Business Ethics; Interview on How to Have An Ethical Lifestyle In A Corporate

Introduction

One of the greatest challenges in business is being able to maintain an ethical lifestyle when you are surrounded by unethical individuals. Businessmen and workers should always strive to approach their dealings according to a code of ethics and morals, avoiding behaviors that are repellent or distasteful to them and deleterious to their colleagues. To study how ethics can be applied in a business place, I spoke to a longtime friend of mine who has worked in the publishing industry for several years, who wishes to remain anonymous. A former mining executive, he became partner in a small publishing venture a few years back, eventually rising to become CEO of the organization after two years. While book publishing might seem to be a low-risk, low-stress industry, my friend has dealt with a number of major problems during his tenure as CEO. He’s dealt with them by working to remove employees within the organization that are trying to undermine him or the company, as well as by inspiring loyalty in his chosen subordinates and employees. A number of problems he’s faced during his time with the company can be analyzed through various ethical methods.

Scenario #1

Recently, my friend had to deal with an attempted coup led by several minority stockholders in the company, as well as the company’s accountant. One day, he found himself locked out of the company’s bank accounts, with a letter sent to him from the accountant falsely accusing him of embezzling a large amount of company funds. The letter demanded that he resign as CEO of the company as well as reimburse the supposedly embezzled amount to the company within two weeks, with the threat of police intervention if he did not comply. He was faced with either caving to the blackmailers’ demands or fighting the charges, which he successfully did with the aid of a lawyer. After regaining control of the company’s bank accounts and dismissing the accountant, my friend was able to purchase the stock of the minority shareholders who participated in the coup, ending any possibility of future blackmail attempts.

Kant’s categorical imperative precludes the actions of the shareholders from being viewed as moral. Kant’s requirements for an action being moral are three: the actor respects everyone in the scenario, the actor does not treat others as a means to an end, and the actor treats others autonomously and does not attempt to control or manipulate them. This is because what Kant regards as moral are actions that can be universally applied to everyone. Any action that cannot meet all the following criteria cannot be considered moral because it cannot form the basis of a universal law that everyone would want to follow. From this perspective, the shareholders’ actions were wrong because they fail all three criteria. The shareholders showed no respect for my friend in trying such a sneaky, underhanded tactic, they treated him as a means to an end (enriching themselves and removing him from the company), and they attempted to control him through blackmail. No one would want the actions of the shareholders to become a universal law, because it would entail legitimizing blackmail and subterfuge. It would be impossible to have any kind of business or employment relationship with anyone if it was considered morally acceptable to coerce money out of people through the threat of revealing confidential information about them. The fact that the shareholders’ actions could not meet even one of Kant’s criteria shows that their actions were utterly immoral.

Business Ethics; Interview on How to Have An Ethical Lifestyle In A Corporate
Business Ethics; Interview on How to Have An Ethical Lifestyle In A Corporate

From a consequentialist perspective, the actions of the shareholders are largely morally justified. Consequentialism states that the ultimate arbiter of an action’s morality is what its results are: in effect, the ends justify the means. On a surface level, this would make the shareholders’ actions justified if their goal was to extract money from my friend and remove him from the company by any means necessary. However, consequentialism must also factor in the real-world results of an action or a set of actions. From this perspective, the shareholders were morally in the wrong because they completely failed at their task; my friend remained in his position and did not give in to the blackmail demands, because he had no incentive to. The charges against him were false, meaning that the shareholders had no leverage when they launched their coup.

In effect, this means that the means of what the shareholders did failed to achieve the end that they were hoping for. There were other methods by which they could have removed him from the company, meaning that the route they took was far from the only one that was available to them. It would have been possible, for example, to have an audit of the company’s finances done to prove my friend was embezzling, and then take legal action against him, an action that would have been acceptable by consequentialist ethics. Therefore, the shareholders’ actions were not morally correct, because they failed to achieve their desired end due to their methods having no chance of successfully working, and because the outcome was not better than the alternative.

According to utilitarian ethics, the shareholders made a morally incorrect action. Utilitarian ethics state that whatever serves utility or the greater good is moral. From this perspective, the shareholders completely failed. If they believed that my friend was damaging the company and needed to be removed, there were other methods they could have used that would have been legal and would have worked. As mentioned above, their attempt to blackmail him was a long shot at best, due to the fact that he was innocent of their charges and therefore had no incentive to cave to their demands. The legal battle due to the coup attempt took several months to resolve and severely weakened the company in the process by draining its resources; the production of new titles slowed to a halt and employees were not able to be paid. From this perspective, the greatest good was not done for the greatest number because everyone involved in this scenario was hurt, including the shareholders themselves. A truly utilitarian method of resolving issues with my friend would have been to use the legal mechanisms within the company and the law to investigate what my friend was doing and remove him if any evidence of malfeasance on his part was found. From a utilitarian perspective, the shareholders did not make a morally correct choice, because their actions actively harmed everyone involved for no gain.

