Moral Issues in Business

11th Edition
by
William H. Shaw and Vincent Barry

Lecture Outlines

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Part I: Moral Philosophy
and Business
Chapter 1: The Nature of Morality
Chapter 2: Normative Theories of Ethics
Chapter 3: Justice and Economic Distribution
 Chapter One:
The Nature of Morality

This multimedia product and its contents are protected under copyright law. The following are prohibited by law:
any public performance or display, including transmission of any image over a network;
preparation of any derivative work, including the extraction, in whole or in part, of any images;
any rental, lease, or lending of the program.
 Overview
Chapter One examines the following topics:
(1) Business and organizational ethics
(2) Moral versus nonmoral standards, etiquette and
professional codes
(3) Religion and business morality
(4) Ethical relativism and the game of business
(5) Moral principles, conscience, and self-interest
(6) Personal values, integrity, and responsibility
(7) Moral Reasoning, arguments, and judgments
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 Introduction to Business Ethics
What is ethics? The study of right and wrong, duty
and obligation, moral norms, individual character,
and responsibility.
What is business ethics? The study of right and
wrong, duty and obligation, moral norms,
individual character, and responsibility in the
context of business.

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Moral Versus Nonmoral Standards
Nonmoral standards: Standards about
behavior or practices with no serious effects
upon human well-being
Moral standards: Standards about behavior
or practices with serious upon human well-
being
 Some Features of Moral Standards
Moral standards take priority over nonmoral
standards.
The soundness or validity of moral standards
depend on the quality of the arguments or the
reasoning that support them.
 Morality and Etiquette
Rules of etiquette are ordinarily nonmoral in
character and are meant to serve as guidelines for
socially acceptable behavior.
Violations of etiquette can sometimes have moral
implications.
The strict observance of rules of etiquette can
sometimes conceal serious moral issues.

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 (1) Morality and Law
Statutes: Laws enacted by legislative bodies such
as the U.S. Congress and state legislatures
Regulations: Laws enacted by special boards or
agencies for various kinds of conduct
Common law: The body of judge-made laws
developed in English-speaking countries over the
course of many centuries
Constitutional law: Court rulings on the
requirements of the U.S. Constitution and on the
constitutionality of legislation
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 (2) Morality and Law
The distinction between morality and legality:
An action can be illegal but morally right
An action can be legal but morally wrong
Professional codes: The rules that govern the
conduct of the members of a given profession
Individuals have the responsibility to critically
assess the rules of their professions
These rules are not always complete and
reliable guides to adequate moral conduct
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You come upon this scenethe car is smoking, and it
is clear that an accident just took place. In most states,
you are not legally obligated to stop and offer help to
the victims.
 (1) The Sources of Morality
The justification of moral norms: Moral
philosophers study mainly the justification, rather
than the origin, of moral norms.
The claim that morality is based on religion:
Religion provides incentives to be moral
Religion provides moral guidance
Moral norms are in essence divine commands

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 (2) The Sources of Morality
Ethical relativism: The view according to which
moral norms derive their ultimate justification
from the customs of the society in which they
occur.
This means that moral norms are not universal,
but are dependent upon a particular cultural or
social context.

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 (3) The Sources of Morality
Implications of relativism:
There is no independent standard by which to
judge the rightness or wrongness of other
societies.
The idea of ethical progress loses its
significance.
It wouldn't make sense to criticize the moral
code of ones own society or culture.

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 (4) The Sources of Morality
Relativism and the game of business:
The idea that business is a just game captures
the thesis of Albert Carr.
He argued that business professionals are
expected to follow a code that has little or
nothing to do with ethics in other contexts.
This view entails incorrectly that the
practices of business professionals cannot (or
should not) be evaluated from an ordinary
moral standpoint.

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 (1) The Importance of Moral
Principles
What it means to have principles: Accepting moral
principles is not just a matter of intellectual
recognition, but of profound individual
commitment to a set of values.
Conscience: The internalized set of moral
principles taught to us by various authority figures
parents and social institutions.
Conscience and its limits: Conscience is not always
a reliable guide because it can be (1) conflicted and
(2) erroneous.
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 (2) The Importance of Moral
Principles
Moral principles and self-interest: The morality of
an action can run counter to our self-interest
The moral point of view requires that we
restrict our self-interest to satisfy social co-
existence.
In situations of conflict between moral
principles and self-interest, it is important to
appeal to shared principles of justification.

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 Morality and Personal Values
Morality in the narrow sense: The moral principles
or rules that do, or should, govern the conduct of
individuals in their relations with others
Morality in the broad sense: The values, ideals,
and aspirations that influence the decisions and
lifestyles of individuals and entire societies
Business ethics are mainly concerned with morality
in the narrow sense.
But values, ideals, and aspirations also affect the
behavior and ethical choices of business
professionals.
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 (1) Individual Integrity and Moral
Responsibility
Organizational norms: Employees of business
organizations (especially corporations) are:
Expected to further profit goals
Often pressured to compromise moral values
and ignore or violate rules of ethical conduct
Conformity: Studies show that individuals are more
prone to act unethically when they are a part of an
organization or a group.

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 (2) Individual Integrity and Moral
Responsibility
Groupthink: The pressure on group members to
conform to morally questionable policies or
strategies, often resulting in unethical conduct.
Diffusion of responsibility: The multiplicity,
complexity, and distribution of tasks that can lead
individuals to feel less responsibility or
accountability for their actions.

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 (1) Moral Reasoning
Argument: A group of statements in which one
statement (conclusion) is follows from the others
(premises)
Example:
(1) If Norman is bald, then Norman does not need a
haircut.
(2) It is the case that Norman is bald.
(3) Therefore, Norman does not need a haircut.

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 (2) Moral Reasoning
Requirements for a sound argument: If its
statements (premises and conclusion) are true and
its form (or structure) is valid
Validity: If the assumption that an argument's
premises are true guarantee that the conclusion
is true, then it's valid
Invalid arguments: If the assumption that an
argument's premises are true do not guarantee
that the conclusion is true, then it's invalid
Determining whether an argument is valid or
invalid requires familiarity with the rules of logic.
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 (3) Moral Reasoning
Moral arguments: Those conflicting theories and
beliefs whose conclusions are moral judgments,
based on the premise of moral standards and
statements of fact
Example:
(1) If an action violates the law, it is morally wrong.
(2) Affirmative action on behalf of women and
minorities in personnel matters violates the law.
(3) Therefore, affirmative action on behalf of women
and minorities in personal matters is morally
wrong.
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 (4) Moral Reasoning
What makes a moral judgment defensible? If it is
supported by a defensible moral standard and
relevant facts
Evaluating moral arguments:
(1) Clarifying the terms of the premises
(2) Examining the factual claims
(3) Assessing the moral standard

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 (5) Moral Reasoning
Thus, an argument can be challenged by:
(1) Uncovering ambiguity in the terms
(2) Questioning the factual claims
(3) Challenging the moral standards

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 (6) Moral Reasoning
Criteria for moral judgments:
(1) Should be logical
Embedded in valid arguments
Compatible with moral and nonmoral beliefs
(2) Should be based on facts
(3) Should be based on acceptable moral principles

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