This page contains A*/A grade levelsummary revision notes for the Business ethics.

Find the full revision page here.

For General questions, it’s up to you what to mention for AO1 marks.
For focused questions, your AO1 marks will be for whatever the question focuses on from this list:

Kant
Utilitarianism

On/or:

CSR
Globalisation
Whistleblowing

AO1: CSR (& application)

CSR = corporate social responsibility. It’s the theory that businesses have a responsibility not just to make profit for their shareholders but also to their stakeholders.
A stakeholder is anyone who is affected by the business, including its employees, customers and wider community.
Environmental CSR = businesses have a responsibility not to destroy the environment.
Social CSR = businesses have a responsibility to not mistreat nor be involved in the mistreatment of its employees, customers and wider community. E.g. minimum wage, health & safety provisions, not benefitting from any kind of exploitation (e.g. sweatshops).
Case study:
Util: environmental CSR is valid, but social CSR might not be, it depends on the situation. If it maximises general happiness for a business to exploit, then that could be valid.
Kant: all violations of CSR treat people as a mere means and are therefore morally wrong.

AO1: Globalisation (& application)

Globalisation is the phenomenon where world economies, industries, markets, cultures and policy-making/politics are connected. Businesses are global entities.
The ethical issues arising from this are things like off-shore outsourcing – when a business closes a factory in a 1st world country and opens it in a third world country. This loses jobs from 1st world countries, and causes exploitation in 3rd world countries.
A further issue is that businesses now have a lot of power and this allows them to influence a country’s laws. A global corporation can bring a lot of jobs and economy to a country, which allows it to ask the politicians to change the laws to favour their business in return.
Ultimately globalisation leads to monopolies – businesses having power allows them to crush their competition so they dominate the market.
This destroys the benefits of free market capitalism – innovation, economic growth and cheap prices.
Case study:
Utilitarians liked Adam Smith’s free market capitalism idea, but they would generally not approve of the way globalisation destroys competition (except in the cases where it happened to maximise happiness – it depends on the situation).
Kant also like Adam Smith’s free market capitalism, but he would not approve of the way globalisation destroys competition and leads to people being exploited (treated as ends)

AO1: Whistleblowing (& application)

Whistleblowing is the act of going public with information about shady/unethical business practices. The upside is that the unethical practices are likely to stop, but the downside can be that the business goes bankrupt and its employees lose their jobs.
Case study: E.g. Edward Snowden – worked for the NSA in America and told the media that they were illegally spying on innocent American citizens.
Whistleblowing is legally protected in many countries, like the UK. Employers aren’t allowed to treat you unfairly or fire you if you whistleblow.
The idea behind this is to encourage whistleblowing, to enable employees to hold employers accountable because whistleblowing is generally seen as a good thing in mainstream liberal democracy.
Util: it depends on the situation. If the suffering alleviated by the whistleblowing outweighs the suffering caused by effect on the business, then whistleblowing is good, however if the conditions are reversed then whistleblowing is bad.
E.g. if a scientist runs a lab who is a genius and about to cure cancer, but is also a psychopath who likes to torture his employees, a Utilitarian would say don’t whistleblow.
Kant: All shady/unethical business practices are likely to treat people as a mere means, so would be wrong for that reason and deserve whistleblow.
Furthermore, Kant claims that lying is not universalizable – so lying is always wrong, no matter the situation. This is another reason that telling the truth during whistleblowing is morally right.

AO2: Sweatshops

Sweatshops are:
A violation of CSR
A consequence of globalisation.
What people whistleblow about.
Util & Kant would disagree/debate about their morality.

Utilitarian reasoning can defend sweatshops.
Effective altruist Will MacAskill points out that people who work in sweatshops can technically be better off, if they would starve without employment.
An instinctual reaction is that we should just demand that sweatshops treat its employees better.
However, if we force a business to lose profit to do that, it would also lose its incentive to open a factory in the developing country in the first place.
So it looks like the benefit gained by sweatshops is inseparable from its exploitativeness

Counter

Many would criticise Utilitarianism for justifying ignoring human rights.
Kant would argue that it’s always wrong to exploit people by treating them as a mere means, regardless of consequences.

