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Oslo and Akershus

University College
Oslo University

Start January 16 2012
Tore Audun Hie
Course Goals

Knowledge. Know key forms and issues of ethics
Criticism. Be able to argue for or against a proposition
Constructive. Be able to suggest simple ethical guidelines
International. Transpose those guidelines to an
international perspective
Application. Use guidelines in daily work

Tore Audun Hie
Lecture 1 Introduction

Why ethics
What is ethics?
What is the difference between ethics and morals?
What is a Code of Ethics?
Symmetrical ethics, and assymetrical ethics
Open and closed systems
Instrumental and principle based ethics
Other ethical principles

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Why ethics for organisations?

* A basis for values and visions

* To motivate employees

* Perhaps demanded by customers

* For good relationships to stakeholders

* An overall check on plans

* To avoid various exposures and risks

* Part of governance

* Sustainability
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Why ethics II

* The finance crisis

* A number of crimes, near-crimes and transgressions

* Managerialism (Robert Locke)

* Management not contributing to organisation growth/health

* Not contributing to society

* Money only management

* Greed is good

* Short term and limited plans
Greed is good. Embrace it. Love it. Live it. In fact, greed
may be the one thing that can save us. Dont believe me?
Greed was the foundation for this country. The brave souls
who risked their life to settle in a new country did so out of
self interest. Our forefathers recognized the importance of
self-interest in the Declaration of Independence where they
emphasized our unalienable right to pursue happiness.

Robert Pagliarini blog, Moneywatch 2010
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Why ethics III

* Self-interest is pervasive economic idea

* Not supported by research, as overriding paradigm

* Country differences, in Japan a negative personality trait

Other personal goals, sometimes more important:

* Family and friends

* Personal development (e.g. Maslow)

* Aestetics, a nice place to live

* Contribution to society
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Relevance of ethics to ICT

* Do good work (Aristotle)

* Plan holistically (systems theory)

* Consider end use (Aristotle)

* Evaluate both ends and means (Kant)

* Be stakeholder oriented (ISO 26000)

* Take care of the environment (ISO 26000)

* Contribute to knowledge
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Definition Ethics

Moral philosophy.

Determining rights and wrongs, selecting actions to achieve good
results, evaluating motives.
(attempting to summarise several definitions)
The achievement of wisdom, choosing actions that are benefical
and acceptable long term; or sustainable. This implies a society

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Definition Morals

Beliefs and behaviour of group. The group can be:

* Nation, or geographical area

* Group of nations

* Religious or life view groups, and subgroups

* Profession or similar

* Other organisation, e.g. sports, clan, NGO...

In an international organisation there can be many morals.
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Forms of ethics
1. Metaethics (what is good? etc)
2. Normative ethics (what should we do?)
3. Applied ethics (how do we apply ethics to work and lives?)
4. Moral psychology (the biological and psychological bases)
1. Descriptive ethics (what morals people follow)

In the course, emphasis on 2 and 3.

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Codes of ethics

Applying ethics to a profession or discipline, examples:

* Engineering
* Medicine
* Law
* Journalism
* Psychology

The Challenger disaster
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Symmetrical ethics the golden rule

* Do to others what you want them to do to you.

* If you demand from others, demand the same from yourself
(perhaps more if you are a leader)

* See yourself as the other (good even for design!)

* Empathy
the Gold-in Rule: Do whatever is necessary to bring in the maximum gold, without
getting caught

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Assymetrical ethics

* When one party has more resources, knowledge, power

* Often in professions (engineering, nursing, law...)

* Need to be careful (professional!)

* Need to be considerate
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Instrumental ethics

Ethics an instrument for achieving something else.
Not based on principles or conviction.


Philantrophy used as an excuse

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Principle based ethics

Based on principles like (from websites):

* We want to deliver first class design
* We want to be best in our discipline
* We will contribute to society
* We consider ecological impact
* We contribute to environmentalism

Preferably followed by action
Picture from, design for Sjmannskirken.
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Compliance ethics

Within existing laws, standards, guidelines, morals

May need a compliance officer in large organisations

- e.g. what does it mean to follow standard?

