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Business Ethics & CSR

Naeem ASHRAF
Spring, 2015
LUMS
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Grades Breakup

Class Participation: 10%


Attendance & Punctuality: 5%
Assignments: 10%
Quizzes: 20 % (4: N-1)
Mid-Term Examination: 30%
Project / Term Paper: 25%

More than 3 absences or late arrivals will result


in a grade reduction of 1% of total grades for
each extra absence or late arrival.

COURSE OVERVIEW
Week/
Session/
Module

Week 1

Week 2- 5

Week 6

Week 7

Topics

Introduction & Overview:


Why Study Business Ethics?
The Nature of Business Ethics
Moral Reasoning
Foundations of Ethics:
Introduction to Moral Philosophy
Consequentialist and NonConsequentalist Theories
Virtue Ethics
The Business System:
Criticizing Markets and Free Trade
Ethical Issues in Business Settings:
External Stakeholder Issues
(Environment)
Mid Term

Recommended
Readings
Chapter 1 (Velasquez, 2006)

Chapter 2 (Velasquez, 2006)

Chapter 3 (Velasquez, 2006)

Chapter 5 (Velasquez, 2006)

Objectives/
Application
Introduction and discussion on
the importance of the subject
Understand how moral
reasoning works

Understand the four widely


used bases for making ethical
decisions in various business
contexts
Appreciate the arguments for
and against markets and free
trade
Explore how certain business
practices damage the
environment, and the ethical
responsibility of businesses

Ethical Issues in Business Settings:


External Stakeholder Issues
Week 8 & 9 (Production and Marketing)

Week 10

Week 11 &
12

Week 13

Ethical Issues in Business Settings:


Internal Stakeholder Issues (Job
Discrimination)
Ethical Issues in Business Settings:
Internal Stakeholder Issues
(Employees Rights and Obligations)
Ethics and Corporate Social
Responsibility:
Arguments for and against CSR
Principles of Social Responsibility in
Business
Schools of Thought on Social
Responsibility
Final Project Presentations

Discuss different theories of a


firms duties to consumers, and
Chapter 6 (Velasquez, 2006)
the ethical dimensions of
advertising and consumer
privacy
Analyze the nature and extent
of job discrimination along
Chapter 7 (Velasquez, 2006)
with the ethical dilemmas
inherent in affirmative action
Understand the employees
rights and responsibilities and
Chapter 8 (Velasquez, 2006)
a firms duties to the employee
Reading: Detienne, K.B., Lewis, Discuss the varying views on
L.W. The Pragmatic and
CSR and evaluate the
Ethical Barriers to Corporate
arguments for and against it
Social Responsibility
using Nike as a case
Disclosure: The Nike Case.
Journal of Business Ethics.
2005.

Week 14

Consequentialism / Utilitarianism

Bentham
Intense, long, certain, speedy, fruitful, pure
Such marks in pleasures and pains endure.
Such pleasures seek, if private by thy end;
If it be public, wide let them extend.
Such pains avoid, which be thy view;
If pains must come, let them extend to few.
(Bentham, quoted from Stewart & Blocker, 2006. Fundamentals of Philosophy, Pearson)

How to Apply Utilitarian Principles


First, determine what alternative actions or policies
are available to me in that situation.
Second, for each alternative action, estimate the direct
and indirect benefits and costs that the action will
probably produce for all persons affected.
Third, for each action, subtract the costs from the
benefits to determine the net utility of each action.
Fourth, the action that produces the greatest sum
total of utility must be chosen as the ethically
appropriate course of action.
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Criticisms of Utilitarianism
Critics say not all values can be measured.
Life, love, freedom, equality, health, beauty, whose
value is such that it cannot be measured in economic
terms.

Utilitarians respond that monetary or other


commonsense measures can measure
everything.
Instrumental goods: that are considered valuable
because they lead to other things (e.g. visit to dentist)
Intrinsic goods: that are desirable independent of any
other benefits they may produce (e.g. health)
Needs (foods, clothing, and housing etc.) vs wants
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John Stuart Mill


How to make qualitative distinction between
higher vs lower pleasures?
Of two pleasures, if there be one to which all or
almost all who have experience of both give a
decided preference, irrespective of any feeling of
moral obligation to prefer it, then that is the more
desirable pleasure (Mill)
The sole evidence it is possible to produce that
anything is desirable is that people actually do
desire it. (Mill)
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Criticisms of Utilitarianism
Greatest good for the greatest number
Critics say utilitarianism fails with rights and
justice.
Utilitarians respond that rule-utilitarianism can
deal with rights and justice.
Rule-utilitarianism: A form of utilitarianism that limits
utilitarian analysis to evaluations of moral rules. (Mill)

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Criticisms of Utilitarianism
Act utilitarianism (Bentham)
The view that we assess the rightness or
wrongness of each act by its tendency to promote
the greatest happiness for the greatest number.

Rule utilitarianism (Mill)


Dont regulate each but to arrive at general rules
which, if kept throughout society, will enhance the
general welfare and increase the total amount of
happiness
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Criticisms of Utilitarianism
Fairness and minority rights
City of happiness

The problem of conflicting rules


Do not kills vs You ought to protect your
homeland from invasion

Proof for utilitarianism


Prescriptive (ought) vs descriptive

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John Stuart Mill


It is better to be a human being dissatisfied
than a pig satisfied; better to be Socrates
dissatisfied than a fool satisfied. An if the fool, or
the pig, is of a different opinion, it is because
they know only their side of the question (John
Stuart Mill quoted from Stewart & Blocker, 2006.
Fundamentals of Philosophy, Pearson).

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The greatest good (taking into account


reasonable personal preferences, based on
commonly accepted time horizons, and judged by
someone with the maximum degree of
impartiality) of the greatest number (subject to
the protection of the socially accepted rights of
legitimate minorities) based on the information
available at the current moment, and reasonable
assumptions about what is likely to happen in the
future. (Jones et al.,2005. Business Ethics. Routledge)
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THANKS !

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