Chapter 2 provides a toolbox for managers for developing principles to address moral issues in business. The introductory case describes a student worker observing potentially illegal practices at work. It then examines how classic and contemporary ethical theory can undergird our intuitions and promote reasoned arguments. We start with utilitarianism, or looking to the maximum good for the maximum number, and identify challenges involved in making those calculations. Next, we look at duty-based theories that encourage good for its own sake, with the implication that a firm should benefit all stakeholders, and virtue theory which promotes notions of character and purpose. The chapter also asks whether corporate culture makes a firm sufficiently like a person to be regarded as a moral agent. The ethics of care, often championed by feminist philosophers, is presented as a contrast to classical theory and recent work in standpoint ethics is also discussed. The concluding case deals with EpiPens, potentially life-saving devices which, after a huge increase in price, led to windfall profits to the manufacturer, and invites analysis based on the theories presented.

This chapter discusses the adoption, and rejection, of a quantified sliding scale of sentence in comparable legal jurisdictions. The chapter begins with England and Wales, where the sliding scale of sentence discounts was first standardised. It then looks at Hong Kong, where its sliding scale of sentence discounts was a judicial creation of the appellate court that took inspiration from the developments in England and Wales. Afterwards, this chapter examines certain Australian states that have moved towards a quantified sliding scale of sentence discounts. It then discusses the two jurisdictions of Scotland and New Zealand, which have rejected the quantified sliding scale of sentence discounts in favour of greater judicial discretion. It is shown that despite the varying responses to whether quantified guidelines for sentence discounts for guilty pleas should be implemented, all the jurisdictions surveyed agree that earlier guilty pleas should generally attract higher sentence discounts, primarily justified based on the perceived utilitarian benefits of early guilty pleas.

Environmental, transportation, occupational, and other regulations that reduce fatality risk are frequently evaluated using benefit-cost analysis (BCA). We examine how risk reductions are valued under BCA, utilitarian and prioritarian SWFs. The social value of risk reduction (SVRR) to an individual is the rate of increase of social welfare for a small decrease to the individual’s current-period fatality risk. Under BCA, the SVRR is the individual’s value per statistical life (VSL), which is increasing in wealth and baseline risk. Under utilitarian and prioritarian SWFs, the SVRR is far less sensitive to income; it can decrease with income for prioritarian SWFs that exhibit sufficient inequality aversion. The SVRR increases with or is independent of baseline risk. Like VSL, it can increase or decrease with age, but prioritarian SWFs assign larger SVRR to younger relative to older individuals than does the utilitarian SWF. Extensions to catastrophe aversion and nonfatal health risks are discussed.