Session 1 : Introduction

Session 1: Introduction 51E00100 Business ethics Jukka Mäkinen & Marja Svanberg 14.3.2016

Agenda for today • Who we are • Course objectives & background thinking • Course programme • Workload for 6 credits • Let’s get started: Private Power and Human Capabilities

1. Who are we? Marja Svanberg Jukka Mäkinen Background in: -political philosophy & economics -business ethics - organization studies Research interests: - political approaches to CSR studies -contemporary theories of justice Background in: -organization & management studies -property management Doctoral dissertation: The morality of CSR -business ethics -profitability and morality

1. Who are we and why are we here? • Who are you? • Name • Major • Why interested in the topic? • Have you faced something where you thought if this is right or wrong?

2.a Course objectives • Insights into the ethical and political backgrounds and requirements of business activity • Outlines perspectives to professional use of ethical skills in business • Philosophical appraisal of central business-ethical and CSR approaches and practices, and illustrative examples

2.a Course objectives • To understand historical and societal backgrounds of the moral dilemmas and ethical challenges in business life • To get new ethical and political perspectives on business life • Learn to express and understand your own and others’ moral and political positions

2.b Background thinking of the course Paradigm shift in understanding business? • The politicization of the business firms? • Markets in everything? • The promises and limits of private power?

Markets in Everything • http://www.bostonreview.net/forum-sandel-markets-morals

Promises of Private Power • http://www.bostonreview.net/forum/can-global-brands-create-just-supply-chains-richard-locke

Political History of CSR • http://www.nytimes.com/2010/11/07/business/07shelf.html?_r=0

2.b Background thinking of this course Topic for Consideration If the suggested paradigm shift is real, what are the ethical, social, and political implications for the future international managers?

3. Course programme

4. Workload for 6 credits • In total 160 hours of work for 6 ECTS • Evaluation based on • Seminar discussions and reflection papers (25% of grade) • Students’ group works (25% of grade) • Mandatory 80% class attendance • Final exam (50% of grade)

4.1. Workload for 6 credits: Article reflection papers (1/2) • 25 % of grade • In total4reactions papers • To be written beforeeach session • Note that this prepares you well in advance to the exam! • Evaluation criteria • 1-2 points: Summarizes the contents (articles, sessions, exercises) by using direct quotations from the articles (i.e. not your own words) with minimal own reactions or reflection • 3 points: Reviews parts of the content and offers own reactions or reflection OR provides reasoning for (not) understanding/liking the main points of the content and offers own reactions. • 4 points: Makes an elegant analysis of the main issues combined with well argued and perceptive reflection • 5 points: Provides an original presentation/viewpoint on the topic with a story or good reasoning.

4.1. Workload for 6 credits: Article reaction papers (2/2) • Max 2 pages (Times New Roman, 12 points, line spacing 1) • Sometimes specifying questionsgiven (seelectureslides) • Bringpapercopiesto eachlecture

4.2. Workload for 6 credits: Group works • 25 % of grade • Presentation • Evaluation • States clear, relevant and focused research questions (1-3 maximum) • Covers appropriate literature effectively and demonstrates sound knowledge of the topic • Critically evaluates and applies the literature to the case • Provides relevant conclusions on the basis of the research questions, literature review and research • Is presented in a clear and coherent style and quotes references appropriately • Offers original insights and demonstrates critical thinking

Organizing the group work teams: Practicalities • Go into groups of 3-4 to think about possible topics • Decideyour topic by Tue 15.3. and let us know it • (Photos of the groups)

Organizing the group work teams: Topic examples Theory based Case based Choose an interesting ethical case (e.g. corporate scandal, crisis etc.) Reflect the case based on readings for the course and other literature You can e.g. compare two different approaches to the case in your presentation • Choose a theory that interests you • Offer a reflective and critical presentation • Can include smaller examples of real-life cases that clarify your presentation

Group work – to start • Discuss and list a few ethical dilemmas you might face in business life • Also, think what actually makes them dilemmas and not something that can be easily solved based on existing business codes etc. • Make a mindmap, list, etc.

