SINGAPORE MANAGEMENT UNIVERSITY

LGST001: Ethics and Social Responsibility

ACADEMIC YEAR 2010/11 TERM 2

Group Assignment 2

Prepared for Prof Loo Wee Ling

Prepared by:
Cliffton Ho Eunice Yap Jia Li Ng Hui Chun Lim Wei Hong 1 G11 G1

Contents
1. 2. Assumptions .......................................................................................................................................... 3 Ethical Issue .......................................................................................................................................... 3 2.1 3. Possible Solutions ......................................................................................................................... 3

Analysis of Ethical Issue ....................................................................................................................... 4 3.1 3.1.1 3.1.2 3.1.3 3.2 3.3 3.4 3.4.1 3.4.2 3.4.3 3.5 3.6 3.7 Kantian Ethics ............................................................................................................................... 4 Principle of Universalisability ............................................................................................ 65 Principle of Humanity ......................................................................................................... 65 Kantian Conclusion ............................................................................................................. 65 Aristotle: Virtue Ethics ........................................................................................................... 76 Confucian Ethics ......................................................................................................................... 76 Utilitarianism .............................................................................................................................. 86 Stakeholders ........................................................................................................................ 86 Analysis............................................................................................................................... 87 Conclusion under Utilitarianism ..................................................................................... 1211 Ethical Egoism ........................................................................................................................ 1211 Rawlsian Justice ...................................................................................................................... 1311 Ethics of care........................................................................................................................... 1413

References .......................................................................................................................................... 1513

1. Assumptions
In order to perform a thorough ethical analysis for Cynthias decision, our group has taken facts of the case prima facie, but included the following assumptions: [OK, I suppose the following assumptions can be reasonably made given the facts of the case.] a. Cynthia has a Restraint of Trade Clause in her contract b. In Cynthias employment contract, should she decide to leave the company, she will need to tender her resignation with one months notice, or if its urgent, pay a compensation of one months salary to leave with one days notice c. Impossible for Cynthia to finish her project first before she leaves to join Crytex because Crytex only gave her a few days to consider and even if they can be flexible, three months will be too long [This was implied in the facts of the case but I suppose you wish to be clear in that case perhaps it is better to state that this is your interpretation of the facts rather than calling it an assumption.] d. A months notice is too long for Crytex to wait for her e. There is no other suitable replacement for Cynthia that can follow through the project successfully due to the intricacies of the project [Same comment as for your assumption (c).]

2. Ethical Issue [Competent framing of issue but please note improvements suggested.]
Is it right for Cynthia to leave her current job just to pursue her own dreams and selfinterest/development, knowing that by doing so will likely jeopardize the current project that she is in charge of and she will be seen as disloyal especially since she as she would be leaving to join Crytex, which is Altrues big competitor?

2.1

Possible Solutions

From the facts of the case, Cynthia has 4 possible solutions, namely: a. To stay at Altrue b. To stay at Altrue but negotiate for better benefits using Crytexs offer as a bargaining tool c. To quit for Crytex d. To quit for Crytex but ask for some time to hand over her work (around two weeks) [given your assumption that one months notice is too long for Crytex to wait for Cynthia, what makes you think this option is a realistic solution???]

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The ideal option would be to quit after the completion of the project. However, given the circumstances of the case; David needing Cynthia for the job in short notice, we have ruled out this option in our analysis. [Sensible.]

