Business Ethics Final
What are some negative effects of technology? What is the dopamine effect?
"The internet and our digital devices offer us a perfect storm of dopamine stimulation: a perpetual stream of visually enticing new content accessible instantaneously through a medium that makes us feel that we are in control even as we are becoming increasingly passive, and rewards us with visual and auditory cues that make us feel at each moment that we have just accomplished or discovered something. The result is a feedback loop of perpetual seeking, and self-satisfaction in the privatized possession of novelty, that fits uncannily with both Augustine's and Griffiths's diagnoses of disordered intellectual appetite." dopamine effect = "Shock and surprise particularly stimulate dopamine, explaining why shocking and disgusting images may nonetheless compel our attention. However, the brain becomes rapidly desensitized in the face of such stimulus and requires ever more intense experiences to keep the dopamine flowing; this is the basic structure of all addictions."
Define the various parts of courage.
"attack" and endurance" "therefore fortitude is about fear and daring, as curbing fear and moderating daring" "the will being disinclined to follow that which is in accordance with reason, on account of some difficulty that presents itself. On order to remove this obstacle fortitude of the mind is requisite, whereby to resist the aforesaid difficulty even as a man, by fortitude of body, overcomes and removes bodily obstacles." II-II.123.1 — Aquinas
According to Benedict XVI, what is the role of the Church and the state in pursuing justice? Is social justice enough, or do we need something more?
"the just ordering of society and the state is the central responsibility of politics" (28) The Church has a social expression of her faith, but this is independent of the State, but must be guaranteed freedom by the state. (28) Even in antiquity, the charity of the Church became institutionalized in corporations dedicated to serving the poor and distributing among them (cf. 23) state pursues justice through politics (not the church): realm of "reason" → justice (28) however, reason has blind spots so the church (faith) forms people and purifies reason → awakens spiritual energize to fight for justice "Faith and reason are like two wings on which the human spirit rises to the contemplation of truth; and God has placed in the human heart a desire to know the truth." -Saint John Paul II "The Church must not take upon herself the political battle to bring about the most just society possible. She cannot and must not replace the State. The Church..."plays her part through rational argument and she has to reawaken spiritual energy without which justice, which always demands sacrifice, cannot prevail and prosper." (28) Social justice is not enough → we need social charity Love is the absolute need of every human person "Love will always prove necessary, even in the most just society....Whoever wants to eliminate love is preparing to eliminate (the human person) as such." politics, business, economics cannot be the overarching and totalizing domain based on a materialistic account of the human person we need a person-centered economy and business
What is a just wage, according to Catholic Social teaching? What questions should be taken into account when trying to quantify such a wage?
1) Mutual agreement does not imply justice (CCC 2434) 2) Should provide for basic needs 3) Some things are due to human beings by virtue of their dignity 4) The needs and contributions of each person need to be accounted 5) Wages cannot lead to the destruction of a business 6) Wages should promote employment and decrease unemployment 7) The notion of the family wage or family allowances 8) Solidarity and subsidiarity govern and limit the government and businesses' roles 9) Cannot simply be left to the operations of the market alone 10) Determinations in light of the common good
What three fundamental ethical principles should a society uphold when seeking a social just capitalism, according to John Ryan?
1. The earth and all its potentialities belongs to all members of the human race who have natural rights 2. We are morally obliged to use the goods of the earth according to justice and charity - Private property is morally right because its necessary for human welfare - Owners should exercise it so that non-owners have access on reasonable terms - One can own goods, but must use them to 'minister to the needs of others - Corollary: the State should institute policies that favor wider distribution (distributism?) 3. Every member of society is subordinate to the organic unity of the whole - Individual liberty with regard to property ceases to be morally valid not when it encroaches upon the liberty of others, but when it violates charity or justice acc. to principle #2
Define prudence, justice, fortitude, and temperance, and describe the natural (acquired) virtues in relation to the supernatural (theological) infused virtues.
Acquired cardinal virtues: concern "innerworldly" activities (cf. Plato, Aristotle, Confucius, Mencius) prudence = "the virtue of choosing well, or doing practical decision-making well" (Mattison 67) → right reason in the right action justice = the "moral virtue that consists in the constant and firm will to give their due to God and neighbor" (CCC 1807) fortitude = the "the moral virtue that ensures firmness in difficulties and constancy in the pursuit of the good. It strengthens the resolve to resist temptations and to overcome obstacles in the moral life" (CCC 1808) temperance = is the moral virtue that moderates the attraction of pleasures and provides balance in the use of created goods. It ensures the will's mastery over instincts and keeps desires within the limits of what is honorable. The temperate person directs the sensitive appetites toward what is good and maintains a healthy discretion. infused theological virtues: concern one's actions in light of relationship with God faith hope charity "As distinct from the cardinal virtues which we can develop, the theological virtues are the perfection of human powers given by the grace of God." Like the cardinal virtues, an individual who exercises these virtues strengthens and increases them, i.e., they are more disposed to practice them.
What is a pre-commitment device and how does it help one's growth in temperance and self-control?
Ariely argues for the importance of "pre-commitment" devices that will help our weak will to be motivated to make the right decisions. without precommitments we fall into temptation and fail to reach long-term goals A commitment device is, according to journalist Stephen J. Dubner and economist Steven Levitt, a way to lock oneself into following a plan of action that one might not want to do, but which one knows is good for oneself.
