6

Overview of Ethics

Compiled: Dr. Robert McGrath

October 4, 2018

1. Ethical Principles

http://soe.syr.edu/academic/counseling_and_human_services/modules/Common_Ethical_Issues/ethical_principles.aspx

Ethical principles provide a generalized framework within which particular ethical dilemmas may be analyzed. As we will see later in this module, these principles can provide guidance in resolving ethical issues that codes of ethics may not necessarily provide. What follows are definitions of five ethical principles that have been applied within a number of professions (Beauchamp & Childress, 1979):

1. Respecting autonomy 2. Doing no harm (nonmaleficence) 3. Benefiting others (beneficence) 4. Being just (justice) 5. Being faithful (fidelity)

Respecting autonomy

The individual has the right to act as a free agent. That is, human beings are free to decide how they live their lives as long as their decisions do not negatively impact the lives of others. Human beings also have the right to exercise freedom of thought or choice.

Doing no harm (Nonmaleficence)

Our interactions with people (within the helping professions or otherwise) should not harm others. We should not engage in any activities that run the risk of harming others.

Benefiting others (Beneficence)

Our actions should actively promote the health and well-being of others.

Being just (Justice)

In the broadest sense of the word, this means being fair. This is especially the case when the rights of one individual or group are balanced against another. Being just, however, assumes three standards. They are impartiality, equality, and reciprocity (based on the golden rule: treat others as you wish to be treated).

Being faithful (Fidelity)

Being faithful involves loyalty, truthfulness, promise keeping, and respect. This principle is related to the treatment of autonomous people. Failure to remain faithful in dealing with others denies individuals the full opportunity to exercise free choice in a relationship, therefore limiting their autonomy.

2. Five Principles of Moral Reasoning

https://www.huffingtonpost.com/john-paul-rollert/benjamin-franklin-ethics_b_2544857.html

For inspiration, I assign Franklin’s Autobiography to students in my business ethics class at the University of Chicago Booth School of Business. Then I challenge them to derive principles of their own with an eye toward strong moral leadership. With their permission, I wanted to share five favorites from my fall class.

1. Put a Face on It

Unlike Franklin’s experience, many of our work relationships will involve people we will never meet. Dan, an IT professional, makes the obvious but often overlooked point that it is “easy to engage in unethical or immoral behavior when you don’t have to see the person whom you are affecting.” Accordingly, he always tries to put a face with a name, finding photos of the people he interacts with on LinkedIn or other online directories. “Associating a face with the interactions reminds me that my actions affect a real person,” he says, “not just some faceless name in an email address line.”

2. Manage by Listening Rather Than Telling

Unusually precocious, Franklin knew the awkward status of being junior in age but senior in position. Drawing on her own experience working for an industrial supplier, Lindsay observes that a promising associate is often placed in a leadership role “before she may be ready,” with the result that she finds herself “fighting an uphill battle to do well and gain the respect of those around her with more tenure and experience.” Accordingly, Lindsay contends that one must establish a professional dynamic of mutual respect. “I am only successful if the people I manage have my back and respect me,” she says. “I am nothing if I do not respect and support the work that they do day in and day out.

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3. Be Flexible, Not Dogmatic

Franklin’s rejection of a rigid approach to problem solving spoke to Drew, a corporate trust analyst. “Businesses leaders need to be flexible and not dogmatic about their beliefs and intellectual frameworks,” he says. Reflecting on Alan Greenspan’s leadership in the years before the financial crisis, he faults the former Fed Chair not for failing to anticipate the crisis, but for believing that such an event could never occur. “Greenspan relied too heavily on frameworks,” he says, “and not enough on doing everything in his power to rationally understand what was going on and make adjustments to his policies as needed.” For Drew, strict adherence to dogma not only binds a leader’s hands, it can blind him to problems his framework won’t admit.

4. Follow Published Rules of Conduct

Franklin wrote his precepts in a memorandum book he carried with him wherever he went. The aim was to remind him of the behavior he aspired to — and to shame him whenever he failed to live up to it. An executive at a Fortune 50 company, Megan observes that, while the “Code of Conduct” is a mainstay of the modern office, “many people disregard these published rules.” Such a tendency not only undermines the rules, when managers flout them, it reinforces a spirit of lawlessness. A fish rots from the head down. If rules are important enough to be written down, they are important enough to be followed — by everyone.

