Chapter 2: Introduction to Business Ethics

Ethics is a branch of philosophy that deals with questions of morality, which means it involves
thinking about what is right and wrong, good and bad, and how people should behave. It’s about
the principles or rules that guide our actions and decisions in life.

Key Points:

1. Principles of Conduct: Ethics is like a set of rules or guidelines that help us decide how
to act, whether we’re individuals or part of a group. These principles tell us what is
considered acceptable or unacceptable behavior.
2. Study of Morality: At its core, ethics is the study of morality. Morality refers to the
values and beliefs about what is right or wrong that guide how we live our lives. Ethics
examines these values and beliefs to understand what makes something morally good or
bad.
3. Investigation: Ethics involves investigating moral issues, which means it includes both
the process of asking questions about morality and the conclusions we reach from this
process. When we investigate something ethically, we are trying to figure out what the
right thing to do is, based on our understanding of moral principles.
4. Examining Moral Standards: Ethics is also about looking at and evaluating the moral
standards or rules that people live by, whether as individuals or as part of society. This
means thinking critically about what we and others believe is right or wrong.
5. Moral Philosophy: Ethics is also known as moral philosophy. This field of study
explores big questions about what it means to live a good life, what justice is, and how
we should treat each other. It seeks to understand concepts like justice, virtue, and the
difference between right and wrong.

Example to Illustrate:

Imagine you find a wallet full of money on the street. Ethics would help you decide what to do
with it. Should you keep the money, or should you try to find the owner and return it? Ethics
guides you to think about what the right action is, considering fairness, honesty, and respect for
others.

Morality refers to the beliefs and standards that people or groups have about what is right and
wrong, or good and bad. These beliefs guide how we think about different situations and how we
act in our daily lives.

Key Points:

1. Standards of Right and Wrong: Morality is all about the rules or standards we use to
decide whether something is right or wrong. These standards tell us how we should
behave in different situations. For example, most people believe that helping others is
good and harming others is wrong.
 2. Thoughts About Morality: Morality involves how we think about different situations or
actions. When we consider whether something is right or wrong, we are thinking about it
in moral terms. This can be a positive thought (like thinking it's good to be kind) or a
negative thought (like thinking it's bad to lie).
3. Moral Standards: These are the specific rules or norms that we believe in. They guide
our actions and judgments. For example:
o Action: We might believe it’s wrong to steal from someone, especially if they are
poor.
o Object: We might value honesty as a great virtue, meaning we think it’s very
important to be truthful.

Sources of Moral Standards:

Moral standards don’t just appear out of nowhere; they come from different sources in our lives,
such as:

 Church/Religion: Religious teachings often provide moral guidelines about what is right
and wrong.
 School: Education helps shape our understanding of moral behavior, like teaching us to
share and be respectful.
 Television/Magazines/Music: Media can influence our moral beliefs by showing us
different behaviors and values.
 Group Associations: The groups we belong to, such as our friends or community, can
affect our moral views.
 Culture: Different cultures have different moral standards based on their traditions and
history.
 Early Upbringing: The way we are raised by our parents or guardians has a big impact
on our moral beliefs.
 Experience: As we go through life, our experiences help shape and sometimes change
our moral views.

How Moral Standards Can Change:

As we grow and learn, our moral standards can evolve. New experiences, education, and
reflection can lead us to rethink what we believe is right or wrong. For example, someone might
grow up believing that certain behaviors are acceptable, but later in life, they might change their
views after learning more or having new experiences.

Example to Illustrate:

Imagine you were taught as a child that it’s okay to take small items from a store without paying.
As you grow older and learn more about honesty and fairness, you might start to believe that
stealing is wrong, even if it's just a small item. Your moral standard has changed based on new
experiences and understanding.
Non-moral standards refer to rules or guidelines that help us judge certain behaviors or actions,
but they are not about what is morally right or wrong. Instead, they are about what is considered
appropriate or correct in specific areas like manners, law, or language.

Key Points:

1. Etiquette Standards:
o What They Are: Etiquette standards are rules about manners and how people
should behave in social situations. These standards help us decide if someone is
acting politely or rudely.
o Examples:
 Saying "please" and "thank you" is considered good manners.
 Talking with your mouth full is considered bad manners.
o Why They Matter: Following these standards helps people get along in social
situations, but breaking them doesn’t usually mean you’re doing something
morally wrong—just that you might be considered impolite.
2. Legal Standards:
o What They Are: Legal standards are the rules set by laws. They help us decide
what is legally right or wrong.
o Examples:
 Driving within the speed limit is following the law.
 Stealing is against the law.
o Why They Matter: Breaking legal standards can lead to consequences like fines
or jail time. However, something being legal or illegal doesn’t always mean it’s
moral or immoral. For example, some things might be legal but still considered
morally wrong by some people, and vice versa.
3. Language Standards:
o What They Are: Language standards are the rules of grammar and usage that
help us decide whether writing or speaking is correct.
o Examples:
 Using proper punctuation in a sentence is grammatically correct.
 Saying "I ain't got no money" is grammatically incorrect.
o Why They Matter: Following language standards helps us communicate clearly
and effectively, but using incorrect grammar isn’t a moral issue—it’s just a
mistake or a different way of speaking.