From a virtue ethics perspective, the blackmailers were completely in the wrong. Virtue ethics resolves around virtues versus vices; morally correct actions are ones rooted in virtue, while incorrect ones are rooted in vice. Morally correct choices will spur actors to behave in a virtuous fashion, while incorrect ones will spur them to indulge in vices. In this specific incident, a blackmail attempt is an action rooted in vice, because it is motivated by greed—that of the shareholders—and deceit. Instead of honestly addressing their issues with my friend, which would have been an acceptable option under virtue ethics, they went behind his back and ensnared him in a sneaky, underhanded move, designed to cripple him and the company at a critical moment. This makes their actions unacceptable, because there are no virtues or positive traits that they are encouraging or using themselves. Greed and lying are frowned upon in society for a reason: the former encourages people to cheat each other, while the latter results in people being mislead, deceived, and led astray. From a virtue ethics perspective, the shareholders made a morally incorrect choice.

Scenario #2

Around the same time that my friend was dealing with the attempted coup against his company, he was also forced to contend with treachery from his business partner, the editor-in-chief of the company. This partner, despite being a longtime friend of my friend and one of the founders of the company, had begun a campaign to dislodge him from the CEO position by spreading lies about him. Among the false accusations my friend had to deal with were claims that he was constantly drunk and not doing work, that he was blowing off the company in favor of partying and clubbing, and that he was spending company money on prostitutes, strippers, and visits to swingers’ clubs. On top of this, the partner was a poor editor, constantly missing deadlines and turning in slipshod work. Because my friend had chosen to let this business partner serve as the face of the company for the longest time (because my friend doesn’t enjoy being in the limelight), this partner was able to drive numerous wedges between my friend and several other co-workers and friends of his. Indeed, these rumors may have led to the attempted coup against my friend that was described in the previous section. My friend dealt with this issue by confronting his partner at a party just prior to an event the company was throwing, and when the partner refused to admit what he’d been doing, my friend disinvited him from the event and fired him from the company.

From a Kantian perspective, the business partner was acting irrationally and immorally. Going back to Kant’s rules on judging the morality of an action, the partner’s actions only fulfill two of them. His actions obviously fail the first criteria, which is respecting all actors in the scenario; spreading malicious rumors about someone else is the exact opposite of respect. The business partner could not be said to be using my friend as a means to an end, simply because it’s still unknown what exactly his plan was. We’re not certain if the partner had some sort of sinister scheme in mind when he was trashing my friend’s reputation or if he was simply a narcissistic gossip, but because he wasn’t clearly manipulating my friend—indeed, he was trying to hide all this from him—he was obeying this particular law of Kant’s.

Finally, the business partner was treating my friend autonomously, because as mentioned above, he was not directly interacting with him when he was spreading these rumors (for obvious reasons). However, failing just one of Kant’s criteria means that an action cannot be considered morally correct. In this particular instance, universalizing rumormongering and gossip would destroy humans’ ability to form friendships, partnerships, or any kind of relationship with others. It would be impossible to trust anyone if it was considered morally acceptable to slander and defame them when their back was turned, and indeed, the business partner’s rumormongering led to the end of his employment with the company and the end of his friendship with my friend. Because of this, we can safely say that the business partner was not acting in a morally correct fashion at all.

According to consequentialist ethics, my friend’s business partner can’t be said to have acted morally or immorally. Consequentialism is concerns with the consequences of peoples’ actions and the means by which they achieve, but the problem in this scenario is that the goals of the business partner were never clearly defined. He was never proven to have had any direct involvement in the coup that was led by the shareholders, so we cannot assign the motivations of that group to him. If his goal was merely to besmirch the reputation of my friend out of jealousy or spite, he made a morally incorrect choice because most everything that he claimed about my friend was a lie.

Moreover, his method of doing this was entirely reliant on my friend never finding out who was spreading the rumors, and as the final outcome shows, when my friend did discover what his partner was doing, he swiftly cut him off. Given their closeness as friends and their mutual circle of acquaintances, it was all but guaranteed that my friend would have discover his business partner’s actions at some point down the line. While the partner did succeed in doing some damage to my friend’s reputation, the ultimate cost was being removed from the company and having his own reputation ruined. From a consequentialist perspective, this is disastrous. Therefore, if we can assign this motivation to the partner’s actions, we can conclude that the partner’s actions were not morally correct because the outcome was not better than the alternative and the means by which he sought his end did not work. However, if this wasn’t his motivation, then we cannot clearly judge his actions by consequentialist ethics.

From a utilitarian perspective, the business partner did not make a morally correct decision. Spreading rumors about his friend and business partner did not serve the greater good for the greatest number of people, simply because the rumormongering actively hurt the company, my friend, and the business partner himself. Even if the partner had managed to avoid detection, all he ultimately would have accomplished was weakening the company by making others more reluctant to work with my friend due to the rumors being slung about him. This would have actively worked against utility by sinking the company’s profitability and hurting those who were working for it or dependent on it. If all the business partner wanted to do was recklessly hurt my friend, he also failed on that count from a utilitarian perspective, because his efforts backfired in the end. Ultimately, because the greatest good was not done for the greatest number of people, the partner’s actions were morally incorrect.