3. Analysis of Ethical Issue

3.1 Kantian Ethics

Based on the principle of universalisability and the principle of humanity, we have identified duties that the various stakeholders owe: Cynthia a. Fulfill her contract with Altrue As she is legally bound to her employment contract, it is imperative that she fulfills the agreements in the contract. In order to leave her current job, Cynthia will need to either tender her resignation with one months notice, or pay a months compensation to leave with one days notice. b. Be loyal to the company (completing the project that is assigned to her and seeing it through) Notwithstanding the absence of any mention of an explicit clause on loyalty to the company, we deem being loyal to the company as an implied term by her employment contract.[Why do you see fit to deem such? Any logical arguments to support your assertion? Is it possible to owe loyalty to a non-living creature such as a company?] As such, Cynthia has a duty to see through her project through or at least ensure a proper handover, if it is possible, as she should act in the interests of the company. c. Not to bring trade secrets to competitor firms This duty would fall under the restraint of trade clause in her contract as well as the implied term of being loyal to her company. It would certainly be disloyal for Cynthia to leave her company for Crytex as it is a big competitor of Altrue. [It is unclear if Cynthia is in danger of breaching the restraint of trade clause even if she joins Crytex. I think you should have merely highlighted here a duty not to breach the restraint of trade clause and to point out the possible danger of a breach depending on Cynthias designation and scope of duties in Crytex.]
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d. To develop herself [Is this a duty or a right, or both?] One of the duties derived by Kant was the duty to develop ones talents and capabilities. As such, Cynthias intention in leaving for Crytex would seem to be a move can be deemed to develop her own capabilities. What about Cynthias duty to her project team members at Altrue? Does she not owe a duty to be a team player? Does Cynthia owe a duty to the clients of the project that she is in charge of or is that a duty owed only by Atrue and not Cynthia? [You have highlighted Cynthias duties above you should also highlight what (and whose) rights they correspond to.] Altrue a. To treat employees not as means to profits alone Based on Kantian ethics, a company should not treat their employees as means to an end. and as thus this duty. As mentioned in the facts of the case, Altrue treated their employees as means to profits and not as an end in itself. [This is a categorical imperative by which you should judge any action taken. I would have thought the proper duty to highlight is Altrues duty to maintain business efficiency in the interest of the shareholders. By the way, how do the facts show that Altrue is treating their employees as mere means to profits and not as ends in themselves? I thought the facts say that Altrue has treated Cynthia fairly!]
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b. Give employees opportunities to develop themselves [On the facts of the case, the relevant duty to highlight here is the duty to respect Cynthias right to pursue selfdevelopment. That is the matter under discussion, not whether Altrue is giving opportunities to employees to develop themselves.] Being an employer, and given the right for an individual to develop themselves, Altrue owes a duty to its employees to develop their skills and capabilities. [Note my comment on this point above!] Crytex a. To give Cynthia reasonable time to consider the offer as well as to hand things over properly at her old company It is only fair that Crytex gives Cynthia sufficient time to hand over properly but we agree that it is difficult to assign a specific time that would be deemed reasonable. We believe it should be on a case-by-case basis, and in this case, since Cynthia has a big project on hand,

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Crytex should give at least a few days more than what they initially gave, when they did not know about this information, which would approximately be two weeks. After identifying the various duties, we note that there is a clash of duties in making this decision, namely the tension of owing a duty to herself to develop her own skills and capabilities which justifies her leaving for Crytex, but at the same time owing a duty of loyalty to Altrue, which would not justify her leaving. We have also identified that Altrue has not fulfilled their duties in treating their employees as ends ??? [Note my comment above on this particular assertion.], but it does not justify Cynthia breaking her duties just because Altrue did the same (?).
3.1.1 Principle of Universalisability

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The ethical maxim in this issue is, It is acceptable that employees leave for competitors just for their own self benefit, with total disregard for the well being of the company. Is this maxim universalisable? In other words, will companies be able to accept having their own employees leaving for competitors? It is not universalisable surely as a company because as one an employer company would not find it desirable for its employees to be poached or to leave, even though they might want employees from other companies. [You do not actually have to formulate a maxim to test against the categorical imperatives. You could merely ask whether Cynthia leaving Altrue and her fellow team members in the lurch, ie in total disregard for their interests, in order to pursue self-development and fulfillment of her dreams at a competitor company to be something that universalisable. Remember that the aim is to advise Cynthia on what is right or wrong to do. So you do need to be able to explain why what she is contemplating doing is wrong, in this instance, from Kants point of view.]
3.1.2 Principle of Humanity

