Education

In Defense of a Utilitarian Business Ethic

ANDREW GUSTAFSON

ABSTRACT

In this article, I suggest and support a utilitarian approach to business ethics. Utilitarianism is already widely used as a business ethic approach, although it is not well developed in the literature. Utilitarianism pro- vides a guiding framework of decision making rooted in social benefit which helps direct business toward more ethical behavior. It is the basis for much of our discus- sion regarding the failures of Enron, Worldcom, and even the subprime mess and Wall Street Meltdown. In short, the negative social consequences are constantly referred to as proof of the wrongness of these actions and events, and the positive social consequences of bailouts and other plans are used as ethical support for those plans to right the wrongs. I believe the main cause of the neglect of the utilitarian approach is because of misguided criticisms. Here, I defend utilitarianism as a basis for business ethics against many criticisms found in the business ethics literature, showing that a business ethics approach relying on John Stuart Mill’s utilitarianism supports

Andrew Gustafson is an Associate Professor of Business Ethics and Society, College of Business Administration, Creighton University, Omaha, NE. E-mail: andrewgustafson @creighton.edu. http://www.andygustafson.net

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Business and Society Review 118:3 325–360

© 2013 Center for Business Ethics at Bentley University. Published by Wiley Periodicals, Inc., 350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford OX4 2DQ, UK.

principles like justice, is not biased against the minority, and is more reasonable than other views such as a Kantian view when dealing with workers and making other decisions in business. I also explain utilitarian moral motivation and use satisficing theory to attempt to defend utilitarian business ethics from questions raised regarding utilitarian calculus.

1REVITALIZING A UTILITARIAN BUSINESS ETHIC FOR SOCIAL WELL-BEING

Let us . . . find ourselves, our places and our duties insociety, and then, gathering courage from this newand broader understanding of life in all its relations, address ourselves seriously to the problem of making our- selves and our neighbors useful, prosperous and happy. Such is the supreme object of utilitarian economics.

Phelps and Myrick (1922, p. 7)

[T]he utilitarian standard is not the agent’s own greatest happiness, but the greatest amount of happiness altogether; and if it might possibly be doubted whether a noble character is always the happier for its nobleness, there can be no doubt that it makes other people happier, and that the world is in general is immensely a gainer by it.

Mill (1998, ch. 2, para. 9, l. 4)

Utilitarianism provides a vision of ethical behavior which holds the common interests of humanity as of utmost importance when we make a moral decision. Utilitarianism fits business well if we conceive of business as a means of transforming culture and society, and utilitarianism is the ethical perspective which most easily helps us to address the ethical relationship and responsi- bilities between business and society. Surely, nothing is more powerful than business itself in shaping our cities, our work environments, our playing environments, our values, desires, hopes, and imagination. Business provides great goods for society through goods and services, jobs, tax revenue, and many common outcomes, but it also has wide-ranging effects on a broad spec- trum of stakeholders. The utilitarian in business asks, how can

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we do business in such a way that it contributes to the greater good? Drawing here on the utilitarianism of John Stuart Mill, here I will first put forward some key features of a utilitarian business ethic—that the right actions are the ones which contribute to the greatest good for the most—and then in the latter part of the article, respond to some of the typical criticisms of utilitarianism in the business ethics literature in hopes of displaying utilitari- anism’s promise as a guiding vision for ethical business behavior.

Self-interested profit-maximization cost-benefit analysis is often labeled as “utilitarianism,” and that has often been the target of business ethicists, looking to get business to consider ethical inter- ests along with profit. These criticisms are useful and correct, so long as they are aimed at economic profit maximization, rather than the utilitarian ethics approach, but sometimes, the distinc- tion is not clearly drawn. Utilitarianism as an ethical theory is quite different than mere profit maximization, but the confusion is common. There is, actually, a severe gap in business ethics litera- ture regarding a utilitarian ethics approach to business ethics. Although there have been books in the field of business ethics written on Kantian business ethics (Bowie 1999), Social Contract business ethics (Donaldson and Dunfee 1997; Sacconi 2000), and Aristotelian business ethics (Hartman 1996; Morris 1997; Solomon 1993), no book has dealt with utilitarian ethics and business ethics per se. Although there has been some positive attention paid to the notion of “utilitarianism” as a basis for business ethics (Brady 1985; Elfstrom 1991; Snoeyenbos and Humber 2002; Starr 1983), mostly it has been critical (Audi 2005, 2007; Beauchamp and Bowie 2001; Bowie 1999; Bowie and Simon 1998; Desjardins 2011; Hartman 1996; McCracken and Shaw 1995; McGee 2008; McKay 2000; Velasquez 1995; Velasquez et al. 1989).

Ironically, all this criticism comes while we continue to use greatest good or common good analysis for most of our societal ethical issues. Considering societal benefit and harm is usually the basis for much of our discussion regarding the ethical failures of Enron, Worldcom, and the subprime mess and recent Wall Street Meltdown. Taxcheating, welfare or insurance fraud, racism, gender discrimination and harassment in the workplace, under- mining trust, stealing from the company, dishonest bookkeeping, and nearly any unethical business practice we can imagine are argued against and considered wrong in part, at least, because of

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the harm these activities do to the greater good. Utilitarianism in this sense is already widely used as an ethical appeal and busi- ness ethic approach, although it is seldom discussed in the lit- erature. The negative societal consequences (to investors, the market, homeowners, employees, the jobless, etc) are constantly referred to as proof of the wrongness of these actions and events, and the positive social consequences of bailouts and other plans are used as ethical support for those plans to right the wrongs. When we call on society to shared sacrifice, the reason given is almost always “for the greater good” which is to say, the greatest long-lasting happiness for the most—the prosperity of society into perpetuity. Yet, when discussed in business ethics litera- ture, utilitarianism is usually sketched, criticized, and then dismissed—usually because these “utilitarianisms” are quite dif- ferent than Mill’s classical utilitarianism. Here, I will attempt to provide a more intelligible view of how Mill’s classic utilitarianism can apply to business ethics and respond to a number of the key criticisms raised against utilitarianism in the business ethics literature, in hopes of bringing attention and support to the viability of a developed utilitarian business ethics.

What Mill’s Utilitarianism Is not

It is quite important from the start to realize that many views are criticized by the name “utilitarianism,” and we should first realize that the classical utilitarianism of Mill is not equivalent to a number of other theories referred to as utilitarianism—views which business ethicists are right to criticize. First, as mentioned, it is not mere profit maximization, which is from some business literature. Second, it is not preference utilitarianism—the view that the source of both morality and ethics in general is based upon subjective preference.2 (Rabinowicz and Österberg 1996). Third, it is not a “rational actor” model. (McCracken and Shaw 1995) The rational actor model “utilitarianism” is well defined by McCracken and Shaw as holding that (1) humans are rational, (2) rational behavior is characterized by preference or value maximi- zation, (3) businesses seek to be profit maximizing, (4) the moral good is utility, (so therefore) (5) ethical business practice consists of maximizing profits within a framework of enlightened, but not clearly defined, rules, rights, and obligations.

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This “rational actor model” is ethically problematic, and McCracken and Shaw are right to point out that “[t]o analyze business decisions using as a model an individual solely moti- vated by the maximization of value or of profits, without regard to his or her own character, is totally unrealistic. It does not speak to the role of ‘Nobility,’ ‘Sacrifice,’ ‘Sportsmanship,’ ‘heroism,’ and the like—” (McCracken and Shaw 1995, p. 301). Mill’s utilitari- anism, fortunately, does address such concepts as heroism, nobil- ity, and sacrifice, as we will see. The point here is simply that Mill’s utilitarianism model is quite different from a simple profit maximization model or a simplistic cost-benefit model which is often referred to as “utilitarian” in the literature.

