Business Ethics & CSR

Naeem ASHRAF

Spring, 2015

LUMS

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Grades Breakup

Class Participation: 10%

Attendance & Punctuality: 5%

Assignments: 10%

Quizzes: 20 % (4: N-1)

Mid-Term Examination: 30%

Project / Term Paper: 25%

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More than 3 absences or late arrivals will result in a grade reduction of 1% of total grades for

each extra absence or late arrival.

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COURSE OVERVIEWWeek/

Session/ Module

TopicsRecommended

ReadingsObjectives/Application

Week 1Introduction & Overview: Why Study Business Ethics?The Nature of Business EthicsMoral Reasoning

Chapter 1 (Velasquez, 2006)Introduction and discussion on the importance of the subjectUnderstand how moral reasoning works

Week 2- 5

Foundations of Ethics: Introduction to Moral PhilosophyConsequentialist and Non-Consequentalist Theories Virtue Ethics

Chapter 2 (Velasquez, 2006) Understand the four widely used bases for making ethical decisions in various business contexts

Week 6The Business System:Criticizing Markets and Free Trade Chapter 3 (Velasquez, 2006)

Appreciate the arguments for and against markets and free trade

Week 7

Ethical Issues in Business Settings: External Stakeholder Issues (Environment)Mid Term

Chapter 5 (Velasquez, 2006)Explore how certain business practices damage the environment, and the ethical responsibility of businesses

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Week 8 & 9

Ethical Issues in Business Settings: External Stakeholder Issues (Production and Marketing)

Chapter 6 (Velasquez, 2006)Discuss different theories of a firms duties to consumers, and the ethical dimensions of advertising and consumer privacy

Week 10

Ethical Issues in Business Settings: Internal Stakeholder Issues (Job Discrimination)

Chapter 7 (Velasquez, 2006)Analyze the nature and extent of job discrimination along with the ethical dilemmas inherent in affirmative action

Week 11 & 12

Ethical Issues in Business Settings: Internal Stakeholder Issues (Employees Rights and Obligations)

Chapter 8 (Velasquez, 2006)Understand the employees rights and responsibilities and a firms duties to the employee

Week 13

Ethics and Corporate Social

Responsibility:

Arguments for and against CSRPrinciples of Social Responsibility in BusinessSchools of Thought on Social Responsibility

Reading: Detienne, K.B., Lewis, L.W. The Pragmatic and Ethical Barriers to Corporate Social Responsibility Disclosure: The Nike Case. Journal of Business Ethics. 2005.

Discuss the varying views on CSR and evaluate the arguments for and against it using Nike as a case

Week 14

Final Project Presentations

Consequentialism / Utilitarianism

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Bentham

Intense, long, certain, speedy, fruitful, pure

Such marks in pleasures and pains endure.

Such pleasures seek, if private by thy end;

If it be public, wide let them extend.

Such pains avoid, which be thy view;

If pains must come, let them extend to few.

(Bentham, quoted from Stewart & Blocker, 2006. Fundamentals of Philosophy, Pearson)

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How to Apply Utilitarian Principles

First, determine what alternative actions or policies are available to me in that situation.

Second, for each alternative action, estimate the direct and indirect benefits and costs that the action will probably produce for all persons affected.

Third, for each action, subtract the costs from the benefits to determine the net utility of each action.

Fourth, the action that produces the greatest sum total of utility must be chosen as the ethically appropriate course of action.

Criticisms of Utilitarianism

Critics say not all values can be measured. Life, love, freedom, equality, health, beauty, whose

value is such that it cannot be measured in economic terms.

Utilitarians respond that monetary or other commonsense measures can measure everything. Instrumental goods: that are considered valuable

because they lead to other things (e.g. visit to dentist) Intrinsic goods: that are desirable independent of any

other benefits they may produce (e.g. health) Needs (foods, clothing, and housing etc.) vs wants

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John Stuart Mill

How to make qualitative distinction between higher vs lower pleasures? Of two pleasures, if there be one to which all or

almost all who have experience of both give a decided preference, irrespective of any feeling of moral obligation to prefer it, then that is the more desirable pleasure (Mill)

The sole evidence it is possible to produce that anything is desirable is that people actually do desire it. (Mill)

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Criticisms of Utilitarianism

Greatest good for the greatest number

Critics say utilitarianism fails with rights and justice.

Utilitarians respond that rule-utilitarianism can deal with rights and justice.

Rule-utilitarianism: A form of utilitarianism that limits utilitarian analysis to evaluations of moral rules. (Mill)

Act utilitarianism (Bentham)

The view that we assess the rightness or wrongness of each act by its tendency to promote the greatest happiness for the greatest number.

Rule utilitarianism (Mill)

Dont regulate each but to arrive at general rules which, if kept throughout society, will enhance the general welfare and increase the total amount of happiness

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Criticisms of Utilitarianism

Fairness and minority rights

City of happiness

The problem of conflicting rules

Do not kills vs You ought to protect your homeland from invasion

Proof for utilitarianism

Prescriptive (ought) vs descriptive

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Criticisms of Utilitarianism

John Stuart Mill

It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates

dissatisfied than a fool satisfied. An if the fool, or the pig, is of a different opinion, it is because

they know only their side of the question (John Stuart Mill quoted from Stewart & Blocker, 2006.

Fundamentals of Philosophy, Pearson).

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The greatest good (taking into account reasonable personal preferences, based on commonly accepted time horizons, and judged by someone with the maximum degree of impartiality) of the greatest number (subject to the protection of the socially accepted rights of legitimate minorities) based on the informationavailable at the current moment, and reasonable assumptions about what is likely to happen in the future. (Jones et al.,2005. Business Ethics. Routledge)

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THANKS !