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Chapter One ETHICS

This chapter introduces ethics and business ethics. It discusses why studying ethics is important for business students and managers. While making profits and obeying laws are important, ethics is also vital. An ethical company is likely to prosper in the long run through strong reputation. The chapter distinguishes between moral and non-moral standards, and examines the relationship between ethics and law. It notes that legal actions are not always ethical, and that ethics and law can conflict at times. Components of moral behavior and responsibility are outlined. Four views of ethical behavior and the process of moral reasoning are also introduced.

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jewelyn Ciocon
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27 views

Chapter One ETHICS

This chapter introduces ethics and business ethics. It discusses why studying ethics is important for business students and managers. While making profits and obeying laws are important, ethics is also vital. An ethical company is likely to prosper in the long run through strong reputation. The chapter distinguishes between moral and non-moral standards, and examines the relationship between ethics and law. It notes that legal actions are not always ethical, and that ethics and law can conflict at times. Components of moral behavior and responsibility are outlined. Four views of ethical behavior and the process of moral reasoning are also introduced.

Uploaded by

jewelyn Ciocon
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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• Chapter One

• Basic Principles: Ethics and Business


• Learning Objectives
After reading this chapter , you will be able to :
• 1. Identify reasons Why the study of ethics is important.
• 2. Explain the nature and the meaning of business ethics.
• 3. Explain the difference between ethics and the law.

Why Study Business Ethics


• It must be remembered that the School of Business’ task is to prepare students for the business
world.  If ethics do not matter, then time spent teaching ethics is better spent elsewhere.
• Business Ethics class is not aim simply to help you to learn about ethics, but aim to help you do
ethics. That is, The goal of Business ethics is to help each of us become more ethical and help us
all to create and promote ethical institutions.

Why Study Business Ethics


Everyone agrees that business managers must understand finance and marketing. But is it necessary for
them to study ethics?
Managers who answer in the negative generally base their thinking on one of three justifications.
1. They may simply say that they have no reason to be ethical. They see why they should make a profit,
but why should they be worried about ethics, as long as they are making money and staying out of
jail?
2. Other managers recognize that they should be ethical but identify their ethical duty with making a
legal profit for the firm. They see no need to be ethical in any further sense.
3. A third group of managers grant that ethical duty goes further than what is required by law. But they
still insist that there is no point in studying ethics.

Why Study Business Ethics


• Perhaps when business people ask why they should be ethical, they have a different question in
mind: what is the motivation for being good? Is their something in it for them?
• There is no denying that one can often do well by doing good.
• An ethical company is more likely to build a good reputation, which is more likely to bring
financial rewards over the long term.
• What is Ethics?
• Ethics: defined as the set of moral principles that distinguish what is right from what is wrong.
• Moral Standards : rules about the kinds of actions that are morally right or wrong, as well as the
values placed on what is morally good or bad.
• Non-Moral Standards: manage individual life, aspirations and desires and may decide a person's
place in his group. Some non-moral standards of any society could be the table manners, general
etiquette,  clothing etc.

How Can We Distinguish Between Moral and Non-moral Standards?


Generally, you can say a standard is moral if:
1) It deals with things that can seriously harm or greatly benefit others.
2) It is not changed or modified by state or social authorities.
3) It leads to internal notions of guilt, shame, good and evil, right and wrong.
Moral Responsibility
• Three Components of Moral Responsibility:
1. Person caused or helped cause the injury, or failed to prevent it when he or she could and
should have (causality).
2. Person did so knowing what he or she was doing (knowledge).
3. Person did so of his or her own free desire (freedom).

The Relationship Between


Ethics and Law
• Law is the system of rules of conduct established by the government of a society to maintain
stability and justice.
• Law defines the legal rights and duties of the people and provides the means of enforcing these
rights and duties.
• A relationship exists between law and ethics. In some instances, law and ethics overlap (related)
and what is supposed as unethical is also illegal.
• In other situations, they do not overlap. In some cases, what is supposed as unethical is still
legal, and in others, what is illegal is perceived as ethical.

Ethics and Legal Conflicts


• Because law is made by people, it is imperfect.
• Legislators and judges bring their own personal opinions on ethics to the lawmaking process.
• As a result, ethics and law will sometimes conflict.
• As a result, Legal behavior is not necessarily ethical behavior.

Moral Behavior
• There are four components of moral behavior.
1. The first of these is moral sensitivity: which is "the ability to see an ethical dilemma, including how
our actions will affect others."
2. The second is moral judgment: which is "the ability to reason correctly about what 'ought' (have to)
to be done in a specific situation."
3. The third is moral motivation: which is "a personal commitment to moral action, accepting
responsibility for the outcome."
4. The fourth and final component of moral behavior is moral character: which is a “courageous
persistence in spite of fatigue or temptations to take the easy way out."

Four Views of Ethical Behavior


1. Utilitarian View Where moral behavior is that which delivers the greatest good to the greatest
number of people.
2. Individualism View Where moral behavior is that which is best for long-term self-interest.
3. Moral-Rights View Where moral behavior is that which respects fundamental rights shared by
all human beings.
4. Justice View Where moral behavior is that which is impartial, fair, and equitable in treating
people. (Procedural and Distributive Justice)
Moral Reasoning
• The reasoning process by which human behaviors, or institutions are judged to be in accordance
with or in violation of moral standards.
• Moral reasoning involves:
– The moral standards by which we evaluate things
– Information about what is being evaluated
– A moral judgment about what is being evaluated.

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