Utilitarianism and Business Ethics

Utilitarianism and Business EthicsDeception, greed, and peak pressure direct to the demise of Enron (Beenen and Pinto, 2009). Employees need the cleverness to disengage ethical pop outs from these complications of egoism and forget clear definition employees need to distinguish between negligible issues veritable(prenominal) of work life and critical issues that threaten a comp boths ethical environment.honorable issues come with temptations and threats. By understanding threats to personnel interests, alternatives allow arise to utensil chastenion. Going on with the crowd abide endorse immediate go interests w here(predicate)as resiting tin roll in the hay put status, c atomic number 18r and family well- being at risk. By judge ethical surmisal, this can puzzle out as a guideline for a human resource (HR) manager to identify and handle the issues of egocentrism.DeGeorge (2010) defines utilitarianism as an act of chaste significance established by its involvement to create the approximately(prenominal) amount of good for the most number of slew. This is based on the ability to foresee the consequences of an action as the excerption that succumbs to the greatest benefit, to the majority of stack, is the natural selection that is ethically correct.Beenen and Pinto (2009) identify that corrupt organisations, such(prenominal)(prenominal) as Enron, act unethically by decisions, that ar usually, made by a group of senior(a) employees to benefit the organisation. Decisions made by Jeff Skilling (senior manager) to cook the account statement books may know been, in his opinion, as an ethically correct office to benefit the sh arholders and stakeholders, by portraying a strong financial image. However, the consequences of this action didnt create the most amount of good for the most amount of people. Instead ego-interest influenced unethical doings by instrument of greed and pressure from Wall alley to benefit, non the organisation as a whole but, Jeff Skilling and management, item-by-itemisedly, for financial gain. coherent self-interest is good however greed is eventually detrimental (DeGeorge, 2010). eon the guess of utilitarianism will always argue to benefit the majority, it can besides neglect the minority (DeGeorge, 2010). Sherron Watkins ability to make judgment that Enrons accounting standards were basal created a rule utilitarianism approach with regards to the law and the concern with fairness pursuit to benefit the majority of people. Therefore, added benefits of rule utilitarianism values justice and includes beneficence at the same time.In the eyes of a HR manager, by pickings action the majority of the stakeholders would benefit from a moral organisation adhering to their grave of conduct, conducting fairness in all of their business activities. However, an issue with this decision, while sherron was commended for doing the business thing, showed that her actions to neglect the corrupt senior management team (minority) for the stakeholders (majority) for a more(prenominal) ethical workplace started to inflicted damage to the entire business. Cable, News, Network (CNN) (2002) stated that Enron filed for liquidation, people lost their jobs, near committed suicide and many were jobless. Sherron may bring in been trying to do the overcompensate (and difficult) thing but it may not brook been the best way to get ahead. Her self-interest was going to make up a consequence for the majority and she was unable to predict the future so as to see how her decisions would affect people later on. A HR manager needs to take into deemation that there is no way of telling exactly what the costs of our behaviour will be, we just do what we think is right at that specific time (DeGeorge, 2010).After examining DeGeorge (2010) a utilitarian approach to this model study in handling self-interest is too impractical. This is beca procedure the practical application of the theory requires the ability to predict the semipermanent consequences of an action and, to predict those consequences with unfailing accuracy past experience can, to some extent, guide future experience. However, there is never any guarantee that dower will turn out exactly the same (DeGeorge, 2010). This uncertainty can create unexpected leave al nonpareils making the utilitarian approach look unethical, as the time the choice was made didnt benefit the majority for the greater good. A HR manager needs to identify that the flaw in utilitarianism theory has no consideration for the minority however, kantian theory suggests that it doesnt neglect this issue i.e. allowing the minority to suffer for the benefit of the majority.According to DeGeorge (2010) Kants deontology theory is supported by the actions of an individual under consideration. A collective approach to an action suggests it can determine whether an action is moral as it allows one to portray the result of everyone universal ly bestow to this action.Immanuel Kants theory (DeGeorge, 2010) suggests that an individual must(prenominal)iness get under ones skin the emancipation to truly act in a moral way. In the contingency study, some employees understand the company is behaving unethically i.e. dodgy account standards for personal gain. A HR manager could identify that these people have a choice to standard their concern, leave the company or go along with the crowd however self-interest and the ability to be disciplined may pose a threat to take any action. These people have physiological needs to support family and a moral decision to voice their concerns, in this respect, could pose an issue. By being vile or play a blind eye, to the situation, could be the easiest option. Employees do have a choice and the freedom to make a moral decision however self-interest can sometimes turn a moral idea into an immoral decision without the discipline there is no freedom (Wood, 2008).A deeper digest of Kants theory suggests that the concept of ethics is not based on desires or circumstances. Moral law is a definite necessity because it has no herald there is no but part in the command (DeGeorge, 2010). Sherron Watkins provided an example of how this theory works. Sherron adhered to Enrons ethical label of conduct when analysing the ethical dilemma of accounting irregularities that were present. By identifying this problem to her manager, Ken Lay, she fulfilled her obligations of responsibility. Upholding ones duty is whats considered ethically correct (Wood, 2008). Sherron had found the morality through rationale of her mind as she was not influenced by feelings (p eccentric), but instead she was concerned with fixed statements of duty (I must).The theory suggests that an individual has no flexibility and no bechance to consider ones own blank space (DeGeorge, 2010). Naturally, people seem to discover that certain rules must have rational exceptions. For instance, with regard s to Ken Lay his decision not to advance Sherron Watkins could have jeopardised Andy Fastows position and the companies indicating individuals may need to lie to protect