Finally, according to virtue ethics, the business partner was extremely morally incorrect. Spreading rumors about someone else is encouraging the vice of deceit and lies, and there is no virtue being encouraged by the partner’s actions. A world in which the business partner’s actions were condoned would be one where it is acceptable to lie about someone and smear them when they aren’t around, but to suck up to them and be nice to them when you are speaking to them. This is obviously untenable and flies in the face of what most people would consider to be acceptable behavior. Indeed, “two-faced” is a word that could be applied to what the business partner did. Because the partner’s actions actively involved lying and mendacity, from a virtue ethics perspective, they are not morally correct at all.

Scenario #3

Most recently, my friend had to deal with an under-handed competitor trying to take advantage of his company’s weakness in order to destroy it. Following his dismissal of the editor-in-chief, that individual went to work for a competitor, who attempted to take advantage of the chaos at my friend’s company by urging the shareholders to oust my friend as CEO, allowing him to take the company over. My friend dealt with this by publicly outing this competitor and what he did, urging his friends and colleagues to blacklist the site and cease working with said competitor.

From Kant’s perspective, the competitor’s actions were not morally correct. In this particular scenario, the competitor’s actions fail all three of the criteria that Kant requires for actions to be universally adoptable (and thus moral). The competitor did not respect all actors in the scenario because he actively disrespected my friend by trying to take his company over in the middle of a chaotic time. The competitor also actively used the shareholders as a means to an end in trying to take over the company himself, and he did not treat my friend autonomously, because he sought to control him by using the chaos at the company to his advantage. A world in which the competitor’s actions would be considered acceptable is one where it would be impossible to conduct any kind of commerce, because competitors would simply seize on internal chaos in order to take over companies in underhanded and dishonest ways. Universalizing the competitor’s actions would lead to a complete breakdown in the world of business and many other areas, so we can therefore conclude that from a Kantian perspective, this competitor was morally incorrect.

Analyzing the competitor’s actions from a consquentialist perspective, he acted in a morally correct fashion. The competitor’s mission was to destroy my friend’s company or take it over, because doing so would advantage him by leaving him with one less publisher to contend with. This is a common objective of business owners, but this alone doesn’t make it morally correct from a consequentialist perspective; the means by which this end is achieved is also important. While urging shareholders forward in their already planned coup might seem somewhat sleazy, from a consequentialist perspective, the competitor was merely offering his own advice and opinions, albeit with the intent of achieving his particular goal. Viewed in this light, the competitor acted in a morally correct fashion, although he did not achieve the end he was aiming for, because his means had a very good chance of achieving his end, and because eliminating a rival publisher would be a good outcome for him.

From the utilitarian perspective, the competitor’s actions were somewhat morally incorrect. The greatest amount of good for the greatest number of people cannot be said to have happened, primarily because the competitor failed in his objective to destroy my friend’s company. Not only is my friend still in business and strong, the reputation hit that the competitor has taken has lowered his esteem in the eyes of others, making it more difficult for him to do business and risking the livelihoods of his employees. In this scenario, “happiness” would have been the competitor succeeding in taking down my friend’s company, which obviously did not come to pass. However, because the competitor’s actions were relatively slight compared to what the shareholders did, the actions of the competitor are only morally incorrect in a small way.

Finally, from a virtue ethics perspective, the competitor did not make a morally correct action, though again, his actions were not as serious as the ones taken by those in the two previous scenarios. The behavior being encouraged by the competitor’s actions is deceit, a vice because it undermines the foundations of truth and factuality that a society needs in order to function. Deceit and underhandedness are regarded as the opposite of virtue because a society in which people are constantly trying to undercut each other through deceptiveness is one that cannot function properly. At the same time, the competitor did not overtly spread lies in the same way that my friend’s business partner did; he simply tried to take advantage of a bad situation to eliminate my friend’s company. While sleazy, it can’t be claimed as a major violation of virtue ethics, because the competitor did not engage in truly heinous activity in pursuit of his goal. While the competitor is not trustworthy, according to the virtue ethics perspective, he is only a minor wrongdoer.

Conclusion

My personal takeaway from interviewing my friend is that the world of business often requires people to make decisions that might be seen as morally dubious. In the three above-mentioned examples, my friend had to deal with various people—including a so-called friend of his—who were trying to undermine and ruin him through backhanded and surreptitious means. Ultimately, my friend’s survival through all these attacks and dealings, while still maintaining his personal code of honor, is a testament to his intelligence and skill as a businessman. He has dealt with some of the worst people imaginable in his line of work, people who violate every ethical code known to man, yet he has survived and triumphed.

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