
awkward, we have a chance to decide NOT to engage in the behavior.
This is a useful rule, and it is also closely-related to the Intuition Ethic.
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The intuition ethic says that What is good and right is understood by an inner moral
sense based on character development and felt as intuition. If this is true, then the
only rule you will ever need to use for inner-directed ethical reasoning is the
disclosure rule. But our moral intuition is informed by all the ethical maxims we have
truly bought into at a deep level. But as we will see as we continue through this
lecture, sometimes the ethical maxims we have bought into at a deep level are in
conflict, and there is no clear resolution. That is why the intuition ethic and the
disclosure rule by themselves are not enough. We want to study the others both
because our intuition is informed by them, and because when our intuition is pulling
us in two different directions, we want to be able to tease apart what is going on and
perhaps to use some kind of more deliberate selection of one principle over another
to decide what to do.
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The Golden rule says “Do unto others as you would have them do unto you.” This
one’s got “reciprocity” written all over it! It also ties into our natural capacity to
empathize with others.
The Golden Rule appears in various forms in Ancient Egyptian texts, The Old
Testament, Buddhism, Confucianism, Hinduism, Islam, Taoism, Zoroastrianism, and
most other major religions.
Remember how I said in the chapter 7 lecture that Dan Ariely found that just
REMINDING people about the Ten Commandments caused cheating to be
suppressed to zero, at least for a short while? Well, there’s a reason the world’s
major religions all advocate regular prayer, practice, and meetings. Because to be
our best selves, we need to be constantly reminded of the effects of our actions on
others. Otherwise, over time, the effects of our actions on our OWN welfare tend to
become writ large in our consciousness while the effects of our actions on OTHERS
tends to become writ small. The universal popularity of the Golden Rule and the
idea that we should not be hypocritical; that is, that we should just our own actions
and the actions of others with the same yardstick, shows how important this
tendency to BE hypocritical is among humans and how damaging it can be to
human relations. We need to be reminded FREQUENTLY about the Golden Rule
and other similar concepts in order to be our best selves around others.
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The test of reversibility is closely-related to the Golden Rule and the principle of
reciprocity. It says to ask yourself this question: Would you be willing to change
places with the person or persons affected by your actions? If yes then your action
is ethical. If no then your action is unethical. If we would not want to be in their
shoes, then perhaps what we are doing is unethical.
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The Ends-Means Ethic was presented in a book called The Prince written by Italian
political philosopher Niccolo Machiavelli in 1513. It is worth noting that the ONLY
purpose to which Machiavelli sought to justify the use of unscrupulous methods was
the preservation of the state. In others, the prevention of the overthrow of the
government. Machiavelli’s reasoning was that, whenever a government is
overthrown, there always ensues a period of chaos, in which people get raped and
robbed, their farms and homes get burned, et cetera, et cetera. In other words,
allowing the government to get overthrown has such a disastrous impact on
peoples’ welfare that doing a little bit of lying, spying, poisoning and cheating in the
court of the king or prince pales in comparison.
The Ends-Means Ethic is a form of consequentialist ethical reasoning.
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Consequentialism is The idea that actions are right or wrong, in part or in whole,
based on their consequences.
The Ends-Means Ethic and the Utilitarian Ethic are both examples of
consequentialist ethical principles, because they focus on the desirability of the
OUTCOMES, the net COSTS AND BENEFITS, rather than on the rightness or
wrongness of the ACTIONS that CAUSED those consequences.
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Deontological Ethics is the opposite. It is the idea that actions are right or wrong in
and of themselves, independent of and in SPITE of any consequences they might
cause or do cause.
Examples of deontological ethical principles are The Categorical Imperative, The
Golden Rule,
The Ten Commandments, and the Rights Ethic. The Ten Commandments aren’t
called “The Ten Tentative Suggestions.” The idea is, THOUGH SHALT NOT
STEAL. PERIOD. EVER. NO EXCEPTIONS. Doesn’t matter who benefits.
Doesn’t matter how much. Never. The action itself is immoral and wrong, so you
should never do it. The other three listed here are similar to that. They focus on the
rightness or wrongness of the ACTIONS THEMSELVES, that’s what all
deontological ethical principles have in common.