Mill’s Utilitarianism

It is important to be clear about what Mill’s classic utilitarianism entails. When we seek common ethical principles, we really seek a common vision of the good, because we want a common vision for making decisions which provide at least semi-universal guid- ance. Although no ethical theory is without its difficulties, what an ethical theory provides is some shared common starting points from which to work out ethical decisions—as an individual and as a community. There is not a shared understanding of application in all cases, but the community shares the common starting point for making their case. There is, we might say, a hermeneutics of ethics, whereby the meaning of an ethic for a particular situation involves interpretation and so, dispute. The Bible and church tradition are to Christians a shared starting point—and obviously, not all agrees on the application of that text/tradition—but there is a shared assumption about where we should meet to try to come to conclusions. There are hermeneu- tical differences of interpretation of Scripture, as there are of the utilitarian principle, but utilitarians at least share a common vision for trying to work out ethical answers rooted in a shared assumption that what we all seek ultimately is to attain the greatest happiness for the most.

Three key aspects of Mill’s utilitarianism distinguish his ethics and so, a utilitarian business ethic: (1) it is consequentialist and has a shared goal of the common good at its heart; (2) it takes account of long-term consequences or the prosperity of society; (3)

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it entails nurturing moral education in culture by developing social concern in individuals.

First, Mill’s utilitarianism is a consequentialist ethical theory: Mill’s utilitarianism is concerned about the welfare of the many, rather than just the individual, as he says, “[the utilitarian] stan- dard is not the agents own greatest happiness, but the greatest amount of happiness altogether” (Mill 1998, ch. 2, para. 9, l. 4). It is not mere egoism and, in fact, calls on an individual to sacrifice one’s own happiness on occasion, if it is for the greater common good. For Mill’s utilitarianism according to this “Greatest Happiness Principle”—“the ultimate end, with reference to and for the sake of which all other things are desirable . . . is an existence exempt as far as possible from pain, and as rich as possible in enjoyments, both in point of quantity and quality” (Mill 1998, ch. 2, para. 10, l. 1). Greatest happiness might come by a wide distribution of hap- piness to the most, or in some cases, the interests of the many might be served actually by affording something to the minority (such as providing fair trial to all, even those who are apparently guilty—which maintains a happier society than one which does not provide fair trials (Sadam’s Iraq, Syria, North Korea, etc).3

Utilitarianism fits business well, because business often thinks in terms of utility. However, utilitarianism is not concerned with the interest of the individual only, or even of the larger distribu- tive sum or aggregate of the happiness of individuals (Audi 2007). Rather, Mill’s utilitarianism is concerned with the happiness of humanity as a whole—his is a corporate narrative aimed at “cre- ating bonds between the individual and humanity at large” (Heydt 2006, p. 105). On this view, “[h]umanity begins to appear as a ‘corporate being’ rather than as a simple aggregate of individuals, when one begins to imagine it as having a destiny” (Heydt 2006, p. 105).4 The difficulty is trying to help people to start to think of social utility, not just personal or profit-maximization utility, and to realize that we must consider long-term social utility, not just social utility for this evening. This involves having a vision of the good of humanity in mind when making decisions. In the words of Mill, the utilitarian conceives of life this way:

So long as they are co-operating, their ends are identified with those of others; there is at least a temporary feeling that the interests of others are their own interests. Not only does

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all strengthening of social ties, and all healthy growth of society, give to each individual a stronger personal interest in practically consulting the welfare of others; it also leads him to identify his feelings more and more with their good, or at least with an ever greater degree of practical consideration for it. He comes, as though instinctively, to be conscious of himself as a being who of course pays regard to others. The good of others becomes to him a thing naturally and neces- sarily to be attended to, like any of the physical conditions of our existence. (Mill 1998, ch. 3, para. 1, l. 30)

Such utilitarianism will not answer every single dilemma, but it does give direction in many situations. Mill believes humans have a fellow feeling toward other human beings, and that this feeling can be nurtured and trained as one develops a vision of oneself as a member of this society of humanity and as we integrate indi- viduals into a strong culture of concern for others (more of this on the succeeding paragraphs).

Second, Mill’s utilitarianism pursues long-term benefit and so has rules of morality following from the Greatest Happiness Principle (GHP) which provide moral guidance.5 Mill says, “Whatever we adopt as the fundamental principle of morality [the GHP], we require subordinate principles to apply it by” (Mill 1998, ch. 2, para. 24, l. 52), and he points out that such subordinate principles are both necessary for morality and ultimately grounded in the GHP. To those who think that we can have no intermediary principles and must always refer back to the GHP directly, Mill responds:

It is a strange notion that the acknowledgement of a first principle (GHP) is inconsistent with the admission of second- ary ones . . . The proposition that happiness is the end and aim of morality, does not mean that no road ought to be laid down to that goal, or that persons going thither should not be advised to take one direction rather than another . . . Nobody argues that the art of navigation is not founded on astronomy, because sailors cannot wait to calculate the Nautical Almanack. Being rational creatures, they go to sea with it ready calculated, and all rational creatures go out upon the sea of life with their minds made up on the common questions of right and wrong. (Mill 1998, ch. 3, para. 24, l. 36)

So for Mill, there are subordinate intermediate principles deriving from the GHP which are affirmed in light of their overall long-term

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happiness-producing benefit. In holding to principles of justice and other such virtues, utilitarianism focuses on the long-term or cumulative benefit, not merely the local, short-term, or immediate benefit.6 Mill is like a stock buyer with a long-term view of things, who rides out the ups and downs of the market. A company which follows this utilitarianism will be concerned with fair treatment of employees, honest habits with customers and suppliers, and just policies because acting with justice, fairness, and honesty will, in the end, produce the greatest happiness for the many—through increased productivity, a strong reputation, and customer loyalty all leading to a positive outcome. Fortunately, we have history and experience to turn to, to help us discover best practices and establish values worth pursuing grounded in precedent: “During all that time mankind have been learning by experience the tendencies of actions; on which experience all the prudence, as well as all the morality of life, is dependent” (Mill 1998, ch. 2, para. 24, l. 9). We have seen on Wall Street the negative conse- quences of not maintaining fairness, prudence, and honesty in the subprime meltdown, for example, and this is not news to us—we saw the same lessons in Enron, Worldcom, the savings and loan scandal, etc. The actions which led to the meltdown were committed in violation of principles which we know bring about societal stability and prosperity, and those acts were committed without regard to the long-term societal market consequences. Thinking we are an exception to the rule often gets us in trouble.

Overall historic tendencies, not particular exceptions, guide the decision. Mill’s utilitarianism is concerned not with static results but with dynamic trends.7 When Mill says “actions are right in proportion as they tend to promote happiness, wrong as they tend to produce the reverse of happiness,” he is looking for derivative rules of action which only usually or more often than not promote the benefit of the many. This means it can stick to a principle in the face of possible exceptional circumstances.8 The utilitarian sticks to his tried and true principles in the face of pressure to change course. If, in general, an action (i.e., telling the truth) tends to promote happiness, we should do that even if in this particular instance it does not produce happiness, or we do not see how it will—because telling the truth tends overall to produce benefits to the many as we have seen from previous empirical observations. We can have quite intelligent guesses as to what actions tend to

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promote happiness for the many9—principles like “do not murder,” “do not cry wolf,” “do not lie,” and other such principles. These principles, by and large, tend to promote happiness for the many. Again, the utilitarian looks at decisions like a long-term investor looks at stock—a long-term investor does not sell when- ever the stock goes down and buy whenever it is going up—and a utilitarian does not reject the principles he knows from cumula- tive experiences from the past as it will provide the foundation of a happier society every time it becomes inconvenient or unclear if on this specific occasion the benefit will come.10

