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Ethical nihilism is the supposition that any philosophical discussion of ethics and values is meaningless because of the observable fact of moral diversity and disagreements. (Thus, ethical nihilism is a thesis about the philosophical treatment of values, while nihilism is about knowledge and values themselves.) What can often be observed is that what some people perceive as “good,” others perceive as “evil,” and still others are indifferent to it (for instance, abortion, the death penalty, or stem-cell research). From that evidence, ethical nihilism takes a more radical step than ethical relativism, which only goes as far as postulating that ethics is ultimately relative to the moral agent or observer. Ethical nihilism argues that, in the end, nothing matters in the moral arena. Many ethicists argue that ethical nihilism is a consequence of subjectivism, the view that each individual is the sole authority concerning the selection and applicability of ethical principles.

Arguably, in everyday organizational practice, ethical nihilism may manifest itself in amoral management. Managers are said to act amorally when they are indifferent to ethical considerations in their decision making. But because ethical norms and rules are irrelevant to ethical nihilists, the typical outcome may also be immoral management, with its consequent violation of ethical principles. Immoral managers are continuously tempted to find loopholes in existing legislation to benefit themselves. This downward spiral from amorality to immorality and illegality is easy to understand with reference to, or in the context of, ethical nihilism. For if ethics were ultimately meaningless and irrelevant, nihilists would regard the law merely as governmental fiat without any compelling normative force.

It is important to keep in mind, though, that ethical nihilism has been considered a viable philosophical tradition. Among the world famous philosophers subscribing to (or at least often interpreted as subscribing to) ethical nihilism are some influential German philosophers of the 19th century. For example, Friedrich Nietzsche (1844–1900) called for the devaluing of old values, such as pity or compassion. After what he called the death of God, Nietzsche expected Western societies to pass through a transitional period of ethical nihilism until new values would be created. He was quite clear, though, that this nihilist period was a pathological yet necessary transition in his proposed “transvaluation” of values. Another German philosopher often considered an ethical nihilist is Arthur Schopenhauer (1788–1860), with his pessimistic philosophical views. However, such a view of Schopenhauer's moral philosophy is actually a misinterpretation because Schopenhauer was quite clear, in his book On the Basis of Morality, that compassion is the sole criterion of morally worthwhile actions. This book harshly criticized Kant's categorical imperative, but it cannot be considered nihilist because it ultimately substitutes a virtue ethic for Kantian deontology. In opposition to Schopenhauer, Nietzsche rejected any morally affirmative view of compassion and believed, more closely following a nihilist philosophical line than Schopenhauer ever did, that there could be no cultural or human progress without slavery or cruelty. (Nietzsche's approval of cruelty and slavery cannot easily be reconciled with the classification of Nietzsche as a virtue ethicist by some current scholars, although admittedly the ultimate outcome envisioned by Nietzsche may, in fact, be a particular antidemocratic type of virtue ethics.)

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