Evaluation:

However, Kant’s approach may be too absolutist.
Simply banning sweatshops seems more intuitive and in line with human rights
However, if workers’ alternatives are starvation or deeper poverty, bans may leave them worse off.
This is shown by cases like Primark, where western companies cut ties with sweatshop suppliers after public criticism, causing workers to lose the income they depended on.
Kant infamously refused to allow lying even to save a life, and similarly here he refuses to allow exploitation to save lives.
Kant’s theory might seem morally clean, but arguably it actually reflects an irresponsible lack of courage to risk getting one’s hands ethically dirty in the face of what Aristotle referred to as the intrinsic nuance and complexity of ethics.
Mill’s Rule Utilitarianism has a better approach.
It would not defend unlimited exploitation, but ask which rules maximise welfare long-term.
The best rule is to allow poor workers access to employment while regulating conditions as far as possible without destroying the economic benefit.
So sweatshops may be temporarily justified, but only if exploitation is minimised (as far as profitability will allow) through higher pay, safer conditions and bans on child labour.
Therefore, utilitarianism can justify sweatshops conditionally: not as good in themselves, but as the least bad stage on the economic ladder towards a more regulated, worker-friendly economy.

AO2: The calculation issue

Utilitarianism faces calculation issues: we cannot reliably predict the future, measure subjective pleasure/pain, or calculate under moral time pressure.
Kant uses this to defend deontology: since we control actions, not consequences, ethics should focus on right action.
Application to Whistleblowing:
In whistleblowing, employees may underestimate damage to the business and staff, especially since they rarely know enough about its finances to predict bankruptcy.
Application to Globalisation &/or CSR:
Utilitarians may oppose exploitation generally, but might justify it where it maximises happiness.
The issue is, it’s possible to underestimate the amount of unhappiness caused by the exploitation or overestimate the amount of happiness gained by preventing it.
More generally, it is hard to calculate the long-term danger of letting businesses exploit people. Chomsky argues businesses given too much power will trample rights, so exploitation risks a slippery slope: give businesses an inch and they take a mile.
In all such cases, a Kantian approach can seem safer and more reliable Utilitarianism.

Counter:

However, Kant’s deontological approach leads to counter-intuitive extremes. E.g. he would say you can’t even lie to save a life, because consequences are unpredictable. Similarly, in the context of business ethics, Kant would say you can’t exploit (treat as mere means) to save a life either.
Util’s approach actually seems more intuitive.

Evaluation:

Mill’s rule utilitarianism reduces the calculation problem by conforming actions to socially tested rules which maximise happiness and can improve over time.
E.g. Mill’s harm principle maximisses happiness by allowing people freedom so long as they are not harming others.
Following such rules means we can avoid impractical calculation of every action.
Application:
Mill opposed exploitation and a more equal economy, featuring worker-owned co-ops.
As a utilitarian, Mill might allow exploitation short-term, but would phase it out long-term.
Society must progressively develop rules for CSR, globalisation and whistleblowing.
This approach is ideal, because issues in business ethics are a moving target.
New technology and innovation gives corporations new ways to exploit, monopolise and corrupt governments.
This is very close to the way regulation actually works, though Mill would want greater priority and strength granted to it.
This is ethically ligitimised through the goal of maximising happines and politically legitimised through rules being formed by democracy and expertise.

AO2: Adam Smith & Capitalism vs Milton Friedman vs Kant & Utilitarianism

Adam Smith, the ‘father’ of capitalism, argued markets harness self-interest through competition, producing better and cheaper goods, self-organising through supply and demand as if guided by an ‘invisible hand’.
Friedman’s shareholder theory develops Smith with libertarian ethics:
Freedom is the ultimate good, which justifies free markets grounded in voluntary transactions.
A business is private property: giving back may be good, but cannot be a responsibility.
Its only responsibility is increasing shareholder profit through fair market competition.
What is good business is therefore good ethics.

Counter:

Political centrists favor some regulations like CSR, whistleblowing, anti-globalisation.
This links ethics and business differently; responsibility to society and the environment benefits business because people prefer to purchase from ethical companies.
Left-wing or Marxist economists regard CSR as hypocritical window-dressing: public relations masking capitalism’s inherent exploitation.
Giridharadas captures this: “Jeff Bezos wants to start a school for kids whose families are underpaid by people like Jeff Bezos” — generosity is no substitute for justice.
Marx argued capitalism necessarily divides owners from workers, whose lack of opportunity is exploited so that their labour mainly enriches owners, causing alienation.
On this view, CSR and whistleblowing can never go far enough to make capitalism ethical.
Globalisation’s oligarchic tendency reflects the naivety in thinking capitalism can be tamed.