4.3. Workload for 6 credits: 80 % mandatory attendance • Why you should take this seriously? • There are only few lectures and lot to learn, appreciate your possibility to come, listen and most importantly: discuss and ask! • Respect your work group – it is your responsibility to guarantee your contribution to the group work! • Let us know in advance if you will be absent, need to come late etc.!

4.4. Workload for 6 credits: Exam • Examdate • Thu 24.3.2015, 15-18 (class exam, no need to register in Oodi) • Readings: Articles for reflection papers + a couple of extra readings + Lectureslides (see Noppa)

All practicalities • Course basic website: https://mycourses.aalto.fi/course/view.php?id=3812 • Readings • Lecture slides • Please be proactive and read carefully all given instructions, materials, course news etc.to prevent misunderstandings about course practicalities  • Contact info:, jukka.makinen@aalto.fi Room: F3.07 marja.svanberg@aalto.fi

5. Let’sgetstarted

Private Power and Human Capabilities

Agenda for Today Theoretical Part: Martha Nussbaum’s capabilities approach in the context of global supply-chain ethics. Practical Example: A documentary film “A Decent Factory”

The Basic Question We examine issues of labor standards and gender equality in the context of global economy Can we settle on universal standards of decency by which we can evaluate whether business practices and institutions humiliate people under their authority? We can also discuss issues related to the division of moral labor between firms, public sphere and other actors to tackle the challenges of (gender) equality in contemporary economies. Laitoksen nimi

Decency vs. Justice • A just society; sublime ideal but hard to realize globally • A decent society; more realistic alternative? • AvishaiMargalit (1996): There is more urgency in bringing about a decent society than in bringing about a just one. Presentation name and author - 3/2/16

Asia in Global Economy -Expanding markets -Still relatively cheap labor -Efficiency -Financial problems of the western economies

Global Supply-Chain Ethics Western firms have moved their business operations to locations where costs of operations are lower. http://www.nytimes.com/2012/01/22/business/apple-america-and-a-squeezed-middle-class.html?pagewanted=all Outsourcing of business operations to countries where production costs are lower leads easily to insourcing of ethical problems. http://www.nytimes.com/2012/01/26/business/ieconomy-apples-ipad-and-the-human-costs-for-workers-in-china.html?pagewanted=all http://bits.blogs.nytimes.com/2012/02/13/apple-announces-independent-factory-inspections

”Missing Women” ”It is often said that women make up a majority of the world's population. They do not. This mistaken belief is based on generalizing from the contemporary situation in Europe and North America, where the ratio of women to men is typically around 1.05 or 1.06, or higher. In South Asia, West Asia, and China, the ratio of women to men can be as low as 0.94, or even lower, and it varies widely elsewhere in Asia, in Africa, and in Latin America.” • Sen, Amartya. 1990. More Than 100 Million Women Are Missing. The New York Review of Books 37 (20).

Resources: UN & WEF There is no country in the world where women are equal to men in the four dimensions of economy, health, education, and politics. Yet the gaps between the national gender gaps are wide.

Gaps between Gender Gaps • Iceland 0.8594 • Finland 0.8453 12. Germany 0.7780 87. China 0.6830 114. India 0.6455 Gender inequality is strongly correlated with poverty.http://povertydata.worldbank.org/poverty/region/EAP

Below the Poverty Lines in Asia Presentation name and author - 3/2/16

The Boomtowns in China • Since the 1970s, China has witnessed the largest migration in human history; 130 million migrant workers in China today, most of them women. • Via global supply chains we all become connected to the lives of these young women leaving their villages and seeking their fortunes in the factory towns. • Leslie Chang’s Factory Girls (2008); describes lives of these people in Chine’s factory boomtown Dongguan. Presentation name and author - 3/2/16

Factory Yue Yuen, Dongguan, China Has 70 000 workers (80% women between ages 18-25) Making our branded athletic shoes (Nike, Puma, Adidas etc.). Workers sleep in factory dorms (10/room), eat in factory cafeterias, shop at factory commissaries. Runs a kindergarten, hospital with a 150-member staff, movie theater and a performance troupe, volunteer activities and English classes. Operates own power plant and fire department. Bottles its own water and used to have own farmers to guarantee its food sources Bays 70$/month for work done 11hours a day/sixty hours a week with Sundays off. Presentation name and author - 3/2/16

