Cost-benefit analyses are helpful in getting the most bang out of a buck—but what really constitutes “cost” and “benefit”? When looked at from an ethical perspective, are businesses really doing enough when calculating costs?

Toyota issued a recall in 2010 for certain models. Allegations arose claiming that Toyota knew of the sticky gas pedals back in 2007 (http://www.reuters.com/article/2010/03/25/us-toyota-recalls-idUSTRE62O3HL20100325), or as early as 2003 (http://www.consumeraffairs.com/news04/2010/08/toyota_lawsuit.html).

Toyota received thousands of complaints before starting recalls. It’s not hard to guess why: to issue a recall of millions of vehicles would cost much more than paying for a couple of accidents, so they didn’t. The cost of a recall early on would be not worth the benefit.

And here lies the main ethical issue: how do companies include the unquantifiable in their cost-benefit analyses? Do they assign monetary value to lives and emotions? Should they always value life over money, no matter the amount? Both suggestions will cause problems to arise for both the consumers and the company. Assigning monetary value to lives and emotions wouldn’t be morally acceptable, and no amount would seem enough to a victim’s family. If life is always valued over money, the company would have a lot more to lose, thereby driving up the prices, which will also make consumers unhappy.

It’s a rock and a hard place.