Business Ethics: Moral Analysis and Legal Requirements

Chapter 3: Moral Analysis and Legal Requirements

Question: How do we find an equitable, fair-to-all balance between financial performance and social performance when faced with those conditions then how do we logically convince others to both understand and accept that balance?

Hobbes proposed that men and women were supposed to obey the law and it was up to the government authority to set the law. Even if they do not like the law, you have to accept them. If humans continue to look over their self-interests, the result will be chaos because:
Equal Ability: there is equality in ambition, therefore, there is a struggle for everyone to acquire material wealth and personal safety
Continual War: as individual struggles continue this leads to war
Depressed Economy: if every man only looks out for themselves, there is a lack of security
Proposed Solution: to stop this continual cycle, Hobbes says it is necessary to look at the “Natural Laws”
Men who seek to gain benefits will be in continual war will use all their means available to them
In order for peace to be established, men must surrender their rights to a central authority

Social Contract: all laws should reflect what people living in a state of nature would accept as the governing rules of society. It lacks knowledge of self-interests.
It is the way society should theoretically distribute all resources because it is the way that has been determined to be best for all when we are all equal in position and property.
Veil of Ignorance: an advantage of the Social Contract that forces people to think about issues from different perspectives (which represents the interests of the full society).
The primacy of community is the reason why legal requirements exist and can be applied in moral analysis.

Law: consistent set of universal rules that are widely published, generally accepted and usually enforced. Defines what you theoretically must do.
Consistent: two requirements cannot contradict each other
Universal: must be applicable to everyone facing the same situations
Published: must be in written form, and accessible to everyone.
Accepted: majority must obey laws or there will be a heavy burden on enforcement
Enforced: members must be compelled to follow the law
The relationship between moral judgment and legal requirements:
1. Considerable Overlap
Law does not duplicate the exact moral standards of society, although it does overlap (i.e. segregated education in the 60s in USA)
2. Negative Injunction
There is no required law for us to do the positive (i.e. if there is a drowning child, you have no obligation to save them)
3. Lengthy Delays
Laws lag behind apparent moral standards of society
How do we determine laws if the legal requirements do not necessarily represent the moral judgment of the majority? We follow the process to formulate laws:

There are four stages to formulating collective moral standards:
1. Individual Persons: every person has own set of goals, norms, beliefs and values
2. Small Groups: people with similarities associate with each other
3. Large Organizations: small groups become larger and formal organizations
4. Political Institutions: the resultant moral standards of individuals, small groups and large organizations are formalized into laws

Problems occur when laws are formulated:
Inadequate information: laws may be based on lack of information
Incomplete participation: some members may not be included in the formation of small groups and as a result their interests are not heard
Inarticulate representation: moral standards not fully represented by the formal organizations that influence the laws
Inconsistent Formulation: some organizations within society may not be equally considered
Indefinite Wording