Week 3: Utility, Duties and Organizational Stakeholders

Societies have norms. Organizations have values, policies and practices. Profession’s have standards.

Ethics and law, what is considered legal by a society and what is not, are two separate things. The hope is that laws will be grounded in what is moral. Ideally, ethics is to guide law and civic regulations in their formation and practice.

For Robert Nozick (2001), former Harvard philosopher and professor, ethics referred to "the most weighty principles or values concerning interpersonal relations (or relations of self and other, including self and animals, or self and environment) that mandate behavior that may be opposed to one's desires of the moment, where these principles or values are not backed solely (or predominately) by the consideration that other people will punish you if you deviate."

For him, "ethical beliefs facilitate closer coordination and voluntary exchange among people."

While there are many ways to categorize Western ethical traditions (Pojman, 2002) four frameworks are pivotal in examining information ethical issues in either a social or business setting: utilitarian, duty (deontological), virtue, and care. These frameworks are augmented by two perspectives that can be used as sub lenses that focus decisions: stakeholder theory and social contract theory.

The utilitarian framework espouses the greatest good for the greatest number of people with the outcome or end being the primary focus (Mills, 1987). On the other hand, the duty (deontological) framework emphasizes that there are moral imperatives that need to be followed while never compromising the dignity of people when taking action. One must seek to discover and act in a manner rooted in these principles with the means never justifying the end. (Kant, 1988) Related to this ethical perspective, is the understanding that all men and women have rights that should not be violated. (Locke, 1952)

The utlitarian ethical perspective is the most prominent approach in today's business arena, and the deontological second.

The utilitarian approach enables the business as a whole--its survival and success--to be seen as the primary objective when decisions are made. It also allows the shareholders to be conceived as the organization's key stakeholders whose "happiness" or interests must always be sought.

Employees, natural resources, vendors, business partners, customers and local communities are just a "means" to the organization's articulated end, i.e., its business goals and mission. Thus, their needs and welfare do not have to be considered, only the organization's desired end. In the modern business arena that is the financial bottom line--the highest profit margin, the greatest return on one's investment. In a utlitarian perspective people can ethically be used as a means to the end.

Such perspectives can be seen in how lay-offs are used, downsizings are conducted, workloads are constructed, and pay scales and compensation packages developed. Business practices often ask much of employees--long hours and work weeks, reduced pay, work travel, always being on call, etc.--for the benefit of the business enterprise. Markets are often seen as a source of "profitable gain," not people. Natural resources are often utilized for the sake of the highest bottom line, not looking at the effect upon the environment or the sustainability of resources. Products, and their quality, are developed and sold to customers for the profit, not always considering their effect upon the consummers health and safety.

The deontological or duty perspective, has a different approach. People have rights and can never be treated as a means to an end. If the desired result cannot be optained without violating the dignity and rights of people, then another end must be sought. What ever "legitimate" or "reasonable" harm that may come to a person must be minimal. With today's wider consciousness and its understanding of the "rights" of animals, this view can be extended to the environment.

Such a perspective can be seen in human resource laws and regulations that protect employees and demand safe, nonviolent and non toxic work environments. Product quality/safety and the emerging ecological and sustainable standards also are influenced by this viewpoint. Organizations, their productes and services are to safeguard the rights of citizens and future generations by providing safe products and a helping ensure a healthy environment.

What do you see as the pros and cons business practices being rooted in utilitarian and duty oriented ethical perspectives? How can business practices be improved? Why?