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The rights ethic says that Each person has a strong right to certain basic pursuits,
liberties, and protections that we as a society will vigorously protect. But the exact
list of protections varies from country-to-country and certainly has varied over time
within countries. The U.S. constitution and the cultures of many other Western
nations enshrine these basic rights, among others. But notice that even within one
country, the U.S., none of the rights is absolute. The rights will be vigorously
protected. They will have priority over most other pursuits and objectives, but they
are not absolute rights.
The right to life means the right not to be killed. But 33 states and the U.S. military
have and use the death penalty. So the right to life is not absolute.
The right to free speech has lots of limitations that go well beyond the scope of this
chapter. It came up a little bit in the Nike case study at the end of chapter 6, and we
will talk about it a little bit more in chapter 9 when we talk about corporations’ right,
or lack thereof, to spend as much as they want on political ads to help a given
political candidate get elected.
The right to practice whatever religion you want also gets extensive protection in the
United States but has limits. For example, since 1994, members of the Native
American Church have been able to legally use peyote in religious services, while
non-members cannot. On the other hand, though Mormonism permits and in some
sects even encourages bigamy – having multiple wives is illegal in 49 of the 50 U.S.
states. Only Utah allows it.
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The right to privacy has many, many limitations and exceptions in U.S. law, but is the
legal basis of certain fundamental rights such as the right to have intercourse with
whom you want in the ways that you want, and the right to consume pornography in
the privacy of your own home, provided that the models pictured in that pornography
are at least 18 years of age. Most of the limitations on our right to privacy have to do
with balancing the reasonable interest the state has in investigating possible crimes
against your right to privacy.
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The protection against arbitrary, unjust police actions overlaps with our right to
privacy but of course also limits the ways the police can behave and the actions
they can take when they take you into custody and/or you are no longer in your
home.
Freedom from unequal application of laws. Before people have been convicted of a
crime, they are treated equally by the law. Even the president of the United States,
for example, is bound by all the same laws you and I are. This is a relatively new
idea in human society. Until the late 1700s, it was generally accepted that people
had unequal rights with respect to the law. Even today, there are debates and
discussions regarding whether racial profiling by the police should be permitted.
Does it make law enforcement more efficient without unduly trampling the
unalienable rights of racial minorities, or does it trample those rights? There are
people on both sides of this argument. Also, once you are convicted of a crime,
your legal rights are not entirely the same. That is, your sentence for a subsequent
conviction can be higher than what someone else would get for a first conviction,
and we say that’s fair. Most of your legal rights are the same, though.
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The might-equals-right ethic has been practiced by businessmen such as Ben
Holladay, owner of the Overland Stage Line in the 1860s, and record producer
David Geffen. The might-equals-right ethic says “Anything goes.” If I have the
POWER to do it, then I have the RIGHT to do it, and you can’t criticize me for it.
Many people find this idea appealing, particularly people in a position to do
something that cannot be justified using any other principle. This is worth studying
because it is tempting to use it as a reason to justify our actions. But you are not
going to win friends and influence people by publicly embracing this principle,
because it can be used to rationally justify behavior that almost every feeling
individual would find very unfair at an intuitive level.
It is also interesting to note that VERY FEW PEOPLE in history have stepped
forward to publicly defend the might-equals-right ethic. Even Machiavelli didn’t
advocate this model, although many who misunderstand him think that he did.
Friedrich Nietzsche defended it, and the advocates of Social Darwinism defended it,
and that’s about it.
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(Read slide, then say)
It’s also closely-related to the Ends-Means Ethic because we could see “the culling
and shaping of the human race into something more perfect” as a noble end that
justifies seemingly immoral means and extensive suffering by the losers in the
competition that takes place within markets.
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This is a perfect example of the kind of conflict that can emerge between ethical
maxims we have bought into at a deep level. I’m saying IF you had bought into
Social Darwinism then, unless you are a sociopath, it would have to be the case
that there existed a moral tension within you between your belief in social
Darwinism and your belief in these two other ethical principles, which in my opinion
are pretty widely-held.