Third, moral education toward a culture of ethical–social concern is essential (Gustafson 2009; Heydt 2006). Mill’s utilitari- anism relies on education and the development of social ties to undergird our moral motivation so that we will act according to the GHP. This is the sort of corporate culture construction which we achieve through strategized ethical training and integrity development, not unlike the model Sharpe-Paine calls the integrity approach (in contrast to the compliance approach) (Paine 1994). Throughout his Utilitarianism and On Liberty, we find Mill arguing that without proper socialization and moral education, people will not be enabled to pursue the GHP because they will be oblivious to it and incapable of desiring it. But fortunately, because humans have fellow feelings, these can be nurtured and trained toward a strong culture of social concern:

[T]he smallest germs of the feeling are laid hold of an nour- ished by the contagion of sympathy and the influences of education; and a complete web of corroborative associations is woven round it, by the powerful agency of the external sanctions. This mode of conceiving ourselves and human life, as civilization goes on, is felt to be more and more natural. (Mill 1998, ch. 3, para. 1, l. 44)

The first means of encouraging utilitarianism is not legal, but cultural: “that education and opinion, which have so vast a power over human character, should so use that power as to establish in the mind of every individual an indissoluble association between his own happiness and the good of the whole” (Mill, Utilitarian- ism, 2.18). This is exactly the job of us in business ethics and the job of any corporation which really wants to ensure moral

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employees—to nurture this social sentiment, encourage the moral imagination so that our students or employees can realize the consequences of their acts on others, and to come to habitually think not in terms of immediate personal gain, but think of themselves in community. So, for example, Mill would say that training employees to be ethical should not simply be oriented around rules and enforcement but should center on nurturing a corporate culture which has implicit expectations of moral behav- ior and concern for others as human beings. Once they under- stand ethical behavior as “of course!—that’s just the way we do things around here,” then they have come to see ethics as a matter of course—expected without question; bloodstream beliefs as an esteemed businessman I know puts it.11

When speaking of external sanctions, Mill recommends “laws and social arrangements should place the happiness, or . . . the interest of every individual, as nearly as possible in harmony with the interest of the whole” (Mill 1998, ch. 2, para. 18). This we attempt to do through taxation, through equal opportunity legis- lation, tax-incentives for innovations, federal sentencing guide- lines, Sarbanes–Oxley Act, etc—we try to provide incentives for people and companies to do what is in the public interest through external sanctions. These can of course also be positive incen- tives, such as awards or ethical responsibility lists published by organizations or magazines such as Business Ethics Magazine. However, we know that codes and rules alone do not change personal or corporate character—culture formation is essential.

With these three principles in mind, we can better see the possibility of a utilitarian business ethic, and also, see how Mill can respond to typical criticisms of his position most commonly brought up in the business ethics literature.

Common Criticisms and Responses

One helpful way to understand the adequacy of a theory is to hear its responses to its critics—and there are plenty of opportunities with regard to this, as was mentioned, as most commentators on utilitarianism in the business ethics literature have had reserva- tions about utilizing utilitarianism. Here, I will provide five key typical criticisms of utilitarianism brought up in the business ethics literature and respond to each in turn. My goal is to initiate

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further development of utilitarian business ethics in the field—not by criticizing critics, but by distinguishing Mill’s utilitarianism from other forms of thought which might be criticized by that label. Common criticisms of utilitarianism found in the business ethics literature include the following:

1. The Convenience Objection: utilitarianism undermines prin- ciples such as justice and truth telling, which would make the keeping of contracts a matter of convenience at best.

2. The Supererogatory Objection: utilitarianism leads to irratio- nal and futile conclusions which are unworkable and unten- able in the business place because it asks too much of us.

3. The Majority-bias Objection. utilitarianism is biased against the minority viewpoint and so is unnecessarily blind both to the dignity of individuals and to innovation from dissenters.

4. The Motivation Objection: utilitarianism fails to provide moral motivation for this social concern it requires.

5. The Calculation Objection: utilitarianism is considered fatally flawed insofar as it cannot provide an adequate calculus system to do the utilitarian calculus, leaving it impotent to assist in making ethical business decisions.

Here, I aim to show that one can, on the basis of Mill’s utilitari- anism, respond to these criticisms and that a robust and fruitful utilitarian theory can be quite able to help us develop a vision of business ethics.

Convenience: Utilitarianism Has No Principles: Justice and Rights Go out the Window It is often said that utilitarianism cannot adequately provide an explanation for rights, duties, or justice because it will compro- mise these for expedient good of the greater happiness for the majority: “Perhaps the strongest criticism that can be made against a utilitarian approach is that it completely and totally ignores rights [of individuals]” (McGee 2008). Utilitarians are cari- catured at being willing to do anything, so long as the majority benefits. For example, it has been said that Oliver North’s decep- tive lying about the Iran-Contra affair of the 1980’s was a clear example of utilitarian reasoning:

North’s method of justifying his acts of deception is a form of moral reasoning that is called ‘utilitarianism.’ Stripped down

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to its essentials, utilitarianism is a moral principle that holds that the morally right course of action in any situation is the one that produces the greatest balance of benefits over harms for everyone affected. So long as a course of action produces maximum benefits for everyone, utilitarianism does not care whether the benefits are produced by lies, manipu- lation, or coercion. (Velasquez et al. 1989)

Here, utilitarianism is characterized as justifying acts of deception through lies, manipulation, or coercion. If one considers happi- ness of the majority above all else, it is said, then a utilitarian will give up justice for expediency and will ignore principles and rights when it is beneficial to the majority. Hartman likewise claims that “[t]he determination always to perform whatever act, or even whatever sort of act, maximizes happiness will have unhappy consequences, not least as a result of the breakdown of rules and institutions that enable people to trust one another” (Hartman 1996, p. 46). This criticism actually makes the point for utilitari- anism! On Mill’s utilitarianism, if in fact an act would have unhappy consequences—including “the breakdown of rules and institutions that enable people to trust each other”—then a utili- tarian should not do that act. Lying and ignoring rights and otherwise undermining basic stabilizing foundations of society which make it a happy one are not in line with utilitarianism, but quite rejected by a utilitarian ethic.

However, there is still an apparently difficult dilemma for the utilitarian here: either Mill remains committed to the principle of utility when possible exceptions arise, in which case he acknowl- edges that sometimes one morally ought to violate such alleged rights as liberty and freedom, or else the utilitarian remains com- mitted to these rights even when they violate the principle of utility. Mill addresses such concerns when he says, “We are told that an utilitarian will be apt to make his own particular case an exception to moral rules, and, when under temptation, will see an utility in the breach of a rule, greater than he will see in its observance” (Mill 1998, ch. 2, para. 25, l. 4). His response is, first, to admit that utilitarianism can be misused as a rationalizing excuse for doing evil—but all moral creeds can be misused. Second, he points out that there are often “conflicting situations” and that “[t]here is no ethical creed which does not temper the

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rigidity of its laws, by giving a certain latitude, under the moral responsibility of the agent, for accommodation to peculiarities of circumstances” (Mill 1998, ch. 2, para. 25, l. 19). In the recent scenario where a choice had to be made to break previous prom- ises to united auto workers and help General Motors (GM) survive or fulfill those promises and let them go bankrupt, a great many people agreed with utilitarian thinking that in such a difficult situation, survival will bring about greater benefit than fulfilling promises to the union (New York Times 2005). However, GM made those promises in good faith (we trust) not realizing the extraor- dinary possibility of extinction was coming. These decisions are quite difficult, with conflicting sides, and as Mill says, “Though the application of the standard may be difficult, it is better than none at all: . . . only in these cases of conflict between secondary prin- ciples is it requisite that first principles should be appealed to” (Mill 1998, ch. 2, para. 25, l. 28). In normal (nonextraordinary) situations, a utilitarian does not give up principles which support the well-being of society in the light of apparent short-term goals. In the literature, this is known as “rule utilitarianism” (Carson 1997; Starr 1983). A utilitarian would say that supporting higher pleasures of noble sentiments of fidelity and loyalty for the sake of the greater good would outweigh short-term benefits of breaking trust.12 Preserving rights, duties, and justice is essential to pro- viding the possibility for the greatest happiness for the many—and for maintaining trust in the markets.13 Mill says of justice, “Justice remains the appropriate name for certain social utilities which are vastly more important, and therefore more absolute and impera- tive, than any others are as a class” (Mill 1998, p. 107). Honest business dealings, acting in good faith, fair trials, equality before the law, civil rights, etc are all social utilities on Mill’s view because they provide for a happier society overall, despite short- term costs (of keeping this contract, despite its liability). We can think of many examples of companies which have sacrificed integ- rity and trust for short-term benefits, and in the end, when such companies as Enron or others collapse, it is impossible to say that their breaking of trust led to a greater benefit for the majority involved, much less that as a general rule breaking trust or tossing aside principles of integrity leads to greater happiness.14

