Business Ethics Notes

PHI2397 NOTES

Moral and Ethical Questions

• How we ought to behave
• Apply ethics,
• Example of intuition is clear

• Raising dog from puppy, kicking the dog and hits the wall – feelings during response of anger and sad

• Try to take step back from intuitive response
• Difference between reasoning and persuading – is reasoning about persuasion?

• Persuade is to get someone to convince
• Being reasonable and logical can help people in persuading – reasoning is one possible way of persuading

Argument

→ Series of proposition to support a conclusion or statement

• Series of propositions would be called premises
• Trying to convince you of conclusion
• What’s the conclusion? What are they trying to convince us of?
• www.criticalthinking.org/ctmodel/logic-model1.htm → Elements of thoughts

Google Biases – Women vs. Men

• Trainers asking for feedback about the training
• Talks about how women different from men
• Look at all the facts – who shared it? It was an internal message
• Example with the news getting leak and had a huge twitter fight
• Public relations disaster
• This should be the kind of thinking to proceed throughout the semester

Class 4: Honesty and Trust

• Second half of chapter 2
• Every class will have discussion note –

• Car’s Position

• Threshold in business is different than in real life
• Uses poker as a reference and how people bluff – poker is used as an analogy
• Business is like poker. What’s true of poker is what’s true of business

• Said that if you don’t want to bet, don’t play
• Bluffing is part of the game therefore morally acceptable
• If you’re a poker player, expectations are that the others bluff
• Faking an injury during a match would be considered a form of bluffing
• Bluffing is part of the RULES

• How are poker and business similar?

• There’s rules that you have to follow for example, the law
• Different players with different interests
• It’s not expected for people to help each other help
• There’s winners and loser

• If you say it’s morally ethical to bluff in poker, is it ethical to bluff in real life?

• Poker is nothing less than a game

• There are non profit places that

• More toleration for bluffing in a business than non profit
• Moral threshold for non profit

• Rederick

• Art of persuasion – reason is one way but there’s a distinction between logic and rederick

• Harry Frankfurt on Bullshit

• These are among the foundation of civilization
• Bullshit is lack of concern between truth and falsity
• Serves another purpose, true or false is irrelevant
• Distinction between bullshit and liars

• Insidious threat to the values

• This shows value for truth
• Our attitude of bullshit – we are tolerant of this versus lying

• Liars are injuring us, but we don’t feel this way with bullshit

• Does bullshit require creativity? Yes.

• Liar is limited to their commitment to saying something that conflicts with the truth (constraint)
• Bullshit doesn’t care about truth can go anywhere he likes

• Bullshit has increased compared to 100 years ago. Intensity of marketing motive in contemporary.
• Higher educated people can create more bullshit and acquire arrogance that leads them to be negligent about truth and falsity

• This may encourage to produce bullshit

• It’s a disregard for truth
• Liars see value in the truth such that they want to guard it whereas bullshitters don’t care

• Is being a good bullshit artist good for the business?
• Is there a difference between being strategic with information and bullshitting?

October 2, 2017

Insider Trading

• How would you describe this normative vs. descriptive?

• Descriptive is more neutral, normative is going to have values embedded in the statement (not obvious)
• Descriptive is just stating what is the case and not saying whether it’s good or bad
• Know the difference between the two

• Insider Trading

• Having access to private information putting you in an advantage

VIDEO: Money Matters

• Martha Stewart

• Accused of insider trading
• Would’ve lost 46k if she didn’t sell her stocks
• Language was relatively neutral
• Was there anything suggested in the subtext to present normative argument

• The music was very intense

What’s wrong with inside trading?

• It gives people an advantage compared to others and can influence the market
• If you play unfairly, you’re taking money from other people

VIDEO: ROBERT MURPHY’S ARGUMENT

• Reflects what everyone knows

• Just by insider trading, stock price is going down
• If you’re an insider, and you’re allowed to trade, you’re going to be encouraged to trade your stuff, which will better reflect
• Companies will be less able to hide things
• He’s incentivizing to let you know what’s going on through their trading actions

• Yes you’re going to benefit as insider, that’s your incentive
• Able to influence the price, price will then accurately reflect what’s going on
• If you’re not outsourcing, are you more likely to check it yourself?

Took out textbook to look into insider trading section…

• She believes that lifting band on IT will cause harm

• This is a normative argument
• Moral Theory: actor, action or consequence?

• Consequences because we’re talking about harm – consequential theory

• Duties

• What kind of moral theories are we talking about? Deontology
• Talking about the action itself
• Elements of both

• Equal opportunities – fair fight (version one)

• E.g. garage sale and finding a good deal

• Disparity of information with insider trading
• Disparity of info is not what’s unfair. If I get good at the game, that’s not unfair (practice or just naturally better)

• People on both sides already know of the price (or should know)

• Unequal access to information (version two)

Property Rights

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Two Kinds of Harm:

1. Potential harm to ordinary investors

1. There’s winners and losers

1. Harm to the market

1. Erode investors confidence in the market

→ Insider trading necessary for ordinary investors? It depends how you construct the management of your money. Example in the book.