AB105 Organizational Behavior & DesignEthical Reasoning Assignment Summary Page
The issue arises as Wellness Village; a spa operator who collected prepayment from its customers suddenly terminated its business without prior notice, leaving its customers and credit-issuing banks in great loss. The customers did not receive the service they supposed to get from Wellness Village and as a result, the bank faced credit risks that some credit customers refused to pay. The owners knew the closed-down of the spa beforehand, but they still sold prepaid packages dishonestly. A concern is thus raised whether the owners and managers of a business are ethically right to ignore their responsibility and integrity in the pursuit of self interests and benefits, which could impose potential damages and losses to customers or other related stakeholders.
Businesses have evolved into many distinctive forms, but for all of them the goal to maximise their profit is nevertheless in common. This everlasting aim of business is more or less in line with ethical egoism theory that ‘it is necessary and sufficient for an action to be morally right that it maximises one's self-interest’ (The Stanford Encyclopaedia of Philosophy, 2010). According to this theory, the spa owners’ irresponsible and dishonest act was ethically correct and should be encouraged. Contrastingly, in the view of Ethical Altruism, such act is definitely unethical as it states ‘only actions having for their object the happiness of others possess a moral value’ (Catholic Encyclopaedia). The spa owners apparently did not sacrifice for its stakeholders such as customers. Besides, a more popular and convincing ethical theory, Utilitarianism also renders such act immoral. Utilitarianism aims to achieve ‘greatest good for the greatest number of people’ (Jeremy Bentham), by which a business can be ethically correct only if the