NORMATIVE

THEORIES OF ETHICS

Presented to:- Prof. Rajesh Kumar

Presented by:- Group 3
Normative Theories of Business ethics

• Normative theory involves arriving at moral standards that regulate right and wrong conduct.

• In a sense, it is a search for an ideal litmus test of proper behaviour.

 Outcome based Ethical theories
We develop these theories after considering some assumption and this assumption depends on the degree to which
we share this underlying assumption.

In outcome-based theories, every decision is taken on the basis of the desired and actual outcome. If desired
outcome is achieved then its ethical otherwise unethical.

Theory of egoism and utilitarianism come under this wing.

Action Based Ethical theories

These theories are based on moral judgement or action. Their underlying assumption is based on the principle that
the decision maker believes.

An action is considered right or wrong not on the basis of its outcome but on the basis of rights or duties.

As explained in Bhagavat Gita Karma yoga , one should always do one’s appointed duty.

It also explains duty should be done with maximum concentration and pure mind without looking on the
results of the action.
 Consequentialist Theories
Those theories that determine the moral rightness or wrongness of an action based on the
action’s consequences or results.

It is divided further divided in two parts :-

• Egoism
• Utilitarianism
 Egoism
The view that morality coincides with the self-interest of an
individual or an organization

Egoists: Those who determine the moral value of an action based

on the principle of personal advantage.

Psychological egoism: The theory of ethical egoism is often

justified on the ground that human beings are essentially selfish.

Even acts of self-sacrifice are inherently self-regarding insofar as

they are motivated by a conscious or unconscious concern with
one’s own advantage.
 Criticism to egoism

(1)The theory is not sound: The doctrine of psychological egoism is false – not all human
acts are selfish by nature, and some are truly altruistic.

(2)Egoism is not a moral theory at all: Egoism misses the whole point of morality, which is
to restrain our selfish desires for the sake of peaceful coexistence with others.

(3)Egoism ignores blatant wrongs: All patently wrong actions are morally neutral unless they
conflict with one’s advantage.
 Utilitarianism

The moral theory that we should act in in ways that produce

the most pleasure or happiness for the greatest number of
people affected by our actions.

Main representatives - The British philosophers Jeremy

Bentham (1748– 1832) and John Stuart Mill (1806–1873).
The principle of utility - Actions are morally praiseworthy if
they promote the greatest human welfare, and blameworthy if
they do not.
Six points concerning utilitarianism:

I. In choosing between alternative courses of action, we should consider the net worth of
happiness vs. unhappiness produced by each course of action.
II. We should give equal consideration to all individual preferences, then calculate the net
worth of the various kinds of pleasures and pains.
III. Anything can be morally praiseworthy in some circumstances if it promotes the greatest
balance of pleasure vs. pain for the greatest number of people.
IV. We should seek to maximize happiness, not only immediately, but in the long run.
V. We should avoid choosing actions if their consequences are uncertain.
VI. We must guard against bias in our utilitarian calculations when our own interests are at
stake. So it is advisable to rely on rules of thumb.
 Criticisms of utilitarianism

1. The practical application of the principle of utility involves considerable difficulties.

2. Some actions seem to be intrinsically immoral, though performing them can maximize
happiness.

3. Utilitarianism is concerned with the amount of happiness produced, not how the amount
is distributed, so the theory can run counter to principles of justice.
 Nonconsequentialist Theories

Non-consequentialist theories claim that whether an act is right or wrong depends on factors other than or in
addition to the non-moral value of relevant consequences.

Nonconsequentialist Theories it is also called Kantian theory.

Kantianism : Ethics of duty

Immanuel Kant (1724–1804): A German philosopher with a
nonconsequentialist approach to ethics.

• Said the moral worth of an action is determined on the basis of i

intrinsic features or character, not results or consequences.

• Believed in good will, that good actions proceed from right

intentions, those inspired by a sense of duty.
The categorical imperative: The morality of an action depends on whether the maxim (or
subjective principle) behind it can be willed as a universal law without committing a logical
contradiction.

An example of the categorical imperative:

• A building contractor promises to install a sprinkler system in a project.
• But he is willing to break that promise to suit his purposes.
• His maxim can be expressed as: “I’ll make promises that I’ll break whenever keeping
them no longer suits my purposes.”
• By willing the maxim to become a universal law, the contractor undermines promises in
general.
 Theory of Duty or Deontology

According to Kant, Morality and decision about right and wrong are not depended on a
particular situation. They are based on the consequences of one’s action.

A person will follow his or her obligation to another individual or the society because it is
considered ethically correct to upholds one’s duty
 Theory of Rights and justice

The rights established by the society are protected and given the highest priority in ethical
theories based on rights.

Individual may bestow rights on other if they have the ability and resources to do so.

One issue with this theory on a larger scale is that one must decipher (convert) the
characteristic of a right in a society.

In order for the rights theory to be successful it must be used along with another ethical theory
that will consistently explain the goals of the society.