Is profit a good, bad, or neutral goal in business? Why or why not?
Fanfani Wealth: is neither good nor evil and is not to be distrusted; people are to be distrusted in their use of it; the evil lies in making wealth the end in itself Havard "Mature business people are driven neither by personal financial gain nor by an obsessive desire to increase shareholder value. Profit is a necessary goal of business activity, but not its purpose." (Havard 11) profit should not be the end goal of business, instead it should serve as a means to achieve a higher goal "Profit is useful if it serves as a means towards an end that provides a sense both of how to produce it and how to make good use of it" (Benedict 21). The pursuit of profit should be motivated by a desire to benefit the common good or society, rather than for the sake of producing profit alone. "Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end it risks destroying wealth and creating poverty" (Benedict 21).
Define consumerism and describe some of its aspects and qualities (consider William Cavanaugh [optional], Pope Francis, and John Paul II
Francis The "great danger in today's world": "desolation and anguish" caused by "consumerism" (§2). Poverty, disease, fear, desperation; an economy of "exclusion and inequality" that "kills" (§§52-53) John Paul II A profitable company can still humiliate people and offend their dignity. "Morally inadmissible." Also negatively affects "the firm's economic efficiency." Profit? Yes. But also human dignity. "Artificial consumption"; drugs and pornography (§36). False consciousness? Willing our own and others' good? Not "having," but "being." Even the decision of where to invest: "always a moral and cultural choice." Consumerism = a social and economic order that encourages the acquisition of goods and services in ever-increasing amounts. encourages purchasing and consumption of goods and services in excess of a person's basic needs idolization of $ and the material realm encourages the pursuit of money and profit as an end in and of itself, rather than as a means to achieve a greater end material goods should be ordered towards spiritual development Pope Pius XII
Would a universal basic income be just according to the author we have read? Who might argue for or against such a proposal?
Friedman → YES pair-down government programs to have one main one inverse income taxes Andrew Yang → YES Pope Francis → "no worker should be without rights" soem people are left out of the economic system simply because of its structure, rather than anything they did wrong → so they have basic rights John Ryan state should raise taxes on moderate to high income people to distribute to the poor → probably for a UBI UBI rests on the idea that the money will be spent properly bounded ethicality must consider the different costs of living both sides of the economic spectrum → no state interference and the ones who want more government participation CST → Leo 13th believes in the necessity of allowing workers to accumulate property and receive their own income, but also a just wage → against because either property is a fruit if their labor, so if they don't work they don't deserve anything
According to John Ryan, what individual and state action is needed to establish and secure a socially just order?
Fully honest and equitable agreements; Refraining from violence Recognizing the limits of private property Right to organize and strike Formation of cooperatives, associations, guilds Ie: agriculture, banking, retail No collective action by the State; but no extreme individualism and laissez faire State intervention, particularly for the poor? (25) Rights to strike, religion and rest, Working hours, a living wage, private property But what is "reasonable and frugal comfort": all things required for development of all human faculties (28) A Living Family Wage: who should establish this? Fr. Edwin O'Hara: Stettler vs O'Hara (US Supreme Court) Urban workers aided by the State to become property owners? (31) Breaking of monopolies by the government (33)
According to Clayton Christensen, what three questions should every businessperson ask herself, and why do these matter?
How can I be sure that my relationships with my spouse and family are an enduring source of happiness? design your family's culture build an enduring relationship what is your source of happiness How can I be sure that I'll be happy in my career? create a strategy to achieve life goals and find happiness allocate your resources and time properly How can I be sure I'll stay out of jail? how to live a life of integrity
Why does Msgr. John Ryan argue that socialism is flawed? Is it possible to support a "reformed" socialism?
It is based on economic materialism (8) All social institutions and beliefs are determined by economic factors and conditions (9) Government, education ethics, religion, politics are all determined by economic factors It denies the existence of the human soul and the transcendent, and thus free will (10); this means that: There can be no culpability Nobody is at fault for the oppressive situations Human interrelations have no meaning or significance Children belong to the State The end of socialism justifies the means of arriving there (12) Whatever is necessary for the welfare of the State is a morally good action could not support a "reformed" socialism because the underlying theories and principles are flawed (destructive of individual rights)
According to St. John Chrysostom, what was wrong with the rich man? How did Lazarus suffer? Who should we imitate and why?
Let us, both rich and poor, emulate Lazarus." (p. 38) Not "one for one": Even before the punishment comes, those who practice wickedness and live in sin are punished in this life. (34) The rich man was wrong because he did not give to the poor and failed to demonstrate solidarity "Just as the dogs licked the wounds of the poor man, so demons licked the wounds of the rich man; and just as the poor man lived in starvation of nourishment, so the rich man lived in starvation of every kind of virtue" (35) idea that we are not punished for our sins, but are punished by them (tormented by our own conscience) suffering gives us an opportunity to grow in virtue rich man was wealthy materially, but Lazarus was wealthy spiritually Lazarus suffered in 9 ways no solace in eternal life sight of the fortunes of the rich man not necessarily petty/jealous no companion/all alone slander of others poverty illness loneliness lack of protection or anyone who cared about him
What is the role of finance? What are its internal and external goods? When does finance cease to be used virtuously, according to our authors?