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The Utilitarian Ethic says that That which does the greatest good for the greatest
number is the most ethical thing to do. It is the most famous consequentialist
ethical principle in the modern world, and a lot of people like it. Even people who
don’t realize they like it use it, because it is the basis of all cost-benefit analysis,
which governments use extensively to decide which public programs are worth
funding, which regulations to pass, and many other things. Business also uses
cost-benefit analysis, but their analysis is usually limited to the costs and benefits to
the FIRM ONLY. One criticism of cost-benefit analysis is that, in order for it to work,
you have to reduce all costs and benefits into a single unit of measure, which for
practical purposes, ends up being money. For example, when the government
decides whether to implement a new regulation that will save lives, in order to be
able to add the benefits and subtract the costs to see if the project produces a net
benefit, they have to make an assumption of what a human life is worth. There’s no
way around it. One cost benefit analysis we are going to look at in chapter 10 for
example, used a value of $6 million per life saved. The very IDEA of assigning a
dollar value to a human life bothers some people. But other people are really
attracted to cost-benefit analysis because it provides such a clear, unambiguous
indication of when something is ethical and when it is not. It’s ethical when the
benefits are greater than the costs. Period. No exceptions. No grey area. It’s a
nice feature.
Also, a lot of people are attracted to utilitarianism because it seems to treat each
person equally. A benefit to one person is not worth more than a benefit to another
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person. Everybody’s benefits are given equal weight and equal value. It says you
can’t assign a higher value to benefits to you and your friends and a lower value to
benefits that will be received by people you don’t know or don’t like.
So its got a bit of a “Golden Rule” flavor to it, and presumably things suggested by an
application of the utilitarian ethic would always pass the “reversibility test.”
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The Principle of Equal Freedom says that A person has the right to freedom of
action unless such action deprives another person of a proper freedom.
Most people know the colloquial version, which goes “Your right to swing your fist
ends where my nose begins.”
This principle is Popular with people who are, at an intuitive level, libertarians,
because individual liberty and freedom is their core value.
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The Organization Ethic says Be loyal to the organization. This Implies that the
needs and desires of individuals should be subordinate to the needs and desires of
the organization.
This principle Appeals to people who are, at an intuitive level, conservatives.
It is Rejected by most liberals and libertarians, who see individual liberty, freedom,
and happiness as more important than any needs or goals a lifeless organization
such as a corporation might have.
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Recently, Social Psychologist Jonathan Haidt published a book called “The
Righteous Mind: Why Good People are Divided by Politics and Religion.” In it, he
talks about some research that he and his colleagues have been doing over the
past 12 years or so on how people reason morally, and why they reach different
moral conclusions than one another when certain types of moral dilemmas or
problems are reported to them. To understand what he found out, it is helpful to
look at the three main groups he divided people into and what makes them tick from
a moral reasoning standpoint. I will also share with you a little bit about some
differences he has found between countries.
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Liberals’ most sacred value is care for victims of the oppressed.
They like fighting against authority and traditional institutions for the rights of
disenfranchised minorities such as blacks, women, and homosexuals. They
generally support extensive government regulation and extensive government
spending to help the poor and rectify inequalities. Social progressives fall into the
liberal camp. Liberals are people who find the following allegorical narrative
inspiring:
Once upon a time, the vast majority of human persons suffered in societies and
social institutions that were unjust, unhealthy, repressive, and oppressive. These
traditional societies were reprehensible because of their deep-rooted inequality,
exploitation, and irrational traditionalism. But the noble human aspiration for
autonomy, equality, and prosperity struggled mightily against the forces of misery
and oppression, and eventually succeeded in establishing modern, liberal,
democratic, capitalist, welfare societies. While modern social conditions hold the
potential to maximize the individual freedom and pleasure of all, there is much work
to be done to dismantle the powerful vestiges of inequality, exploitation, and
repression. This struggle for the good society in which individuals are equal and free
to pursue their self-defined happiness is the one mission truly worth dedicating
one’s life to achieving.
One recent study concluded 28% of Americans are liberal.
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Libertarians are sometimes said to be socially liberal, since they general favor
individual freedom in private matters such as sex and drug use, and economically
conservative, since they strongly favor minimum taxes and minimum government
regulation of the free market. Libertarians love liberty. That is their sacred value.
One recent study concluded that 24% of Americans are Libertarians.
(http://reason.com/poll/2011/08/29/reason-rupe-poll-finds-24-perc) Libertarians tend
to gravitate toward ethical principles that preserve maximum individual freedom.
These include the conventionalist ethic and the Principle of Equal Freedom.