Mill’s utilitarianism sees that for society to maintain its happiness-producing capabilities long term, it must maintain

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respect for certain values such as justice, fairness, and civil (society-granted) rights which require some to sacrifice for the greater good. Obviously, these are values which a corporation must preserve to maintain a positive healthy workplace. In addi- tion, we know now more than ever that market stability requires a great deal of trust on the part of investors, which in turn requires upright honest behavior on the part of companies.

So, it is not as though the utilitarian regularly denies these values and principles for short-term expedient gain. To do so would be to undermine the most important values in society which ensure long-term happiness. Why is it wrong to break contracts? The utilitarian would argue that it is wrong in large part because breaking contracts tends to undermine faith in business as an institution, and this would undermine the happiness-producing capacity of our society at large. When can we? In extraordinary circumstances. It is obvious that GM’s deci- sion to not fulfill contracts with their workers was considered an extraordinary act—an anomaly, not one which forever under- mined trust in GM—because their workers made new contracts with GM and the financial institutions stepped up to loan to them once again after that extraordinary decision to break the contract. To say that utilitarians do not really stick to principles because in extraordinary circumstances they will sometimes make exceptions is like saying that the school superintendant does not care about the children’s education because he called off school due to inclement weather. Both require difficult judgment calls, and both, if done well, will be done in a principled and thoughtful manner. To characterize these extraordinary exceptions as random or capricious is quite untrue to classic utilitarianism.

Supererogatory: Utilitarianism When Followed Leads to Futile Actions The first criticism we addressed is the concern that the utilitarian will not stick to the GHP always, whereas this second criticism is concerned that if the utilitarian does, it will result in absurdity. Utilitarianism asks us to act for the benefit of the many, but sometimes, such actions seem futile if others are not correspond- ingly cooperating. In short, it seems irrational to act on a rule which assumes others are acting likewise, if they are in fact not doing so. Hartman provides a great example in which your

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department can finish the project due the next day if all 10 of you stay late, but everyone goes home at 5 except you. “Surely,” says Hartman, “you have no moral obligation to the organization to work alone all night if you know your effort will be futile” (Hartman 1996, p. 46). This is the principle Hartman later devel- ops as an “exit” principle—the notion that it is rational, at certain times, to exit previous agreements (Hartman 1996, p. 170). His point, as I understand it, is a good one: does not utilitarianism seem to lead to supererogatory acts and have no limit of obligation? Velasquez brings a similar criticism against utilitarianism when he says that a “standard utilitarian claim” is “that businesses and agents in general have the duty to provide for people’s basic wants right up to the point where the costs begin to outweigh the benefits . . . For example, so long as cor- porate assets could provide advertising, pure utilitarians would say that it would be wrong to use them for such corporate purposes” (Velasquez 1995, p. 873). Again, utilitarianism on this criticism leads to unrealistic expectations and obligations.

In responding to Velasquez first: perhaps some models of thought would advocate the reallocation of funds as per Velasquez’ suggestion, but Mill’s utilitarianism does not need a company to cease to spend money on operations to increase the fulfillment of other people’s wants, for example, for the manager to give all their advertising budget to the local soup kitchen. The reasons are many. There are multiple promises and good faith obligations made to investors, stockholders, and other stakehold- ers such as employees and suppliers which would all be broken for the sake of soup, and randomly breaking such contracts in nonextraordinary circumstances would not be acceptable—a society where commitments are fulfilled, salaries are paid, jobs are maintained, tax revenues are produced, and investors are repaid, and the owners fiduciary interests are maintained will be a society happier than one where such fidelity and trust is absent (on the other hand, if the company was in New Orleans after Hurricane Katrina and made a corporate decision to divert special funds from advertising toward helping with the emergency, it might very well be considered acceptable). Second, the point of utilitarianism is not merely to give people what they want or to provide a communistic equality which brings all down to a common low level of means. Having concentrated wealth in

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institutions such as corporations may lead to more efficient eco- nomic growth and so, help bring about prosperity to society. An argument could be made that it is more advantageous to the well-being and overall happiness of society for the company to advertise well and increase revenues and grow, provide more jobs and dividends and tax revenues for the local community, than for the soup kitchen to increase its budget.

We might respond in three ways as utilitarians. First, if it is an extraordinary circumstance, and in fact the greater good is not served in staying, then we should not stay, unless an important socially beneficial principle is preserved. In effect, the utilitarian agrees with Hartman’s exit principle: “in a community in which some people are free riders—the usual state of affairs—it is not rational to want to want to be a contributor all the time . . . you ought to want to be the sort of person who contributes until others clearly show they will not; then you can reciprocate by withholding your contribution” (Hartman 1996, p. 184). Of course, in principle, one should always try to fulfill promises and obligations, be faithful, loyal, etc. Loyally staying to burn the midnight oil out of loyalty to the company is admirable, but if it really is impossible for you to do your work without the others present, then it may simply be absurd.

Second, it seems that not being able to complete the goal of the group does not necessarily mean that one has no reason to complete one’s own responsibilities from a utilitarian viewpoint. Utilitarians who see that none of their neighbors recycle are not excused from recycling, despite the fact that their actions alone will not make much of a difference. With regard to this “staying late” example, a utilitarian may say that you do have an obligation—and your obligation is to stay relatively late, as late as it would have taken all of you to get finished, granted you can do your work without the input from the others. In other words, other people not doing their part does not mean you have 10 times as much responsibility, or all the responsibility, but it also does not mean that you are relieved from doing your part.

Third, there are long-term benefits to the many which come from sticking to principle apart from the immediate short-term gain. We can easily see this in research and development depart- ments, where many ultimately fruitless projects are pursued in

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hopes that some of them will come to fruition. In football practice, third stringers do all the same drills as the starters knowing they likely will not play Friday night in the game. The point is, the utilitarian does support practices which are rooted in principles that are thought to have long-term benefits, but these principles are always guided by the basic guidance of utility—what will bring about the greatest good in the long run.15 A utilitarian upholds certain principles because of a belief that maintaining the prin- ciples will produce a society in which happiness production is more possible and likely. This is exactly the very heart of integrity and trust which business depends on. If we do not act on good faith principles, then business cannot happen, and society becomes unable to provide basic happiness ultimately. In cultures of extreme corruption and no good faith trust, there is no capacity for business interaction. If a person is surrounded by lazy irre- sponsible coworkers, that in itself is no excuse to give up their own integrity and work ethic because we know a society in which people act with integrity will be a happier one.