Similarly, the maxim advocates pursuing one humanitys as one own end, but Kant argues that this is ethically sound insofar as one considers others humanity in the course of pursuing their own ends. Cynthia would be using her company and her colleagues, in particular her project team, as mere means to further her own benefits if she was to leave for Crytex. [How so? Please explain.]
3.1.3 Kantian Conclusion

Therefore, we conclude that since the maxim fails both the principle of universalisability and principle of humanity, it is not ethically right for Cynthia to quit her job at Altrue. Furthermore, looking at the duties that Cynthia owes, we look at a An ethical decision that can fulfills the most duties and that would be to fulfill her duty of loyalty to Altrue by not to leavingleave Altrue and her colleagues in the lurch. This would fulfill three aforementioned duties, as opposed to the pursuit of developing her self-interest by leaving alone. However, in

line with developing her self-interest, the ethical decision for Cynthia should be to stay at Altrue but negotiate for better benefits.

3.2

Aristotle: Virtue Ethics

In trying to reach a conclusion under Aristotles virtue ethics, we have identified the following golden mean: Quit (Selfish) Stay (Selfless)
Figure 1: Aristotles golden mean

We identify the two extremes as being selfish (quit for self-interest) and selfless (stay to accomplish the project), and the golden mean would be for Cynthia to base her decision between the two. As such, the golden mean would certainly be the ideal case - Cynthia should quit only after the completion of the project at Altrue. However, given the facts of the case, Crytex is unable to wait so long for Cynthia as they need her urgently; thus, in trying to achieve the mean, the probable conclusion under virtue ethics is for Cynthia to ask for some time for a proper handover. But what if this is not possible? What would be the right thing for Cynthia to do according to Aristotles virtue ethics?

3.3
3.3.1

Confucian Ethics
Primary Focus

With reference to the primary focus in Confucian Ethics, we found that there is in fact a dilemma. Virtue and Self-development would in fact point Cynthia towards different directions. Virtue would suggest that Cynthia should stay in Altrue to demonstrate her loyalty towards her company and the current project that she is heading. However, self-development would encourage her to leave Altrue to pursue more career opportunities at Crytex.
3.3.2 Principle of Reciprocity

Referring to the principle of reciprocity, Cynthia should not leave the company in the midst of a project. This would bring additional problems and stress to the project. Any reasonable person would find it undesirable that other project team members to leave the company in the midst of the project for their own self-interests; she should not choose to leave the project as well.
3.3.3 Familiar Familial Relations

Lastly, Confucian Ethics advocates that family relations should take priority over universal love. Therefore, relations among colleagues in Altrue should take priority over her self-interest. She should not do anything would cause harm and inconveniences to her project team members in Altrue.
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3.3.4

Conclusion for Confucian Ethics

Since both Principle of Reciprocity and Familiar relations necessitates that Cynthia stay in Altrue and oversee the project till it is completed, Cynthia should choose to stay at Altrue. It is unclear if she should negotiate for better benefits in this case. [The lack of focus on individual rights under Confucian Ethics may be some guide on whether she should negotiate for better benefits.]

3.4
3.4.1

Utilitarianism
Stakeholders

To further the analysis, we have identified the various stakeholders as well as their interests in this decision: I wonder if the clients of the particular project Cynthia is in charge of should be considered as well.

Stakeholders Cynthia Altrue

Colleagues of her project team David Newhoff, Crytex Systems Her husband, Tom
Table 1: Stakeholders

Interests - Career prospect - Monetary benefits - Profitability of Altrue - Smooth running of Operations of Altrue - Completion of project - Stable career - Profitability of Crytex - Operations of Crytex - Cynthias happiness

3.4.2

Utilitarianism Analsis

For Cynthias husband Tom, his interests is solely based on the well being of Cynthia and she he will respect whatever decision that Cynthia arrives at. This is with reference to the text facts of the case that Tom does not have any objections to whichever decision that Cynthia undertakes. As such, there is no need to consider Tom in our analysis as the effect on Cynthias decision is negligible. [Acceptable a wise decision to trim the list of stakeholders to consider.] Option 1: Stay at Altrue Pleasure Potential promotion and remuneration from the success of the project