MACINTYRE 1. to promote household and corporate savings 2. to allocate funds 3. to manage and distribute risks 4. to facilitate a reliable payment system internal goods = the 4 purposes of finance external goods = money, power, status The "real vocation" of finance lies in its "social function" of nourishing markets and financial institutions which are really at the service of the person and are capable of responding to the needs of the common good and universal solidarity. (p. 67) finance ceases to be used virtuously when it is utilized to promote solely material ends → instead, finance should be directed towards a greater end than wealth accumulation
How do our authors claim one can grow in virtue?
MACYNTRE/CATECHISM:exercising the virtue→ engaging in different practices where you will have ample opportunities for virtuous formation ex. put yourself in morally challenging situations to foster the virtue of prudence surround yourself with other people who are virtuous and good examples for you to follow
What qualities characterize the good abbot/abbess according to Saint Benedict of Nursia?
Must not establish anything contrary to the will of Christ Faults of the sheep are attributed to the fault of the shepherd Holy deeds and words No favoritism and no partiality Must convince, entreat, rebuke "To whom much has been given..." "First, seek the Kingdom of God..."
What are the three "fonts" of morality?
Object: the matter, the "what" of an action, described as accurately and concisely as possible; that towards which the human will is directing itself (external to the acting person) Intention: the purpose pursued in an action (internal to the acting person) Circumstances: the secondary elements of a moral action that can increase its moral goodness or evil
What does it mean to say that prudence is the "charioteer of the virtues"?
Prudence guides the other virtues by setting rule and measure. It is prudence that immediately guides the judgement of conscience. The prudent man determines and directs his conduct in accordance with this judgement. With the help of this virtue we apply more principles to particular cases without error and overcome doubts about the good to achieve and the evil to avoid (CCC 1806)
According to Fides et Ratio, who are we as human beings? Why does the search for truth matter? What are different ways of coming to know the truth?
Reason shows that human beings are directed to truth or "otherwise they are at the mercy of a caprice, and their state as a person ends up being judged by pragmatic criteria based essentially on experimental data, in the mistaken belief that technology must dominate all. (3) every philosophical system is incomplete the truth can be known People cannot be genuinely indifferent to the question of whether what they know is true or not. If they discover it is false, they reject it; but if they can establish its truth, they feel themselves rewarded. (25) truth can be discovered through Scientific truth: based on immediate evidence or confirmed by experimentation philosophical truth: attained to by means of the powers of the human intellect religious truths: grounded in philosophy, and by which religious traditions offer answers to the ultimate questions (30) not possible to know all truths. must live by belief
What are Cremers' three "c's" of business, and discuss their relation to one another?
SEE shared purpose: contribute to human dignity/flourishing (Faith) JUDGE: shared priorities: cooperate with solidarity (Love) ACT in shared practice: compete in subsidiarity (Hope)
What does Socrates think of morality, and what does Glaucon believe?
Socrates believes that morality is desirable for its own sake (a just person will still be just even if no one is watching ) Morality of happiness Glaucon says people are only moral because of fear of repercussions (a just person would behave unjustly if they could) Morality of obligation
Why do Havard, Sison et al., Mattison, and others argue that a rules-based approach to ethics is not sufficient?
This is the strength of the virtue/integrity approach: it recognizes that our actions shape who we are and become, and reflect what we hold to be TRUE Havard Professional/work-based ethics: limited to external, visible, actions I perform on the job do not cover the variety of life situations people often encounter Unity of Life: "Leaders...behave virtuously always and everywhere: at work, with the family, among friends, during free time, and even when they are alone." (p. 143) pitfalls of rule based ethics Narrowness: We don't usually do the right thing for just one reason. Ignore agents and contexts: In attempting to come up with a universal theory, we lose a sense of individual values, history, culture, and situations. We can't decide between them: It remains difficult to get people to agree about these theories—so the payoff of a "scientific" approach to morality is not as high as some might hope Mattison argues that the intentions behind an action are equally, if not more important are we acting justly solely for appearances or because we are truly just? intentions/"intransitive" aspect of people's actions
Why is Pope Leo XIII opposed to socialism? Does this mean that he favors capitalism? Why or why not?
against socialism → Socialists' proposals are "are so clearly powerless to end the controversy that were they carried into effect the working man himself would be among the first to suffer. They are, moreover, emphatically unjust, for they would rob the lawful possessor, distort the functions of the State, and create utter confusion in the community. (4) Inviolability of private property: ":The door would be thrown open to envy, to mutual invective, and to discord; the sources of wealth themselves would run dry, for no one would have any interest in exerting his talents or his industry; and that ideal equality about which they entertain pleasant dreams would be in reality the levelling down of all to a like condition of misery and degradation. Hence, it is clear that the main tenet of socialism, community of goods, must be utterly rejected, since it only injures those whom it would seem meant to benefit, is directly contrary to the natural rights of mankind, and would introduce confusion and disorder into the commonwealth." (15) I would argue that Leo favors some aspects of capitalism inviolability of private property allows individuals to take responsibility for their own families problems: unequal distribution of wealth and poverty solution: the church and charity sort of against it because unbridled capitalism has created a situation in which socialism could be a possibility if employers don't recognize that they have certain duties to their workers (just wage), and commodification of the worker in a system of abuse in order to generate profits wants harmony between the laborers and owners of capital allow them to unionize, demand just wages, create a system where both parents don't have to work (sanctity of the family)
What is behavioral ethics? What is bounded ethicality?
