Business Ethics is a field of study in philosophy that investigates the underlying principles and standards employed to evaluate the morality of human actions (“ethics,” Collegiate). Unlike anthropology or sociology, which primarily aim to define moral systems within societies, ethics focuses on providing justification for moral principles.
The study of ethics has been conducted since ancient times, with its presence seen in the oldest Indian writings from around 1500 BC. These writings are considered to be the oldest philosophical literature globally, encompassing discussions on the nature of reality and how individuals should lead their lives (Everson 5).
In ancient China, various teachings offered alternatives to frequent wars. These included the humane teaching of Confucius and his followers, the peaceful wisdom of Lao-zi, and the universal love of Mo-zi.
Early Greece is where Western philosophical ethics originated. During the 7th and 6th centuries BC, there were ethical principles in poetic literature, but no cohesive ethical stance was formulated. The Greeks later referred to these notable poets and early philosophers as the seven sages, and Plato and Aristotle often quoted them with reverence.
Three influential philosophers – Socrates, Plato, and Aristotle – emerged during the Classical Period of Greek ethics in the 5th and 4th centuries BC. Their concepts have remained paramount in Western ethics.
Two prominent schools of thought, Stoicism and Epicureanism, emerged during the later Greek and Roman periods. Both of these approaches aimed to address the question of how individuals should live.
During the Middle Ages, there were no notable ethical theories that emerged. It is essential to acknowledge that Christian ethics and philosophical ethics differ as Christian ethics is derived from revelation, specifically the teachings and actions of Jesus Christ, whereas philosophical ethics is grounded in reasoning. Also known as moral theology, Christian ethics relies on authoritative revelation for its principles.
During the Renaissance, there was a significant shift in ethics as it marked a change from God being the primary focus to man becoming the main point of interest. This shift was noteworthy because it had not occurred since the Roman Empire’s conversion to Christianity. The new dominant theme during this time period was humanism instead of religion (Becker 25).
During the 16th century, Western Christianity experienced a division known as the Reformation. This event led to the emergence of national traditions of moral philosophy in Europe. The British tradition, in particular, developed autonomously from ethics, while the continental tradition followed a distinct path of development in continental Europe.
Confucius, a Chinese philosopher born in 551-479 BC, has had a profound impact on East Asian civilization. His teachings focus on the transformation of individuals into “gentlemen” or “superior men.” Integrity, respect for others, trust, and justice are highly valued by Confucians, especially when it comes to treating everyone equally. These values play a vital role in creating a healthy business environment and hold even greater significance in today’s global knowledge economy.
The process of globalization has made it possible for people from various cultures to engage in business relationships. However, establishing trust among vastly different individuals can be challenging. This challenge becomes even more complex if both parties fail to recognize their shared similarities or believe that their own business practices are superior rather than just different. The global ethic embedded within Confucianism promotes harmonious relations among diverse communities.
Thomas Hobbes (1588-1679) was a well-known British philosopher known for his pessimistic view of human nature. He argued that all voluntary actions undertaken by individuals are motivated by either self-gratification or self-preservation. In line with his egoist theory, an action is deemed moral if it benefits the long-term self-interest of the person. However, this perspective goes against the ethical standards upheld in diverse fields such as accounting.
Georg Wilhelm Friedrich Hegel (1770 – 1831) was the final great systematic philosopher of modern times. According to Hegel, history advances through a series of conflicts. A concept, called a thesis, inevitably gives rise to its opposite, known as an antithesis. The interactions between these two lead to a synthesis of the two. This synthesis then becomes a new thesis, and the process begins anew. From this perspective, we can interpret the ethical environment of the late 1990s as a thesis that generated an antithesis in the form of social outrage, new regulations, increased stockholder activism, the implementation of the Sarbanes-Oxley Act, heightened focus on the support roles of Finance and HR, and various other changes.
