2309 4556 1 SM - 220415 - 114554
2309 4556 1 SM - 220415 - 114554
2309 4556 1 SM - 220415 - 114554
VOL. 8 NO. 1, 2022 (ISSN: 2504-8694), Indexed in Google Scholar (EMAIL: ijaasng@gmail.com)
NNAMDI AZIKIWE UNIVERSITY, AWKA, NIGERIA
Abstract
Velasquez underscores Business Ethics as a specialized study of moral right and wrong. This is so since
it focuses on moral standards as they apply particularly to policies, institutions, and behavior in business
environment. It is the application of our understanding of what is good and right to that assortment of
institutions, technologies, transactions, activities, and pursuits which we call ‘business’. J. Desjardins
holds that Business Ethics refers to those values, standards, and principles that operate within business.
He also believes that Business Ethics can refer to an academic discipline which studies such values,
standards and principles. However, he endeavored to make a distinction between Business Ethics as an
academic field and as a practical guide. Thus, he opined that Business Ethics as an academic field is
more a matter of ethical reasoning and thinking than behaviour. The crux of the matter in this study is
– what exactly is the subject matter of Business Ethics? In addressing the question, this study employs
the method of analysis to look into the quiddity/nature of Business Ethics especially as it pertains to
resolving some ethical dilemmas that rear their heads in business environments. This is in relation to
putting human beings side by side with profit making which is the hallmark of doing business. In all,
this study concludes that the gamut of what is studied in Business Ethics is that Business Ethics seeks
to ensure that there is human face in business.
Keywords: Business Ethics, Ethical Dilemma.
Introduction
Business Ethics is a specialized study of moral right and wrong. This is so since “Business Ethics
focuses on moral standards as they apply particularly to policies, institutions, and behavior”.1 “It is the
application of our understanding of what is good and right to that assortment of institutions,
technologies, transactions, activities, and pursuits which we call business”. 2 C.W. Gichure views
business “as corporate institutions, voluntary and statutory, including small sector, professional and
trade bodies, trade unions, government departments, legislative and regulatory agencies and
institutions”3. These imply that Business Ethics applies to such parties as; investors, consumers,
employees, policy makers, directors etc. To this effect, Business Ethics is undoubtedly needful in
business because, producers, providers and consumers of goods and services may conflict with each
other in value sharing. Expatiating on the above postulation, J. Desjardins holds that “Business Ethics
refers to those values, standards, and principles that operate within business”. 4 He also believes that
Business Ethics can refer to an academic discipline which studies such values, standards and principles.
However, he endeavored to make a distinction between Business Ethics as an academic field and as a
practical guide. Thus, he opined that “Business Ethics as an academic field is more a matter of ethical
reasoning and thinking than behavior”.5 This is so because Business Ethics having a practical side aims
at judgment, behavior and actions within business milieu. “Business Ethics is very pivotal in business
owing to the fact that human individuals underlie the cooperate organizations and those human
individuals are the carriers of moral duties and moral responsibilities”. 6This simply means that human
person is both the terminus a quo and terminus ad quern of Business Ethics. Business Ethics therefore,
considers the rights, duties, and obligations of individuals as both producers and consumers in the
business environment. Consequently, Business Ethics covers such business areas as production, sales,
pricing, profit making, advertising, marketing, purchase, etc., all in a bid to ensure justice and fairness
as well as commitment and loyalty in business environments.
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i. Systemic Issues: Systemic Issues in Business Ethics are those ethical questions that pertain
to the economic, political, legal, and any other social systems in which business functions
and operates. Velasquez submits that systemic issues include “questions about the morality
of capitalism or of the laws, regulations, industrial structures and social practices within
which business operate”.7They are ethical issues that relate to the incompatibility of cultural
norms and values expectations of different businesses. For instance, in Nigerian case, this
type of issues may be seen in the relations between oil companies and their host
communities. Again, systemic issues in business may arise in a situation where a business
organization that produces condom wishes to operate in an environment that abhors pre-
marital sex.
ii. Corporate Issues: These are ethical questions that pertain to individual companies. For
Velasquez, “they include questions about the morality of the activities, policies, practices
or organizational structure of an individual company taken as a whole”. 8 For instance, in a
company such questions as these constitute corporate issues: do production processes have
harmful effects on the operators or users, are people lied to, are products in breach of patent
rights, are labour practices in breach of human rights? Etc. all these are some of corporate
issues that Business Ethics is desirous of examining and consequently resolving.