Majority Bias: Utilitarianism Is Biased in Favor of Majority, and So, Is Unfair to Minority Rights Utilitarianism is undeniably for the happiness of the majority. The greatest happiness is what we strive for in our ethical decisions. However, certain freedoms for the minority are always supported by Mill with utilitarian arguments. Another criticism often raised against utilitarianism is that it will regularly undermine people’s rights, particularly when they are in the minority.16 For example:

A straightforwardly utilitarian rule consistently applied may violate people’s rights. Consider a rule that licenses discrimi- nation against the handicapped and thus saves all the money that would be spent in accommodating them. There is no evident algorithm for trading off rights and utility insofar as they are distinct, not least because there is not reason to suppose they are commensurable. (Hartman 1996, p. 46)

Hartman is right to point out that the needs of handicapped and money are incommensurate goods. Yet, we constantly are put in situations where we must weigh them and make judgments, and we do—in light of a common good principle, much like the GHP. So, the choice is not either: pursue utility or help the disabled—

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helping the good of the disabled is part of the utility as we make our judgment. We should not withhold money to the disabled simply because we love money. However, we would limit money spent on handicapped on the basis of justice, the rights and needs of others, and a utilitarian wants to pursue justice because a just society is more happiness productive than one which does not pursue justice as a general rule. We would weigh the needs of elementary education and highway maintenance, senior citizens, and military spending against the needs of the handicapped. Practically speaking, we unfortunately must set some financial limits on how much we will make provisions for the disabled, and that is why we, for example, do not demand that all buildings be retrofitted for handicapped access, but only public buildings of certain types. Doing such calculations is complicated but hardly without precedent or models. We do not simply write blank checks for funding the disabled. Mill obviously thinks preserving justice is essential to happiness, and it is likely that he would endorse helping the needy, supporting the less fortunate to a limited degree, and providing treatment to those who need it. A society which can help its disabled, resocialize its psychopaths, and bring its poor into the mainstream economy will be better off than one which ignores these minority needs.17

Bowie seems to also claim that Mill ignores the rights of the minority when he highlights what he considers to be the “anti- utilitarian principle” in Kantian thought. This is the key point which goes against utilitarian thinking, according to Bowie. This principle of Kant’s which is incompatible with utilitarianism goes as follows:

When a situation arises where it appears that the humanity of one set of stakeholders must be sacrificed for the humanity of another set of stakeholders, that decision cannot be made on the grounds that there is a greater number of stakeholders in one group than in another. (Bowie 1999, p. 90)

Bowie is correct in saying that not only the interests of the major- ity should be considered. Utilitarianism is not simply for the greater number, it is for the greatest overall happiness of the greatest number, and Mill is clear that, in many cases, this requires the majority grant the individual in the minority rights which might not have any apparent immediate benefit to the

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majority. One example he provides is security: “security no human being can possibly do without; on it we depend for all our immu- nity from evil, and for the whole value of all and every good,” (Mill 1998, ch. 5, para. 25, l. 13) and so, as it is such a basic necessity, and because without it basic happiness is impossible, society protects it for us as a right. “To have a right, then, is, I conceive, to have something which society ought to defend me in the pos- session of. If the objector goes on to ask why it ought, I can give him no other reason than general utility” (Mill 1998, ch. 5, para. 25, l. 1). In some cases, such as when a criminal, politician, or other person whose security is in danger is protected from angry protesters, society has police risk their lives for the security of a citizen. So, the reasons for protecting the rights of an individual or minority group are (1) a society which maintains rights of indi- vidual or minority will be happier than a society which does not provide such rights and (2) the pain to the individual or minority group outweighs the cost to the majority more often than not (if the individual does not get fair trial they get lynched. The majority pays for this with time/patience and some tax dollars, which, distributed across the public, are a small cost per person).

So, with respect to Bowie’s point, Mill’s actually agrees that you should not ask that the humanity of one set of stakeholders be sacrificed for the humanity of another group solely on the grounds that there are more stakeholders in one group than another (Audi 2007). That would be to ignore the amount of happiness and quality of the happiness involved. Promoting indi- vidual liberties does contribute to the overall happiness capacity (“utility”) of society at large.

But again and again, we find it claimed that utilitarianism itself is totalitarian and homogenous, tending to undermine individual liberty and creativity:

[I]t is a good thing that utilitarianism cannot get off the ground. It is a good thing that we, and most particularly our political and economic institutions, respect a variety of con- ceptions of the good and a variety of kinds of life, rather than imposing a single one on all within the community. We rightly grant people autonomy in that sense. (Hartman 1996, p. 61)

While some utilitarian models may quash variety and diversity, Mill clearly supports the principle of liberty and wants it because

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he thinks a free society is a better pleasure-producing society (Gustafson 2009). Mill does think that providing protection for minority behaviors and activities does in fact directly contribute to the greater good of society. Mill would support diversity, affirma- tive action, and proactive support of women in traditionally male workplaces, and males in traditionally female workplaces. He sees diversity in general as a great happiness-producing asset to society. He brings this out most clearly in his On Liberty where he provides explicitly utilitarian arguments for supporting the liberty of individual dissent against the majority—because it is in the majority’s best interest to do so. Mill says that “the only unfailing and permanent source of improvement is liberty, because by it there are as many possible independent centres of improvement as there are individuals” (Mill 1999, p. 117). For Mill, liberty is what provides opportunity for progress in society [or corporate culture], and homogeneity is much more dangerous, so individual liberty must be protected from the tyranny of the majority:

the peculiar evil of silencing the expression of an opinion is, that it is robbing the human race; posterity as well as the existing generation’ those who dissent from the opinion, still more than those who hold it. If the opinion is right, they are deprived of the opportunity of exchanging error for truth; if wrong, they lose, what is almost as great a benefit, the clearer perception and livelier impression of truth, produced by its collision with error. (Mill 1999, p. 59)

Progressive companies seek and promote innovative people who think outside the box, even if it goes against “the way we’ve always done things around here.” Respect for liberty and minority opinion is not contrary to but is actually founded upon the greater happiness principle, as Mill sees things. We also see the same sort of greater happiness argument used to support the individual’s right to try various experiments in living which go against the majority:

As it is useful that while mankind are imperfect there should be different opinions, so is it that there should be different experiments of living: that free scope should be given to varieties of character, short of injury to others; and that the worth of different modes of life should be proved practically, when any one thinks fit to try them. (Mill 1999, p. 103)

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The core starting points for establishing a society which promotes these experiments in living are justice, liberty, and fairness. Why do we start with these? Because those are the sentiments which will bring about a happier society or corporate culture, compared with those we have seen which have not valued justice, liberty, and fairness. While on the face of it, it might seem like liberty of the individual to resist the majority and the pleasure of the majority might be at odds, Mill in fact thinks that allowing great liberty will nurture a diversity which will enhance the strength and depth of society at large and produce a society which is best able to achieve high levels of happiness potential.

We of course see this tension in the corporate environment—the tension between allowing freedom for creative solutions and main- taining order through cohesive unified policies. We know that too much restriction hampers creativity, and what Mill says of states applies just as well to the contemporary corporation:

A State which dwarfs its men, in order that they may be more docile instruments in its hands even for beneficial purposes—will find that with small men no great thing can really be accomplished; and that the perfection of machinery to which it has sacrificed everything, will in the end avail it nothing, for want of the vital power which, in order that the machine might work more smoothly, it has preferred to banish. (Mill 1999, p. 166)

When trying to find the balance between allowing freedom and yet maintaining order through some restrictions, in either case we tend to use utilitarian style arguments to support the policies we have to support or conversely restrict individual freedoms in the workplace.

Motivation: Utilitarianism Is Irrational and Impractical Because We Have No Motivation to Obey the Greatest Happiness Principle In the workplace, we often hear about being a “team player,” but at times, my being a team player might not lead to much good for me but rather might provide more good to others who already seem to be doing better than me (like my superior). If utilitarian- ism asks me to sacrifice for “the team” (the greater happiness), then what exactly is my motivation for doing so? Bowie asks,

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“What would motivate an individual to sacrifice his good for the public good even if those who gain are already better off . . . would not the less fortunate be extremely bitter at having to sacrifice even more for the benefit of the more fortunate?” (Bowie and Simon 1998, p. 51). Two questions are raised here—one about inequitable sacrifice, and one about motivation to be concerned about the public good.