Ensures that organisation does no wrongs, but difficult

The Ethics & Compliance Officer Association (ECOA) is a
member-driven association exclusively for individuals
responsible for their organization's ethics, compliance, and
business conduct programs. The only organization of its kind,
its members represent the largest group of ethics and
compliance practitioners in the world. The ECOA is credited
with formally "founding" the ethics and compliance field in
1991. December 2010
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Positive ethics

* Contributing positively to:

- Organisation
- Profession
- Society
- Environment
- and other stakeholders

Normally cannot balance lack of compliance

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Positive ethics 2011:

We invite you to submit a a manuscript for the Special Issue of the
Journal of Business Ethics on Positive Organizational (POE). This
issue targets the Journal of Business Ethics view that ethics
encompasses all human action aimed at securing a good life.
Towards this end, more research must be directed toward the best
of human functioning, especially within the context of todays
ethically challenged business environment and protracted economic
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The moralist
My life view is

Other views
are inferior
I have the
I need no other
The ethicist
My life view is
based on
I evaluate life
I have questions

I respect other

Aristotle (384-322)
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Openness and privacy

Openness Privacy

Publish information Personal room, integrity
Register information Information may cause harm
Compare information Info may cause embarrasment
Analyse information Wrong information
Find missing information Wrong use of information


Data Protection
Data Inspectorate
Open Government

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Villains or heroes?

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Quality information (as applied to website)

* Correct
* Timely
* Relevant
* Interesting
* Useful

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Principles (organisation virtues):

Openness privacy
Symmetrical asymmetrical ethics

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Ethics applies to:

Professional duties
Employee care
Customer care, and supplier responsibilities
Environment care
Ownership (price, value, opportunities..)
* - the list is being extended

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Conclusion lecture 1

Ethics important, and varied

Includes social responsibility, and governance

Needs terminology, and philosophy

Very relevant to society, now

Lecture 1 needed for evaluation in lecture 2
Tore Audun Hie
Homework for lesson 2

Look up Pfizer on Internet. What do they do, and how big are
they? What does their website say about social responsibility and
ethics? Do they mention a recent fine? What were they fined,
and why? What happened to the Pfizer CEO, and why? Is it
easy to find this information? What is your evaluation of their
social responsibility?

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Lecture 2 Ethical transgressions (and crimes)

The lecture will present some transgressions
that are typical of today's business and
political environment, and attempt to indicate
trends and need for action.

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Categories of ethical problems

Poor quality
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Philosophical problems

Beliefs (axioms) not clearly expressed
Not defining, or defining poorly (example CRM)
Belief that microoptimisation gives macrooptimisation
Optimisation instead of satisfiation (Herb Simon)
Overall effects seldom evaluated (like competence, motivation)
Transactions instead of relationships (and trust)
Hierarchic structures, top down
Money only, and often short term
Quality and service ignored or downplayed, including data

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An important professional problem:

An ICT system supporting other coordinating ideals than
those wanted, can have a contraproductive effect

Koordination och informationssystem i fretag och ntverk. PhD thesis. Ulf Melin, Linkping Universitet 2002.

- you buy the supplier's assumptions
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Consequences customer:

Need clear expressions of own position

Need to communicate to supplier

Need to check that supplier has understood

Need to evaluate any deviation from own norm

Need to reevaluate own position, perhaps every year

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Consequences supplier:

* Need to know customer values

* Need to know own values, and reflect on them

* Need to adapt to customer needs, if not in line with
own values

* Need to inform customer if values unethical or
not sustainable

I.e. Supplier depends to some extent on customer values
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Ethical problem in ICT

Texas University found inaccuracy problem 2003.
Supplier Dell answered that machines were overtaxed.
Later, leaky motherboards was found to be the cause.
Dell attempted to hide the problems, even for own staff.
Not even Dell lawyers were helped.

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Consequences of Dell problem

Motherboard production was outsourced, what responsibility
remained with Dell?

Non-openness may have contributed to problem.

No big fine, no repercussions from professionals, is that ethical?

