ETHICAL DECISION MAK
Lessons’ Objectives
◦ Identify ethical behavior and m
ethics
◦ Define ethical dilemma
◦ Familiar with resolving dilemm
◦ Identify process of Ethical dec
making
Ethical Behavior
◦ Ethical behavior goes beyond th
requirements, as it concerns disc
decisions and behavior; in other
a business chooses to do, rather
is forced to do.
◦ Health ethics are relevant both to
conduct of an individual within an
organization and to the conduct o
organization as a whole.
Myths of Ethics
◦ It is a more religion than mana
◦ Our employees are ethical
◦ It is a discipline best led by ph
◦ It is a matter of good person p
bad persons
◦ It is a new police-person in org
◦ Ethics can't be managed
◦ Business ethics & CSR are sa
◦ We obey to law so no need ab
Ethical Dilemma
◦ There are situation when there
simple choice between write o
◦ Ethical dilemma is complex jud
the balance between the econ
performance and the social pe
of an organization.
Have two interests - cannot
without having negative impact o
Private Interest Conflicts with
Business Interest Conflicts with P
Ethical Dilemma
◦ E.g.
New house purchase by e
reach office fast meanw
considered to retrench.
When the both products are s
to justify your high price touc
of competitor
◦ An ethical dilemma exists whe
faced with having to make a ch
among following alternatives:
Significant value conflicts am
interests,
Real alternatives that are equally
Significant consequences on "st
the situation.
Characteristics of Dilem
◦ It have extended consequence
◦ It has multiple alternatives
◦ It have mixed outcomes
◦ It have uncertain consequence
◦ It have personal implications
◦ It is easy to make when a pers
directly involved
◦ Hence EDM are not simple ch
between right and wrong.
Paradigms of Dilemma
◦ Four such dilemmas are so co
our experience that they stand
patterns, or paradigms. They a
Truth versus loyalty.
Individual versus community.
Short-term versus long-term.
Justice versus mercy.
E
L
Classical Approach Reso
Dilemma
◦ Three approaches are facilitat
End-based thinking (utilitarianism
Rule based thinking
Care-based thinking (value to
relationships)
And Virtue ethics - instead u
execute as an alternative wa
Here action is considered m
if in carrying out the action.
Nine ways to Resolvin
Dilemma
◦ Rushworth Kidder
1. Recognize as moral issue an
problem accurately
2. Identify the affected by decision
3. Gather the facts how events hap
4. Test for right vs. Wrong issues
Nine ways to Resolvin
Dilemma
5. Test for right vs. right paradigm (t
6. Apply for the resolution principle
(end, rule, care)
7. Investigate if is any third way out
8. Make decision & take action
Whistle blowing
◦ It is methods can be contribute
identify and act of disclosing w
organization
◦ Like blowing a whistle to call a
thief or unethical practitioner
◦ But it is questionable when...
Dissent / disagree - Must spea
others in organization
Breach of Loyalty - Perceived
violates confidentiality and loyalty
Accusation - Singles out specific
threats to organization or the pub
Whistle blowing
◦ Care about whistle blowing
◦ Make sure situation involves a
threat to society or to the busin
◦ Document all allegations
◦ Examine internal whistle blowi
◦ Should you remain secret
Framework for Ethical De
Making
◦ Step 01: Describe the pro
◦ Step 02: Determine whether
ethical issue or an ethical dilem
◦ Step 03: Identify and rank the
and principles
◦ Step 04: Gather your infor
◦ Step 05: Review any applicab
Ethics
◦ Step 06: Determine the op
Framework for Ethical De
Making
◦ Step 07: Select a course o
◦ Step 08: Put your plan into
◦ Step 09: Evaluate the resu
Don’t forget!
◦ Step 10: Submit cases to you
review team or board regularly
Effects of Ethical/Unethic
Unethical
Reduces Eff
Effective
Production
Reduces c
Perform
Reduces
Standard of L
being, and P
Behavior
Ethical Behavior
Increases Efficiency and
Effectiveness of
Production and Trade
Increases Company Performance
Increases National
Standard of Living, Wellbeing, and Prosperity.
Utilitarian Rule
An ethical decision should produce
the greatest good for the greatest
number of people
Moral Rights Rule
Rules for Justi
An ethical decision should
maintain and protect the
Ethical An ethical d
distribute be
fundamental rights and
privileges of peoples.
Decision among pe
equitable,
Making. ma
Practical rule
An ethical decision should be one that
a manager has no hesitation about
communicating to people outside the
company because the typical person in
a society would think the decision is
acceptable.
Ethical Decision Making
Approaches
1) Utilitarian Approach – Moral
produces the greatest good
greatest number
2) Individualism Approach – Ac
moral when they promote the
individual’s best long-term in
which ultimately leads to the
good.
Ethical Decision Making
Approaches
3) Moral – Rights Approach dec
those that best maintain the
those people affected by the
4) Justice approach – Moral De
must be based on standards
fairness, impartiality
Three Types of Justice
◦ Three types of Justice Appro
Distributive Justice – In case of s
differences, people should be
treated differently in propo
differences among them
II. Procedural Justice – Rules sh
clearly stated & consistently a
enforced
III. Compensatory Justice –Indiv
be compensated for the cost of th
the party responsible.
Ethical Test
1. Is it Legal
2. Benefit Cost Test
3. Categorical Imperative
4. Light of Day Test
5. Do onto Others Test
6. Ventilation Test
Is It Legal
1. Is It Legal
Ethical – Legal
Ethical-Illegal II
Unethical – Legal III
Unethical – Illegal IV
◦ I and IV
◦ II and III Difficult
Ethical
• Quadrant II •Q
• Ethical and •E
Illegal L
Codification
Manifestation
Illegal
Corporate
Decisions
• Quadrant IV •Q
• Unethical •U
and Illegal a
Unethical
Benefit & Categorical
Imperative
2.Benefit Cost Test
Do the benefits exceed the costs
whomsoever they accrue?
3.Categorical Imperative
Are you willing to allow to everyon
the proposed action or do you wa
special case?
Light of Day & Do onto
4.Light of Day Test – What w
your reaction if the action we
out into the open for public s
5.Do onto Others Test – Go
If you would like others to d
to you - passes the test
6.Ventilation Test – Seek ou
views. Discuss the 5 tests w
others feel it is OK – passes
A Venn Diagram Model f
Ethical Decision Making
Area 1
Profitable
legal, ethical, G
o for it
Ethical
Area 2a Responsibility
Profitable and
legal, Proceed
cautiously
2b 3
1
Economic 2a Legal
Responsibility Responsibil
THAN
YOU
