Acca p1 chap 12- ethical theories


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Acca p1 chap 12- ethical theories

  1. 1. Ethical Theories<br />Chapter 12<br />
  2. 2.
  3. 3. Ethical & moral belief of society<br />
  4. 4.
  5. 5. Deontological v/s teleological approach to ethics<br />
  6. 6. Deontological<br />A non consequentialist theory.<br />Motivation & principle is important.<br />Action is based on Moral.<br />3 maxims/ tests of action, to know if action is morally right- all 3 maxims must be satisfied.<br />Consistency- Action is right if everyone can follow the same principle<br />Human dignity – Treat humanity as an end, never as a means . Humanity inside you and inside people.<br />Universality- Would others / external parties , view the action as moral or suitable<br />
  7. 7. Deontological approach- categorical imperative<br />Maxim 1<br />Act only according to that maxim by which you can desire that it should become a universal law.<br />Explanation<br />Action is right if everyone follows the same principle.<br />Eg certain behaviors are judged as immoral by almost everyone , namely; murder, child abuse, fraud.<br />
  8. 8. Maxim 2- Principle of human dignity<br />Act to treat humanity , in yourself and in others , always as an end , never as a means only.<br />Explanation<br />Never consider humans as slaves , or as only providers of service only<br />Consider their needs and expectations<br />Some concept of Empowerment of employees<br />
  9. 9. Maxim 3- Principle of Universality<br />Act only so that the will , through its maxims , could regard itself at the same time as universally law giving.<br />Principle of universality<br />Will an action be viewed as moral when viewed by external parties. Not by the initiator of the action/decision.<br />Outside – in approach.<br />If the initiator doubt of the moral founding/ grounding of the action, then the moral status is doubtful.<br />Examples<br />
  10. 10. Teleological approach<br />Consequentialist theory<br />The right or wrong depends on conseqences/ outcomes of the decision.<br />If the outcome is right , then the action itself is irrelevant.<br />2 perspectives to view an outcome <br />Egoism<br />Utilitarianism<br />
  11. 11. 2 perspectives <br />
  12. 12. Teleological approach<br />The goal is important , not the means to get there.<br />Consequentialist theory- whether a decision is right or wrong will depend on the outcomes of the decision.<br />Utilitarianism<br /> highly subjective approach<br />The effect of collective welfare<br />Concept of utility<br />Measuring good or bad utility produces a Cost benefit analysis of decisions , thus making those decisions <br />
  13. 13. Kohlberg Level of Human development<br /><ul><li>Individuals tend to move from Level 1 to Level 3 as they grow older.
  14. 14. The move is decided by how a decision is made , not what the decision is about.
  15. 15. Research show that most people , including business managers tend to reason on Level 2.</li></li></ul><li>Kohlberg Cognitive Moral development theory<br />CMD theory- explain the reasoning process behind moral judgments.<br />The theory views ethical decisions from an individual’s perspective.<br />CMD theory derived from Piaget’s work<br />Piaget’s work was to assess kids below 10 yrs and how they responded to problems and dilemmas different from much older kids.<br />Kohlberg built on Piaget’s work and interviewed kids and teens about moral dilemmas. He found other moral stages that went far beyond Piaget’s traditional model.<br />
  16. 16. Critics of CMD theory<br />Gender bias-study interviewed only young American males<br />Too great emphasis on rights & justice compared to other bases of morality.<br />People use different moral reasoning strategies in different situations so there may not be any sequence of stages.<br />Moral reasoning strategies – the brain react differently to all sorts of stressing situations. <br />When in happy situations , brain will react more positively and will be more creative.<br />
  17. 17. C.M.D (explained)<br />Pre conventional – obedience & punishment<br />Right/wrong defined according to expected rewards / punishments from people of authority<br />Eg – eyee make unethical decision and believes they won’t be punished.<br />Pre Conventional – Instrumental purpose & exchange<br />Right is defined according to whether there is fairness in exchange<br />Self interest prevails<br />
  18. 18. C.M.D (explained)<br />Conventional – interpersonal accord & conformity<br />Action is guided by what is expected from peers & close ones<br />Conventional – social accord & system maintenance<br />Expectations of others extended / broadened to social accord<br />Not limited to immediate peers<br />
  19. 19. C.M.D (explained)<br />Post conventional- social contract & individual rights<br />Right / wrong determined i.r.o :<br />Basic rights<br />Values<br />Contracts of society<br />Post conventional – universal ethical principles<br />Decisions taken, based on self chosen principles which the person believe , everyone should follow.<br />Autonomy in decision making.<br />
  20. 20. Social responsibility<br />
  21. 21. Social responsibility<br />Org need to be socially responsible.<br />This entails – Social accountability<br />Gray, Owens & Adams theory – 7 positions on social responsibility.<br />
  22. 22. Social responsibility – 7 positions<br />Pristine capitalist<br />Expedient<br />Proponents of social contract<br />Social ecologist<br />Socialist<br />Radical feminist<br />Deep ecologist<br />
