Why Ethics Matter
Ethics are the standards of behaviour we hold ourselves to in personal and professional life. In business, they guide how we deal with customers, clients, colleagues, employees and shareholders.
- Being a professional of integrity
- Ethics versus legal compliance
- Ends, means and character
- Ethics and profitability
- Stockholders, stakeholders and goodwill
- Corporate social responsibility
- Multiple versus single ethical standards
Every day we make countless decisions, and in a business context those choices have consequences for ourselves and for others. Success is worth defining before you chase it: does it mean wealth, status and power, or also a blameless reputation, colleagues whose good opinion you value, and the ability to think well of yourself?
Learning objectives
- Describe the role of ethics in a business environment
- Explain what it means to be a professional of integrity
- Distinguish between ethical and legal responsibilities
- Describe three approaches for examining the ethical nature of a decision
- Differentiate between short-term and long-term perspectives
- Differentiate between stockholder and stakeholder
- Discuss the relationship among ethical behaviour, goodwill and profit
- Explain the concept of corporate social responsibility
- Explain the doctrine of ethical relativism and why it is problematic
Notes
Legal ≠ ethical
Compliance with law is mandatory and punishable when breached; ethical observance is voluntary and builds on that baseline. Ethical thought often precedes and sets the stage for changes in the law.
Three lenses on one decision
Ends (utilitarianism): who is helped and who is harmed? Means (deontology): what duties bind me here? Character (virtue theory): what kind of person does this choice make me?
Why one standard
A deontologist, a utilitarian and a virtue ethicist all reach the same conclusion: a single ethical code applied in every context. Relativism costs you consistency, and consistency is what earns trust.
Toyota's long game
Toyota sold cars in the U.S. at a slight loss for years from 1957 to build trust and overturn the belief that Japanese goods were cheap and unreliable — short-term cost, long-term market.
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