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Ethical decision making in business : 

Ethical decision making in business

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Ethical Models that Guide Decision Making Rights Theories : were advocated by Immanuel Kant and based on the view that ethical decisions should protect the legal and moral rights that an individual is entitled to by the Law . Justice Theories: were originally advocated by Greek philosophers and more recently by Rawl, and is based on the view that ethical decisions should result in a situation where all human beings are treated equally, and in case some are treated unequally, it must be based on some defensible reasons.

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Ethical Models that Guide Decision Making (Contd.) Utilitarianism : Advocated by Adam Smith, David Ricardo, Jeremy Benthem and John Stuart Mill, this theory employs a teleological approach to ethics and asserts that behaviour or actions should be evaluated in terms of their consequences not by the means.. The Virtue Approach It advocates that ethical actions should be consistent with certain morally acceptable virtues that would pave the way for full development of humanity.

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Ethical Models that Guide Decision Making (Contd.) The Common Good Approach: It underlines the societal view that life in a community is good in itself and that it is every person’s moral responsibility not only to contribute, but also to enrich it.

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Ethical Decision Making with Conflicts and Competition Barry proposed the following decision making rules regarding cases of conflicts and mixed effects: Choose the more important obligation between two or more conflicting obligations Choose an action of higher ideal when two or more ideals conflict or when ideals conflict with obligations Choose the action that produces the greater good, or the lesser harm, when the effects are mixed.

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INFLUENCES ON ETHICAL DECISION MAKING There are three major influences that have an impact on an employee’s decision making in business – his personal moral standards, his workplace ethics and culture, and the nature of the issue concerned.

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Personal Values and Ethical Decision Making For an individual to be considered as an ethical decision maker, he needs to build and develop certain values. The Josephson Institute of Ethics proposed the following Six Pillars of Character: Trustworthiness Respect Responsibility Fairness Caring and Citizenship

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Corporate Values and Ethical Decision Making A corporate culture can be defined as “a set of values, beliefs, goals, norms and ways of solving problems” that an organization’s employees share and live up with in their work environment. It involves certain prescriptions of behaviour the organization’s employees are expected to follow.

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A FRAMEWORK OF ETHICAL DECISION MAKING Michael Josephson has constructed the following components of good choices: 1. Take Choices Seriously 2. Good Decisions are both Ethical and Effective 3. Judgment and Discipline

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The Process of Making good Ethical Decisions The process one has to follow to make good ethical decisions is:- 1. Recognise and identify the kind of ethical issue you need to resolve Recognise the ethical issue, seek answers to questions such as the nature of the issue, the conflict it has raised and how the decision would impact the larger community.

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The Process of Making good Ethical Decisions (Contd.) Pause and Think Pause for sometime on the ethical issue; think ahead, reflect on the consequences that are likely to follow.

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3. Make Sure of Your Goals Be clear on goals, both short-term and long-term, weigh options clearly The Process of Making good Ethical Decisions (Contd.)

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Get Your Facts Right Gather all facts concerning the issue Verify the uncertain facts Get additional information The Process of Making good Ethical Decisions (Contd.)

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Evaluate choices from Different Ethical Perspectives Make a list of options that attempts to accomplish the goal. Test each option against various ethical perspectives such as rights, justice, virtue or common good Find out which option will produce the most good and do the least harm to others. The Process of Making good Ethical Decisions (Contd.)

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6. Consider the Consequences Ensure that there is no unethical option See that your option is consistent with all core ethical values Analyze the possible consequences of each of the options for each stakeholder Ensure that the end result causes more good than any harm The Process of Making good Ethical Decisions (Contd.)

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6. Consider the Consequences….. Identify the stakeholders who are likely to be impacted by the decision Find out what important stakes individuals and groups have, in the outcome Find out whether some individuals have a greater stake because they have a special need or because we have special obligations to them. THE PROCESS OF MAKING GOOD ETHICAL DECISIONS (Contd.)

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Make a Decision Prepare a criteria derived from the facts gathered. Create a decision criterion including the financial outcome, if any. Rate the appropriate action against your list of criteria. Talk to a person whose judgment you respect. The Process of Making good Ethical Decisions (Contd.)

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8. Act, then Reflect on the Decision Later Implement the decision Evaluate the consequences. The Process of Making good Ethical Decisions (Contd.)