Day 8- Business Ethics

Today's lecture was continuation of yesterday's lecture. Today lecture starts with the topic "Ethical Analysis". In ethic analysis there few steps to follow. Steps of the ethical analysis has mentioned below.

1. Identify stake holders who involves in ethical issues and the facts pertaining to it- From this can identify who has involved in the problem and from this can explain what really happen.
2. Define the conflict or dilemma and identify the higher-order values involved-Identify rules and regulations, code of conduct.
3. Identify the stakeholders-Who are the people involved and what is the impact.
4. Identify the option that you can reasonably take- Alternatives, non of the alternatives may satisfy all the parties associated, find out consequences from each alternates and come up with better process.
5. Identify potential consequences of your option- Some ethically correct alternatives may bring disastrous outcome. 

Today we discussed about business ethics. Lecturer started the discussion about business ethics defining what are business ethics.

Business ethics is the study of business situation, activities and decisions where issues of rights and wrong are addressed (Rane & Matten, 2004:8). In business ethics it asks what is right or wrong behavior in business and what principles or rules can be used as guidance in business situations.  

Figure 1:Business Ethics(Forum.belmont, 2008)

There are two characteristics in business ethics, they are

• Tells people what they ought to do
• Set of rules or principles

By studying ethics we will be able to not to make ourselves more ethical and helpful to choose right things. There are two levels of concerns in ethics. They are, individual and organizational.

After that lecturer started to discuss about concepts in ethics. There are four concepts in ethics. These concepts used to distinguish ethical from unethical behavior. But each concept has some problem.

The four concepts in ethics

1. Relativism
2. Egoism
3. Utilitarianism
4. Deontologism

Relativism

There is no universal guidelines for ethics and measure morality because ethics and morality is changed form country to country , society to society, culture to culture also to sub culture to sub culture. There is no such standard which can judge morality. The problem in this concept is above mention facts. As a result of this problem leads conclusion each person's opinion is correct and no-one does anything morally wrong.

Egoism

A person acts based on his or her own interest. The problem with this concept is externalities associated with private actions.

Utilitarianism

The morality of an action can be determined by it's consequences.

Ex:- Harry Truman and decision to drop a bomb to Japan.

The action which was taken by him was unethical but the intention was good because they thought about the national security.

The problem in this concept is can lead to unjust consequences and restrictions against the majority to protect a minority is not utilitarian. 

Deontologism

This word is a Greek word means duty. This concept explains actions are not justified by their consequences  to demonstrate the rightness of the actions. The problem with this concept is there are conflicts between duties.

The next sub topic lecturer discussed was ethical tests. He discussed five types of ethical tests.

1. Legal Test

Figure 2:Legal Test

2. Benefit Cost Test

Do the benefits exceed the costs to whomever they accure? 

3. Light of Day Test

What would be your reaction of action were brought out into the open public security?

Ex:- Relativism- If public believes a particular action is wrong, then it is wrong.

4. Do Unto Others Test

Gloden rules- If you would like others to do the same to you.

 5. Ventilation Test

Seek out other view. If majority thinks a particular action is unethical, then the action is unethical

From today's lecture I understood how to analyse a ethical problem in a better way. Also understood what ethics in business, concepts in business ethics and problem that has in each concept and ethical tests.

References:-

Forum.belmont. (2008). Business Ethics. [Online] available at:

http://forum.belmont.edu/business/archives/Ethics%20Graphic.jpg [Accessed 24th July 2012]