Total institution ”A basic social arrangement in modern society is that the individual tends to sleep, play and work in different places, with different co-participants, under different authorities, and without an over-all rational plan. The central feature of total institutions can be described as a breakdown of the barriers ordinarily separating these three spheres of life” (Erving Goffman 1961, 17) Presentation name and author - 3/2/16

The Threshold Level of Decency? • One promising starting point to sketch out international standards of decency is offered by Martha Nussbaum in her work Women and Human Development (2000). • Rather than look for psychological or material indicators of well-being we should draw attention to what each person is able to do and to be. • Threshold level of basic capabilities (a decent social minimum) secured for all as a universal political goal. Presentation name and author - 3/2/16

List of Basic Capabilities Life Bodily Health Bodily Integrity Senses, Imagination, and Thought Emotions Practical Reason Affiliation Other Species Play Control over one’s Environment: a)Political b) Material Presentation name and author - 3/2/16

Conception of Well-Being

Capabilities better metrics of well-being than… material resources (income, wealth etc.) since different people have different needs and abilitiesto use resources. utilities or preference satisfaction since utilities and preferences are adaptive to circumstances. functioning since different people value different functions and capabilities leave room for individual choice. Presentation name and author - 3/2/16

The central human capabilities The principle of each person as an end: The capabilities sought are sought for each and every person (Kant). Intrinsic value: The central capabilities are not instrumental to further pursuits: they have value in themselves, in making the life that includes them fully human(Nussbaum 2000, 74-75) Presentation name and author - 3/2/16

Equality as a human capability 7. Affiliation ”Having the social basis of self-respect and non-humiliation; being able to be treated as a dignified being whose worth is equal to that of others.” (Nussbaum 2000, 79)

Equality of human capabilities Equality with respect to human capabilities does not always mean that individuals should be treated in the same way. In order to have equality with respect to human capabilities, societies would have to attend to special needs (e.g., pregnancy) and to barriers that are encountered by some groups (e.g., subtle forms of sex discrimination) (Nussbaum 2000, 68).

Objections and Replies from Nussbaum Universal values is nothing but camouflaged westernimperialism Nussbaum: Universal values can and should be flexible. They may be ordered and specified according to culture and specific preferences Claiming these values and ideals to be Western is to paint a un-nuanced picture of non-Western countries where there equally exists proponents for such values (e.g. women’s movements in India and Africa) Presentation name and author - 3/2/16

Argument from Culture What counts as good/bad, right/wrong can only be evaluated in accordance with a particular cultures own moral standards; no particular cultures moral standards can meaningfully be evaluated as better or worse Nussbaum: Cultures are never homogenous: We must not only consider and protect diversity among cultures, but also withinthem Cultural norms may themselves be highly non-relativistic and intolerant towards minority and divergent notions of good/bad, right/wrong (cultural relativism is self-defeating) Why should we follow local norms rather than the best we can get? Presentation name and author - 3/2/16

Argument from the good of diversity Cultural diversity is a value in itself which should be protected. Nussbaum: in order protect diversity among and within cultures we need universal values (e.g. minority groups, women) Presentation name and author - 3/2/16

Argument from Paternalism We should let people act on their own choices and ends/respect their autonomy Nussbaum: In order to meaningfully speak of autonomous choices, certain circumstances must be in place. People must be in a position to substantially (not just formally) exercise their autonomy (e.g many cultural systems exclude women from this) Presentation name and author - 3/2/16

A Decent Factory • A documentary about globalization; Nokia as the subject. • Two European women – Finnish Nokia employee and a British consultant – are auditing a factory of a Nokia supplier in China lead by a European male manager. Presentation name and author - 3/2/16

While Watching the Film Consider the position of the women in the factory from the perspective of Nussbaum’s basic capabilities. Identify aspects in the lives of these women where they are in danger to fall below a decent level of capability to function? Presentation name and author - 3/2/16

Class exercise! Using the cross-cultural normative evaluative framework of Nussbaum (capabilities approach) discuss in groups: • The position of the women in the factory? • Which aspects of their lives can be problematized? • Are certain aspects more pressing than others? Why?

Session 1 : Introduction