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Social conservatives feel threatened by change and believe that those that
advocate rapid and almost random change in the name of human happiness and
freedom are reckless and foolhardy. They believe in traditional things: traditional
values like chastity and fidelity, and traditional institutions like the family with a
monogamous heterosexual couple at its center. They are more often to attend
church at least once a week and more often to be against Obamacare, abortion,
and gun control.
Social conservatives would be much more likely to buy into the organization ethic.
The principle that loyalty to an organization is a supremely moral act, and disloyalty
to an organization is, by and of itself, an immoral act. They tend to be patriotic and
are suspicious of those who are not.
American social conservatives should find the following allegorical narrative
inspiring:
Once upon a time, America was a shining beacon. Then liberals came along and
erected an enormous federal bureaucracy that handcuffed the invisible hand of the
free market. They subverted our traditional American values and opposed God and
faith at every step of the way. Instead of requiring that people work for a living, they
siphoned money from hardworking Americans and gave it to Cadillac-driving drug
addicts and welfare queens. Instead of punishing criminals, they tried to
understand them. Instead of worrying about the VICTIMS of crime, they worried
about the rights of CRIMINALS. Instead of adhering to traditional American values
of family, fidelity, and personal responsibility, they preached promiscuity, premarital
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sex, and the gay lifestyle; and they encouraged a feminist agenda that undermined
traditional family roles. Instead of projecting strength to those who would do evil
around the world, they cut military budgets, disrespected our soldiers in uniform,
burned our flag, and embraced negotiation and multilateralism to resolve international
conflicts. Then Americans decided to take their country back from those who sought
to undermine it. One recent study concluded that between 28% of Americans are
conservative. The 20% not accounted for in any of the three numbers I’ve given you
so far were something called “Communitarians”: People in favor of a strong role for
government in peoples’ lives but who support and practice traditional values, roles,
and lifestyles.
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I said in the chapter 7 lecture that, if we try to use ethical reasoning to persuade
others to change their behavior, we should expect to have at best mixed success. I
have presented Jonathan Haidt’s Moral Classification Scheme to show you why that
would be so. But there are additional differences that show up when you test
peoples’ moral sensitivities in different countries, and to the degree we have more
and more international and multinational businesses and business activity, that’s
going to create a problem also. People are not going to naturally see eye-to-eye on
certain moral issues, and they are going to be resistant to being persuaded that the
other person’s moral perspective is better than their own. This research was done
in 1987. The Indians were residents of the state of Orissa on India’s eastern coast.
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Now, I know none of these are business scenarios, but can you see how some of
the values implicit in these hypotheticals might translate into business situations,
like equal pay for and treatment of women in the workplace for example, and equal
opportunity to rise to management positions?
By the way, the reason they had a problem with the widow eating fish is because
Hindus in Orissa believe fish stimulates a person’s sexual appetite. If the widow
eats fish she is more likely to have sex with someone, which would offend the spirit
of her dead husband and prevent her from reincarnating at a higher level.
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Let me now try to sum up the main messages I have tried to deliver in this lecture.
(Read bullets)
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Therefore, cultivation of an understanding of others’ moral matrices will be useful to
us in our dealings with others.
The best way to persuade someone and bring them over to our point of view is to
begin by acknowledging that we can see the merits of their position.
This will trigger their reciprocity reflex and they will want to afford you the same
courtesy.
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Others will often not be persuaded by our ethical arguments, but we will still need to
try. Sometimes we will succeed. Sometimes we will have to compromise and
accept half of what we were trying for.
Cultivating tolerance of the divergent moral premises and conclusions of others is
absolutely appropriate. It’s helpful to know what moral matrix a person is operating
in. If they are operating in the same moral matrix as you, you can be harder on
them if they aren’t agreeing with you. They are more likely to come around. With
people operating in a different moral matrix, you may have to settle for agreement
on just basic rules and then within those rules they’ll win some and you’ll win some.
Your choice to be an ethical person, should you make one, will be greatly
appreciated by others, and will make them want to associate with you and partner
with you. You can also have the satisfaction of knowing that, through your ethical
self-restraint, you are making the world a better place for others.
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This concludes the chapter 8 lecture. If you have taken notes during this lecture,
then you are probably ready for the chapter 8 lecture quiz. If not, you might want to
review all or part of this lecture before taking that quiz.
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