Stakeholders 1. Cynthia

Pain Loss of additional income, job satisfaction & career prospects

2. Altrue

No disruption to company operations Project remains under the purview of Cynthia Success of project might increase the profitability and reputation of Altrue Potential remuneration from the success of the project Loss of a suitable candidate and incurs searching cost

3. Colleagues of Cynthias project team 4. David Newhoff, Crytex Systems

Table 2: Utilitarianism Option 1- Stay at Altrue

Option 2: Stay but negotiate (only stating marginal differences from Option 1) Stakeholders Pleasure Pain Same as option 1 Same as option 1 1. Cynthia Possibility of incurring the Immediate increase in displeasure of jealous remuneration and colleague depending possible promotion on the perceived fairness of additional [Is this a real possibility or pay/benefits she merely a chance? Wont receives? Altrue have to consider whether it has the capacity to grant increases in remuneration and the fairness of increasing remuneration for Cynthia?] Same as option 1 Cost incurred for 2. Altrue providing Cynthia with additional benefits/promises? Same as option 1 Jealousy (depending on the 3. Colleagues of perceived fairness of any Cynthias project extra pay/benefit to Cynthia) team if they find out?
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4. David Newhoff, Crytex Systems

Table 2: Utilitarianism: Option 2 - Stay but negotiate

Same as option 1

Stakeholders 1. Cynthia

Option 3: Quit for Crytex Pleasure Increased monetary benefits Increased job satisfaction as she views Crytex as an ideal employer

Pain May feel that she was being disloyal to her previous company Risk of losing personal credibility for being disloyal (in whose eyes, Altrue, ex-colleagues at Altrue, Crytex, or all of the above?) Potential lawsuit for working for competitor if she is in breach of the (restraint of trade clause) Working environment at Crytex may not suit her Company operations might be affected Searching costs for finding replacement Potential loss of profitability and reputation from the failure of the project Loss in morale from Cynthias absence
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2. Altrue

3. Colleagues of Cynthias project

team

could cause reduced efficiency Risk of losing job (do facts of case suggest this possibility?) from failure of project May see Cynthia as an irresponsible employee who left Altrue without settling her assignments
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4. David Newhoff, Crytex Systems

Glad that Cynthia joined Crytex. She might be a great asset to Crytex as she has previous experience in Altrue, Crytexs competitor Possible Increase in clientele after the employment of Cynthia Possible Increase in profitability and reputation

Table 3:Utilitarianism: Option 3 - Quit for Crytex

Option 4: Ask for some time for proper hand-over (stating marginal differences from Option 3) Stakeholders Pleasure Pain Same as option 3 Same as option 3 1. Cynthia [how can she be Good credentials for regarded as disloyal if being seen as a she has acted responsible employee responsibly before leaving for Crytex?] Problem of finding 2. Management of Project may still be a the right replacement Altrue success for Cynthia within the period of time Company operations might still be affected and the project might still fail Problem of adjusting to the change of leadership
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3. Colleagues of Cynthias project team

Potential remuneration for the success of the project

4. David Newhoff, Crytex Systems

3.4.3 Utilitarian conclusion

Same as option 3

Incur waiting costs

Table 4: Utilitarianism: Option 4 - Ask for some time for proper hand-over

Based on the analysis, the option to stay at Altrue, stay but negotiate and ask for some time for a proper handover yielded an overall net pleasure while the option to quit for Crytex resulted in an overall net pain. The basis of deriving at this verdict is based on several considerations. They are: Time horizon of the pleasure/pain (immediate or future) Extent of the pleasure/pain Probability of the pleasure/pain