  23. 23. Pristine capitalist<br />S/h wealth maximization is of Value.<br />What reduces s/h wealth is Theft.<br />Liberal democratic economy is correct.<br />Business have no moral obligations beyond their responsibilities to s/h & creditors.<br />Explanation<br />Shareholders’ needs are the most important for the org.<br />Low CSR consideration<br />Shareholders expect maximum returns<br />No returns tantamount to theft<br />
  24. 24. Expedients <br />Some social expenses needed to position the org.<br />Concept of “ enlightened self-interest”.<br />Minimum social responsibility necessary to achieve Long term economic stability & welfare.<br />CSR is acceptable if it is within interest of business.<br />Explanation<br />Business need some minimum ethical guidelines.<br />Impact on society need to be considered.<br />A co can’t simply use resource & not consider impact on society.<br />
  25. 25. Proponents of social contract<br />Co has license , granted by society<br />Co exist at society's will, must serve society<br />Behave according to ethical norms of society<br />Behavior change as norms change<br />Explanation<br />Existence of co & decisions made are justified if they serve public interest.<br />But responsibilities & accounting requirements are not clear.<br />
  26. 26. Social ecologist<br />A biz has a social & environmental footprint. <br />Therefore is responsible to minimize the footprint<br />There is an overall concern for the environment<br />Recognition that large organizations cause environmental & social problems.<br />Explanation<br />More concern for resource allocation , pollution effect & waste control.<br />With these changes , it is assumed that quality of life will be improved or will be constant.<br />
  27. 27. Socialist<br />Actions of biz = actions of capitalist oppressing other lower classes.<br />This is the view of the socialist and their recurrent battle.<br />Biz should help to correct imbalance in society<br />Capitalist should not dominate social , economic or political life<br />Change needed to reduce capitalist power<br />In the socialist system , capitalist oppress workers<br />So change is required.<br />Explanation<br />Economic systems & the creation of things is a secondary objective rather than a primary<br />Mistrust of accounting & CSR systems <br />No clue how these can be amended<br />
  28. 28. Radical feminist<br />Society & biz should be based on feminine characteristics. E.g. equity , dialogue, compassion, fairness.<br />More emotional side <br />Business reflect too much masculine concepts of aggressivity. <br />Need more feminine values of compassion, love & cooperation.<br />Radical change needed in ownership & structure of society<br />More towards feminist viewpoint<br />
  29. 29. Deep ecologist<br />Human beings have no monopoly on the world’s resources<br />Biz have to be cautious with the environment<br />Lack of environment awareness by biz<br />There is too much negative impact on the environment caused by co’s operations.<br />
  30. 30. Variables determining cultural context of ethics & csr<br />Focus on Profit<br />Focus on Law & Compliance<br />Focus on what is right<br />Focus on doing what is desired<br />
  31. 31. Variables (cont’d)<br />Ethics & csr will vary according to Culture<br />The 4 variables will vary according to European and US culture.<br />European = Ethics & philanthropic actions can be enforced legally<br />US= Focus on discretionary actions of co’s & individuals<br />Caroll model of CSR …<br />
  32. 32.
  33. 33. Corporate & personal ethical stances<br />
  34. 34. Corporate & personal ethical stances<br />Corporate stance- approach of the org to the different theories.<br />Personal stance – Approach of the individual to different theories.<br />
  35. 35. Multiple stakeholder theories<br />Short –term shareholder interests<br />Corporate stance<br />- In short term, org need adequate ROI.<br />- Conflict exist in 2 areas :<br />1) Need to pay dividend & investing in the co.'s future.<br />2) Shareholder’s expectations of return<br />Personal stance<br /><ul><li>S.T interests depend on the type of s/h
  36. 36. Small/ minority s/h need annual Roi as a form of income + capital growth
  37. 37. Larger s/h have little interest in short term returns. For them short term dividend may conflict with long term goals.</li></li></ul><li>Multiple stakeholder theories<br />Long-term shareholder interests<br />Corporate stance<br />In L.T , org need to maintain existence- going concern.<br />This objective may conflict with Short term return needs.<br />Org will cater for LT s/h interests with capital growth.<br />So that these s/h retain their investments in the Co.<br />Large scale sale of shares is considered a weakness sign which affect L.T prospects of the org.<br />Personal stance<br />In LT , s/h concerned with security of inv as well as capital growth<br />These goals are congruent with org objectives.<br />But org will tend to resolve conflicts between org existence & s/h conflict.<br />
  38. 38. Multiple stakeholder theories<br />Multiple stakeholder obligations<br />Corporate stance<br />Organizational stance is to identify stkh with high power & influence over the org. <br />Then involve these stkh in decision making & provide them with returns they are expecting.<br />There will be conflicts because of different needs of different groups.<br />Egeyees expect increase in salary, compared to s/h who expect more capital growth & dividends.<br />Personal stance<br />Each stkh group expect their interests to be understood & acted upon.<br />Lack of action will increase outside pressure on the org to meet those interests<br />Eg needs for dividends will decrease if s/h understand that h& s issues are important and will lead to more productivity from eyees , thus more return in the future for <br />
  39. 39. Shaper of society<br />