5. Respect the Bottom Line, but Don’t Worship It

“[A]fter getting the first hundred Pound,” Franklin observed in the Autobiography, “it is more easy to get the second.” Yet, as Patrick, a student with experience working in renewable energy, observes, the additional gain can sometimes come at too high a cost. “I don’t believe that the pursuit of profit on its face is immoral,” he says, but “I do believe that a relentless focus on profit often leads to immoral behavior.” The same may be said for any single-minded focus that excludes all other goods. For leaders, a sense of perspective and an ability to step back are essential to balancing moral integrity with corporate mission. At the same time, Patrick notes, the emergence of companies that have double or triple bottom lines of profit, social impact, and sustainability “indicates that certain businesses either share this principle or have very slick PR teams.”

Benjamin Franklin wasn’t above a little “slick PR” — how else to explain a book where one presents himself as a paragon of self-improvement? — but he believed that the appearance of integrity would inevitably be undone without the reality in support of it. The principles described above are no doubt demanding, but so is any standard of leadership worth the trouble of writing down.

John Paul Rollert teaches business ethics at the University of Chicago Booth School of Business

3. 4 Universal Moral Principles: Lessons of the Ages

https://www.hoban.org/s/1098/images/editor_documents/2009-10%20School%20Year/Bulgrin/4%20Basic%20Moral%20Principles.pdf?sessionid=f9e8cb31-22cc-4159-9676-b18595ccbc90&cc=1

Basic moral principles represent the wisdom of human experience over the ages. These principles are not collected into any one book, nor are they agreed upon by every human being.

But some principles are so widely held that we can think of them as universals. Here are a few of these principles:

1. Do good; avoid evil . This most basic moral principle, the starting point for morality, was articulated by Aristotle, an ancient Greek philosopher, and is held by all the world's major religions. All other moral principles flow from this one.

C.C. 1803 "Whatever is true, whatever is honorable, whatever is just, whatever is pure, whatever is lovely, whatever is gracious, if there is any excellence, if there is anything worthy of praise, think about these things." A virtue is an habitual and firm disposition to do the good. It allows the person not only to perform good acts, but to give the best of himself. The virtuous person tends toward the good with all his sensory and spiritual powers; he pursues the good and chooses it in concrete actions.

2. Do unto others as you would have them do unto you . All the world's major religions carry an expression similar to the Golden Rule familiar to Christians: "'Do to others

whatever you would have them do to you.'" (Matthew 7:12) C.C. 1970

The Law of the Gospel requires us to make the decisive choice between "the two ways" and

to put into practice the words of the Lord. It is summed up in the Golden Rule, "Whatever you wish that men would do to you, do so to them; this is the law and the prophets."

3. The end does not justify the means . Classical philosophy and the major world religious traditions have upheld the principle that having a good end (goal or purpose) does not justify the use of evil means (method) to achieve that end.

``There are those who say: And why not do evil that good may come? Their condemnation is

just' (Rom 3:8).'' C.C.1756 It is therefore an error to judge the morality of human acts by considering only the intention that inspires them or the circumstances (environment, social pressure, duress or emergency, etc.) which supply their context. There are acts which, in and of themselves, independently of circumstances and intentions, are always gravely illicit by reason of their object; such as blasphemy and perjury, murder and adultery. One may not do evil so that good may result from it. Also, as Pope John Paul II wrote in The Splendor of Truth:

The foreseeable consequences are part of those circumstances of the act, which, while capable

of lessening the gravity of an evil act, nonetheless cannot alter its moral species.

4. Follow what nature intends . Known in philosophy as natural law, this principle is not actually a law written down someplace but, rather, an approach to making decisions that respects the nature of things, especially human nature. Briefly, natural law tells us this: Follow what is natural for human beings and the rest of creation. Do not violate the nature of things. For instance, our innate sense of what is fair and honorable. The universal condemnation of selfishness, senseless cruelty, and deceit. Additionally, consider how natural law could apply to humans' tampering with the earth's environment. For example, it is natural for the earth to have a protective ozone layer around it to shield animals and plants from the destructive effects of ultraviolet light. Human beings' damaging of the ozone layer through pollution could be considered a violation of natural law. C.C. 1956

The natural law, present in the heart of each man and established by reason, is universal in

its precepts and its authority extends to all men. It expresses the dignity of the person and determines the basis for his fundamental rights and duties:

For there is a true law: right reason. It is in conformity with nature, is diffused among all men, and is immutable and eternal; its orders summon to duty; its prohibitions turn away from offense. To replace it with a contrary law is a sacrilege; failure to apply even one of its provisions is forbidden; no one can abrogate it entirely.