As there are three options that result in a net pleasure, factors in deriving happiness value by Bentham are utilized to find out which options will net the highest happiness. [A very mathematical approach. I do not really need you to do this you should just explain with some convincing reasons which of the options you feel will yield the greatest net pleasure over pain. You will not have time to draw up a table in a mid-term test or final exam. Prose is best and perhaps serves to convey your message clearer.]] Option: Intensity of pleasure Duration of pleasure Certainty that pleasure will materialise Remoteness of pleasure sought Repeatability of pleasure Purity of pleasure Extent 1 H L H L L M H 2 H M H L M M H 4 M H M M M L H Ideal H H H L H H H

Table 5: Bentham, Happiness Value (L: Low, M: Medium, H: High)

Based on the analysis, option 2, stay at Altrue but negotiate derived the highest happiness value. Therefore, under utilitarianism, Cynthia should stay at Altrue but negotiate for better terms as that will result in the highest happiness.

3.5

Ethical Egoism

From an ethical egoists perspective, Cynthia should choose to maximize her individual utility. The pleasures and pains have been listed in the analysis above, and we derive the following table: 12

Option: Stay at Altrue Stay but negotiate Quit for Crytex Ask for some time to hand over
Table 6: Ethical Egoism Net pleasure and pain

Net Pleasure

Net Pain

The first two options yields net pain for Cynthia as staying at Altrue would certainly be seen as suboptimal for her since she values the job at Crytex very highly. The loss of not going to her ideal job, securing additional remuneration would result in net pain if she stays in Altrue. However, if she quits for Crytex immediately, we view that the costs she would incur from losing credibility and being doubted as a loyal employee would have long term effects, and thus negatively affect her. {See, you did not have to use a table based on Benthams criteria for analyzing magnitude of pain and pleasure to explain which option you think yield the greatest net pleasure over pain!} Therefore, the option that would give Cynthia maximum utility would be to ask for some time to hand over. {But note what I said earlier about whether this option is a realistic solution given the assumption you made right at the beginning.}
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3.6

Rawlsian Justice
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In the Original Position and under the veil of ignorance, Cynthia will not know whether she will become the least advantaged person in the Rawlsian society.{??} Cynthia as the decision-maker should maximize the minimum outcome amongst all the possible alternatives. [This is not a straightforward case of a distribution of a benefit or burden between members of a society and so it is hard to draw analogies to justify application of Rawls principles of justice. I would have thought that in this case, it suffices to use the veil of ignorance thought experiment to test whether a decision by Cynthia to leave for Crytex without seeing the project at Altrue to the end was fair. And perhaps being able to recommend, from behind the veil of ignorance, what decision would be fair in the circumstances of the case.]
Stake holders Impact 1. Stay with Altrue & reject Crytex job offer. Altrue's employees Job security 0

Cynthia Job satisfaction -

Altrue Earnings 0

Crytex Performance 0

Alternatives

Remarks

2. Stay with Altrue but negotiate with Altrue for better benefits (can be future).

A lot of benefits achieved if project succeeds A lot of benefits achieved if 13

project succeeds 3. Leave Altrue immediately & join Crytex High chance of project failure 4. Negotiate with Crytex to +++ --+ High risks allow her more time (1 month) to project to find replacement. completion Remarks: "-" = negative impact, "- -" = very negative impact, '+"= positive impact, + + "= moderate positive impact '+ + + "= extreme positive impact , "0" =neutral
Table 7: Rawlsian theory of justice analysis [I note your fondness for tables and statistical analysis. But I think it will be more persuasive to highlight arguments in prose for why you think any particular option is FAIR OR UNFAIR. I need to be persuaded by logical reasoning and I think that sometimes tables can present ideas a little artificially and not as convincingly. Your table also seems to focus more on positive or negative consequences when you should be raising arguments for what is FAIR OR UNFAIR.]