How Non-Moral Standards Are Different From Moral Standards:

 Focus: Non-moral standards focus on what is considered correct or appropriate in

specific contexts, like social behavior, law, or language, rather than what is morally right
or wrong.
 Consequences: Violating non-moral standards might lead to social disapproval, legal
penalties, or misunderstandings, but it doesn’t usually involve moral judgment.

Example to Illustrate:
Imagine you are at a formal dinner. If you use the wrong fork for your salad, you’ve broken a
standard of etiquette. This might be seen as impolite or improper, but it’s not a moral issue—it’s
just a matter of manners.

In contrast, if you see someone stealing and do nothing about it, that’s a moral issue because it
involves questions of right and wrong behavior.

Morality in Decision-Making:

When we make decisions about what to do, we often think about whether our choices are right or
wrong. These decisions can be influenced by different types of standards—moral or non-moral.

Key Points:

1. Judging Right and Wrong:

o Whenever we make a decision, we use some kind of standard to judge whether it's
good or bad, right or wrong.
o Moral Standards: These involve thinking about what is ethically right or wrong.
o Non-Moral Standards: These involve rules or norms that are not about morality
but are about what is considered correct in specific contexts, like legal rules or
etiquette.
2. Choosing Between Standards:
o Sometimes, people might prioritize non-moral standards over moral ones. This
means they might follow rules or guidelines that are not related to morality, even
if it has negative effects from a moral perspective.

Example to Illustrate:

Imagine a company is facing financial problems due to a recession. The company’s by-laws
(rules) say that when there are financial difficulties, layoffs are necessary to save the company.
The CEO decides to follow these by-laws and lays off some employees.

 Non-Moral Standard: The CEO is following the company’s by-laws, which are rules
about how to handle financial problems. These rules are not about what is morally right
or wrong—they are about managing the company according to its procedures.
 Moral Standard: From a moral perspective, the CEO might consider the impact of the
layoffs on the employees and their families. This includes thinking about how losing their
jobs will affect their lives and well-being.

In this case, the CEO chose to follow the non-moral standard of the by-laws rather than
considering the moral standard of caring for the employees' welfare.

Irony of Fate:
The “irony of fate” here refers to the situation where someone might choose to follow non-moral
standards (like company rules) even when it might be more morally right to consider the impact
on people’s lives. The CEO’s choice highlights how sometimes, practical or procedural standards
can override moral considerations, leading to outcomes that might be seen as ethically
questionable.

Five Characteristics of Moral Standards:

To understand the difference between moral and non-moral standards, we can look at these five
key characteristics of moral standards:

1. Impact on Human Well-being:

o Moral Standards: Deal with issues that can significantly affect people’s lives,
either positively or negatively. Examples include actions like theft, murder,
charity, and fraud. These issues involve serious consequences for individuals or
society.
o Non-Moral Standards: Deal with less serious matters that don’t have a big
impact on people’s lives. For example, making a grammatical mistake in a report
is a non-moral issue because it doesn’t significantly harm or benefit people.
2. Not Created by Authorities:
o Moral Standards: Are not set or changed by specific authorities or organizations.
They are personal or cultural beliefs about right and wrong that people or groups
follow.
o Non-Moral Standards: Are often established by authorities or rules, like laws or
organizational policies. For example, a country’s laws are made by the
government, but moral standards come from personal or societal beliefs.
3. Preference Over Self-Interest:
o Moral Standards: Should be prioritized over personal gain or self-interest. If
following a moral standard means sacrificing your own benefit for the greater
good, it should be preferred.
o Example: If you have to choose between a decision that benefits you personally
and one that benefits others more, you should choose the option that helps others,
even if it’s not in your personal interest.
4. Impartial Consideration:
o Moral Standards: Require us to consider everyone’s interests equally and fairly,
not just our own. They are based on the idea that everyone’s well-being matters
equally.
o Example: If you’re making a decision that affects both yourself and a group of
people, you should choose what benefits the group or doesn’t harm them, rather
than just focusing on your own interests.
o Exception: Sometimes, it is morally acceptable to be partial, especially towards
family members. For example, if you need to save your family from a dangerous
situation and can only take a few people, it’s understandable to prioritize your
family over others.
 5. Associated with Emotions and Vocabulary:
o Moral Standards: Are connected to specific feelings and language. When you
act against your moral beliefs, you might feel guilty or lose self-esteem.
o Example: If you steal from someone or harm others, you might feel guilty and
have a lower opinion of yourself because you’re going against what you believe is
right.

