Ethical Decision Making

Satish. S
Institute of Management in Kerala

Let's Start With "What is ethics?" Simply put, ethics involves learning what is right or wrong, and then doing the right thing -- but "the right thing" is not nearly as straightforward as conveyed in a great deal of business ethics literature. Most ethical dilemmas in the workplace are not simply a matter of "Should Boss steal from Jack?" or "Should Jack lie to his boss?" The concept of business ethics has come to mean various things to various people, but generally it's coming to know what it right or wrong in the workplace and doing what's right -- this is in regard to effects of products/services and in relationships with stakeholders. Ethics, this is one of the most commonly debated topics in management. A lot of people have come up with many ideas on ethics. Business people often face difficult ethical dilemmas. In this highly competitive business world, it's always difficult to succeed in a very good manner. Following ethical behaviors in between this is yet another difficult task. Yet, we have many good examples to quote, which states the effect on companies who follow ethical behavior. Here we are discussing certain approaches that business owners can use to consider ethical questions.


The utilitarian approach focuses on the decision or action that will result in greatest good for greatest number of people.

Moral Rights:

The moral rights approach concerns itself with moral principles, regardless of the consequences. Under this view, some actions are simply considered to be right or wrong. From this standpoint, if paying extremely low wages is immoral, your desire to meet the competition and keep your business afloat is not a sufficient justification. Under this view, you should close down your business if you cannot operate it by paying your workers a "living wage," regardless of the actions of your competitors.


The universalist approach to ethical decision making is similar to the Golden Rule. This approach has two steps. First, you determine whether a particular action should apply to all people under all circumstances. Next, you determine whether you would be willing to have someone else apply the rule to you. Under this approach, for example, you would ask yourself whether paying extremely low wages in response to competition would be right for you and everyone else. If so, you then would ask yourself whether someone would be justified in paying you those low wages if you, as a worker, had no alternative except starvation.


Under the cost-benefit approach, you balance the costs and benefits of taking versus not taking a particular action. For example, one of the costs of paying extremely low wages might include negative publicity. You would weigh that cost against the competitive advantage that you might gain by paying those wages.

10 Myths About Business Ethics

1. Myth: Business ethics is more a matter of religion than management. Diane Kirrane,
2. Myth: Our employees are ethical so we don't need attention to business ethics.
3. Myth: Business ethics is a discipline best led by philosophers, academics and theologians
4. Myth: Business ethics is superfluous -- it only asserts the obvious: "do good!"
5. Myth: Business ethics is a matter of the good guys preaching to the bad guys.
6. Myth: Business ethics in the new police person on the block.
7. Myth: Ethics can't be managed.
8. Myth: Business ethics and social responsibility are the same thing
9. Myth: Our organization is not in trouble with the law, so we're ethical
10. Myth: Managing ethics in the workplace has little practical relevance.


 In our complex global business climate, ethical decision making is rarely easy. However, as a business owner, you have several models available for analyzing your ethical dilemmas. Sometimes one approach will be more appropriate than another. If you take time to consider the various possibilities, you are more likely to make a decision you believe is ethically correct.

Satish. S
Institute of Management in Kerala

Source : E-mail April 3, 2005



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