iii. Individual Issues: These are those ethical issues that concern a particular individual or
individuals within a company. These include questions about the morality of the decisions,
actions and character of individuals in a business organization. These are issues that arise
from individual idiosyncrasies, beliefs, opinions and moral inclinations. For instance, a
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company that has individuals from different cultural and religious leanings is sure to
experience this level of ethical problem. In this context, “Business Ethics has to do with the
extent to which a person’s behaviour measures up to such standards as the law,
organizational policies, professional and trade association codes, popular expectations
regarding fairness and rightness, plus individuals’ internalized moral standards”.9
a. Law: Law is an important and legitimate source of ethical guidance. That is why in business
environment, it is generally believed that the way out of ethical dilemma is to concentrate
on legal compliance. In line with-this, violation of the law is regarded as unethical except
where civic disobedience is the case. Regarding this Schermerhorn believes that “pursuing
business outside the law is regarded as an obstructionist approach to Business Ethics”. 10
c. Codes of Conduct: These are codes of behaviour that are adopted by professionals and
trade associations. Most often these codes go beyond stipulations of law to establish higher
standards than the law ordinarily requires.
d. Social Mores: These refer to communities’ concept of morality which is often times
unwritten. “These social mores based on commonly held beliefs about what is right and
wrong and fair and unfair can be powerful determinants of a person’s reputation”. 11
ii. Drawing Demarcating Line between Legality and Morality in Business Environment:
The relationship between law and Ethics is close that often they are difficult to separate.
This is because both law and ethics (morality) help for a well ordered society. However,
the two concepts are not the same thing though they share relatedness.
One clear way to understand their distinction is to view them from the perspective of legality and
morality. While legality is connected to law, morality is connected to ethics. This way, it becomes clear
that some actions can be legal without being moral. Some laws proscribe certain moral acts while others
still allow immoral act. For instance, slave trade at the time it was in vogue was legal but immoral.
In the business world, many business people believe that ethics is identified with the law. For these
people, business behaves ethically when it obeys the law. But does compliance with law alone
presuppose compliance with ethics? By no means, compliance with law alone will prove insufficient
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for ethically responsible business. In line with this presupposition, Desjardins postulated that “there are
some cases where law does not help, and the manager (of an organization) therefore is forced to make
judgment about what ought to be done”.12 This goes to demonstrate that one cannot always rely on the
law alone to decide what is right or wrong. Now consider a situation where a factory that produces
edible items with one form of harmful elements obtains and retains a legal backing to operate. The
question here is, is the activity of this factory legal and moral? By all standards, it is legal. By all
standard too, it is unethical or immoral. Corroborating this view, Joseph Desjardins opines that:
It is because most business decisions never get to the point where a
judge and jury' are asked to make a determination, business managers
will be faced with the unavoidable responsibility of looking beyond
the law for guidance in making ethical decisions.13
Now consider this story as told by Manuel G. Velasquez, in his book Business Ethics, Concepts and
Cases.
When an accountant for example, was asked to prepare a
Business ethics report for the Board of Directors of a certain
company, his report excluded allegations that a store manager
was trying to bribe a tax officials. When asked why the alleged
bribery attempt was excluded from the report, he replied that
he did not feel the incident was ‘unethical’ because it was not
‘illegal’ implying that ‘unethical’ and ‘illegal’ are the same. 14
This story serves to show that it is wrong to see law and ethics as identical. However, in certain
circumstances, law requires what ethics requires and vice versa. For instance, both law and ethics
prohibit murder, rape, theft, etc. When this happens, we say that law and ethics have coincided.
However, this coincidence is not always because same laws have nothing to do with morality. Again,
experience has shown that some laws even go as far as violating moral standards so much so that they
are contrary to morality. Examples of such laws are pre-civil war laws in America that required citizens
to treat slaves as property and the laws of Nazi Germany that allowed anti-Semitism.
The point that has been established is that in life and in business environment, ethical standard
supersedes legal standards. But this does not imply that ethics does not need law. Velasquez succinctly
puts it this way:
Both law and ethics should play complementary roles in the
business world; where ethics lack force, law should come in
and where law derails, ethics should direct. Our moral
standards are sometimes incorporated into the law when
enough of us feel that a moral standard should be enforced by
the pressures of a legal system; and laws on the other hand, are
sometimes criticized and eliminated when it becomes clear
that they blatantly violate our moral standards.15
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The above citation implies that Ethics, apart from being an academic discipline as a branch of
Philosophy, is also a practical guide in life which helps us to, among other things, make some choice
about how to conduct our behaviours every now and then. Business Ethics arose from the need to have
a clear guide in the decision making processes environments. This is so given the fact that a whole lot
of dilemmas exist that need to be tackled in day to day business operations. More so, given that law
alone is insufficient in guiding business. Ethical dilemmas in business are both actual and potential in
nature in that they occur and keep occurring.