Dell was darling of business schools, have they updated

- And Dell was also fined for accounting fraud.

Dell boss was replaced.
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Conclusion from many ICT problems

Many ethical challenges within ICT
Many unreflected projects
Knowledge is sometimes incomplete or missing
ICT as a knowledge discipline needs refinement
Philosophy may have a major positive effect on ICT

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Damning BP verdict points to cost cuts
Years of cost-cutting and lack of investment led to BP's
Texas City refinery fire that killed 15 workers, a watchdog
has said
An ad from 1999:
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BP Alaska

BP fined in 1999 for offshore dumping, agreed to probationary

Pipe corrosion widespread, formal warnings in 2002 and 2004

Oil leak in Prudhoe Bay 2006, inspectors found several miles of
bad corrosion.

Engineer fired for corrosion warning, case pending 2010

Four more accidents 2008-2009

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BP Macondo field

Explosion 20 April 2010, 11 persons died

Blowout preventer did not work, remote blowout preventer not

BP was in charge of the drilling, Transocean owned the drill,
Halliburton cemented well. Uncertainty about accountability.

Several decisions regarding drilling, cementing and technology
solutions influenced by cost and time considerations.
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BP Norway

Fire 13 July 2011. Nobody hurt, but work stalled for weeks.

Petroleum Safety Authority Norway says reason was poor
maintenance, 10 issues were outstanding and not amended.

A general problem in the North Sea is ageing equipment.

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The trade organisation:

In May 2011 the American Petroleum Institution had the following
statement on its website:

when spills occur, the United States employs world-leading
preparedness planning and response capabilities to minimize
environmental harm.
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General consideration, perhaps valid outside oil:

Safety downprioritized (and not even well understood)

Maintenance not done till too late

Prioritizing cost (and time)

Short term perspective, little reflection

A pervasive culture, that is difficult to change

Regulations weak and sometimes not observed

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Fake medical journals

In a law suit in Australia 2009 it became known that the
publisher Elsevier, and the Pharma company Merck had
cooperated to publish the Australasian Journal of Bone and
Joint Medicine (AJBJM), the journal is apparently dedicated to
promote Merck products.

The AJBJM was distributed to 20000 doctors, it is unclear to
what extent they believed the journal was authentic.

Later 8 further fake journals were found. Elsevier refuses to
inform who paid.
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Elsevier's viewpooint

Elsevier has officially regretted the incidents, and have
apparently reformed:

We are committed to ensuring that advertising, reprint or other
commercial revenue has no impact or influence on editorial
decisions. ( january 2011)

In addition, Elsevier will work closely with other publishers
and industry associations to set standards for best practices on
ethical matters, errors and retractions--and are prepared to
provide specialized legal review and counsel if necessary.
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Merck's viewpoint

The journal promoted Merck's product Vioxx for uses that it
was not approved for.

This has caused personal problems and perhaps death of

Merck failed to share research showing the dangers of Vioxx.

Merck lawyer became the new boss.

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Book viewpoint:

In a new book, All The Justice Money Can Buy, former National Public Radio
reporter Snigdha Prakash, who was embedded with a team of plaintiffs lawyers
for one of those trials, describes legal machinations, strategies and battles that
eventually led Merck to reach a $5 billion settlement
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Professional viewpoint

Merck has been a generous supporter of medical personnel
especially nurses.

Merck paid nurses to provide potential patients for Vioxx

Merck apparently drew up a hit list to neutralize or
discredit personel criticizing Vioxx (The Independent 6 March

It is difficult to find criticism from professional organisations

Little media coverage, especially in the US

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Finance crisis

In 2006 speculators started to withdraw from overheated US
housing market.

Banks offered better terms, for instance No Income, No Assets
loans, later called NINJA loans.

Loans were bundled into instruments that were quality
controlled by credit rating agencies and sold to other banks.

In 2009 the International Monetary Fund estimated that the
cumulative losses of banks and other financial institutions
exceeded 4 trillion US dollars

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Professional issues

Risk management raised issues, and was overridden due to
market and money considerations.