++ +

--

--

+ +

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For alternatives 3 and 4, which involves Cynthia leaving Altrue, the most disadvantaged [note my caution to readers below in bold!] stakeholders can be seen from the chart are Altrue, and Altrues employees. The next level of improved position for this disadvantaged group can be found in alternatives 1 & 2 where Cynthia stays in Altrue. In alternative 1, Cynthia would be the least advantaged, but in alternative 2, the least advantaged would be Altrue, Altrues employees and Crytex, but the impact to them is neutral as opposed to negatives for the other alternatives. [I would caution any person reading your report NOT TO mistake your use of the phrases most disadvantaged or least advantaged to have the same meaning as what Rawls intended in his principle of justice 2a.] We then conclude that based on the original position under Rawl's principle of justice, using the maximin rule. Hence, Cynthia should continue to stay but negotiate with Altrue.[Note that there could be arguments for saying this option is unfair for example if Cynthia is trying to extract advantages that puts her in unduly favoured position compared to her colleagues.]

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3.7 Ethics of care [For ethics of care, do remember to identify the relationship first before assessing the extent of vulnerability and dependence of the people whose interests Cynthia ought to take into account in making her decision.]
In applying the ethics of care, we identify the question Who does Cynthia owes a duty of care to, and which stakeholders are dependent and vulnerable to Cynthias decision? As Altrues employee, and being the head of the project, Cynthia owes a duty of care to Altrue and her colleagues since these two stakeholders are dependent and vulnerable to her decision. Crytex would be affected as well, but they most probably have other candidates for the position,
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so it will not be a big loss for them. [But does Cynthia have a relationship with Crytex to justify her owing them a duty of care?] Thus, relatively, Cynthias decision will affect Altrue and her colleagues much more than Crytex. Using the ethics of care which emphasizes on care and responsibility to others especially those particularly vulnerable to Cynthias choices, Cynthia should stay at Altrue.

Conclusion

To make this ethical decision, it would be easy for Cynthia to solely consider her own benefits. We see this from the conclusion i If she chooses to adopt an ethical egoists point of view, the decision would be which is certainly to leave for Crytex since it would give her the most individual benefit. [Really? I thought you concluded that leave but ask for reasonable period to hand over was the best decision from the egoistic perspective?] However, it is imperative in making the ethical decision to be ethically objective and to weigh her decision with others in mind. As such, theories such as Rawlsian justice, utilitarianism and the ethics of care are more relevant theories to be ensure objective objectivity., and to consider others in our decisions. Kantians categorical imperatives provide great insight to the moral dilemma as well. Certainly, embedded in these theories(?) (do you mean to say Kants theory?) also bring about the duty or right of individual interest and self-development. In conclusion, Cynthia should stay at Altrue and negotiate for better benefits. Negotiating for benefits might be deemed unfair to the other employees. However, we reconcile this by proposing that there are possible inefficiencies in the labour market, in particular pricing Cynthias wages in Altrue. Given that Cynthia is key to the success of current big project and the fact that Crytex is willing to pay more for her show that Cynthias current wages are insufficient. As such, Altrue should provide a fair remuneration to Cynthia, as discussed earlier in Kantian ethics.

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Effective word count (excluding tables) : 2336 [You used tables to ensure you stayed within the word limit and I have already highlighted how the use of tables does not really adequately replace the need for good logical and relevant arguments to convince the reader/examiner of your proposed conclusions. I will excuse this because your use of tables although they helped to lower your effective word count did not help in the persuasiveness of your arguments. In other words, you have penalised yourselves.]

Overall comments: Please note my comments along the way to see areas I found satisfactory or unsatisfactory. I am pleased with your efforts to be methodical, structured and clear in argument and to exercise moral imagination in proposing solutions. The problems I found include gaps in analysis, 15

inconsistent arguments, inconsistency between assumptions and solution proposed (specifically option 4) and s a lack of accuracy in the application of Rawlsian justice (your arguments seem more focused on consequences than fairness. Not a bad attempt for the first group to perform an ethical analysis. You have at least shown the ability to identify the relevant theories to help in the analysis of this particular situation.

WRITTEN REPORT: A- to A (Common grade unless otherwise justified by peer review. The grade is arrived at after taking into account that you are the first group to attempt application of ethical theories.)

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