This document discusses three major ethical theories: teleological, deontological, and virtue theories. It provides details on teleological and deontological theories. Teleological theories determine rightness based on consequences, focusing on achieving the greatest good. Deontological theories hold that certain actions are right or wrong regardless of consequences, based on absolute duties and moral rules. The document also examines forms of utilitarianism as a teleological theory, and discusses strengths and weaknesses of calculating utility.

1. Types of Ethical Theories
•Teleological Theories
•Deontological Theories
•Classical Utilitarianism
•Forms of Utilitarianism
•Problems in calculating Utility

2. Introduction
• There are three major theories, based on our
beliefs about moral obligations, rights, and
justice and they are applied in a number of
issues concerning rights and obligations of
employees, employee relations, protection of
employees and consumers and the
responsibility of corporation to the firm at
large.
• There are major disagreement in the content
and application of these theories.

3. TYPES OF Ethical Theories
•Teleological
•Deontological
•Virtue(Aristotle)

4. Teleological
• Rightness of action is determined solely by the amount
of good consequences they produce.
• The word is derived from the Greek word telos which
refers to an end.
• Action is justified by the ‘end’ it achieves rather than
the features of the action.
• According to utilitarianism, our obligation or duty, in
any situation is to perform the action that will result in
the greatest possible balance of good over evil.
Whatever makes human beings better off is good.
• Obviously it depends on what is considered as ‘good’
or ‘evil’ or ‘pleasure’ or ‘pain’.
• It depends on person’s own conception.

5. Strengths:
1. They agree to much of our moral reasoning
2. Teleological theories provide relatively precise
and objective method for moral decision making.
E.g. Goodness of consequences can be measured
and compared.
Weaknesses
1. Ordinarily our moral reasoning is teleological, but
some are non-teleological.
2. We have an obligation to keep our promise.
Example: If we promise to store food for a
person, it would be wrong to give it away to
hungry beggars, because it would have better
consequences.

6. Role Obligations, Rights, and Justice.
• Role obligations, which occupy prominent place in
business, often seem to be non teleological. Parents
have obligation to their children, is created by special
relationship of parenthood. There is nothing wrong
for parents providing for their children, when money
could be better spent on donation to an orphanage.
• Rights to free speech may entitle us to speak freely—
even when restricting this might produce better
consequences.
• Similarly, discrimination against women or children
could produce better consequences, discrimination is
a violation of basic principles of justice.

7. Deontological Theories.
• It holds that certain actions are not right and
consequences do not determine what we ought to
do.It contains set of absolute morals( WD Ross):
1. Duties of fidelity-to keep promises
2. Duties of reparation- To compensate for injuries
3. Duties of gratitude- return favours
4. Duties of justice- to distribute goods according to
people’s merits or deserts.
5. Duties of beneficence- to do whatever to improve
conditions of others.
6. Duties of self-improvement- To improve our own
condition with respect to virtue and intelligence
7. Duties of nonmaleficence-To avoid injuries to others.

8. Strengths and Weaknesses
Strengths:
• Justifies obligations irrespective of
consequences- justifying obligations arising out
of relationships. E.g. manufacturer honouring a
warranty.
• It account for role of motive; Two people give
large amounts to charity– one for genuine reason
and the other for impressing people.
Weaknesses :
• How to know our moral obligation?
• No reason offered to accept these rules.
• People at different times and different places
may reject Ross’s Rules

9. Forms of Utilitarianism
An action is right if and if only it produces the
greatest balance of pleasure over pin for
everyone.
So stated utilitarian principle invonves four
distinct thesis:
1. Consequentialism-
2. Hedonism(Bentham)- Pleasure in absence of
pain.
3. Maximalism - A right action is one that has not
merely some good consequences, but the
greatest amount of good consequences.
4. Universalism- The consequences to be
considered are those of everyone.

10. Act-and Rule- Utilitarianism
• It is judged by virtue of the consequences. If
telling a lie or breaking a promise leads to
better consequences, it may be better!
• Two versions of Act Uttiltarianism:
 AU- An action is right if and if only it produces
the greatest pleasure over pain to everyone.
 RU- An action is right and only right if it
conforms to set of rules the general
acceptance of which would produce the
greatest balance of pleasure over pain for
everyone.

11. Problems of calculating Utility.
• The amount of Utility-Balance of pleasure
over pain to individual
• To society?!?
• Interpersonal comparison of utility between
two people who attended a concert to find
out who enjoyed more.
• The problem of quantifying or assigning
monitory value.

12. Cost-benefit Analysis.
• Differs from Bentham’s hedonistic calculus primarily
because it uses monitory units for measuring utility
• From economic point of view, it is means for efficient
achieving efficient allocation of resources.
• It is basing business decisions based on returns on
investments.
• Chief advantage-price of many goods are set by the
market so that the need to have knowledge of
people’s pleasures or preferences are largely ignored.
• In cost-effectiveness analysis we assume that we have
some agreed upon ends while in cost-benefit analysis
both the means and the ends are selected to come to a
decision.
• Cost -benefit analysis is a reply to any theory which is
value-laden.

13. Conclusion
• Utilitarianism is a powerful and widely
accepted ethical theory that has special
relevance to problems in business.
• It allows us to justify many of the obligations
of individuals and corporations.
• It provides a strong foundation for rights and
justice.
• It provides a relatively firm and coherent basis
for business ethics.