Some Philosophers through the ages have come up with five approaches/ways in dealing with moral
issues in Business Ethics. This study adopts these approaches as a way out of those ethical dilemmas as
earlier stated in this work. The approaches are:
i. The utilitarian approach
ii. The rights approach
iii. The fairness or justice approach
iv. The common-good approach
v. The virtue approach
Finally, utilitarianism provided that the ethical action is the one that provides utility (usefulness) based
on the greatest good for the greatest number.
ii. The Rights Approach: Immanuel Kant is a foremost proponent of this approach. According
to the philosophers of this approach, what makes human beings different from mere things is
that people have dignity based on their ability to choose freely and that they have a fundamental
moral right to have these choices respected. This approach maintains that humans are not
objects that can be manipulated so that it is a violation of human dignity to use people in ways
they do not freely choose. Apart from this already mentioned fundamental rights there are others
that are related and complimentary to it, namely:
a. The right to the truth
b. The right to privacy
c. The right not to be injured
d. The right to what is agreed
Using this approach to decide whether an action is moral or otherwise we must ask: Does the action
respect the moral rights of everyone? Actions are wrong to the extent they violate the rights of
individuals.
iii. The Fairness or Justice Approach: This approach is traceable to the teachings of the ancient
Greek philosopher, Aristotle who submitted that equals should be treated equally and unequals,
unequally. Another philosopher whose work has great bearing on this approach is John Rawls.
Going by this approach, the basic question to ask is: How fair is an action? Does the action treat
everyone in the same way, or does it display favoritism and discrimination which are both
unjust and wrong.
iv. The Common-Good Approach: The notion of common good originated from the writings of
Plato, Aristotle, Cicero and Thomas Aquinas. It is a notion that conceives a society as a
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community whose members are joined in the shared pursuit of values and goals they hold in
common. The goods of the individuals are inextricably bound to the good of the whole. This
approach enjoins us to consider ourselves members of the same community while reflecting on
questions regarding the kind of society we want to become and how we are to achieve that
society. It also exhorts us to recognize and advance those goals we share in common.
v. The Virtue Approach: Oxford Advanced Learners’ Dictionary defines virtue as behavior or
attitudes that show high moral standard. This approach therefore holds that there are some ideals
toward which we should strive and which leads to the full development of our humanity. These
ideals are discovered through thoughtful reflection on what kind of people we have the potential
to become. Virtues are like habits which once acquired characterize a person. In this way, the
person will be naturally disposed to act in ways that are consistent with moral principles. Some
of these virtues in question include: honesty, courage, compassion, generosity, fidelity,
integrity, fairness, self-control, prudence, et cetera. In tackling ethical dilemmas by applying
the virtue approach, we should ask the following questions: what kind of person should I be?
What will promote the development of character within me and my community? What character
traits would I be exhibiting if I choose this action? - Honesty or deceit, compassion or
selfishness, prudence or imprudence, responsibility or irresponsibility? etc.
Conclusion
There is no gain saying the fact that some people believe that all there is in business is to make profit
no matter the means employed in making such profit. As it were, some people believe that lying is part
and parcel of business so that one must lie to make profit if lying is the only way to succeed in business.
Lying entails falsehood and falsehood has different manifestations in business which include –
adulteration of products, putting false expiration date on products, lying about ingredients on products,
shooting up prices, etc. All these are done not minding the negative effects on the customers and
consumers. Therefore, it amounts to a situation of subjugating the cause of humanity and indeed
relegating the service-nature of business to the background. It is therefore important that Business Ethics
should exist to provide a standard that must be followed in business environment. Otherwise, business
environment will be characteristic of Hobbesian state of nature where life is nasty, short and brutish.
References
1. M.G. Velasquez, Business Ethics: Concepts and Cases, 4th ed. (New Jersey: Prentice-Hall
Inc., 1998). p. 13.
2. Ibid. p.1.
3. C.W. Gichure, Ethics for Africa Today: An Introduction to Business Ethics (Nairobi: Pauline
Publications Africa, 2008). p.14.
4. J. Desjardins, An Introduction to Business Ethics, 2nd ed. (New York: McGraw Hill Companies
Inc., 2006). p. 8.
5. Ibid. p.9.
6. M.G. Velasquez, p.18.
7. Ibid. p.15.
8. Ibid. p.16.
9. W.I. Saucer Jr., Experiences in Teaching Business Ethics, (Charlotte: Information Age
Publishing Inc., 2011). p.5.
10. J.R. Schermerhon, Management for Productivity, Business Ethics Set, (New Jersey: John
Wiley & Sons, 1993), p.75.
11. W.I. Saucer, Op. Cit., p.6.
12. J. Desjardins, p.11.
13. Ibid.
14. M.G. Velasquez, p.37.
15. Ibid. p. 38.
16. J.M. Finnis, Fundamentals of Ethics, (Georgetown: Georgetown University Press, 1983), p.1.
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