First, regarding apparent inequitable sacrifices, we can think of very practical examples where those who are less fortunate are sacrificing their good for the public good, and especially for those who are already better off. Consider these three examples: (1) our military is made up of a disproportionate share of lower income enlistees than of those who come from wealth, although the wealthy have more to lose quantitatively if our free country was overtaken or the markets severely disrupted by terrorism; (2) oftentimes, the wealthy get tax breaks that middle and lower income people never could get; and (3) people with middle and lower incomes pay a great deal of money to help put up stadiums, pay athletes and rock stars and others who are already better off financially. Although it might be argued that there may be a social injustice in these examples, there are arguments which seem to support these types of apparently inequitable situations: (1) the military provides income, training, and pension to the lower income enlistee than they could get otherwise; (2) the wealthy get tax breaks for investing in construction, job creation, rental housing, giving away money (Philanthropy), and other sorts of spending which—it is thought—help the majority. In other words, we use utilitarian thinking to provide such tax incentives to the wealthy because we see the long-term benefits of that spending for the economy that the majority benefits from. For example, the $100 Million Holland Performing Arts center in Omaha was pri- marily paid for by a private donor, and that donor undoubtedly got a tax break—and the City of Omaha got a first class perform- ing arts center; and (3) people are often willing to pay to contrib- ute to the good of someone more wealthy than they are if they see a tangible benefit such as being able to have a professional sports team or active concert venue in their city. So, it actually seems that in many cases, those less well off are motivated and willing to sacrifice their good for the good of the many, even if the many seem to be better off to begin with.

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Second, the question of why someone would be concerned with the public good rather than their own selfish interests is important, and Mill deals with it a great deal in chapter 3 of Utilitarianism. One motivator is external sanctions—external pun- ishments which we suffer if we act against the majority interests. In business, examples of this would be the 1993 sentencing guidelines, Equal Employment Opportunity Commission man- dates, Occupational Safety and Health Administration regula- tions, public shame, community outcry, etc. The second motivator is internal, conscience nurtured by education or habitual asso- ciation, the process by where my happiness begins to be more and more closely aligned with that of the social good.

Mill says,

So long as they are co-operating, their ends are identified with those of others; there is at least a temporary feeling that the interests of others are their own interests. Not only does all strengthening of social ties, and all healthy growth of society, give to each individual a stronger personal interest in practically consulting the welfare of others; it also leads him to identify his feelings more and more with their good, or at least with an ever greater degree of practical consideration for it. He comes, as though instinctively, to be conscious of himself as a being who of course pays regard to others. The good of others becomes to him a thing naturally and neces- sarily to be attended to, like any of the physical conditions of our existence. (Mill 1998, p. 78)

The GHP is the utilitarians’ guide for action, not the spring for moral motivation (Wilson 1982). The principle of the theory is not the motivation, obviously. Mill knows that motivation comes through habituation and socialization which are really a process of getting someone tied into a particular narrative about how they live in the world—who they are, what their relation is to others, etc. In business, as in the rest of life, most ethical decisions are made without theoretical analysis. Theory may play a background role, or an anchor for our convictions, but really, most of our moral acts are habitual-subconscious responses. So then, the question is: how do we instantiate right moral habitual-subconscious responses to situations? How do we make it so that we and our employees just as a matter of course nearly automatically do the

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right thing? Somehow, we must create a community of ethical behavior, a community which nurtures this sort of conscientious- ness. Putting upright principles and value statements forward can provide some compass, and narratives of noble business practices can stimulate ethical motivation. However, a lot of a manager’s job is the long-term work of establishing and nurturing habits of ethical conduct and expectation in the day-to-day ways of doing business, demonstrated in the leadership of the firm but passed down through mentoring and example, and a clear, repeated, vision of how things should be done. External and internal sanction methods are discussed in business ethics literature as the “compli- ance based approach,” where you get obedience to corporate poli- cies through punishment versus the “integrity-based approach,” where you nurture a corporate culture of doing things the right way through management encouragement and reiteration of values and purpose (Paine 1994). Mill believes that habituating the conscience through socialization and education is the key to nurturing a strong social concern and moral sentiments in people. In this sense, he is quite like Aristotle who believes ethics is taught more through habit formation like basketball or piano playing, rather than through theory learning alone.

Calculation: Utilitarian Calculation Is Not Possible Because We Cannot Determine Maximal Happiness The utilitarian principle seems clear: do what brings about the greatest happiness for the most. However, this is more easily said than done because it seems to leave us with an even more difficult question: how do we determine what the greatest happiness for the many is?—and how many? Who is the many? So, two ques- tions arise: (1) are the goods we are comparing even commensu- rate? and (2) how are we to measure them uniformly in terms of pleasure and pain?

It is often said that utilitarians cannot provide a singular account of the good toward which all are supposed to strive because, in fact, there are multiple incongruous goods we are choosing between (DesJardins 2011, p. 38; Hartman 1996, p. 60; McKay 2000; Rawls 1971). As Audi comments, “is calling a tooth- ache twice as painful as a pin prick even fully clear in its meaning?” (Audi 2007, p. 596). This incommensurability problem comes up a lot in our decision making. We see it especially in

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questions of Triple-Bottom-Line (TBL) accounting, and attempts to value environmental concerns according to the free market. If you try to measure (for example) societal good against environmental concerns against financial profit (TBL), it becomes difficult to do the comparative assessments of valuation for each of them against the others (Pava 2007). How do we weigh the value of the environment against job losses because of increased spending on environmental concerns? How do we weigh the value of an unclut- tered skyline against the need for affordable housing? However, for the utilitarian the fact that we have some disagreements about happiness does not necessarily derail utilitarianism. A lot is agreed upon regarding what happiness entails—and what will provide for a happier society. Most would consider a degree of liberty, private property rights, justice, fairness, kindness, moral imagination, education, etc essential to creating a happy society. We can certainly come to widespread agreement as to why certain countries do not provide for the happiness of their citizens, and agree on means by which happiness could be achieved. We do have debates of course about abortion, gun control, taxation, and so on, but there are general aims we agree on, which we use as the basis of our arguments for or against our positions. In the greater scheme of things, the debate about whether or not we should allow semiautomatic weapons is a micro issue. The reason we have debates about more-free versus less-free market is often because we have different ideas about economics, rather than because we have different ideas about happiness (although there are obviously disagreements about what will bring about the greatest happiness and what it is). Again, as the Bible is the starting point for understanding christianity for most christians (despite disagreement about interpretation), so to the GHP is the agreed starting point for the utilitarian (again, despite disagree- ment about interpretation of where that will bring us).

A related important critique says utilitarianism does not provide a means for measuring pleasure or pain, or making difficult deci- sions. This seems especially acute as a problem as it is impossible to know the future results of present actions (Audi 2007, p. 596; Hardin 1988; MacNiven 1984). Mill’s response to the difficulty of knowing future outcomes would be along these lines I believe: we believe the world to have regular causes and effects, and for the future to resemble the past, and based on generalizations, we can

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make extremely well-grounded guesses as to what our current actions will bring in terms of communal happiness production, and based on those estimates, we can make confident decisions about the pleasure production of our actions. Mill makes the following response to potential critics in Utilitarianism: ”People talk as if the commencement of this course of experience had hitherto been put off, and as if, at the moment when some man feels tempted to meddle with the property or life of another, he had to begin consid- ering for the first time whether murder and theft are injurious to human happiness” (Mill 1998, ch. 3, para. 24, l. 1). That we cannot know the future is not, for Mill, a significant fault of his theory, as the utilitarian’s directive is to aim toward what tends to bring about the greatest happiness for the most and subrules which generally tend toward the greatest happiness are the rules to follow.

