CHAPTER 7 - Utilitarianism

1. Business Ethics: Transcending Requirements through Moral Leadership-------Chapter 7 – Utilitarianism

2. CHAPTER 7 - Utilitarianism • Introduction, Background, and Principal Tenets • Impartiality of the Analysis • Long-Term Consequences • Foreseeing Consequences • The "Good" • Distribution of the Good • Measuring Pleasure and Pain • A Utilitarian Analysis 99 • Act versus Rule Utilitarianism • The "Justice" Problem with Utilitarianism • The Value of Morality - The Utilitarian Approach

3. Utilitarianism • Utilitarianism refers to a systematic theory of moral philosophy developed by the British philosopher Jeremy Bentham (1748 - 1832), and elaborated on and refined by his primary disciple, John Stuart Mill (1806 - 1873). • Bentham was one of the earliest and the most influential utilitarians. • The utilitarians were more than moral philosophers; they were social reformers too. They regarded utilitarianism as an objective, scientific system of ethics, not merely as abstract ethical theory.

4. Utilitarianism & Actions • Utilitarianism determines morality by focusing on the consequences of actions. Actions are not good or bad in themselves; they are judged right or wrong solely by virtue of their consequences. • A utilitarian, after identifying the action for ethical evaluation, determines those people directly and indirectly affected by the action. The utilitarian then attempts to ascertain consequences of the action, good and bad, on the affected parties. In the most challenging aspect of this ethical theory, the utilitarian then strives to measure and weigh the good as compared to the bad consequences. If the good consequences outweigh the bad, the action is moral; if the bad outweigh the good, the action is immoral.

5. Impartiality in Analysis • Utilitarianism treats all people as equally important. Each person's life, happiness, pleasure, and pain has the same value; each person's good is as worthwhile as any other person's good. There are no privileged persons. No one possesses special importance; no person's pleasure or pain counts more heavily than another's. Consequently, there is to be no unequal weighing. An impersonal calculation of the good is required. A utilitarian, therefore, must acknowledge that other peoples' welfare is just as important as one's own.

6. Utilitarianism & Consequences • The utilitarian ethical principle is based on consequences. It is, of course, very difficult to foresee the consequences of an action, even in the simplest of cases, and to predict the future state of affairs resulting from an action occurring in a modern, complex, rapidly changing, urban society is a challenging task, indeed. The indefinitely large number of people potentially affected, the uncertainty and indefinite extensiveness of the future, the fact that some consequences will never be fully knowable, and that others will depend on later, independent choices of people, indicate that ultimate consequences never are fully foreseeable.

7. Utilitarianism & Business Management • The aim of business, of course, is to make money, and business traditionally reduces the "good" to money. As a matter of fact, the cost-benefit analysis commonly used in business is a form of utility calculation. When a business manager uses the cost-benefit analysis as a decision-making tool, however, he or she weighs the good and bad monetary consequences as they relate to the firm, whereas utilitarians weigh the good and bad results of an action, monetary or otherwise, on everyone directly and indirectly affected by the action.

8. Distribution of the Good • By underscoring the maximization of the good, utilitarianism engenders another problem-a potential conflict between the quantity of the good and its distribution. • Is utilitarianism based on an aggregative principle or a distributive principle? That is, should the emphasis be placed on the total amount of good or the number of people who share in the good? • There may be two acts: one produces a greater quantity of good, but with a very narrow distribution; the other produces a lesser quantity, but with a much wider distribution. Which one should a utilitarian choose?

9. Assumptions in Utilitarianism • Utilitarianism assumes that one can measure on a common numerical scale the quantities of pleasure and pain produced by an action. Once one adds up the quantity of pleasure and then subtracts from it the quantity of pain, one thereby can determine whether the action produces more pleasure than pain; and when comparing actions, one can determine which produces the greatest total good (or perhaps the lowest total pain). How this numerical measuring is to be done and, indeed, whether it can be accomplished at all are highly controversial theoretical and practical ethical issues.

10. Utilitarianism Analysis Steps • The Action • The Consequence • Stakeholders • Values Theory • Weighing the Consequences • Although not "scientific" doctrine, utilitarianism can be a useful tool for making moral determinations. Individuals would benefit from familiarity with the central tenets of this ethical theory-foreseeing, measuring, and weighing the consequences of actions. A person who does focus on consequences usually is concerned with the impact of the consequences on himself. Utilitarianism, however, asks that a person expand the scope of analysis and objectively anticipate the consequences of an action on others.

11. Rule Utilitarianism • Rule utilitarianism is the utilitarian analysis applied to general and broad classes, categories, or types of actions, for example, the morality of breaking a contract or keeping one's promises. The moral result of such a calculation is framed as a rule, and individual actions then are judged right on wrong by reference to the moral rule.

12. Act Utilitarianism • Act utilitarianism subjects individual, particular, concrete actions to the utilitarian test. A specific act is evaluated by reference to its own unique consequences. For example, one must calculate the consequences of a particular lie, a particular breach of contract, in unique sets of circumstances.

13. Criticism of Utilitarianism • The major criticism of utilitarianism is that this ethical theory does not account for justice and may even run counter to it. The "right" or "moral" action under utilitarianism may in fact be unjust! The greater good, pleasure, and happiness very well may be maximized, but only by sacrificing justice. There always is the possibility of exploitation of the few. Benefits for the majority can be justified morally pursuant to utilitarianism by imposing sacrifices on the minority. The expropriation of the property of the "wealthy," for example, might bring substantial benefits to large numbers of people, but such an action would be "wrong" despite the benefits for the majority. • Utilitarianism also may allow the exploitation of the many. The few may benefit greatly at the expense of the many, yet the sum total of good is maximized. A slave-holding society, for example, if it provides a greater sum of goodness than one in which all people are treated equally, is moral! A more modern example emerges when a company hires illegal immigrants at very low wages to enable the company to compete.

14. The Value of Morality • Accurately and narrowly state the action to be evaluated (e.g., is it moral for a particular company to...?) • Identify all stakeholders who are directly and indirectly affected by the action (including the company's constituent groups as well as society). • Ascertain whether there are some obvious, dominant considerations that carry such weight as to predominate over other considerations. • Specify for each person or group that is affected directly or indirectly all the reasonably foreseeable good - pleasurable and bad - painful consequences of the action, as far as into the future as appears appropriate, and consider the various predictable outcomes, good and bad, and the likelihood of their occurring. • For each person and group, including society as a whole, measure and weigh the total good consequences against the bad consequences. • Quantify the good and bad consequences for each person and group on a numerical scale (for example, -5, -4, -3, -2, -1, 0 +1, +2, +3, +4, +5) representing units and extremes of pleasure and pain. • Sum up all the good and bad consequences. • If the action results in a positive number, it produces more good than bad and is a morally right action; and if the action results in a negative number, it produces more bad than good and is morally wrong.

15. Summary • Although Bentham and Mill and their adherents may not have persuaded all that utilitarianism is the "right" ethical theory or a "scientific" one, they did establish utilitarianism as permanent and very influential ethical position. They also expanded dramatically the moral intelligence and sensitivity of people by drawing attention to the full consequences of actions and by emphasizing the vital happiness of all sentient beings capable of feeling pleasure and pain.

16. Reference Cavico, F. & Mujtaba, B., (2005). Business Ethics: Transcending Requirements through Moral Leadership. Pearson Custom Publications. U.S.A. ISBN: 0-536-85783-0. Address: 75 Arlington Street, Suite 300. Boston Mass, 02116. Phone: (800) 374-1200. Or: (800) 922-0579.