Innovation, Ethics & Values

Chris MacDonaldBy Chris MacDonald

Innovation is an ethical matter through and through, because ethics is fundamentally concerned with anything that can promote or hinder human well-being. So ethics is relevant to assessing the goals of innovation, to the process by which it is carried out, and to evaluating its outcomes.

Let’s start with goals. Innovation is generally a good thing, ethically, because it is aimed at allowing us to do new and desirable things. Most typically, that gets expressed in the painfully vague ambition to ‘raise productivity.’ Accelerating our rate of innovation is a worthy policy objective because we want to be more productive as a society, to increase our social ‘wealth’ in the broadest sense.

Indeed, when looked at that way, innovation isn’t just a ‘good,’ but a downright moral obligation. Yes, lives for (most) people in developed countries are pretty good. But many still don’t have happy and fulfilling lives; many children, even here, still go to bed hungry. Boosting productivity through innovation is a key ingredient for making progress in that regard. And if less developed nations are going to be raised up to even a minimally tolerable standard of living, we need innovations that will help them, and we need innovations that will make us wealthy enough that we can afford to be substantially more generous toward them than we currently are.

Which brings us to ethical evaluation of the specific fruits of innovation. Some innovations are plainly good: they make human lives better in concrete ways. Penicillin was a very good innovation. So was the advent of the smartphone. Other innovations are less good: nuclear weapons are a clear candidate here, as perhaps are complex financial instruments such as derivatives, which Warren Buffet famously referred to as “financial weapons of mass destruction.”

The problem, of course, is that innovation brings risks. Some of those risks are of course borne by the innovator, by the entrepreneur. Others are borne by society. For one thing, we often don’t fully understand which category a particular innovation will end up in until years later. Is the net benefit of splitting the atom positive or negative? The jury is still out.

But ethical evaluation doesn’t just apply to individual innovations: systems of innovation bring a mix of risks and benefits. If we set ten thousand entrepreneurs loose on the world, and tell them (or incentivize them) to make something innovative that sells, some will bring us the proverbial ‘better mouse trap,’ and others will bring us video lottery terminals, biological weapons, and other bits of detritus that only serve to increase human suffering. If you give your tech company’s R&D department free reign, someone may invent the next ‘killer app,’ and someone else may simply crash your server. And the only way a system can preclude ‘negative’ innovation altogether is probably to discourage innovation altogether.

Hence the recent interest not just in innovation, but in managing innovation. The notion of managing innovation reflects the fact that innovation can be fostered — doing so is an obligation of ethical leadership — and is an activity rooted in creativity, not anarchy. So for practical purposes, the ethics of innovation ends up being a branch of the ethics of management and leadership. Organizations, from small teams to nations, face a range of ethical questions as a result. They need to figure out how much to spend on encouraging innovation, as compared to spending on existing programs. They need to figure out what combination of carrots and sticks to use to foster innovation. They need to figure out how much autonomy to give potential innovators, how much freedom to experiment. And finally, they need to figure out how to spread the risk of innovation, in order to make sure that risks and benefits are shared fairly, and to make sure that fear of risk doesn’t dampen our appetite for innovation. And all of those are fundamentally ethical questions.


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