ETHICAL PRINCIPLES

MORAL PHILOSOPHY DEFINED - Specific principles or rules that people use to decide what is right or
wrong. Guides business people in formulating strategies and resolving specific ethical issues.
Presents guidelines in determining how to settle conflicts in human interests. Is a person’s principles
and values that define what is morale or immoral “There is no one moral philosophy accepted by
everyone”

TELEOLOGY/TELEOLOGICAL APPROACH - A CONSEQUENTIALIST THEORY/CONSEQUENTIALISM

Teleology Greek word for End or Purpose. Whether a decision is right or wrong (Ethical) depends on
the consequences or outcomes of that decision. As long as the outcome is right, then the action
itself is irrelevant.

Teleological Approach - Under this approach there are two perspectives from which, the outcome
can be viewed or decision making can be guided :

1. EGOISM - Sometimes thought of as the view “what is best for me”. Self-interest/ Personal
Interest. Right or Acceptable behaviour defined in terms of consequences to the individual. In EDM
the Egoist will choose the alternative that contributes most to his or her self-interest

The ethical egoism is a teleological theory that posits, an action is good if it produces or is likely to
produce results that maximize the person’s self-interest as defined by him, even at the expense of
others. It is based on the notion that it is always moral to promote one’s own good, but at times
avoiding the personal interest could be a moral action too.

2. UTILITARIANISM - Utilitarianism comes from the root word utility which means useful. So, in
utilitarianism, morality is centered on useful actions. Utilitarianism is a way of living that emphasizes
end results over methods. That is why the theory is described as consequentialist. Sometimes taught
as ‘what is best for the greatest number’ The Utilitarianism theory holds that an action is good if it
results in maximum satisfaction for a large number of people who are likely to get affected by the
action. An action is morally right if it results in the greatest amount of good for the greatest number
of people affected by that action.

Utilitarianism is a consequentialist theory, in that it seeks to maximize the net happiness for
everyone affected by a particular action (‘the greatest good for the greatest number’, as it is
sometimes expressed). The ultimate goal of utilitarianism is not the happiness of the individual, but
the happiness of society.
Two Formulations of Utilitarian Theory

1.Greatest Number: We ought to do that which produces the greatest happiness and least pain for
the greatest number of people. (Quantitative- focuses on the greatest num.)

2. Principle of Utility: The best action is that which produces the greatest happiness and/or reduces
pain. (Good = happiness /pleasure)

Both Act and Rule Utilitarianism follow

the idea of the maximum amount of
pleasure and the least amount of pain.

ACT UTILITARIANISM is the traditional form. It necessitates that one perform the specific act that
will produce the greatest amount of happiness for the greatest number of people. Focuses on what
the actual consequences are- are they good or bad? If they are good the action was good. If they are
bad the action was bad. Act utilitarianism only requires us to answer one question – “Does this
particular action maximize happiness?” Happiness, Pleasure is the measure of the good. The only
component of happiness is pleasure. An Action is right if and only if it produces the greatest balance
of pleasure over pain for the greatest number. This theory emphasizes ends over means.

According to Bentham:

“Nature has placed us (human beings) under the governance of two sovereign masters, pain and
pleasure”. An act is ‘right’ if it delivers more pleasure than pain and ‘wrong’ if it brings about more
pain than pleasure.

Act Utilitarian calculus.

Moral acts= maximise pleasure/ minimise pain.

So, an act = moral if it brings the greatest amount of pleasure and least pain. Figure out the
consequences and then determine if the action was right. Act utilitarian examine the specific action
itself, rather than the general rules governing that action, to assess whether it will result in the
greatest utility.

Examples :

1. You attempt to help an elderly man across the street. He gets across safely.: The Act was a good

2. You attempt to help an elderly man across the street. You stumble as you go, he is knocked into
the path of a car, and is hurt. The Act was a bad act.

3. If lying or stealing will actually bring about more happiness and/or reduce pain, Utilitarianism says
we should lie and steal in those cases.
CASE STUDY

A prominent and much-loved leader has been rushed to the hospital, grievously wounded by an
assassin’s bullet. He needs a heart and lung transplant immediately to survive. No suitable donors
are available, but there is a homeless person in the emergency room who is being kept alive on a
respirator, who probably has only a few days to live, and who is a perfect donor. Without the
transplant, the leader will die; the homeless person will die in a few days anyway. Security at the
hospital is very well controlled. The transplant team could hasten the death of the homeless person
and carry out the transplant without the public ever knowing that they killed the homeless person
for his organs. Being Act Utilitarians, what will they do?