behavioral ethics = a field, inspired by behavioral economics, that brings observation and psychological research to the study of ethics the point is not to determine how people ought to behave, but how they actually behave (descriptive) bounded ethicality = we lack the cognitive resources to be perfect
According to Havard, how is realism different from cynicism, idealism, or skepticism?
cynicism = (immaturity) the exaltation of human defects (convinced that he cannot attain his moral objectives) idealism = (immaturity) idealizes value and demonizes defects skepticism = (immaturity) fosters indifference towards values and defects realism = (maturity) the ability to maintain the noblest aspirations of the soul even as one remains beset by personal weaknesses; this is not giving in to the weaknesses, but transcending them through the practice of virtues
What does Dorothy Day mean when she says that it is "by little and by little that we are saved?"
day believed that social change begins with the individual, so everything is incremented over a period of time in a sort of bottom-up approach ("there is a saint in all of us") → works of mercy
What are some different Ethical Systems?
deontology = follow duty + laws utilitarian = best consequences for all (utilitarian calculus) egoism = Ayn Rand (doesn't consider others at all) virtue ethics = personal consequentialism → shaping moral character consequentialism = focus on the outcome social contract theorists = focus on the necessity of maintaining a functioning society care ethicists = focus on the special relationships among people
Define blind spots and identify some common ones.
ethical blind spots result from: believing you are ethical and therefore assuming your behavior will be ethical unconscious biases conflicts of interest ethical blind spots = a person's temporary inability to see the ethical aspect of a decision they are making moral disengagement ideologies "Most of us understand that to make an effective decision, we need to engage in thorough deliberation prior to the decision and, after making the decision, accurately reflect on it. However, because our predictions of how we will behave aren't accurate, we have trouble making the ethical decisions we planned to make. Moreover, because we distort our recall of decisions to help us feel better about any unethical behavior we may have committed, our reflections aren't accurate, either. As Max and his colleague Mahzarin Banaji have argued, to make ethical decisions, you need to recognize your vulnerability to your own unconscious biases."
What is eudaimonia and how does a virtue ethics approach to business differ from other approaches?
eudaimonia = the condition of human flourishing or of living well virtue ethics focuses on a morality of happiness approach, rather than a morality of obligation happiness comes from functioning well and the virtues are a description of what functioning well looks like
What are the twelve steps of humility in the Rule of Saint Benedict?
fear of God and avoiding forgetfulness 2. renouncing of own will 3. submission to superior for the love of God 4. silence, patient & obedient in harsh things 5. manifest one's sins to Abbot 6. being content with the meanest and poorest of goods 7. consider and call oneself low 8. doing nothing but what The Rule commands 9. restraint of tongue—silence 10. not quick to laughter 11. humble, grave, short speaking 12. show humility externally gaze on the ground
What are some related virtues or opposed vices to the four cardinal virtues?
fortitude → vices = fear, despair, anger, ambition (excess of magnanimity) temperance → vices = desire? prudence → vices = thoughtlessness or rashness: acting quickly without sizing up situations (The "want self"); irresoluteness: deliberates ceaselessly, but never carries into action ("the should self" (?)
What is honorable business, according to James Otteson?
honorable business = firms creating genuine value, and engaging in mutually voluntary, mutually beneficial, positive-sum transactions → contribute to a just and humane society
According to Fanfani, Catholicism and capitalism seem in many cases to uphold the same common virtues. What is the difference between them?
in capitalism the catholic virtues have different meanings, different origins, and different ends Private property: right to use vs. right to possess Respect of personality: human dignity vs. human autonomy Limitation of absolutism: cooperation vs. individualism The value of hard work: as penance and homage to God vs. as means to success and a lack of trust in Providence Honesty: to avoid offending God vs. maintaining a good reputation Liberality: to be stewards of God's goods vs. human order
What are the differences between extrinsic and intrinsic forms of motivation?
intrinsic motivation = performing a task because it's personally rewarding to you extrinsic motivation = completing a task or exhibiting a behavior because of outside causes such as avoiding punishment or receiving a reward
What are the three parts of "purpose" for Christensen? Why are they important?
likeliness = what the key leaders and employees want the enterprise to have become at the end of the path they are on commitment = deep commitment, almost conversion, to the likeliness metrics = by which managers and employees can measure their progress; enable everyone associated with the enterprise to calibrate their work, keeping them moving together in a coherent way "companies that aspire to positive impact must never leave their purpose to chance" (Christensen) "the greatest corporate leaders are conscious of the power of purpose in helping their companies make their mark on the world"
Define the logic of exchange, the logic of the gift, and the logic of the market in Caritas in Veritate.
logic of exchange = giving in order to acquire → takers/fakers logic of duty = giving because of law, obligation, compulsion → matchers logic of gift = founded on reciprocity, openness, mutual principles, friendship, solidarity → givers
For Havard, why is magnanimity a crucial virtue of leaders? How is it different from megalomania or small-mindedness?