4. Ethics at a Glance

https://rhchp.regis.edu/HCE/EthicsAtAGlance/RespectForPersons/RespectForPersons.pdf

Principle of Respect for Persons - In its simplest form, respect for persons maintains that human beings have intrinsic and unconditional moral worth and should always be treated as if there is

nothing of greater value than they are. This principle rests on the unique capability of human beings to behave as rational agents, that is, self-aware and capable of objective thought and

the ability to reason. The ability to reason is believed to give humanity an intrinsic dignity that must be respected above all other considerations.

This inherent value attributed to human beings means that each person is an end in him or herself and should not be treated solely as a means to some other end. It also implies that all persons have equal worth and should be treated equitably and in ways that we ourselves would want to be treated. Principles of truth telling, loyalty, privacy, and confidentiality are all rooted in this basic requirement of unconditional respect and value.

Finally, as rational agents, we are free and capable of making our own decisions and choosing actions based on our own goals and reasoning. In other words, we are self-determining or autonomous. The principle of respect for persons affirms the primary importance of allowing individuals to exercise their moral right of self-determination. To violate their ability to be self

-determining is to treat them as less than persons. In doing so we deprive them of their essential dignity.

The concept of autonomy is an important extension of this principle. You act autonomously when your actions are the result of your own deliberation and choices. Yet there are many ways in which autonomy can be compromised. Likewise, there are justifiable restrict

ions that can be placed on individual autonomy. For example, paternalism is the principle that

allows a physician to act contrary to a patient’s wishes if there is evidence that the patient is not acting in his or her own best interests and on the basis of a higher level of expertise.

Other allowable restrictions to autonomy include the harm principle, which protects others from harm; the principle of legal moralism, which allows society to render an act illegal on the basis of social values and judgments; and the welfare principle, which allows autonomy to be restricted for the benefit of others (Munson, 2004)

Ascension Health http://www.ascensionhealth.org/ethics/public/key_principles/respect_persons.asp

http://www.ascensionhealth.org/ethics/public/issues/autonomy.asp

University of Washington School of Medicine

http://eduserv.hscer.washington.edu/bioethics/tools/princpl.html#prin2

Classmate 1 post-Raghu

The main concept explored in managerial finance they include, ratio analysis, time value of money, review of financial statement, working capital management, cost of capital and risk analysis, among others. The concept learned to relate to financial acuity as well as managerial decision making in following ways; financial acuity is a critical concept that emphasis on making the right judgment about the financial position of the organization (Gan & Ahmad, 2016). Accurate judgment making by the organization is essential in determining financial performance and health of the organization. Financial health is critical since it determines the organization continuity as a going concern in the competitive environment. The existence of financial acuteness within the organization hence is a source of competitive edge for the organization. The managerial decision within the organization they include capital budgeting, liquidity, and dividends decision. Liquidity decision is vital in determining a firm’s ability to honor its short-term obligation. The current ratio is utilized by the organization to gauge the liquidity position of the organization in a competitive environment. Capital budgeting, on the other hand, focuses on organization investments in projects. The organization is required to invest in projects that have the potential of yielding a positive net present value for the organization (Socea, 2012). Dividend decisions, dividends are paid out of retained earnings organization is required to make accurate dividend decision to satisfy the organization shareholders and at the same time ensure that there is sufficient money for the organization to operate. The new skill acquired from the course they are diagnostic, analytical and decision-making skills. Analytical skills are essential since they will assist me in analyzing of financial statement ad providing the right decision about financial health and performance. Decision-making is essential, especially in capital budgeting. These skills will assist me in advising management on investing in various projects. Diagnostic skills these skills are essential in resolving of the financial-related problem, e.g. fraudulent transaction as well as errors (Lee, 2015). This will assist the organization to continue with its operations as a going concern in the competitive environment.

