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Business ethics and u-litarianism
”Greatest good for the greatest amount of people”
Norma-ve ethics What is right/good?
Consequenses of action
Teleological ethics
The qualities of action
Deontological ethics
The virtues of agents
Virtue ethics
Normative ethics
Teleological ethics / Consequen-alism
• Morality is about producing good consequences àThe moral value of an ac-on is solely determined by its result
• Inten-ons do not maAer. An ac-on with an atrocious inten-on can s-ll be good in virtue of its results.
Which result?
“Ac-ons are right in propor-on as they tend to promote happiness, wrong as they tend to promote the reverse of happiness”
J.S Mill, U"litarianism
Why happiness? ”Nature has placed mankind under the government of two sovereign masters, pain and pleasure... they govern us in all we do, in all we say, in all we think: every effort we can make to throw off our subjec-on, will serve but to demonstrate and confirm it.”
Jeremy Bentham, The principles of morals and legisla"on.
• The fundamental impera-ve of u-litarianism is: Always act in the way that will produce the greatest
overall amount of good (the greatest total balance of benefit to harm) in the world.
The ul-mate ethical principle is the Principle of U5lity:
The right thing to do, in any situa-on, is whatever would produce the best overall outcome for all those who will be affected by your ac-on.
Each person’s welfare is equally important!
• An ac-on is right if and only if in the situa-on there was no alterna-ve to it which would have resulted in a greater total sum of welfare in the world (Tännsjö, p. 18)
• If an ac-on is not right, then it is wrong.
What is it that we ought to maximise?
• Hedonism/hedonis5c u5litarianism à happiness or well-‐being
• Quan-ta-ve hedonism – all instances of happiness are of equal importance
• Qualita-ve hedonism – some instances of happiness are more important / valuable
• Preference u5litarianism/preferen5alism • It is the sa-sfac-on of preferences (what is desired) that should be maximised.
• Preference = interest
U-lity maximiza-on
Persons
Action
P1 P2 P3 P4 Sum
A1 +6 +2 -7 +4 +5
A2 +5 -4 0 +6 +7
A3 -12 -1 -6 +15 -4
A4 -3 -1 -2 +7 +1
Quan-ta-ve hedonism Jeremy Bentham (1748-‐1832)
• Principles of morals and legisla"on
• Wellbeing/happines • Happines=a subjec-ve
mental state. • Empirical assump-on
about the nature of human beings
Qualita-ve hedonism John Stuart Mill (1806-‐1873)
• U"litarianism On Liberty
• ”Higher and lower”
experiences of happiness
• ”BeAer to be Socrates dissa-sfied than being a pig sa-sfied”
• Act u5litarianism = a single act is right if and only if it maximises u-lity, i.e. if and only if the balance of benefit to harm calculated by taking everyone affected by the act into considera-on.
• Rule u5litarianism = a single act is right if and only if the act is in accordance to a moral rule which maximise u-lity.
Preference u-litarianism Peter Singer
• Preference sa-sfac-on • Interests (Singer) • Principle of equal concern to
interests • Everyone counts as one and no
one counts as more than one.
The U-litarian argument for mercy-‐killing:
1. Any ac-on that prevents suffering is morally right, provided that it does not cause greater suffering somewhere else (i.e. results in a greater total sum of welfare in the world).
2. In some instances, providing a dying person with a quicker death, at his or her own request, will prevent considerable suffering, without causing anyone else to suffer.
3. Therefore, in at least some instances, mercy-‐killing is morally acceptable.
• U-litarianism is a demanding moral posi-on that ogen asks us to put aside self-‐interest for the sake of the whole.
• U-litarianism is a morally demanding posi-on for two reasons: – It always asks us to do the most, to maximize u-lity, not to do the minimum.
– It asks us to set aside personal interest.
Objec-ons to u-litarianism
• U is impossible to apply • U is a threat to close rela-ons and friendship • U is too demanding • U is too permissive • U does not take the ques-on of equality seriously
U-litarianism and business
• Act u-litarianism provides a basis for economics • Cost-‐benefit analysis
Act u-litarianism provides a basis for economic calculus
àcost-‐benefit analysis
The Ford Pinto case
Ford Pinto case
• The case involving the explosion of Ford Pinto's due to a defec-ve fuel system design led to the debate of many issues, most centering around the use by Ford of a cost-‐benefit analysis and the ethics surrounding its decision not to upgrade the fuel system based on this analysis.
The Ford Pinto
• Tragic example of the applica-on of value of life es-mates in a cost-‐benefit framework. – On an Indiana highway in 1978, three girls between the ages of sixteen and eighteen were killed while driving a Ford Pinto.
– Apparently, had Ford made an $11 modifica-on in the design of the Pinto, the deaths of the girls may have been avoided.
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Ford Pinto: Costs
• Ford had undertaken a cost-‐benefit analysis. – Ford assigned a dollar value to the poten-al loss of human life in the event of just such an accident.
• It was more cost effec-ve for Ford to pay damages to the families of accident vic-ms than it was to make the modifica-on.
• Cost: An $11 modifica-on for the total number of Pintos on the road was approximately $138 million.
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• Benefits Savings: 180 burn deaths, 180 serious burn injuries, 2100 burned vehicles Unit Cost: $200,000 per death, $67,000 per injury, $700 per vehicle Total Benefit: 180 x ($200,000) + 180 x ($67,000) + 2100 x ($700) = $49.5 Million
• Costs Sales: 11 million cars, 1.5 million light trucks Unit Cost: $11 per car, $11 per truck Total Cost: 11,000,000 x ($11) + 1,500,000 x ($ I 1) = $137 Million From Ford Motor Company internal memorandum: "Fatali-es Associated with Crash-‐-‐Induced Fuel Leakage and Fires." Source: Douglas Birsch and John H. Fielder, THE FORD PINTO CASE: A STUDY IN APPLIED ETHICS. BUSINESS, AND TECHNOLOGY. p. 28.1994.
• Should a risk/benefit analysis be used in situa-ons where a defect in design or manufacturing could lead to death or seriously bodily harm, such as in the Ford Pinto situa-on?