IP: Business Ethics

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IP Business Ethics

• Organising Principles for an Ethical Framework

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What is Ethics? Some classic answers

• Ethics is the way things are done around here.
• Aristotle
• Ethics is treating other people as you would be
  treated.
• Confucius, St Paul, Kant
• Ethics is doing whatever brings the best results.
• Bentham, Mill, Singer
• Ethics is becoming the right kind of person -
  acquiring the virtues.
• Aristotle, MacIntyre

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Objections

• Ethics is subjective/relative.
• If its legal, its ethical - at least for
  corporations.
• Ethics is about following rules. If you know the
  rules, thats all you need to know.
• I dont give a damn about ethics.

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Is Ethics subjective and relative?

• Everyone disagrees about ethics. Who is to say
  what is right?
• Ethics is relative to your culture, so it is
  offensive to impose your values on to someone
  else.
• Clearly we do differ, but do we not also share
  values?

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A thought experiment

• Think of someone who is an ethical example to
  you and of the core ethical values they embody.
• One word only (no hyphens)
• Serious (not punctual or polite)
• Non-religious (not pious or prayerful)
• Non-legal (not law-abiding)

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Our guess about your answers

• Honesty
• Integrity
• Fairness
• Compassion

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Although history has long forgotten them, Lambini
Sons are generally credited with the Sistine
Chapel floor.
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Law and ethics a model

• Law is the floor, ethics the ceiling.
• Ethics is a higher standard, but without law is
  unlikely to be effective.
• Ethics and law are complementary they cannot
  substitute for each other.

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Isnt ethics just about following rules?

• Rules are essential because they allow for
  predictability, the definition of roles and
  responsibilities, and the definition of
  boundaries.
• But
• Human conduct cannot be reduced to rules
  rules are derived from conduct.
• Rules date.
• Rules cannot cover all contingencies.
• Rules must be tempered by judgment there can
  be many ways to get things wrong and more than
  one way to get them right.

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Rules and standards

• Rules are one way of proclaiming standards.
• Standards are important for consistency, but they
  are a minimum.
• Businesses and managers must have standards, but
  only as a minimum they should aim higher, like
  an archer.

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Ethical defeat

• Almost no one accepts that there is nothing
  ethical to be said for them, even if they have
  committed horrible offences.
• Tale of a New York drug dealer.
• Stephen Cohen has called this resistance to
  ethical defeat.

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Ethics are trumps

• Consider these reasons for accepting a bribe.
• You would just be doing your job - only more
  quickly.
• You wouldnt be hurting anyone - you would be
  helping someone.
• You and your family would be better off.
• If you didnt do it someone else would.
• You deserve better pay anyway.
• Its unethical.

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Ethics presents the most serious kinds of reason

• That is why we are reluctant to impose our
  views on others and vice-versa. People become
  heated about ethical issues because they are
  serious.
• We cant impose our views, but we can argue hard
  and seriously for them. Why wouldnt we if they
  are truly important?

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An ethical opinion

• Is not just self-interested
• Has regard for others
• Could apply to anybody - is reversible
• Takes account of context
• Overrides other considerations
• Has to be lived with.

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What is involved in ethical justification?

• Being accountable in terms of
• the law
• professional codes
• employers values statements
• common morality
• informed ethical judgment (conscience)

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Trust

• Basic to humanity - we need to trust and be
  trusted. Trust builds trust.
• Basic to relationships - friendships of pleasure,
  utility and affinity.
• Allows confidence and predictability.
• Reduces stress.
• Lowers transaction costs and increases
  productivity.
• Encourages risk-taking discourages risk-aversion.