Evaluation

Marx’s weakness is that communism has never convincingly worked, and repeated failure raises doubts about its compatibility with human nature.
Globalisation helped reduce absolute poverty from 70% to 12% by 2012, making Marx’s critique seem outdated if not misplaced.
However, the economic problem for Friedman is that unchecked capitalism can undermine the free market itself.
Globalisation lets corporations destroy competition, producing oligarchy rather than Smith’s innovation-driving competition.
Friedman fundamentally misunderstands the social contract.
In Obama’s ‘you didn’t build that’ speech, he emphasised how social democracie benefit businesses through educated workers, infrastructure, healthcare and accumulated social knowledge, funded partly by profits.
So, profits can’t logically be described as fully ‘earned’ or ‘deserved’ by the shareholders.
In a classically liberal state (most western states), taxes can’t be described as unfairly taking people’s ‘property’, nor can responsibility be reduced merely to fair competition in a market.
If people want to create a libertarian society where humans are so atomised that everything they build is completely the result of their own effort, they are free to do so.
Kant & Mill both accepted capitalism and praised Smith’s ideas, but thought markets need regulation to be ethical.
Kant would be more restrictive of capitalism than Mill, but they broadly represent the same approach here.
This proven liberal-democratic middle ground between Marx and Friedman shows capitalism can be ethical through interventions like whistleblowing, CSR and limits on globalisation.

Question preparation

Revision paragraphs:

AO1: CSR (& application)
AO1: Globalisation (& application)
AO1: Whistleblowing (& application)
AO2: Sweatshops
AO2: The calculation issue (applied to business ethics)
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism

The AO2 paragraphs can all be linked to all three sub issues (CSR, Whistleblowing, Globalisation) and both applied theories (Util and Kant) feature in them.

So in principle these can work for 95% of possible business ethics essays.

General plan:

Most questions will be of this form:

Assess theory X (Kant or Util) on sub-issue Y (CSR/Globalisation/whistleblowing)

AO1: – explanation of issue Y & Application of theory X to issue Y
AO2: Sweatshops
AO2: The calculation issue (applied to business ethics)
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism

Question types:

Issue focused questions:

“Whistleblowing is sometimes morally acceptable” – Discuss [40]

AO1: Whistleblowing (& application)
AO2: Sweatshops
- Util would say don’t whistleblow sweatshops in cases where they bring net benefit.
AO2: The calculation issue (applied to business ethics)
- Util’s judgement faces this practicality concern.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Friedman would say whistleblowing is only justifiable when a business breaks the law, not simply because a person doesn’t approve of their behaviour.
- Marx would say that doesn’t go nearly far enough to make capitalism morally acceptable.
- Kant and Util would be in the middle: whistleblowing can be acceptable even if the law isn’t broken, but if morality is breached – such as treating people as a mere means (Kant) or failing to maximise happiness (Util).

To what extent is globalisation a problem? [40]

AO1: Globalisation (& application)
AO2: Sweatshops
- Are often a consequence of globalisation.
AO2: The calculation issue (applied to business ethics)
- Assesses whether Kant or Util has the more practical approach to judging globalisation.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Assesses our underlying theory of business ethics in judging globalisation.

Applied questions:

“Kant proves the best approach to whistleblowing” – Discuss [40]

AO1: Whistleblowing (& application) (focused on Kant’s theory and its application to whistleblowing)
AO2: Sweatshops
- Kant and util disagree about whether we should whistleblow over sweatshops.
AO2: The calculation issue (applied to business ethics)
- Kant and util disagree about the practicality of a consequentialist vs deontological approach to informing moral decision-making regarding whistleblowing.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Friedman and Marx would disagree with Kant – from opposite directions.

Should we judge corporate social responsibilised based on whether utility is maximised? [40]

AO1: CSR (& application) (focused on CSR, Utilitarianism, and its application to CSR)
AO2: Sweatshops
- CSR would be against sweatshops, but Util disagrees.
AO2: The calculation issue (applied to business ethics)
- Evaluation of whether Util is practical for moral decision-making
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Friedman and Marx would disagree with Util – from opposite directions.

Weirdly worded questions:

Is good ethics good business? [40]

AO1: CSR (& application)
- Good ethics = good business is the ideology of CSR
AO1: Globalisation (& application)
- Globalisation threatens the idea that good ethics is good business, because it shows how being unethical can be profitable
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- This debates:
  - CSR’s claim that good ethics is good business.
  - Friedman’s claim that good ethics is just fairly competing in the free market
  - Marx’s claim that good ethics can never be good business because capitalism is morally bankrupt
  - Kant and Utilitarianism’s claim that businesses just need to be restricted, we can’t trust them to just do what’s ethical because it’s good business because sometimes it isn’t.
AO2: Sweatshops
- Sweatshops are good for business, but Kant says they are unethical, yet Util disagrees in some cases.
AO2: The calculation issue (applied to business ethics)
- Criticises Util’s method for regulating businesses, suggests Kant may have the more reliable method.

