Business Ethics (Essay Sample)

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Introduction
Business ethics are the guidelines on what is right/ good or wrong/ bad in the business world, and the responsibilities that go with undertaking the business, to the society, environment, as well as the stakeholders (Carey 2013). Business ethics guide in decision making and situations where moral values are being tested. They also provide the guidelines and principles upon which business is conducted. Failure in business ethics provides a leeway for the business to fail (Arnold, Beauchamp & Bowie 2013). Ethics is largely considered to be the ‘science of conduct’, whereby, what is right is based on the moral principle, the situation at the time, or even upon the individual (Kotler & Lee 2005).
Utilitarianism
Utilitarianism refers to a situation where the action taken is of benefit to the majority stakeholders or people, as being right (Ferrell, Fraedrich, & Ferrell 2013). The consequences of an action taken should be more positive, and bring good to the people affected by the action, for it to be right. Utilitarian moral position is normally demanding as it requires the party involved to shelve personal interests for the sake of the majority and the whole (Des Jardins 2011). It always demands for the most to be done so as to maximize utility, and not doing the minimum, as well as putting aside personal interests (Jones, Parker & Bos 2005). This is because utilitarianism is never concerned with an individual, however much an individual counts, but with the good of the whole.
The initial decision reached by the government of Papua New Guinea (PGN), to allow BHP to continue developing the Ok Ted mine, and construct, a permanent waste storage pit and, the fact that BHP had gone ahead and started the construction, reflects utilitarianism (Des Jardins 2001). This is in the sense that both the government of Papua New Guinea and BHP were ready to protect the people of Papua New Guinea by reducing the environmental hazards and damages that were likely to come up as a result of opening up the Ok Ted mine (Jones, Parker & Bos 2005). However, after the storage collapse due to a landslide, the step taken by BHP to push the government to let them mine without the storage reflects the self interests of BHP, and not the good of the whole, the people of Papua New Guinea, who would be affected by the raw waste from the mine (Des Jardin 2001). The postponement of the mine opening because of the collapsed storage meant wasting more time for BHP, as well as more costs to be incurred while reconstructing the storage (Velasquez 2006). This reflects the self interest of BHP, which is against the moral principle of utilitarianism. The government of Papua New Guinea also made a decision which was aimed at benefiting the majority in the short run, (opening up of the mine without the storage, and its benefits), and overlooked the consequences of that decision in the long run, (environmental damage caused to the rivers, water animals, soil, forest, and the people in general) (Kotler & Lee 2005).
According to utilitarianism, an action is deemed right or good as long as it provides utility for the majority (Kotler & Lee 2005). This is reflected by the decision reached by the government of Papua New Guinea after the environmental damage from the mine became high (Hartman & De Jardins 2011). BHP was of the view of closing the mine immediately to stop any more environmental damages, whereas the government opted to the continuation of the mine (Velasquez 2006). This is because they viewed the social and economic gain from the mine as more than the environmental damage caused, and the people of Papua New Guinea were in support of the government (Ferrell, Fraedrich, & Ferrell 2013). BHP transferred its share to a trust that would fund the government’s projects. This was a loss for the BHP, but on the other hand the government of PNG compensated by clearing BHP from any future charges because of having associated with the mine (Kotler & Lee 2005). In this case utilitarianism is evident in that the majority, the people of PNG, benefited from BHP share, and BHP was cleared of any possible future charges.
Kantian deontology
Kantian deontology focuses on the ethics of duty, in that it shifts focus from consequences to the sense of duty when performing any action (Bowie 1999). Kantian deontology judge morality by looking at the willingness of the actor, and the nature of the action, not the goals achieved in the end. It also emphasizes respect for people, in that people should not be used or seen as merely as a means to something, but as an end (Bowie 1999). The reason for shifting from consequences to duties is that human beings cannot control the future, and that people are judged for actions within human control including what they will, not because of their outcome (Carey 2013).
According to Kantian ethics, pure reason is the basis for morality not utility. BHP agreed to compensate the people mostly affected by the mine, not out of duty, but because they were forced to do so due to the legal battle they were facing (Ferrell, Fraedrich, & Ferrell 2013). In this case, they did not compensate the people willingly, but rather they were avoiding the consequences that would come as a result of the legal suit against them, hence did not act according to Kantian ethics of duty (Kotler & Lee 2005). The government of Papua New Guinea, on the other hand, while faced with the possibility of closing down the mine after BHP reached its decision, acted purely out of duty to the people of PNG (Velasquez 2006). The government did not focus its decision on the consequences of closing down the mine, but what would help the people, and what the people wanted; providing social and economic amenities and benefits to the people of PNG like health facilities, education and employment, which are basic for the survival of the people (Kotler & Lee 2005).
Justice
Rawls theory of justice is based on fairness, equality and free choice (Hartman & De Jardins 2011). Rawls accepts the Kantian approach, and advocates for rationality acceptable to all, respect for all people as well as the universal notion (Freeman 2007). He also tries to reach the distributive justice principle acceptable to all rational people. Rawls emphasizes equal distribution of resources except in cases where unequal distribution is beneficial to everyone (Freeman 2007).
Basing on Rawls theory of justice, the actions taken by BHP and PNG government provided justice to the people (Hartman & De Jardins 2011). This is because, BHP had 52% shares of the mine and regardless of the inequality, the people of PNG benefited a lot socially and economically through education, health facilities as well as through employment (Ghillyer 2007). BHP was also paying a lot of tax to the government of PNG, which was used in developing the economy of the country.
Nozick’s libertarian theory of justice emphasizes on economic and social entitlement and liberty. Nozick argues that justice is when there are rights of property ownership as well as rights to transfer (Ghillyer 2007). This theory of justice is reflected in the case study of Ok Tedi copper mine, whereby justice is reflected in the fact that BHP, as a private investor own 52% shares of the mine, and this is allowed by the government of PNG, which owns less shares (Jones, Parker & Bos 2005). Justice is also displayed when the government of PNG allows BHP to transfer its shares to a trust for the people, when it chooses to close down the mine. Justice is also displayed, according to Nozick, when the government plays a minimal role in the running and ownership of the mine; BHP owned the majority shares (52%), before it transferred its shares to a people’s trust (Velasquez 2006).
Rights
Rights are thing a human being is entitled to, which gives the person the freedom to do something, as well as puts others under an obligation or duty to treat a person in a certain manner, so as not to violate his or her rights (Carey 2013). According to the ethical theory, there are two types of rights; positive and negative rights. Negative rights are when an entitlement is left free from any interference from others, while positive rights is where the entitlement is accompanied with something, or something is done in relation to that entitlement. However, these rights have limitations (Hartman & De Jardins 2011). Positive rights are limited by only a fair share of the available resources. The negative rights are limited by the equal rights of other persons to freedom (Ferrell, Fraedrich, & Ferrell 2013).
After BHP suggests the complete closure of the mine, the government of PNG made a decision to protect the people’s rights to social facilities as well as right to education. The mine was the backbone of PNG’s economy and closing it would deprive the people some of their rights like right to health care and their rights to education (Velasquez 2006). On the other hand however, BHP decided to close the mine so as to stop depriving the people their right of being protected from environmental hazards. As a matter of fact, BHP had a right to continue operating the mine since it owned majority of the shares and the contract with the government of PNG was yet to expire (Ghillyer 2012). However, that right was being limited by the people’s right of staying in a healthy and safe environment without pollution from the mine (Arnold, Beauchamp & Bowie 2013).
Normative ethical relativism
Normative ethical relativism asserts that universal truth in ethics is absent, and that the good thing is socially accepted whereas the bad is always unacc...