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Utilitarianism in Asian Business

Table of Contents

Introduction
Utilitarianism in Capitalistic System
Examples of Indian and Chinese Corporations
Conclusion
References

Introduction

Being the largest and most diverse region of the world, Asia varies in the forms of business ethics practices by the corporations. Some countries in the region are highly influenced by the colonization and spread of Western principles, which introduced them to the idea of utilitarianism. These influences then spread to all parts of society, including business. One of these countries is India, about which Mill, the original creator of utilitarianism, wrote in his works. Thus, Indian corporations reflect the countrys journey of dealing with utilitarianism. However, the most prominent and interesting example is China, as it operates on a different ideology, compared to most of the region. Despite this difference, the governments policies remain the main foundation of utilitarianistic direction in corporations development. The main reason for this trend is the capitalistic nature of business across Asia. Therefore, the corporations in Asia use utilitarianism in the context of these policies, as their primary goal is to comply with the law.

Utilitarianism in Capitalistic System

To understand how Asian corporations apply the principles of utilitarianism, it is important to analyze the economic conditions for the operation of businesses. The major economic principle across the world and Asia is capitalism. The underlying goal of capitalism is unlimited growth. Therefore, businesses generally focus on growing their financial profits above any other consideration to be vital in this system. However, this aim can be in contradiction with the idea of utilitarianism, which seeks to maximize happiness in society (Lee & Chu, 2021). In other words, higher financial profits cannot sometimes translate to greater levels of happiness (Bennison-Chapman, 2019). The predominant factor of this conflict is the negative externalities or effects that some decisions to maximize profits can have on overall societal happiness. These factors can include pollution, unfair treatment of employees, and other consequences. For example, pollution can make the company greater profits, but it will minimize happiness, as the effects of pollution will start to negatively influence the environment and peoples health. Therefore, corporations use utilitarian principles for their Corporate Social Responsibility Programs (CSRP) to the extent it benefits them financially.

To protect citizens well-being, the government crafts policies to prevent these negative outcomes, mandating certain behavior from corporations. This mandate, in turn, shapes the corporations direction, development, and goals. The state would usually directly require the companies the contribution of the profit percentage toward CSRP. A more indirect mandate is connected to the existing environmental policies, which can limit pollution. Thus, the corporations reflect their governments goals, as they comply with their utilitarian regulations.

Examples of Indian and Chinese Corporations

Corporations in India generally apply the principles of utilitarianism in the context of governmental policies. Jain (2020) argues that, without government intervention, corporations are unlikely to contribute to CSRP, which is based on utilitarian ideals. Furthermore, the corporations only pretend to promote CSRP to benefit from the publics recognition and consequential increase in profits (Yi & Nataraajan, 2018). Jain (2020) provides the example of a 2 percent requirement to illustrate this conclusion. Since the Indian government created a policy that mandates 2 percent of the profit to go to CSRP, the number of NGOs and level of social entrepreneurship increased dramatically. Previously, most of these ventures were ignored by corporations and remained underfunded. One example of such a corporation is Godrej Consumer Products Limited (GCPL), one of the biggest contributors to CSRP. Since the implementation of the law, GCPL financed many vulnerable communities initiatives and increased its compliance with Extended Producer Responsibility, taking back all the waste it produced. Therefore, the correlation between governmental policies and the implementation of utilitarian principles is essential in India.

Compared to India, the Chinese governments mandates on the application of utilitarian ideas are more direct and strict. The main difference between countries is their ideology and state structure. China is a communistic state with the primary goal of equality in benefits to each individual. Thus, the Chinese state demands compliance from the companies to achieve its objectives. In other words, ideally, the Chinese government wants to see the advantages going not to the corporation but evenly spread throughout society.

Equality does not sometimes mean growth and an increase in happiness. Thus, the Chinese government invests heavily in the industries, which it believes, will benefit society. One such recent industry is Artificial Intelligence (AI). Chinese state claims that AI will benefit society and humanity greatly, as it remains the biggest investor in its development (Kshetri & DeFranco, 2020). China-based DJI corporation takes up almost 70 percent of the AI sector. DJI is determined to contribute to the state and citizens based on its understanding of utilitarian principles. However, this Chinese understanding of utilitarianism is questionable, as the country is plagued with corruption and forceful restriction of civil activity (Zhang, 2020). From the point of view of the Chinese government, AI can increase happiness by preventing perceived negative outcomes, including crimes and non-compliance with the states ideology. On the other hand, it can lead to increased unhappiness, as Chinese citizens political freedom becomes more restricted. Nonetheless, DJI embraced these ideas and became a tool for the Chinese state to achieve its objective.

Conclusion

The implementation of utilitarian principles by corporations in Asia mainly depends on governmental policies. The major reason for that trend is the nature of capitalism that prioritizes financial profits. Thus, companies directions in utilitarianism are primarily connected to the mandates and ideology of the state. In other words, the actions of the companies are defined by the states interpretation of utilitarianism. As in the example of India, it can increase a contribution to CSRP. On the other hand, in China, it can lead to unintended increased restrictions on political freedom.

References

Bennison-Chapman, L. E. (2019). Reconsidering Tokens: The Neolithic Origins of Accounting or Multifunctional, Utilitarian Tools?. Cambridge Archaeological Journal, 29(2), 233-259. Web.

Jain, H. (2020). Mandatory corporate social responsibility: a utilitarian and deontological perspective. Open Journal of Business and Management, 8(5), 2278-2284.

Kshetri, N., & DeFranco, J. F. (2020). Is Privacy Dead? IT Professional, 22(5), 4-12. Web.

Lee, J., & Chu, W. (2021). The effect of adding novel attributes to hedonic vs. utilitarian base: Role of holistic vs. analytic thinking style. Asia Marketing Journal, 23(2), 1. Web.

Yi, Y., & Nataraajan, R. (2018). Customer satisfaction in Asia. Psychology & Marketing, 35(6), 387-391. Web.

Zhang, W. (2020). Reform Philosophy Must Transition from Utilitarianism to Rights-Priority. In Ideas for Chinas Future (pp. 243-249). Palgrave Macmillan, Singapore. Web.

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