Business Ethics Concepts and Cases

Topics: Ethics, Rights, Monopoly Pages: 5 (1625 words) Published: August 21, 2012
Business Ethics Concepts and Cases
Ethics means the behavior and actions of an individual or organization leading to the common good of the society and company. The best way to begin the discussion of business ethics is by looking at how real companies have incorporated ethics into their operation. Merck and Company a well-known name in the pharmaceutical industry resolved the issue of disease called river blindness. River blindness was a disease prominent on the river coast in the third world countries. The disease is caused by a tiny parasite worm which enters the body and causes noudles. Then the worm reproduces in millions and spreads over the whole body. Once the worm reaches the eyes and brain, the patient is blinded. The cost of development of the antibiotic was approx. 100 million. The price of the medicine cannot be kept high, since the poor inhabitants of the Africa cannot afford it. Also another variant of the medicine for animals was already sold in the market. So the problem was that selling cheap version of the same medicine could lead to smuggling of the drugs to the lucrative animal market. Hence the company discussed the issues among its managers and eventually decided to start the research for the new medicine. Hence ethically the company took the correct decision and decided to help the poor and the needy despite the chances of incurring losses in the new venture. Let’s now turn over to the definition of the business ethics. Business ethics is sometimes contradiction in terms because there is an inherent conflict between ethics and self-interested pursuit of profits. But the case of Merck suggests a somewhat different perspective. A management of the company spent millions of dollars developing a product that they knew had little chances of ever being profitable because they had ethical obligation to make its potential benefits available to the people. Moreover the comments from management suggest that in the long run there would be no inherent conflict between ethical behavior and the pursuit of profits. Also the ethical behavior creates the kind of goodwill and reputation that expand the company’s for profits. Morality is defined as the standards that an individual or a group has about what is right and wrong or good or evil. Ethics is the discipline that examines ones moral standards or the moral standards of the society. It asks how these standards are applied to the society, whether they are reasonable or unreasonable. An ethics is a normative study of ethics which is quite different from anthropology and sociology. Utilitarianism –During the last century Ford Made a small Car called as Ford Pinto. Because Pinto was a rush project, it had a problem: The Pinto styling required that the engine be placed behind the rear car axle. This styling was more vulnerable to explosions during accidents. But the cost of repair of the already manufactured cars was 300 million which was much more than the cost of insurance which would be incurred to those injured or dead due to accidents (mere 137 million). Hence Ford decided to launch and ignore the defect. This kind of approach is called utilitarianism. Traditional Utilitarianism – An action is right from ethical point of view, if sum total of utilities provided by the act is greater than the sum total of utilities provided by any other act the agent could have performed. Please note that the utility should not only be beneficial to an individual but to the society as a whole. Problems with Rights and Justice – The major difficulty with Utilitarianism is that it is unable to deal with two kinds of moral issues: those relating to rights and those relating to justice. The Ford Motor is the clear example of the same. Utilitarianism came up with Rule Utilitarianism. This concept limits Utilitarianism to the evaluation of moral rules. One should ask that the action is required by correct moral rules that everyone should follow. Rights and Duties – Walt Disney, the...
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