Conclusion: good ethics isn’t necessarily good for business, therefore businesses need to be regulated in order to create an economically just economy, along utilitarian principles. Rule utiltarianism will be the favored method for this, since its focus on rules escapes calculation issues and is ideally responsive to the challenge that issues in business ethics are a moving target.

Can human beings flourish in the context of capitalism and consumerism? [40]

Same content as the question below

AO1: CSR (& application)
- Claims capitalism can be ethical if businesses realise ethics is good for business because it motivates customer choice.
AO1: Globalisation (& application)
- Shows the downside of unrestricted capitalism on the global stage.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Debates the nature and extent of control over capitalism required to make it ethical and enable human flourishing, or whether it’s impossible to reconcile with flourishing as Marx thinks.
AO2: Sweatshops
- Are seen as a classic example of capitalism being exploitative – though perhaps actually could be defended by utilitarianism.
AO2: The calculation issue (applied to business ethics)
- Debates whether utilitarianism really has a reliable method for determining how and when capitalism ought to be regulated.

Is CSR is just hypocritical window-dressing covering the greed of a business? [40]

AO1: CSR (& application)
- Kant would always be in favour of CSR, and Utilitarianism would mostly be in favour of CSR. Kant would claim that CSR should always be followed by a business – it’s not acceptable to use it merely as window-dressing – also, intention matters for Kant but not for Util.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
Debates whether CSR is:
- Hypocritical window-dressing which distracts from how bad capitalism really is (leftists and Marx),
- An unnecessary infringement of freedom (Friedman)
- Acceptable but not the true ground of ethics nor full measure of how businesses require regulation to be ethical (Kant & Util)
AO2: Sweatshops
- A business might be doing CSR for hypocritical window-dressing, to distract from sweatshops (e.g. Apple was accused of this).
- Kant would be against this, but Utilitarians might defend sweatshops, thinking only maximising utility matters not hypocritical intentions.
AO2: The calculation issue (applied to business ethics)
- At this point we’ve considered whether utilitarianism has the best approach, and its consequentialist method would not care about intentions, only utility, and it wouldn’t fully accept the left wing critique of capitalism.
- But, for it to judge CSR as good (in most cases..), we need to make sure it’s a good theory. This criticism evaluates whether it’s really practical in its method of decision-making. I.e., if it’s judgement about when CSR might or might not be good if practical.

How should a business treat its stakeholders? [40]

A stakeholder is a person who has anything to do with a business whatsoever. E.g. employees, customers, people who live in the local community.

AO1: CSR (& application)
- The idea of CSR is that a business doesn’t just have responsibilities to its shareholders, but also to stakeholders, e.g. to treat it’s workers and customers fairly and to not destroy the environment.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Friedman: a business only has responsibility to its shareholders, not stakeholders.
- Marx: would say mistreatment of stakeholders is immoral, but inherent to capitalism, so CSR can’t solve it and we should be communist.
- Util & Kant: defend responsibility to stakeholders for different reasons and to varying degrees: Kant to avoid treating them as a mere means, Util to maximise happiness.
- This shows Kant and Util have the right middle ground: capitalism is acceptable but only if regulated.
AO2: The calculation issue (applied to business ethics)
- This evaluates whether Kant or Util have the more practical approach for determining ethical treatment of stakeholders.
AO2: Sweatshops
- CSR says sweatshops are bad because they mistreat stakeholders (employees), but Util defends the ethics of sweatshops. And Kant disagrees.

Does globalisation encourage or discourage good ethics as the foundation of good business? [40]

AO1: Globalisation (& application)
- Often taken to show that what’s good for a business is not good ethics, since it enables businesses to destroy the free market through monopolisation.
AO2: Adam Smith & Milton Friedman vs Marx vs Kant & Utilitarianism
- Friedman: would accept globalisation as it’s just a consequence of freedom.
- Marx: would argue globalisation shows what happens if you allow capitalism to exist unchecked.
- Kant & Util: would argue globalisation shows what’s good for business isn’t necessarily good for ethics – therefore, capitalism needs to be regulated.
AO2: Sweatshops
- Sweatshops – are a consequence of globalisation and are good for business, but don’t seem like good ethics.
- But: Util would say they are good ethics (and good business)! And Kant would disagree – arguing they are not good ethics, even if they are good business.
AO2: The calculation issue (applied to business ethics)
- Util runs into issues determining how to judge globalisation since that requires predicting the future. Kant might seem more stable. But Rule Util arguably best positioned here.

Conclusion: globalisation not only discourages good ethics as the foundation of good business, but shows why they are opposed and require regulation as recommended by Mill’s approach.