Deontological ethics and Kant's Categorical Imperative in business practice

KANT

Deontological ethics suggests that there are certain moral principles which are so important that one should follow them as if setting a moral law for all time. Kant formulated his categorical imperative to suggest that there are some transcendent moral laws that are applicable to all situations, and cannot be waived no matter how dire the consequences (Kant and business ethics, 2013, RS). Anticipated positive consequences, according to deontological ethicists, do not excuse immoral or questionable behavior.

Kant's ethical notions contradict many accepted notions of firm behavior. For example, it is largely accepted that an organization has an obligation to make a profit to enrich its shareholders. Some business ethicists consider it immoral to take shareholder money and use it to engage in ethical initiatives because that is using other people's investment capital to satisfy the manager's own personal sense of morality. In Kant's view, however, if every entity put profitability first and foremost, this would create an immoral world which would ultimately be unsustainable.

I experienced a Kantian ethical conflict when asked by a friend of mine for some investment advice. He was considering investing in some stocks and mutual funds, thanks to a small inheritance he had recently acquired. However, many profitable investment opportunities involve companies which engage in immoral actions, such as cigarette companies which create a product that is destructive to human life. My friend, upon reviewing possible stocks, found virtually every possible option lacking in some fashion. Gas and oil companies are destructive to the environment; fast food companies create a product which causes obesity; discount clothing companies sell a product that is produced in sweatshops; 'big box' stores like Wal-Mart and Target hire workers for very low wages and pay them very little to keep prices down.

However, the alternatives to investing in these companies were not nearly as profitable. My friend could ignore conventional wisdom and 'put all of his investment eggs' in one basket and focus only on environmentally pure companies that were relatively untried and untested or he could opt for more blue chip stocks which seemed in his better self-interest. Kant would no doubt advise him to invest in the more morally pure stocks. However, Kant's lack of focus on consequences was troubling for my friend, given that it seemed a more risky strategy.

Although it is difficult to predict market development regardless of what stocks or mutual funds and investor selects, it is equally difficult to apply a purely moral calculus to evaluating stocks when risking money. Even companies which purport to be sustainable and green may have certain ethically questionable practices. Business by its very nature makes it difficult for a company to be 'pure' and to ignore its bottom line to satisfy certain ideals. However, there are companies with ethically ambitious vision statements like Starbucks, The Body Shop, Google, and Whole Foods, who at least try to balance ethics with profitability.