But even if we can define pleasure clearly enough and guess well at future outcomes of our present actions, there is still a question of how to measure outcomes at all. Beauchamp and Bowie, for example, ask, “How does a corporate public affairs officer decide how to distribute limited funds allocated for chari- table contributions? If a corporate social audit (an evaluation of the company’s acts of social responsibility) were attempted, how could the auditor measure and compare a corporation’s ethical assets and liabilities?” (Beauchamp and Bowie 2001, p. 23)

First, as Beauchamp and Bowie point out, this might be a difficult problem for any theory, and if so, utilitarians may be no worse off than other theories would be in light of the question.18

Secondly, there are audits done of this sort of thing all the time at corporate foundations, so it is not as though we have no reason to believe such audits are possible. They happen.

But as a utilitarian, one approach is to argue that if one cannot show an auditor that absolute maximal happiness was not calcu- lable, perhaps a satisfactory happiness was, drawing from the work on Happiness Economics and economic work of Herbert Simon regarding “satisficing” may also provide a means of answering this objection (Simon 1947). On this model, instead of achieving the maximum result, one aims for a satisfying result—one which will provide happiness, if not maximal happiness (Byron 2004; Slote 1985, 1989).19 In many cases, it seems that it would be more rational to achieve a satisfying result resulting in actual happiness, rather than not being satisfied until the optimal result occurs.20

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The fact that we are not omniscient should not in itself count against our ethical theory. Utilitarians may, in certain cases where many good options are available, do the best they can to ensure a satisfactory choice and leave it at that, particularly when we do not know various outcomes. People who sit around all evening until after the restaurants close trying to analyze which restaurant experience would bring the greatest pleasure for the majority are not fulfilling the greatest utility. Stock analysts who take too long to analyze stock might lose their opportunities, and no utility is served there either. There is a balance which must be maintained, or the real utility of the decision may be lost. As the old saying goes, one bird in hand is better than two in the bush.21 So with regard to Bowie’s example of deciding how to distribute charity money, it seems that we could show the moral auditor that we acted in good faith and responsibly on the utilitarian principle. We might have decided to give to the project which we thought would help the most people, or to the five charities which together would help the most people, or to the five neediest charities, or the five best run charities (based on reports from agencies who know this sort of thing), or we might have decided that in light of our inability to make a clear distinction of one above another, we split our charity giving equally among the many. I do not think any of these decisions could be considered substantially worse than the others. Auditors in general realize that there are various ways to keep track of records, but as long as you are following the basic goals and principles, and not “cooking the books,” there is a spectrum of means of bookkeeping which are considered acceptable and upright. In the same way, an ethical auditing can take into account that there are multiple good things to be done, multiple ways to generally accomplish the goal— and the important thing is that one is generally acting on behalf of the interest of the many.

How Mill’s Utilitarianism Is Unique

When this defense of Mill is presented, Aristotelians tend to say that this sounds a lot like Aristotle, and sometimes Kantians say it sounds like Kant. Mill clearly has some similarities to both but is clearly different as well. Of course, Mill’s utilitarianism is dif- ferent from egoism. First, for Mill, the greater happiness of the many is the goal, whereas for the egoist, the only thing that

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matters is my personal happiness. On Mill’s view, I should act to bring about the greatest happiness. Mill’s utilitarianism is dif- ferent from Kant for at least three reasons. First, Kant thinks that instincts guide us toward happiness, and reason tells us not what will make us happy but what we must do (Kant 2002). In short, ethics is not about happiness for us or anyone else. However then, the second point of difference here is that Mill’s theory does not depend on a concept of a universal reason held in common by all rational beings. Rather, Mill’s utilitarian direc- tive, if ultimately rooted in common desires—as a perusal of chapter 5 of Utilitarianism, will show. Third, while Kant’s ethics is rooted in the commands of reason understood by the autono- mous individual, Mill’s view of ethics is fundamentally group centered and others centered. Mill thinks that Kant’s categorical imperative—that one must only act on such a maxim as one could make a universal law—is at root a directive based on happiness because Mill thinks that we must in such a situation consider the outcome of acting on the maxim to make the judg- ment (Mill 1998, ch. 1, para. 4, l. 34). How do we decide which laws should be made universal? By taking the greater good or happiness into account (says Mill). Mill’s utilitarianism is quite like Aristotle’s virtue ethics in many respects, including the fact that some pleasures are higher than others, that moral educa- tion involves habituation of sentiments, that politics and poetics play important roles in developing moral feelings to help us act ethically. However, Mill is different from Aristotle in that Mill is social, not merely an enlightened egoist, as Aristotle tends to be. Second, Mill does not rely on Greek cultural values. Third, Mill makes a place for the importance of sympathy for others, a topic not so central to the Greeks.

CONCLUSION

I hope that the following points have been made sufficiently clear in this article:

1. Insofar as principles of justice, fairness, honesty, and integ- rity, as general rules, provide a foundation for a happier community than a community without these principles, they have a secure basis in utilitarianism.

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2. Insofar as utilitarianism does not require supererogatory (unlimited) altruistic behavior to the point of overgenerosity without limits, it provides a basis for thoughtfully consider- ing personal obligations to others, to duties, and to virtues.

3. Insofar as utilitarianism sees diversity and support of indi- vidual liberty to be the basis of a happier community than one which would not support liberty, utilitarianism supports the concerns of minority viewpoints and liberties.

4. Insofar as utilitarianism can consider the relative worth of individuals and also provide a basis for valuing all individu- als universally with dignity as well, utilitarianism provides an ethic for workplace management which really makes practical sense in decision making.

5. Insofar as utilitarianism provides a vision of a cohesive social community as the basis of all decision making, it provides a real vision of the importance of an ethical corporate culture as the foundation of ethical behavior in the workplace.

6. Insofar as utilitarianism provides a basic starting point and framework for determining right action across individual interests, it provides a useful ethical foundation for business to make sound ethical decisions while making economic sense.

Here, in the course of responding to many typical criticisms of utilitarianism, I have argued that Mill’s utilitarianism can support principles of justice and fairness and can support personal duties and obligations; it does not repress minorities, does not destroy individuality, and I addressed the question of treating people as a means to an end. Further, I have tried to explain how that satisficing theory may be utilized to respond to criticisms that utilitarianism is unable to provide a method of calculating great- est pleasure for the greatest number. These responses are meant as an initial foray into mostly unexplored ethical territory. I hope that work will continue to bring Mill’s utilitarianism to bear on practical business ethics issues.22

NOTES

1. Many thanks to the anonymous reviewers and editor of BSR, as well as Pat Werhane’s class at Darden who provided many thoughtful

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responses to this article when I did a seminar on Mill’s utilitarianism there, and Pat Werhane, as well as the reviewers of this article for the SBE conference a few years back.

2. I am not going to spend time in this article making these arguments to distinguish Mill from preference utilitarianism, but I would simply point to Mill’s discussion of competent judges (Mill 1998, ch. 2, para. 8, l. 1) which seems to assume a broadly universal understanding among human- ity in general to be able to distinguish higher from lower pleasures.

3. Audi (2007) provides a nice argument about this question of dis- tribution in his “Can Utilitarianism Be Distributive?”

4. It should be noted that Mill does not expect us to actually think of that transcendent idea “humanity” when we act ethically toward someone: “it is a misapprehension of the utilitarian mode of thought, to conceive it as implying that people should fix their minds upon so wide a generality as the world, or society at large. The great majority of good actions are intended, not for the benefit of the world, but for that of individuals, of which the good of the world is made up” (Mill 1998, ch. 3, para. 19, l. 23).

5. Of course there is a long discussion of venerable voices between “rule utilitarianism” and “act utilitarianism.” I am here merely pointing out that Mill himself suggests that we refer to intermediate rules to follow as rules of thumb when pursuing the greatest happiness. I myself find act utilitarianism unsustainable in practice or textually.