Credit rating was paid by customer banks,

Auditors apparently did not point to problems

Boards did not intervene

Bonuses were based on efficiency, ability to handle large
amount of loans

Financial models did not forecast crisis, and one was called a
receipe for disaster

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Ethical problems

The overwhelming emphasis on money

Risk and safety downprioritized

Employees doing their duty acted unethically unknowingly

Recruiting finding the wrong people

Naysayers ignored

Nobody looking after the financial system, a meta-issue

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The Arab Spring and ethical reflection

The Arab People did not have (Ali Kadri 2011, London School
of Economics):

* Full sovereignty over natural resources, including self-
determination and popular participation in development;
* The right to work;
* Equality of opportunity, which is preceded by equality of
* The creation of favourable conditions for the enjoyment of
other civil, political, economic, social and cultural rights;
* Peace and security are essential elements for the right to

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Some Arab countries have oil. In 2009 it constituted 40% of Arab
GDP. Despite the high price of oil 2003-2010 poverty levels rose,
income inequality widened and unemployment rates responded
poorly to economic growthslightly more than fifty percent of the
population subsists at below two dollars per day. (Ali Kadri 2011).

The general problem is according to Ali Kadri that the ruling elite
derive the benefits, and for their own good, with few trickle down
effects. The estimated excess savings are estimated at some five
trillion dollars over 40 years, invested abroad, mostly in US
treasury bills.
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Ethics Western Powers before Arab Spring

* Supporting some autocrates, even financially

* Exporting weapons to the autocrates

* Establishing and running business in autocratic countries

* Only 6 countries helped the rebellion in Libya

* UK accused of returning terrorists to Ghadaffi

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To play Hardball means being aware of when you are entering
the caution zone - that area so rich in possibility, that lies
between the place where society clearly says you can play the
game and the place where society clearly says you cannot

Fakes are an accepted part of business life and good fakers are
to be admired.

General Motors is admired.

Stalk, George & Lachenauer, Rob Hardball. Harvard Business School Press 2004.
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Ethical view

Bordering on the unethical (Financial Times)

Close to find-the-loophole management

The manager will be busy with law and borderline issues,
forgetting strategy (like GM).

Extreme emphasis on competition, with quality, risk and
ethics not in index.

Written by two Boston Consulting Group consultants (but the
BCG has changed views according to the website).
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Reasons for disaster (engineering)

1. Poor design (not necessarily bad design)
2. Shoddy maintenance
3. Insufficient, illegible or unavailable documentation
4. Incompetent staff, misunderstandings, tiredness
5. Insufficient training
6. No or little testing of disaster situations
7. Failing measurements, or failing to measure
8. Failing communications
9. A non-quality culture, obedience, fear of speaking up
10. Organisation failures
11. Time constraints, sometimes political
12. Budget constraints, cost cutting

Chiles, James R. Inviting Disaster. HarperBusiness 2001
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Overall disaster conclusions (Chiles 2001)

All disasters had more than one cause

All disasters gave prior warnings

Lack of training central
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Summing up chapter

* Many transgressions (only few covered here)

* Money considerations very important (Financial Times
uses the expression greed in Capitalism in Crisis
January 2012)

* Risk and safety downprioritized, sometimes ignored

* Professionalism and Reputation apparently not important

* Reflection not widespread, perhaps even in academia.

* Enormous losses, even financially, and sometimes
a threat to society.

Tore Audun Hie
Case for technologists:

ISO 22000 Provenance
Following foods from source to delivery
Follow up processing of foods
Determine age of foods
Presenting history and origin (for repeat sales)
-and should this be limited to foods?

Select a food, and describe how you would implement an ICT
system. Will this lead to increased or decreased sales? How is
this related to ethics?

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It is he who knows the whatness of the
thing who has understanding in the
highest degree

Happiness is a virtuous activity of the soul

Moral virtue is a mean (or balance)
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Homework for lecture 3

Who was Aristotle? When and where did he live?

Name at least two major books that he authored.

What life views did he have?

What can he teach us?

Name at least two other philosophers from the same period, and
their influence today

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