1.5 Why Do We Need Business Ethics?

We can already see why we need business ethics: since so many people disagree about right and wrong in so many different ways, we can’t always avoid those disagreements in business settings. We need business ethics to navigate the differences of opinion.

Ethical problems can arise in any field of business, from entrepreneurship and accounting to human resources, management, sales, strategy, marketing, and supply chain operation. Whatever field you are in, whatever role you perform in your organization, you will encounter ethical problems. Training in business ethics will help you identify the problems, evaluate them, consider ethical principles, and make good choices.

Let’s check out another case study to see how a mundane-looking situation can still raise an ethical problem. Though this one isn’t real, it describes an experience many people have had in retail environments.

Francesca’s case doesn’t just have to be about food—you may have faced similar decisions for other small items like pens or paper, or even for larger ones too. We could have disagreements over whether Speedy Diesel still owns the discarded food and whether a manager could fire Francesca for her actions. In these disagreements and others, we would be using ethical reasoning to figure out the best things to do.

Some people hold the idea that it’s in a business’s best financial interest to be ethical. If that were true then we would therefore have no need for business ethics, because what is ethical and what is profitable would align. We will discuss this idea in Chapter 3, but you may already see some problems with it. For one, it may sometimes be in a business’s financial interest to cheat or deceive, especially when it is unlikely to suffer legal or reputational consequences. In addition, by equating financial interest with ethical permissibility, we make it seem as if there is no difference between the two. That isn’t right. Doing something because it is ethical is different from doing the same thing because it is profitable. Two people doing the same thing for different reasons are not performing the same action, at least from an ethical perspective. We’ll have more to say about this difference later.

We’ll close this section by commenting on the term “morality.” It’s common to talk about business ethics but rare to talk about business morality. For most people, ethics has to do with rules for guiding behavior in interpersonal settings, such as the workplace. In contrast, morality tends to be about personal convictions or virtues. Understood this way, ethics and morality share some common features but are not the same.1

Although there’s room for disagreement here, our course will stick to terms like ethics, business ethics, and ethical principles.