magnanimity = a virtue of people with purpose, priorities, and principles Leaders are magnanimous in their dreams, visions, and sense of mission; in their capacity for hope, confidence, and daring; in their enthusiasm for the effort required to being their work to a successful conclusion; in their propensity for using means appropriate to their goals; in their capacity to challenge themselves and those around them. (p. 4) megalomania or small-mindedness = "small minded men cannot even conceive of greatness. The notion that life has a high purpose is foreign to them" (3) Magnanimity enables leaders to dream "to conquer the summit of professional achievement and personal excellence" (3) magnanimity allows for vision, which "gives rise to a mission, which is then translated into action" (21) "As a result he is capable of giving himself. He is not content with merely giving; he gives to his very self" (28)
Define Morality of Happiness and define Morality of Obligation
morality of happiness = desire for happiness (eudaimonia) is our primary reason to do good morality of obligation = obligation is our primary reason to do good
What should characterize a society conducive to business, according to Pius XII?
no excessive taxation laborer is respected as a member of society with dignity (122) fair competition no complicated or regimented obstacles some (limited) social security increasing material goods should be oriented to spiritual development, disinterestedness, and self-giving (121)
What is a reciprocity style? What characterizes a taker, a matcher, and a giver?
reciprocity style = the way you approach interactions with others. taker/faker = Logic of exchange (39): giving in order to acquire matcher = Logic of duty (39): giving because of law, obligation, compulsion giver = Logic of Gift (38, 40): founded on reciprocity, openness, mutual principles, friendship, solidarity
Are we selfless or selfish by nature? Why does the answer to this question matter?
selfish? called to promote the common good adam grant → reciprocity styles (most people are matchers, but the world rewards givers) clip from the nobel prize winning dude benedict 16th → logic of gratuitousness, as human beings we tend to have a selfish orientation, but we are called to imitate Christ → complement and go beyond strict justice human flourishing happens best when we are givers and establish stronger networks, contribute to a culture of giving adam grant when we are able to overcome our selfishness we are able to contribute more to an ethical culture and the common good intrinsic vs. extrinsic motivation
What is shareholder theory? What are some arguments for or against it? Who makes these arguments?
shareholder theory = the only responsibility of managers is to serve in the best possible way the interests of shareholders, using the resources of the corporation to increase the wealth of the latter by seeking profits Kristol (YES) social justice is a term used to justify public, government intervention into private sector problems who decides how much and on what authority? capitalism brings about equality of opportunity→ a just society is "an abstract, utopian ideal" (157) the state intervening in trying to create "social" justice leads to the limitation of human freedom Friedman (YES) the manager of a corporation is the agent of the principals (the shareholders) the agent has a moral obligation to fulfill their promise to the principals (to maximize profits so long as it does not conflict with applicable laws or ethical custom) If a CEO operates the firm in a manner that is contrary to the expressed or implied interest of his employer, the CEO does his employer an injustice
What strategies can be pursued within a company to encourage courage, transparency, and honesty in the workplace?
solicit feedback = A hotline is not enough! Also, make sure to thank employees for speaking up. Soften power cues. Set an Example = Talk openly about ethical issues. Never Tolerate Retaliation. Follow Up = Let those who speak up know what changed. Set clear expectations.
What is stakeholder theory? What are some arguments for or against it? Who makes these arguments?
stakeholder theory = organizations and corporations should strive to do right by all these stakeholders and that in doing so, the organization will achieve true, lasting success Stout (YES) shareholders don't own corporations → corporations own themselves shareholder primacy is a bad return in the long run there is no single "shareholder value" "satisficing" is a way to serve the interests of many different types of stakeholders Freeman (YES) "for any business to be successful it has to create value for customers, suppliers, employees, communities and financiers, shareholders, banks and others people with the money. interests of stakeholders must be viewed together" businesses rely on relationships with stakeholders to be successful (must ensure that these relationships are positive) the idea that each one of these groups is important to the success of a business, and figuring out where their interests go in the same direction is what the managerial task and the entrepreneurial task is all about. "Stakeholder theory says if you're just focused on financiers you miss what makes capitalism tick. What makes capitalism tick is that shareholders and financiers, customers, suppliers, employees, communities can together create something that no one of them can create alone." Friedman (NO) To spend another's money for the sake of "general social interest" is to impose a tax on those persons [1&2] Therefore, a CEO who exercises "social responsibility" imposes a tax on the "principal" To impose taxes is a "governmental function," which requires representation and checks/balances [1-3] Therefore, if a CEO exercises "social responsibility," the CEO should be elected by a political process THEREFORE...if one affirms that businesses ought to exercise social responsibility, one necessarily holds to the "socialist view that political mechanisms, not market mechanisms, are the appropriate way to determine the allocation of scarce resources to alternative uses" McCloskey and Mingardi (NO) "A price on the stock market does a better job of getting the long-term right than a committee of busybodies from the outside." (137) Friedman's thinking "races the perimeter of the social permissible" (133) "To whom exactly should businesspeople be accountable?...Any person with an opinion gets to be a stakeholder, toll free. Not a wise choice." (136) "For a market economy to work, people do not need to be perfectly informed on what is going on elsewhere." (141) Argument Who? What qualifies them? What power do we want to give them? Shareholders already assume uncertainties Stakeholder theory distrusts individuals It cannot adjust to innovation and change; Only shareholder theory can tell you what is the actual accumulation of knowledge across society
What personality traits do the best and most successful leaders possess?
