Ethics of Self-Interest: Ethical Egoism

Egoism is one of the oldest philosophical ideas. It was already well known and discussed by ancient Greek philosophers such as Epicurus, but it has a troubled history. There is real controversy around whether egoism has a place among ethical theories. Whereas the other Western modernist theories we address here are pretty standard in business ethics textbooks, ethical egoism quite often does not get mentioned at all, and is dismissed implicitly as offering no ethical insights of value. The controversy lies in the focus in egoism on self-interest, such that the only obligation for a person, or by extension a business, is self- promotion.

Psychological egoism focuses on self-interest as a type of motivation that is the explanation of human conduct. Here we are more concerned with ethical egoism. In an early narrow perspective on this, Greek philosopher Epicurus was an example of a hedonist, being of the view that pleasure is the ultimate good and should be pursued for its own sake. This, however, is just one version of egoism.

The most commonly acknowledged protagonist of ethical egoism is probably political philosopher Thomas Hobbes. He had a rather pessimistic view of human nature, such that without strong preventative measures, he believed that in a state of nature (society without any systems, controls, or government), anarchy and chaos would result. In one of his key texts, Leviathan, he called this ‘the war of all against all’. This may seem fanciful, but it is worth remembering that he was deeply influenced by the violence of the English Civil War in the 1640s, during which it must indeed have seemed that everyone was against everyone else. Ultimately, Hobbes argued that it was best for everyone—every individual’s self-interest —to be governed by some impartial rules. We will come back to this later, but for now, Hobbes’ contribution to understanding ethical egoism is that no person has a moral obligation to others beyond things which serve their own interest.

A more recent but no less controversial protagonist of ethical egoism is Ayn Rand. Diametrically opposed to altruism, she believed ferociously in individualism as being at the heart of every human being. According to Ayn Rand, who grew up during the Russian Revolution before emigrating to America, objectivism is key to ethics and we are each responsible for our own happiness, self-development, and self-perfection. Rand promoted the idea of a virtue of selfishness (she was also influenced by Aristotle, who we will come to later).

Moving closer to the field of business, other writers, such as the economists Adam Smith and Milton Friedman, have somewhat retrospectively been associated with egoism via their defences of capitalism and the free market, though this again is disputed. Friedman promoted the idea that the responsibility of the business leader is to fulfil fiduciary duties to shareholders (‘the business of business is business’ . Smith, who was also a philosopher, believed in freedom and cooperation to ensure flourishing. He argued that this results in the promotion of the public good, as long as there are sufficient rules to protect the public, and that we can each participate in a coherent society. Leading business ethics protagonist on the work of Adam Smith, Patricia Werhane, has argued convincingly that by understanding his economic work, The Wealth of Nations, alongside his philosophical work, The Theory of Moral Sentiments, we can understand his approach as inherently social, whereby we are each accountable to,

Ethical egoism A theory that suggests that an action is morally right if in a given situation all decision-makers freely decide to pursue either their (short-term) desires or their (long-term) interests.