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Underwriting trust the Ring of Gyges

• Gyges was a shepherd in Lydia who discovered a
  magic ring which made him invisible.
• With this ring, he was able to seduce the queen,
  murder the king and take his kingdom.
• Who would not do forbidden things if one could
  get away with them? (Plato, Republic)

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What the bagel man found out

• Payment rates were higher when he was the known
  provider.
• An open basket is a temptation. A money box is
  safer.
• People who steal bagels dont steal the money
  boxes - dont perceive taking bagels as theft?
• Law firms and telecoms have notable failings and
  executives seem to be the worst offenders!
• Firms with high morale seem to be more honest.
• Smaller firms are more trustworthy - the shame
  factor?

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Bagel behaviour

• An office with low paying staff rarely becomes an
  honest payer, and vice versa. Hence Paul F.
  believes that honest people remain honest, and
  cheaters will cheat regardless of the
  circumstance.
• Against Glaucon (Platos brother) who tells the
  tale of Gyges, Paul F. knows that people are
  honest 89 of the time. The bagels prove it.

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A simple framework

• Do no evil.
• Prevent evil.
• Remove evil.
• Do good.
• William Frankena

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What is ethics?

• The liberal might answer
• Ethics is the responsible use of freedom.
• Surely this is correct. Is not misconduct the
  irresponsible use of freedom, say, to damage
  others and look after ourselves?
• But this definition is too limited it does not
  commit us to anything in particular. What goods
  matter to us ethically?

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Can we name these goods?

• John Finnis has nominated the following
• Life - health, security
• Friendship - friends, community
• Freedom - personal, political, economic
• Knowledge - many forms
• Aesthetics - art, nature
• Play - spontaneous, organised
• Belief systems - like religion
• Trust

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Ethics and impartiality

• The house next door is on fire.
• Your children are in the house. You rush into
  the fire to rescue them. Other children are in
  the house too.
• Does ethics require you to rescue the children
  impartially, i.e. without special regard for
  saving your own children?

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Do we not properly favour those whom we recognise?

• Peter Singer argued that favouring kin was a
  survival device of evolutionary biology that
  fairness and justice should now supercede.
• But what of loyalty, love, affection and
  intimate knowledge of the good in those we know?
• These values relate less to favouring than to
  the ethics of care.

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What principles should steer ethical judgment?

• Four accounts
• 1. Acts are intrinsically right or wrong. Ethical
  requirements are expressed in duties deontology
  (Kant)
• 2. Right and wrong means producing a surplus of
  good over evil consequences - consequentialism,
  e.g. utilitarianism (Mill)
• 3. The ethics of care.
• 4. Virtue and character. Human endowments can be
  improved by the acquisition of virtues that can
  be learned.

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Intentions are basic to responsibility

• Think of Bratmans examples.
• If we intend to kill, it doesnt matter if we
  actively kill or passively let die.
• Intention changes the nature of acts.
• Intention introduces responsibility

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Results are integral to ethics

• Ethics is about consequences even if it is not
  only about consequences.
• If there were no significance to consequences,
  ethics would matter little. It is because ethics
  guides conduct that it matters.
• It is also because of this that ethics links with
  economics.

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Management Ethics

• Management excellence requires human virtues.
• All social virtues built on friendship, but
  professional virtues include
• High practice standards
• Trustworthiness and honesty
• Integrity
• Compassion

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LAURA NASHS MODEL OF ETHICAL DECISION MAKING

1. Have you defined the problem accurately?
2. How would you define the problem if you stood on
   the other side of the fence?
3. How did this situation occur in the first place?
4. To whom and to what do you give your loyalty as
   a person and as a member of the organisation?
5. What is your intention in making this decision?

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• 6. How does this intention compare with the
  probable results?7. Whom could your decision or
  action injure?8. Can you discuss the problem
  with the affected parties before you make your
  decision?9. Are you confident that your position
  will be as valid over a long period of time as it
  seems now?10. Could you disclose without qualm
  your decision or action to your boss, your CEO,
  your family, society as a whole?11. What is the
  symbolic potential of your action if understood?
  If misunderstood?12. Under what conditions would
  you allow exceptions to your stand?Laura Nash,
  Ethics without the sermon, Harvard Business
  Review, 59, 1981, 79-90.