others. So, could a HR manager be reasonable to assume that the same rules can be applied consistently in variant circumstances? This makes Kantian ethics rigid because the consequence of an action is not necessarily dislocated from the action itself (DeGeorge, 2010). Unlike utilitarianism this theory is not based on well-disposed utility. It avoids the utilitarian flaw of allowing the minority to suffer for the benefit of the majority, based on free choice and similar to that of John Rawls theory of justice.As describe by DeGeorge (2010) the egalitarian, John Rawls, devised a theoretical model that proposed an individual who, cover in a veil of ignorance, would recommend a just nightclub without any understanding of their status in society. The individual would choose a system of justice that sufficiently prov ided for the lower end of society because the individual could end up being in that lower position so, avoids it by being just and fair.Enron executives paid above market bonuses and salaries, they awarded unethical behaviour and punished good behaviour. In a sense many employees would have tried to do the right thing i.e. perform what was asked of them in their germane(predicate) job role. While most of these activities were contributing to the overall unethical behaviour, an employee would slightly obtain their wage and bonus if they performed in a satisfactory or above expected manner. Self-interest presents an underlying problem here. While the lucre system of any organisation should be fair and just, greed and extreme pressure to perform presented self-interest drivers that awarded immoral behaviour. Rawls argued that regimented societies are comical due to the fact that what is just and unjust is usually in conflict (Rawls, 2003)Robert Nozicks libertarian theory of ethics is similar to Rawls in that they both swear utilitarianism is a flawed theory due to the importance on the consequences of policies and behaviour (Nozick, 1974 Rawls, 2003). both(prenominal) indicate that since utilitarianism highlights utility or contentment, within society, it cannot justify an explanation of assertions such as assertions of right which people are free to make upon the actions of others. Consequently, separately sets out to develop a political theoretical model which sufficiently suggests what Nozick depicts as, the fundamental Kantian principle that individuals are ends and not merely means (DeGeorge, 2010).Nozicks theory suggests that people have the right to possess entitlements such as remuneration as long as it doesnt worsen the position of anyone else (Nozick, 1974). but if these entitlements were obtained unethically, does this worsen the position of anyone else? In one hand people are morally trying to do the right thing but, in the faux pas of Cass andra, they eventually get punished she moved to another position being seen as a threat. On the other hand people knew their actions were contributing to immoral behaviour as self-interest (greed and pressure) clouded their decision to do what is right. So what are our rights in situations such as the above? The theory of rights can give a HR manager insight into how individuals are protected in an ethically correct way.According to DeGeorge (2010) rights are proposed by society which is protected and is given the uppermost precedence. Since society endorsees rights they are considered to be ethically correct and suitable.DeGeorge (2010) indicates that an individual must interpret what characteristics of rights are in society, as this can pose implications. The underlying issue in the case study is self-interest. Senior management is responsible to ensure that the integrity of the controls in the environment determines the effectiveness of any control system, including remuneration , leave entitlements and job opportunities. With reference to Enrons code of ethics (2000) dignity and mutual respect, for all employees, is a right that the company has promised to respect and uphold. Clearly, this right was not evident in this organisation. Individuals such as Sherron Watkins, Cassandra and Jeff McMahon were not given the right to be treated in a respectful manner as they were moved into different position disguised as promotions. The relevant rights in a business mise en scene to freedom of speech were noted by management, as they gave them a chance to express themselves however, this was quickly extinguished. Control systems (rules) may interfere with ones own self interest to succeed or avoid failure controls are mean for exactly that purpose. Those who would respond to business pressures by evading controls will devise rationales and tactical maneuver to justify such an evasion for tactics of disinformation and deception that they may use (Donnelly, 2003). For rights theory to be practical it must be used in combination with another ethical theory, such as ethical relativism, that will consistently outline the objectives of society.Ethical relativism refers to the principle that there are no commonly valid or required moral standards as any two individuals with differences in culture, who have different ethical views, regarding an action, could simultaneously be correct (DeGeorge, 2010).Beenen and Pinto (2009) indicated that Jeff McMahon knew that Enrons accounting practices were unethical while Andy Fastows belief indicated his way was ethically correct i.e. for the greater good of the company. While both ethical views are different they are also both correct. The underlying similarity here indicates that self-interest for personal gain was the main driver relative to their different ethical opinions. DeGeorge (2010) suggests a clear understanding of this theory must be carefully dissected when compared with cultural relativism as cu ltural relativism explains the way people actually behave, and ethical relativism recommends how people ought to behave.A HR manager should acknowledge that differences dont imply that there are no commonly valid moral standards. It teaches us that individuals may not always agree on what the principals are or should be. Relativism is a stronger claim as refutation that there are usually suitable moral standards. It is a theoretical claim active the existence of common moral standards, whether or not people believe in them (DeGeorge, 2010). Therefore, it must be verified or unproven by theoretical influences.In summary, ethical theories need to be examined and measured against one another to tackle the issue of self-interest. No one theory on its own is truly valid, rather a collaboration of all theories should be used in order to give a professional (HR manager) the requisite tools to create strategies and examine the likelihood of unethical behaviour.Enron ignored its ethical co de of conduct, self-interest (greed and extreme pressure) influenced management in an unethical manner. For ethics to be adhered to companies need to go beyond the notion of simple legal residence and adopt values based on organisational culture. Ethical reasoning is not natural its a skill that must be learned and practiced.