strong guilt-proneness, honesty-humility, conscientiousness (Cohen) magnanimity (Havard) humility (Pope Francis) integrity, fortitude, temperance (4 virtues and some infused virtues as well)
Give some qualities and characteristics of servant leadership according to Vocation of a Business Leader. Can you give examples of some virtuous leaders from our class? Why were they exemplary?
success is not measured by material things (priority of being over action → action follows from who you are) 2. fame and status are not lasting accomplishments 3. virtue forms your character 4. know thyself, for change begins within 5. be open to the transcendent (divine calling) Haruka Nishimatsu formed genuine relationships with his employees and cared for their wellbeing "If management is distant, up in the clouds, people just wait for orders," Nishimatsu told CBS News through a translator. "I want my people to think for themselves." softened power cues tries to create a culture of collaboration Dan Price (gravity payments) slashed his own salary to be able to give every employee at a minimum a $70,000 each year solidarity with his employees idea of a just wage Pope John Paul II advocated for business to act in the best interest of society church looks to advance the interests of the common good The Church has no models to present; models that are real and truly effective can only arise within the framework of different historical situations, through the efforts of all those who responsibly confront concrete problems in all their social, economic, political and cultural aspects, as these interact with one another.84 For such a task the Church offers her social teaching as an indispensable and ideal orientation, a teaching which, as already mentioned, recognizes the positive value of the market and of enterprise, but which at the same time points out that these need to be oriented towards the common good. (43) called on the lay people to imitate Christ "...follow and imitate Jesus Christ, in embracing the Beatitudes, in listening and meditating on the Word of God, in conscious and active participation in the liturgical and sacramental life of the Church, in personal prayer, in family or in community, in the hunger and thirst for justice, in the practice of the commandment of love in all circumstances of life and service to the brethren, especially the least, the poor and the suffering"
What does Ryan mean by security, sufficiency, and status?
sufficiency: Every male or female employee should receive a living wage; this is based on strict justice (p. 158) based on intrinsic worth and dignity of worker Profits should be divided between capital and labor security: Work should meet the needs of the entire life Savings are inducement to self-reliance, self-respect, and independence Social insurance for unemployment, accidents, sickness, old age (160) status: Sharing in Management All in the firm are fundamentally cooperating with the employer in a common enterprise [stakeholder theory? Shareholder theory? Community of persons?] There is a directive, initiative, creative capacity in every normal human being: workers are not just "animated instruments of production" (163); more "human relation" (165) Sharing in Profits After fair wages, a reasonable rate of interest, adequate remuneration or management, and all the other proper expenses of production have been paid, the wage-earners should share the surplus, not with the owners of capital, but with the managers of the business Should stock holders receive surplus profits? Profits should go to those who create them, not inactive stockholders who are already rewarded through dividends for their risk Sharing in Ownership ESOP's? It makes the worker more than a mere wage-earner, and relieves him from entire dependence on wages (171) Industrial Cooperative These often can fail through lack of financial resources, lack of discipline, lack of patience, lack of business ability, and challenges that face all small industries
What role does culture play in a company's pursuit of ethics?
the culture or a company is very important in determining the moral judgements managers make (shareholder vs. stakeholder theory) a culture that is focused primarily on the pursuit of profits may pursue a shareholder theory of approach and care less about the wider-reaching consequences of its actions Aznar and Vaccaro Compliance is important, but it is limited. (Some values aren't represented in law, for example, and compliance doesn't include a larger sense of purpose.) Something LEGAL does not mean it is ETHICAL. Integrity (as opposed to mere compliance) comes with added opportunity. Its greater benefits come from improved performance, happier workers, and a better reputation. Ultimately, the goal is to make ethics everyone's job and to link it to the core of your business (think CULTURE) the culture of the company should encourage employees to be ethical -> DETERT AND BURRIS Solicit Feedback - A hotline is not enough! Also, make sure to thank employees for speaking up. Soften power cues. Set an Example - Talk openly about ethical issues. Never Tolerate Retaliation. Follow Up. Let those who speak up know what changed. Set clear expectations. "We can revise behavior and encourage ethicality by designing supportive environments that minimize temptations and define clear boundaries between right and wrong." -Ayal, et al
Why does Barry Schwartz and/or our other authors think businesses need virtue?
the market currently rewards and promotes vicious behavior → corroding the institutions that provide restraints against bad human impulses rules require enforcement and can crowd out internal motivation + are a "blunt instrument" , instead business needs people to do the right thing because it's the right thing (p. xviii) Business is a practice that require institutions to support them and protect them from the goal of trying to survive → should be structured to encourage human flourishing
Is compliance with ethics codes enough for ethical behavior? Why or why not?