6. This has direct implications for our moral behavior. My moral imagination enables me to think about how my actions affect others; my noble sentiments make me ashamed to be selfish and prompt me to live for higher principles and as I nurture my moral feelings, I find it easier to be thoughtful, considerate, and decent toward others. Lower capaci- ties, like eating, are not evil—they are simply not something “to die for.” We must eat, but one who only lives only to eat will eventually lose their capacity for the higher pleasures, and this will lead to a net decrease in pleasure experience. But what is worse, as one loses ones higher capaci- ties, society as a whole becomes less and less capable of producing as much happiness. Mill is ultimately optimistic about humans: “a beast’s pleasures do not satisfy a human being’s conceptions of happiness. Human beings have faculties more elevated than the animal appetites, and when once made conscious of them, do not regard anything as happiness which does not include their gratification” (Mill 1998, ch. 2, para. 4, l. 10). Of course, some humans live at an animal level of existence, but their happiness capacities are greatly diminished, as though they were sick or only half alive.

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7. I thank an anonymous reviewer for giving me that phrase for what I was thinking here.

8. With regard to exceptions, Mill says, “It is not the fault of any creed, but of the complicated nature of human affairs, that rules of conduct cannot be so framed as to require o exceptions, and that hardly any kind of action can safely be laid down as either always obligatory or always condemnable. There is no ethical creed which does not temper the rigidity of its laws . . . for accommodation to peculiarities of circum- stances” (Mill 1998, ch. 2, para. 25, l. 9).

9. Mill seems quite clear that one does not need to do utilitarian calculus for each and every action, but instead, we can rely on basic principles which we derive from seeing previous happiness results. As Mill says, “there has been ample time, namely, the whole past duration of the human species. During all that time mankind have been learning by experience the tendencies of actions; on which experience all the prudence, as well as all the morality of life, is dependent” (Mill 1998, ch. 2, para. 24, l. 5). To act as though we have no means of believing that the future will be like the past is akin to Hume’s skeptic which even Hume says we should ignore by playing a nice game of backgammon;—any reasonable person relies on sensibly construed expectations about the results of particular types of actions.

10. Yet, the utilitarian is capable of exceptions. One can imagine disobeying laws in a Nazi regime, for example, or lying to a psychopath in order to save a life. Such exceptions could be counted as such if they were obviously done for the greater good.

11. Bob Bates, former executive at Lincoln Financial. 12. This utilitarian response invokes rule utilitarianism, the view that

obeying certain rules is what we should do in a given situation—rules like “do not cry wolf” or “do not break promises” which, when followed, tend to make society a place more capable of producing happiness. However, Hartman criticizes this position, saying that rule utilitarianism is no better than act utilitarianism, “On the contrary, where it does differ from act utilitarianism, it may impose an obligation to do something futile because, although the result of everyone’s doing it would be good, not everyone will, and the good result will not happen” (Hartman 1996, p. 46).

13. In Utilitarianism, Mill says, “Justice remains the appropriate name for certain social utilities which are vastly more important and therefore more absolute and imperative, than any others are ” (Mill 1998, ch. 5, para. 38, l. 11). Justice is sought because a society which is just will be

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able to produce the most pleasure for its citizens. Mill says we will always seek a justice respecting society which provides rights (private property, liberty) and expects duties from people, such as the responsibility of the wealthy to pay more taxes than the less fortunate, because we know that these bring about a happier society. We preserve the right to a fair trial because by and large such a rule establishes a degree of order and fairness which then provide the greatest benefit to the many in the end. We are willing to sacrifice to preserve these principles because ultimately, we know that society will be better for respecting these than it would neglecting them.

14. My favorite class examples for the utilitarian argument for pre- serving principle is the movie Blackhawk Down in which the marines have a pledge to their men: “never leave a man behind” which they fulfill regardless of the danger to those attempting the rescue. The reason that the pledge is kept, despite risking the loss of more lives, is that the morale of the marine community in Mogadishu depended on that pledge being kept, despite its costs. It brought about greater happiness produc- tion than not sustaining it.

15. Mill, for example, suggests what he calls “experiments in living” where people try new and innovative ways of living in the world, not because he thinks that every one of those experiments will turn out to be a viable way to live, but because constant innovation and the provocation of the status quo are of overall value to society. (Mill 1999, p.103).

16. Bowie, for example, has claimed that utilitarians do not make distinctions between desires, and that if we had a majority racist society, “the intense desires of the racist majority would count more than the more passive desires of the oppressed”—especially if they were intense, Bowie says. Bentham does not distinguish desires, but I believe Mill’s higher–lower pleasure distinction is clearly meant to differentiate desires. I am not going to spend time here developing arguments that racist desires correspond to lower pleasures while desires like justice, fairness, and kindness are higher, but I think that the argument could be made quite easily in response to Bowie.

17. As for minority rights in particular, it should be noted that Mill does support the right of the minority over against the majority in his book, On Liberty, and he does support individual liberty on the basis that preserving liberty for minority opinions in society actually is beneficial to the majority: “But the peculiar evil of silencing the expression of an opinion is, that it is robbing the human race; posterity as well as the existing generation; those who dissent from the opinion still more than

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those who hold it” (Mill 1999, p. 59). Really, these sorts of criticisms are rooted in the broader criticism of Mill that his concern for the greater good does not coincide well with his concern for individual liberties and rights, particularly of minorities. However, Mill argues that a society which does provide individual liberties, supports the minority, allows dissenting opinions, etc will be a stronger society more able to produce happiness. Mill’s entire argument in On Liberty is that the principle of liberty and freedom of dissent and minority concerns must be preserved on the basis of utilitarian pleasure. This is clear from chapter 2 of On Liberty.

18. It is hard to imagine an ethical auditor measuring if one has achieved perfect balance of the virtues of generosity, prudence, courage, modesty, kindness, honesty, etc when one is faced with deciding toward which of the many charities to give. It is hard to know how a Kantian would answer when asked what the specific maxim was he acted upon which he could consider universal when he chose to donate to United Way over Salvation Army.

19. Since writing this section, I have discovered Michael Slote’s chapter “satisficing consequentialism” in Common Sense Morality and Consequentialism, (London: Routledge & Kegan Paul, 1985) 35–59. It provides some thoughtful common sense means of appropriating satisficing theory to utilitarianism as well. His Beyond Maximizing (Harvard University Press, 1989) also develops some of this line of thought.

20. We know of this problem in many work situations where a per- fectionist has difficulties finishing a project because there is always “just one more thing to adjust” to make the project better. In such cases, we realize that it is better (and will bring about more happiness) to achieve the closer-at-hand satisfying result rather than perpetually put off the maximal result.

21. It seems that this is how we often make decisions in business. We want to open a new operation in town A, B, or C, and hire manager 1, 2, or 3 to run operations. We find that A or B make the most sense for various economic and other reasons, and managers 2 and 3 seem to be the best qualified and most dependable. What then is the right decision? A2, A3, B2, or B3? Is the utilitarian stuck? No. I think that at this point, one can just make a decision, and any of these are fine. We have eliminated a lot of options using utilitarian reasoning. We have narrowed it to a pool of satisfying decisions, and any will do. Economists and those in business know better than anyone that it is difficult to determine exact

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future outcomes—but this hardly keeps us from making good guesses based on previous experience. And we have to work with vagueness. Consider Friedman’s shareholder theory: we want to maximize share- holder value—but what is our target shareholder? The one who sells this evening? Next year? 2 years? 5 Years? 20 Years? The one who never sells? The policies which we would enact to ensure highest yield tonight would be quite different from those used to aim for highest yields in 20 years. Yet, we cannot aim at either of these exclusively. We just have to gener- ally aim to keep the stock strong and generally healthy. In the same way, as utilitarians, we try to provide a satisfactory outcome which benefits society as best as we can with our knowledge at hand.

22. Mill’s utilitarianism applied to business ethics really brings us to a broader conception of what business ethics is about. It is, on a utilitarian view, a question of what sort of world and people do want to become, in short, what world and what lives will bring about opportunity for the most pleasure capacity.

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