Ethical Decision Making

The Decision Making Process

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 The Ethical Decision Making Process

In business, people make decisions

differently than at home
 Organizational pressures have a strong influence
 The ethical decision making process includes
 Ethical issue intensity
 Individual factors
 Organizational factors
 The framework for ethical decision making does
not describe how to make ethical decisions
 Outlines the factors and processes related to ethical
decision making
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 Framework for Understanding Ethical
Decision Making in Business

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 Ethical Issue Intensity
The perceived relevance or importance of
an ethical issue to the individual, work
group, and/or organization
 Reflects the ethical sensitivity of the individual
and/or work group
 Triggers the ethical decision making process
 Individuals are subject to six spheres of influence
Workplace Legal system
Family Community
Religion Profession

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 Individual Factors
People base their ethical decisions on their own
values and principles of right or wrong
 Values are learned through socialization
 Good personal values decrease unethical behavior and
increase positive work behavior
 Values are subjective; vary across cultures
 An organization may intend to do right, but
organizational or social forces can alter this intent
 Research shows that various factors influence
ethical behavior
 Gender–women are more ethical than males
 Education, work experience, nationality and age affect
ethical decision making
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 Locus of Control

Relates to individual differences in relation

to a general belief about how one is
affected by internal versus external events
or reinforcements
 Managers with
 External locus of control go with the flow because
that’s all they can do
 Internal locus of control believe they can control
events; are masters of their destinies and trust in
their capacity to influence their environment

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 Organizational Factors

Organizational culture has a stronger

influence on employees than individual
values
 Corporate culture: A set of values, norms, and
artifacts that members of an organization
share
 Ethical culture: Reflects whether the firm has an
ethical conscience; is a function of many factors
 Significant others: Those who have influence in
a work group
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 Conflicts Over Privacy in the Workplace
• There is tension between companies and their employees over privacy
in the workplace. Some companies track employees via company-
issued GPS-enabled smartphones and monitor employees’ behavior
through social networking sites such as Facebook and Twitter.
• Currently, there are no laws preventing companies from monitoring
and tracking employees. Companies believe not monitoring these
platforms leaves them vulnerable to misconduct. For instance, the
Internet increased the number of distractions in the workplace, and
some employees may spend up to 30 percent of their time at work
using social media sites for non-work purposes.
• On the other hand, employees argue they have a right to their privacy.
They see tracking as a clear sign that their employers do not trust
them. Another major argument is that employers with access to
employee social media sites or smartphones might be able to monitor
employee activity outside the workplace. Where is the line drawn on
ensuring employees are working appropriately versus their rights to
privacy?

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 Questions?
1. Companies should have the right to track
employees through company smartphones
and monitor their personal Facebook and
Twitter accounts.
2. Employees should be able to maintain their
personal privacy and not be tracked through
their company smartphones or their
Facebook and Twitter accounts.

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 Opportunity

The conditions in an organization that

limit/permit ethical/unethical behavior
 Immediate job context: Where employees
work, with whom they work, and the nature of
the work
 Opportunities for misconduct can be reduced
by establishing formal codes, policies, and rules
 Aggressive enforcement is required

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 Office Supplies Reported Missing Most
Often

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 Business Ethics Evaluations and Intentions

Ethical dilemmas involve situations where

rules are vague or in conflict
 Critical thinking skills and ability to take
responsibility are important
 The final step is deciding what action to take
based on a person’s intentions
 Guilt or uneasiness is the first sign that an
unethical decision has occurred
Most businesspeople will make ethical
mistakes
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 Using the Framework to Improve Ethical
Decisions

Impossible to objectively determine if a

business decision is right or wrong
 Understanding how ethical decisions are made
will not solve ethical problems
 Business ethics involves value judgments and
collective agreement about acceptable patterns of
behavior

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