the virtues primarily concern the intentions behind an action even if the right outcome is achieved, someone isn't acting truly ethical unless they had the correct intentions as well Unity of Life: "Leaders...behave virtuously always and everywhere: at work, with the family, among friends, during free time, and even when they are alone." (p. 143) harvard's chapter on the pitfalls of rule based ethics, volkswagen's statement approaches to compliance are limited to the external statements, but the culture can be completely different from this volkswagen conflicts of interest, negative culture, complete disaster studies have found that there is a self-perpetuating mechanism that occurs when enforcement and punishment occurs about the code, but then people just try and code around the code more surveillance → more unethical actions extrinsic vs. intrinsic motivation compliance is a minimum baseline, but even with those in place (like Volkswagen), if there is a culture of fear/futility it won't lead to the creation of an ethical culture
What is characteristic of the founding of business studies at Notre Dame?
virtuous formation "The primary function of commerce is service to mankind. Business has a code of ethics based very largely on divine principles. When this code is followed, commerce can and does advance civilization. When it is overlooked by selfish interests, individual or national, every sort of injustice, from petty thievery to world war, may result." (1923) "Notre Dame should send [people] into business with a sound knowledge of business theory...character...with lofty ideals of citizenship, and with sound conceptions of business morality based on the Seventh Commandment and the Eight Beatitudes, and with character that will put those principles into practice under whatever temptations the world may offer." A Notre Dame education is a rigorous one that prepares you for business with a balanced worldview. It develops you as a leader — true to your core values — with the moral courage to act with integrity. It pushes you to see business as more than a career but a vocation to serve the common good. Serve the common good and greater society "...This is an era for virtuous individuals, with diverse interests and uncommon potential, to lead human enterprises forward. And this is an era for a business degree that gives those purpose-driven leaders the tools to connect their gifts to a better future for all." "We focus on developing ethical leaders who have a broad vision of the world and understand how to use business to improve local and global communities. Our students are challenged to balance mind with heart, personal success with care for others, and corporate growth with concern for the communities in which those companies operate."
What does St. Basil the Great think that wealth does to our hearts?
wealth damages your soul (5) "If horrors don't terrify, if glories don't attract, we are talking to a heart of stone." (6) wealth leads to a never-ending cycle of materialism and desire for more never stop to enjoy what you already have, instead you are constantly trying to accumulate greater wealth desire for the accumulation of wealth leads us to sin and to lack concern for the poor "For just as the shadow trails the body, so do sins trail souls, giving a precise outline of their actions. (6)
What is the Pygmalion effect?
when we expect certain behaviors of others, we are likely to act in ways that make the expected behavior more likely to occur
What are the works of mercy a "scandal" according to Dorothy Day?
you do not necessarily receive justice/compensation for your works of mercy on earth (stumbling block)
Is it possible to have control over one's emotions? Is one blameworthy or praiseworthy for her emotions? Why or why not?
I believe you can have control over your emotions → temperance temperance = is the moral virtue that moderates the attraction of pleasures and provides balance in the use of created goods. It ensures the will's mastery over instincts and keeps desires within the limits of what is honorable. The temperate person directs the sensitive appetites toward what is good and maintains a healthy discretion (Catechism of the Catholic Church 1809) stages of temperance intemperate → incontinent → continent → temperate thus, those who have negative or unproductive emotions but do not seek out ways to manage or control their emotions can be blamed for them (you should make an effort) Mattison → racism? deep seated inclination to look down upon others? then you cultivate those emotions to act in a racist way? maybe not blameworthy for the initial emotion, but in the end you are blameworthy because you cultivated them in a way that eventually led you to degrade and hurt others we have to examine our emotions in light of the truth and recognize that these emotions are unhelpful and unproductive → need to shift the thought pattern and reframe them to blameworthy or praiseworthy in the sense that we order our emotions to the right end
What is the common good according to Gaudium et spes?
the sum of those conditions of social life which allow social groups and their individual members relatively thorough and ready access to their own fulfillment
What does the HEXACO research from Taya Cohen conclude about good employees and managers?
Ethical people are valuable employees. They have great job performance and make good leaders Moral character is, at least partly, a measurable dimension of personality. (It is related to guilt-proneness, conscientiousness, and honesty-humility. You can identify a person with moral character in an interview. (Ask them about a time they made a mistake at work, or have them take the HEXACO or GASP test.) honesty-humility, conscientiousness and guilt proneness each predicted workplace deviance and organizational citizenship high levels of honesty-humility and guilt proneness predict ethical and effective leadership
What is solidarity according to John Paul II in Solicitudo Rei Socialis?
Solidarity "is not a feeling of vague compassion or shallow distress at the misfortunes of so many people, both near and far. On the contrary, it is a firm and persevering determination to commit oneself to the common good; that is to say to the good of all and of each individual, because we are all really responsible for all." (39)
What would be needed for Ryan's proposals for social reform to work? Was he successful? Why or why not?
Some claim this is Fascism or Socialism; "The probability that the industrial organization operating under the NRA will be transformed into the occupational group system...is not encouraging." (188) More fundamental and more necessary for a better economic order than any of the political or industrial arrangements...is an increase in ethical instruction and a lifting of ethical standards... (189) Pius XI: "If we examine matters diligently and thoroughly, we shall perceive clearly that this longed for social reconstruction must be preceded by a profound renewal of the Christian Spirit, from which multitudes engaged in industry in every country have unhappily departed. Otherwise, all of our endeavors will be futile and our social edifice will be built not on a rock but on shifting sand." (189) If social reform is impeded by "cunning, extortion, and downright dishonesty" we have reason to "doubt whether as a people we have the moral qualities necessary to carry out successfully any plan of social reform or to achieve any considerable measure of social justice." (190)
What economic system, if any, does Catholic social teaching propose?