CASE STUDY

Sam, a basically normal, rather nondescript but ‘nice’ human being, goes to the hospital to visit his
only living relative, his senile, sick aunt. His visit coincides with five medical emergencies at the
hospital. One person needs a liver transplant, another a spleen transplant, another a lung transplant,
another a new heart, and a fifth a new pineal gland. Each of the five patients is a tremendously
important, much-loved person whose death would bring a great deal of grief and actual physical
discomfort to a great number of people. Sam’s death, on the other hand, would be mourned by no
one (except possibly his aunt in her lucid moments). The top members of the hospital
administration, all strict utilitarians, lure Sam into an operating room, remove all his vital organs, and
distribute them to the other needy patients, thereby operating (literally) in accordance with the
principle of utility: the greatest amount of happiness for the greatest number of people.” Donald
Palmer, Does the Center Hold
Utilitarianism doesn’t seem so appealing now, does it? The reason this example is so disquieting is
that it appears to go against our intuitive sense of justice. Increased profit for my business is a good
end, but it does not justify my employing eight-year-old children for twelve hours a day and paying
them a dollar an hour. It also does not justify ignoring safety concerns and selling a product or
service with a high likelihood of harming or killing my customers” Many contemporary utilitarians
recognize this problem, and have created a distinction between “act utilitarianism” and “rule
utilitarianism”

Rule Utilitarianism By John Stuart Mill

Philosophers developed rule utilitarianism to avoid moral dilemmas of the act utilitarianism. John
Stuart Mill’s Adjustments to Utilitarianism - argues that we must consider the quality of the
happiness, not merely the quantity. Mill believed that quality was more important than quantity
when it came to pleasure. Rule utilitarian is about maximum utility to maximum number of person
by following the rule of law.

Rule of law or action in accordance is very much necessary to be the act moral. An action is right if
and only if it conforms to a set of rules the general acceptance of which would produce the greatest
balance of pleasure over pain for the greatest number

General rule: No one should do anything they can’t imagine asking everyone else to do.

Rule utilitarianism claims that the most efficient means of creating the greater good for humanity is
to have a moral code with rules of conduct clearly understood. Rule utilitarianism is put in place to
benefit the most people by using the fairest methods possible. Even if a particular self-serving lie
may go undetected (and therefore causes no one unhappiness), it is nevertheless not appropriate
because lying and deceiving in general cause more unhappiness than happiness. These moral rules
must lead to the maximum amount of happiness, productivity and utility for a maximum number of
people, but once decided upon, the rules apply in every scenario without exception.

Rule Utilitarianism- Example 1

“A friend comes to your door and asks to be hidden so he is not killed -You then hide him in the
basement. -There is a knock at the door and it is the person who is looking for your friend. They ask
if your friend is hiding here”.

• Act Utilitarianism says: No, I have not seen him in Weeks- Thinking of short-term consequences.

• Rule Utilitarianism says: Yes, he’s right down the stairs.

Choosing to tell the truth even though it leads to bad consequences. Thinking long term because
lying is always wrong to do and leads to negative consequences

Rule Utilitarianism- Example 2

A judge sending a murderer to prison. Say the judge knows the convict will not commit any more
violent crimes, and wants to be lenient based on this knowledge (maybe the convict is very old or
terminally ill). The judge knows that this will make the convict very happy, not to mention their
family and friends. Imagine that the victim’s family has forgiven the convict and will not feel pain as a
result of this decision. Should the judge let the convict go?
• Act utilitarinism says yes, because this maximizes happiness while causing no future pain in this
case

• Rule utilitarianism says no, because in general convicts must be punished for their crimes, even if
there is no chance that they will commit future crimes. The judge should follow the rules, according
to this argument, even if in this particular case the rule isn’t necessary.

Rule Utilitarianism- Example 3

Ever heard the myth of Robinhood? the legend has it that he was a reputable, honored thief. this
debatable character may give us another perspective to discuss: whether his act of being generous
to the poor can be counted as ‘good’ though he robbed the rich?

From Rule- Utilitarian’s perspective, however, would say that it is unethical.

But an act-utilitarian would say ‘who cares?’ If it has benefits then it wins.

UTILITARIANISM Decision making - In a Nutshell

Act utilitarianism only requires us to answer one question – “Does this particular action maximize
happiness?”

Rule utilitarianism would have us ask two questions:

1) “What general rule would I be following if I did this particular action?”

2) “Would this rule, if generally followed, maximize happiness?”

1. Must determine what alternative actions or policies are available to one on that occasion.

2. For each alternative action, one must estimate the direct and indirect benefits and costs that the
action would produce for each and every person affected by the action in the foreseeable future.

3. The alternative that produces the greatest sum of utility must be chosen as ethically appropriate
course of action. (Amount of Good Produced) – (Amount of Evil Produced) = “Utility” of the Act

Suppose you are listening to music in your mobile phone while rushing back to University to have a
project discussion with your classmates. On your way, you find a person lying on the pavement
injured and bleeding. It seems that he is seriously injured, but no one to stop and help. You know if
you stop, you will be late and even the meeting cannot be carried out. Will you stop to help the
injured person? Use both Rule and Act Utilitarianism

DIFFICULTIES WITH UTILITARIANISM

It is often very difficult, if not possible, to foresee all the consequences of a business decision. Many
decisions have consequences that are not easily measured and often lack measurement units.
Maximizing net utility may require actions that cause significant harm to a few people o In terms of
organizational research, both egoism and utilitarianism (branches of teleological ethics) are
problematic in that they focus on ends as opposed to means.