Understanding Morality and Law:

Differences Between Law and Morality:

1. Law:
o Strict and Unchanging: Laws are rigid rules set by authorities, such as
governments or legal bodies. Once established, they are hard to change.
o Made by Authorities: Laws are created and enforced by specific authorities, like
legislators or courts.
o Specific Focus: Laws address specific actions and behaviors. They are detailed
and cover particular situations.
o Floor Level: Laws set a minimum standard of behavior. They define what is the
least acceptable conduct in society.
2. Morality:
o Flexible and Evolving: Morality can change based on values, culture, traditions,
and customs of a society. It is not as fixed as laws.
o Judged by Individuals or Communities: Morality is often based on personal or
communal beliefs about right and wrong.
o Broad Focus: Morality covers a wide range of issues, including actions that laws
might not specifically address.
o Ceiling Level: Morality sets a higher standard of behavior. It often aims for ideals
and greater ethical principles.

Relationship Between Morality and Law:

1. Illegal but Morally Right:

o Sometimes, actions that are against the law can be considered morally right. This
happens when laws are unjust or do not align with moral values.
o Example: During World War II, the German government created laws that
mandated the killing of Jews and required citizens to help capture them. Hiding a
Jewish family was illegal under these laws but morally right because it was an act
of compassion and resistance against injustice.
2. Legal but Morally Wrong:
o Conversely, some actions that are allowed by the law can still be considered
morally wrong. This occurs when the legal standards are not aligned with ethical
values.
 o Example: If the same German family had helped the military capture a Jewish
family, this would have been legal according to the oppressive laws of the time.
However, it would be considered morally wrong because it involves harming
innocent people.

Summary:

 Law sets the minimum acceptable standards of behavior and is enforced by authorities. It
provides a clear but limited scope of acceptable conduct.
 Morality represents higher ethical ideals and can vary based on personal or societal
values. It is broader and more flexible than law.
 Sometimes, what is legally acceptable might not be morally right, and what is morally
right might not be legally permitted. Laws and morality don’t always align perfectly, and
moral judgment often goes beyond what the law requires.

Morality and Religion:

Religion often plays a significant role in shaping a community’s beliefs and values. However,
religion itself is not the same as morality. Here’s a detailed look at how morality and religion are
related:

Key Points:

1. Motivations for Acting Morally:

o Religious Motivation: Some people may follow moral guidelines because their
religion teaches them to avoid wrongdoing and seek rewards in the afterlife, like
avoiding hell or going to heaven.
o Non-Religious Motivation: Many people act morally because they care about
others or believe in doing what’s right, regardless of religious beliefs. Morality
can be driven by concern for others’ well-being or a sense of duty, not just
religious reasons.
2. Religious Moral Instructions:
o General Guidelines: The moral teachings in major religions are often broad and
can be interpreted in different ways. For example, many religions teach principles
like compassion and honesty, but how these principles are applied can vary
widely.
o Contextual Interpretation: Different cultures or situations might lead to varying
interpretations of the same religious moral teachings.
3. Divine Command Theory:
o Theory Overview: This theory suggests that something is considered wrong
simply because God commands us not to do it. For example, stealing is wrong
because God says it is.
 oCritique: However, this view implies that morality depends only on divine
commands. It overlooks that certain behaviors are harmful or wrong in
themselves, not just because of religious prohibitions.
o Example: Stealing is wrong not just because God says so, but because it is a
harmful behavior that negatively affects others.
4. Human Reason and Morality:
o Understanding Morality: Most religions believe that humans have the capacity
to understand right and wrong through reason. This means that moral principles
can be supported by human reasoning and understanding, not just religious
teachings.
o Reason and Ethics: While religion can guide moral behavior, humans also use
their own reason and judgment to determine what is ethical. This means that
morality involves rational thought about what is right and wrong, beyond just
religious commands.

Summary:

 Religion and Morality: Religion influences moral beliefs and practices but is not
synonymous with morality. People can act morally for reasons other than religious ones,
such as concern for others or a sense of duty.
 Moral Teachings: Religious moral teachings are often general and can be interpreted
differently depending on context. They provide a framework but not a complete guide to
all moral issues.
 Divine Command Theory: This theory suggests that actions are right or wrong solely
based on divine commands. However, many believe that actions are wrong because they
are inherently harmful, not just because of religious prohibitions.
 Role of Reason: Most religions agree that human reason plays a crucial role in
understanding and applying moral principles. Morality involves both religious teachings
and rational thought about ethical behavior.