Chapter 2 Business Ethics (Key Terms)

consequentialism

A general approach to ethical dilemmas which requires that we consider the consequences our actions will have on relevant people.

ethical dilemma

A question about how a person should behave that requires the person to reflect about the advantages and disadvantages of the optional choices for various stakeholders.

WPH process of ethical decision making

A set of ethical guidelines that urges us to consider whom an action affects, the purpose of the action, and how we view its mortality (whether by utilitarian ethics, deontology, etc.).

ethical guideline

A simple tool to help determine whether an action is moral.

rule utilitarianism

A subset of utilitarianism which holds that general rules that on balance produce the greatest amount of pleasure for all involved should be established and followed in each situation.

absolutism

A theory of ethics which requires that individuals defer to a set of rules to guide them in the ethical decision-making process. Whether an action is moral depends on whether it conforms to the given set of ethical rules.

act utilitarianism

A theory of ethics which requires that individuals examine all the potential actions in each situation and choose the action that yields the greatest amount of pleasure over pain for all involved.

cost-benefit

An economic school of jurisprudence in which all costs and benefits of law are given monetary values. Those laws with the highest ratios of benefits to costs are then preferable to those with lower ratios.

situational ethics

An ethical theory which holds that to evaluate the morality of an action, we must imagine ourselves in the position of the person facing the ethical dilemma and then, the basis, determine whether that person's action was ethical.

values

Positive abstractions that capture our sense of what is good and desirable.

utilitarianism

The ethical principle that urges individuals to act in a way that creates the most happiness for the largest number of people.

virtue ethics

The ethical system which proposes that a decision is ethical when it promotes positive character traits such as honesty, courage, or fairness.

ethical relativism

The ethical theory that denies the existence of an ultimate ethical system, holding instead that a decision must be determined as ethical on the basis of its own context.

ethics of care

The ethical theory that emphasizes human interaction, holding that what makes a decision ethical is how well it builds and promotes human relationships.

deontology

The ethical theory which states that an action can be determined as ethical on the basis of right and wrong regardless of its consequences.

stakeholders

The groups of people affected by a firm's decisions.

categorical imperative

The principle that an act is ethical if we want all people to act according to its dictates.

principle of rights

The principle that judges the morality of a decision on the basis of how it affects the rights of all those involved.

social responsibility of business

The responsibility of firms doing business within a community to meet the expectations that the community imposes on them.

ethics

The study and practice of decisions about what is good or right.

business ethics

The use of ethics and ethical principle to solve business dilemmas.