The Church's social doctrine is not a "third way" between liberal capitalism and Marxist collectivism, nor even a possible alternative to other solutions less radically opposed to one another: rather, it constitutes a category of its own. Nor is it an ideology, but rather the accurate formulation of the results of a careful reflection on the complex realities of human existence, in society and in the international order, in the light of faith and of the Church's tradition. Its main aim is to interpret these realities, determining their conformity with or divergence from the lines of the Gospel teaching on man and his vocation, a vocation which is at once earthly and transcendent; its aim is thus to guide Christian behavior. It therefore belongs to the field, not of ideology, but of theology and particularly of moral theology. -Solicitudo Rei Socialis, 41 (JPII)
Give an account of how the virtues work together. Can one have only one of the virtues?
You can have multiple virtues → to grow you must try to accumulate as many virtues as possible Ex. Jane Fraser continuing to create programs fostering diversity and inclusion in the workplace, even after facing backlash, because she knows it is the right thing to do (prudence, justice, fortitude)
According to the Second Vatican Council (Vatican II), what is the lay apostolate? Why does it matter?
The apostolate is everybody's job (§2) Sharing in the priestly, prophetic, and kingly office of Christ (§2) Charity...urges all Christians to work for the glory of God through the coming of his kingdom and for the communication of eternal life to all human beings, that they may know the only true God and Jesus Christ whom he has sent (Jn .17:3) The vocation of the lay faithful to holiness implies that life according to the Spirit expresses itself in a particular way in their involvement in temporal affairs and in their participation in earthly activities. matters because each individual person has a call to "holiness" and "are the humble yet great builders of the Kingdom of God in history"
What are some of Pope Francis' diseases of leadership? Can you apply them to any of the case studies from our class?
Thinking we are immortal, immune, or indispensable humility Excessive busyness →leisure Emotional Petrification --> detachment, generosity, compassion Excessive planning and functionalism → spontaneity and flexibility Poor coordination → symphonic equilibrium Forgetfulness of mentors → memory and gratitude Rivalry and vainglory → service Existential schizophrenia/isolation → togetherness Gossiping, grumbling, backbiting → courageous honesty and transparency Idolizing superiors/selfish idolization → selfless giving Indifference to others → Sincerity and warmth Downcast face or severity--> joyful humor Hoarding → contentment Closed circles and self-referential(ism) → unity and fraternity with others Extravagance and self-exhibition → equal dignity and cooperation Wells Fargo Case Study indifference to others/emotional petrification didn't care what the superiors were doing to both employees and customers sought only profits and other metrics of "success" closed circles and self-referential(ism) superiors did not listen to those below them and created a culture where individuals were not encouraged to speak out about what was happening Ford Pinto Case Study emotional petrification/indifference to others leaders sought profit for profit's sake, and didn't consider the consequences that their actions would have on individuals took a purely utilitarian approach Volkswagen Case Study idolizing superiors Julia didn't realize what was going on because she idolized both her superiors and the company as a whole → she didn't go into enough depth or detail when researching what was actually going on at the company
What is the "better than average" effect?
This is a self-serving bias, one version of the Dunning-Kruger Effect Most people believe they are better than average on most positive traits, including morality. Those who are inexperienced (or immoral, in the case of ethics) are most prone to overconfidence. From "Unskilled and Unaware of It" by Dunning and Kruger. As Alexander Pope said, "A little learning is a dangerous thing."
What is subsidiarity?
the coordination of society's activities in a way that supports the internal life of the local communities (Benedict XVI)
What is the central problem of capitalism, according to Amintore Fanfani?
capitalism is founded on a "seperation of human aims" (114) its final principle is economic utility, which causes society to "adopt its standards of judgment, hence the ideas of what is just and unjust, fitting and unfitting, normal and abnormal." (115)
What is ethical fading? What are forecasting errors?
ethical fading = the process by which the moral colors of an ethical decision fade into bleached hues that are void of moral implications forecasting errors = prediction errors ("I should behave ethically ... therefore I will", but then you don't
What virtues should a good businessperson exhibit, according to Pius XII?
good economic sense moral qualities tenacious optimistic engages in fair competition self-reliant responsible does not profit at employee's expense does not exploit labor
Why can curiosity be a vice? What virtue is opposed to, and what kinds of curiosity are there, according to Bradford Littlejohn?
lack of temperance in the vice of curiosity (curiositas) we can err in the object of knowledge arrogant, meddling, distracting, curiosity demanding things only God can know mode of knowledge intemperate curiosity "this error can express itself either in being willing to turn aside from a more important activity to pursue lesser knowledge and being willing to do evil to gain the knowledge, such as seeking knowledge from demons" end (purpose of knowledge) "A vicious knowing is possessive, taking delight not in the object of knowledge but in the act of knowing it. The knowledge of truth is a good that belongs to all of us in common, but the curious wish to privatize this gift" possessive curiosity
