Busines Ethics

BUSINESS ETHICS

2008

Outline :

A) General overview.

B) Utilitarian theory.

C) Kant theory.

C) Rawls theory.

D) Conclusion.

Foreword:

This research paper discusses theories in business ethics. It also considers three cases that illustrate ethics principles violation.

Thesis:

Nowadays in the era of economic relations and international trade business ethics plays a very important role.

Nowadays in the era of economic relations and international trade business ethics plays a very important role. It is of vital importance at any level of activity: corporate, state or international. Questions of corporate social responsibility and business ethics are engaging business more and more - both domestically and internationally (Sims 2006). This tendency is emphasized by outrageous cases in international trade illustrated by violating rules of ethical behavior. Rules and regulations on ethics and behavior are affected unavoidably by basic values about the goal of company in the community. However, some organization members think the only social goal of a company is to gain benefit. On the other hand, other members consider that that the goal of a company is much wider than one of gaining profit and that all those participants who are influenced by the firm's activity - shareholders, staff, consumers, suppliers, the domestic society, babies (in particular concerning environmental protection) - have a reasonable concern and commitment in the corporate activity. Many of these commitments are important to a company whether it is domestic or international in its activity. Nevertheless, international companies face specific difficulties and requirements and above those operating only in local market.

The first situation we were given to consider deals with capital export for production abroad. This situation can be understood with the help of utilitarian theory. This theory is well presented in the works of M.Valaskes, J. Rawls, L. Nash. This concept is believed to be the most influential and pervasive in the business sphere. Any action that leads to the large useful effect is considered fair. In the common sense, the utilitarian principle is formulated in the following way: any action is rightful from ethical point of view if the total useful impact exceeds the total useful impact of any other action that could be carried out instead of the first one. The point is that all direct and indirect participants gain benefit. But applying this theory one should bare in mind that long-term consequences must be also taken into account. Considering the situation given with capital export, I should point out that this situation on the countries of export and import. If the export country is a rather developed one (such as the USA, the United Kingdom etc.) and the import country belongs to the underdeveloped one, it means that both parts will gain benefit from the situation. The developed country will generate profit locating its production in the area of cheap resources and workforce. In addition, the import country will get additional workplaces. As the result, all participants have benefits in the situation. The capital owner generates benefit, the unemployment rate in the import country reduces and the employees have ability to earn money. However, when the situation is reverse it can cause losses to many participants. Suppose the business in the African state is rather prosperous despite the total economy decrease in the country and its owner decides to export money in the developed country. He does this because believes that in that country business is more stable and durable. As a result, he satisfies only his own goals, but this will not increase economy situation in the country. The business takes money from the mother country and then invests it into another one. This case cannot be considered fair from the ethical point of view applying the utilitarian theory. The main difficulty of this theory is the problem of evaluating negative and positive impact of the company activity. It is very difficult to evaluate moral consequences justly.

The second situation refers to export of commodities that have been banned from sale in the USA. I would like to consider this situation with the help of Kant theory. Many businesspersons apply Kant ethics nowadays. The action is considered morally fair for the individual if the reason of the action encourages this individual desire other to act the same way. Therefore, personal motives are to be universal and reversible. Contrary to the utilitarian theory, Kant concentrates on inner motives of an individual. Lying is considered to be the wrong process, because when this activity is pervasive the relationships between humans will be distracted. People will lose confidence and society will split into small hostile groups. Certainly, humans apply lie from time to time, but the society works as a single mechanism. Kant only warned about the consequences of the widespread unfair practice. Kant theory belongs to deontological theories that deal with human's rights. Any businessperson has the right to lie that those commodities are of high quality and the customer is very lucky to have them. It regards his moral values weather to make harm to consumers or not. It is quite clear that those products that are banned from sale in such developed county as the USA cannot be healthful and useful. By exporting such goods, the seller takes informal responsibilities for the consequences. Kant formulated the principle of his ethics: "Act as if you considered mankind as a goal but not as a mean. Every person has temptation to use other people as a mean to achieve the terminal goal. This practice is often used in business. Nevertheless, Kant theory cannot be applied to social responsibility of the business. How can the corporate norms and the universal ethics be correlated. In the case study, the seller has the right to sell those products to any customer desiring to purchase it. Moreover, others have the moral obligations not to interfere with him. If he has the right then his actions are believed to be morally justified. On the other hand, we must bear in mind that he seller from the developing or underdeveloped