References

Gan, C., Chong, L., & Ahmad, Z. (2016). Impacts of FRS139 adoption on value relevance of financial reporting in Malaysia. Managerial Finance, 42(7), 707-721. Doi: 10.1108/mf-06-2016-0167 Lee, T. (2015). An Analysis of Retirement Financial Service Providers' Approach to Using Websites to Augment Consumer Financial Acumen. SSRN Electronic Journal. Doi: 10.2138/ssrn.2681322 Socea, A. (2013). Managerial Decision-Making and Financial Accounting Information. Procedia - Social and Behavioral Sciences, 58, 47-55. Doi: 10.1026/j.sbspro.2013.09.977

Classmate 2 post-Akhila

The evaluation of financial strategies to decide how they influence the business inside and remotely. Managerial finance thinks about how to enhance monetary systems to better the organization and where changes can be made to anticipate misfortune. This approach is a blend of fundamental corporate financing and managerial. This course manages the standards of corporate finance. It will furnish you with the dialect and the apparatuses of finance and enable you to comprehend the hypothesis and apply, in certifiable circumstances, the systems that have been created in corporate finance. We talk about the three fundamental rules that guide corporate chiefs in boosting firm esteem: (1) the venture guideline, (2) the financing rule, and (3) the profit rule.

The real points of the course incorporate the part of companies and monetary administrators, time estimation of cash, valuation, capital planning, jump rates, capital structure, and profit approach. While concentrating on the corporate setting, this course will likewise assist you with making better choices in your own budgetary issues and it will acclimate you with how monetary markets function. This course expands on the ideas of the time estimation of cash and presents applications including the valuation of bonds and stocks and utilizing net present esteem and other speculation criteria to settle on venture choices. The connection amongst hazard and return is underlined, alongside deciding the cost of capital. The motivation behind the course is toward building up the important aptitudes to be a viable budgetary director. (BusinessDirectory, n.d.)

Investigation of Managerial Finance is extremely vital in our expert life since chiefs in the firm, paying little mind to their sets of responsibilities, often need to give monetary support to the assets they must carry out their activity. Regardless of whether you are enlisting new laborers, arranging a publicizing spending plan, or redesigning the innovation utilized as a part of an assembling procedure, understanding the monetary parts of your activities will enable you to pick up the assets you should be fruitful. It is essential in our own life because many the standards in managerial finance apply there. Taking in a couple of straightforward monetary standards can enable us to deal with our own cash more successfully. Finance shows that supervisors' essential objective ought to be to expand the abundance of the association's proprietors—the investors. The most straightforward and best measure of investor riches is the association's offer cost, so directors should take activities that expansion the company's offer cost. To begin with, timing is critical. A venture that gives a lower benefit in the short run might be desirable over one that wins a higher benefit over the long haul. Second, benefits and cash flows are not indistinguishable. The benefit that a firm report is basically a gauge of how it is getting along, a gauge that is impacted by a wide range of bookkeeping decisions that organizations make when amassing their monetary reports. Cash flow is a clear measure of the cash flowing into and out of the organization. Organizations need to pay their bills with cash, not profit, so cash flow is the thing that issues most to money related directors. Third, hazard matters an awesome arrangement. A firm that acquires a low, yet solid benefit may be more important than another firm with benefits that vacillate an awesome arrangement and, in this manner, can be high or low at various circumstances. (Gitman & Zutter, 2012)

References

ACCA. (2016, May). Financial management and business Success - a guide for entrepreneurs. Retrieved from http://www.accaglobal.com: http://www.accaglobal.com/content/dam/ACCA_Global/Technical/smb/pi-financial-management-entrepreneurs.pdf

BusinessDirectory. (n.d.). managerial finance. Retrieved from http://www.businessdictionary.com/: http://www.businessdictionary.com/definition/managerial-finance.html

Gitman, L. J., & Zutter, C. J. (2012). Principles of managerial finance. Boston : Pearson Prentice Hall, ©2012.

Classmate 3 post-sowmya

McGarvie. (2007). The importance of financial acumen in staff. Retrieved from https://www.icaew.com/technical/personal-development/leadership/importance-of-financial-acumen-in-staff