Adam Smith, the Scottish social philosopher and political economist of the eighteenth century, is often credited with being the originator of the Industrial Revolution. According to Smith, individuals engaged in commerce typically act in their own self-interest for personal economic benefits. Nevertheless, Smith asserts that this does not imply that those involved in commerce are inherently selfish or greedy. He proposes that markets function optimally when there is economic freedom and when individuals exhibit thrift, prudence, and a balance between cooperation and competition (represented by the “invisible hand”).
Henry Sidgwick (1838 – 1900) was an English philosopher and author known for his direct ethical theory based on Utilitarianism. His Methods of Ethics (1874) is the most comprehensive and nuanced work of Utilitarian ethics ever written (Ashby 38). Utilitarians acknowledge the presence of trade-offs in decision-making. They view morality from the perspective of what benefits society as a whole. The utilitarian approach is frequently applied in certain business decisions, including performance measurements and evaluations.
Friedrich Nietzsche (1844-1900) is a well-known literary and social critic, rather than a systematic philosopher. He opposes Henry Sidgwick’s ideas on objective ethical standards and the notion of progress in ethics. Nietzsche argues for abandoning both modern and ancient ethical beliefs, including those embraced by the Greeks.
In the 19th century, Herbert Spencer, a prominent British figure, was known for his radical liberal beliefs and contributions to sociology and political philosophy. He is widely credited as the founder of Social Darwinism. According to Spencer’s ideology, an ideal society embraces a laissez-faire approach to political economy – relying on private enterprise and minimizing government intervention, except in cases where deliberate harm or interference among individuals needs prevention.
Spencer argues that an economic system based on laissez-faire principles promotes individual-driven entrepreneurial growth. It gives individuals control over their economic pursuits and allows them to fully enjoy the benefits of their labor. Spencer supports privatizing various aspects of society such as roads, schools, money, mail services, land, parks, and utilities while advocating for minimal taxation.
Watsuji Tetsuro (1889 – 1960) was a renowned Japanese moral philosopher who aimed to amalgamate Eastern moral values with Western ethical concepts. His philosophy revolved around interpersonal and societal relationships, encompassing the family through to the state. Rooted in Watsujian and Confucian philosophies, these relationships are perceived as lifelong commitments, where individuals find it challenging to forge new connections. Moreover, their sense of duty towards relationships frequently extends beyond death; for example, a friend may feel obliged to support the education of a deceased friend’s child. Likewise, commercial relationships are also regarded as enduring commitments. Rather than solely engaging in transactions or building reputation, businesses strive to establish lasting connections with their customers.
John Rawls (1921 – 2002) was an influential American philosopher known for his work in political and ethical philosophy. He is widely regarded as the foremost political philosopher of the 20th century. Rawls focused on the concept of justice and its importance in society. He proposed a model called “property-owning democracy,” which aimed to distribute production resources fairly, enabling economic self-sufficiency even for those in disadvantaged positions.
In summary, conflicts of interest are inherent in the business world. Society desires increased employment opportunities, while companies seek to decrease expenses and increase productivity. Customers prioritize affordable prices, while businesses aim to maximize profits. Moreover, society aims to reduce pollution levels, whereas businesses strive to minimize the cost of complying with environmental regulations.
Managers have the responsibility of effectively managing the requirements of their organization and stockholders, while also taking into account the needs of other stakeholders such as employees, customers, and the wider community. It is important for managers to consider their own personal needs and desires in relation to their organizations.
Works Cited
Ashby, W. Allen, Warren Ashby. A Comprehensive History of Western Ethics: What Do We Believe? Amherst: Prometheus Books, 1997
Becker, Lawrence C., and Charlotte B. Becker, ed. A History of Western Ethics. New York : Routledge, 2003.
The term “ethics” is defined as a branch of knowledge, according to the 2005 Collegiate Encyclopedia. This definition was discovered in the same encyclopedia on June 4, 2005.
Stephen Everson edited a book titled Ethics, which was published by Cambridge University Press in 1998. The publication occurred in both Cambridge, U.K. and New York.
