Identify ethical behavior and myths of ethics Define the ethical dilemma Familiar with resolving the dilemma Identify the process of Ethical decision making

1. Topic :- Ethical Decision Making
1

2. Lessons’ Objectives
2
◦ Identify ethical behavior and myths of
ethics
◦ Define ethical dilemma
◦ Familiar with resolving dilemma
◦ Identify process of Ethical decision
making

3. Ethical Behavior
3
◦ Ethical behavior goes beyond the legal
requirements placed on a business, as it
concerns discretionary decisions and
behavior; in other words, what a business
chooses to do, rather than what is forced to
do.
◦ Business ethics are relevant both to the
conduct of an individual within an
organization and to the conduct of the
organization as a whole.

4. Myths of Business Ethics
4
◦ It is a more religion than management
◦ Our employees are ethical so no need BE
◦ It is a discipline best led by philosophers
◦ It is a matter of good person preaching to
bad persons
◦ It is a new police-person in organization
◦ Ethics can't be managed
◦ Business ethics & CSR are same thing
◦ We obey to law so no need about ethics.

5. Ethical Dilemma
5
◦ There are situation when there is not
simple choice between write or wrong
◦ Ethical dilemma is complex judgments on
the balance between the economic
performance and the social performance
of an organization.
 Have two interests - cannot purse one without
having negative impact on other
 Private Interest Conflicts with Corporate
 Business Interest Conflicts with Public.

6. Ethical Dilemma
6
◦ E.g.
 New house purchase by employee to
reach office fast meanwhile he is
considered to retrench.
 When the both products are same
quality to justify your high price touch
drawback of competitor

7. Cont...
7
◦ An ethical dilemma exists when one is
faced with having to make a choice
among following alternatives:
 Significant value conflicts among differing
interests,
 Real alternatives that are equally justifiable,
and
 Significant consequences on "stakeholders" in
the situation.

8. Characteristics of Dilemma
8
◦ It have extended consequences
◦ It has multiple alternatives
◦ It have mixed outcomes
◦ It have uncertain consequences
◦ It have personal implications
◦ It is easy to make when a person is not
directly involved
◦ Hence EDM are not simple choice
between right and wrong.

9. Paradigms of Dilemma
9
◦ Four such dilemmas are so common to
our experience that they stand as
models, patterns, or paradigms. They are:
 Truth versus loyalty.
 Individual versus community.
 Short-term versus long-term.
 Justice versus mercy.
Ethics and Sri
Lanka

10. Classical Approach Resolving
Dilemma
10
◦ Three approaches are facilitated
 End-based thinking (utilitarianism)
 Rule based thinking
 Care-based thinking (value to you or close
relationships)
 And Virtue ethics - instead upon
execute as an alternative way
 Here action is considered morally right
if in carrying out the action.

11. Nine ways to Resolving
Dilemma
11
◦ Rushworth Kidder
1. Recognize as moral issue and define the
problem accurately
2. Identify the affected by decision
3. Gather the facts how events happened
4. Test for right vs. Wrong issues

12. Nine ways to Resolving
Dilemma
5. Test for right vs. right paradigm (true vs...
6. Apply for the resolution principle
(end, rule, care)
7. Investigate if is any third way out of the
situation
8. Make decision & take action 12

13. Whistle blowing
◦ It is methods can be contributed to identify
and act of disclosing wrong in an
organization
◦ Like blowing a whistle to call attention to a
thief or unethical practitioner
◦ But it is questionable when...
 Dissent / disagree - Must speak out against
others in organization
 Breach of Loyalty - Perceived as one who
violates confidentiality and loyalty
 Accusation - Singles out specific individuals as
threats to organization or the public 13

14. Whistle blowing
◦ Care about whistle blowing
◦ Make sure situation involves an imminent
threat to society or to the business
◦ Document all allegations
◦ Examine internal whistle blowing first
◦ Should you remain secret
14

15. Framework for Ethical Decision
Making
15
◦ Step 01:
◦ Step 02:
Describe the problem
Determine whether there is
an ethical issue or an ethical dilemma
◦ Step 03: Identify and rank the key
values and principles
Gather your information
Review any applicable Code
◦ Step 04:
◦ Step 05:
of Ethics
◦ Step 06: Determine the options

16. Framework for Ethical Decision
Making
16
◦ Step 07:
◦ Step 08:
◦ Step 09:
Select a course of action
Put your plan into action
Evaluate the result
 Don’t forget!
◦ Step 10: Submit cases to your ethical
review team or board regularly for review

17. Effects of Ethical/Unethical
Behavior
Increases Efficiency and
Effectiveness of
Production and Trade
Increases Company
Performance
Increases National
Standard of Living, Well-
being, and Prosperity.
Ethical Behavior Unethical Behavior
Reduces Efficiency and
Effectiveness of
Production and trade
Reduces company
Performance
Reduces National
Standard of Living, Well-
being, and Prosperity.
17

18. Rules for
Ethical
Decision
Making.
Utilitarian Rule
An ethical decision should produce
the greatest good for the greatest
number of people
Justice Rule
An ethical decision should
distribute benefits and harm
among people in a fair,
equitable, and impartial
manner
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.
Moral Rights Rule
18
An ethical decision should
maintain and protect the
fundamental rights and
privileges of peoples.

19. Ethical Decision Making
Approaches
19
1) Utilitarian Approach – Moral behavior
produces the greatest good for the
greatest number
2) Individualism Approach – Acts are moral
when they promote the individual’s best
long-term interest, which ultimately
leads to the greater good.

20. Ethical Decision Making
Approaches
20
3) Moral – Rights Approach decisions are
those that best maintain the rights of
those people affected by them.
4) Justice approach – Moral Decisions
must be based on standards of
equity, fairness, impartiality

21. Three Types of Justices
21
◦ Three types of Justice Approaches:
I. Distributive Justice – In case of
substantive differences, people should be
treated differently in proportion to the
differences among them
II. Procedural Justice – Rules should be
clearly stated & consistently and impartially
enforced
III. Compensatory Justice –Individuals
should be compensated for the cost of their
injuries by the party responsible.

22. Ethical Test
22
1.Is it Legal
2.Benefit Cost Test
3.Categorical Imperative
4.Light of Day Test
5.Do onto Others Test
6.Ventilation Test

23. Is It Legal
23
I
II
III
IV
1.Is It Legal
 Ethical – Legal
 Ethical-Illegal
 Unethical – Legal
 Unethical – Illegal
◦ I and IV
◦ II and III Difficult

24. • Quadrant III
• Unethical
and Illegal
• Quadrant IV
• Unethical
and Illegal
• Quadrant I
• Ethical and
Legal
• Quadrant II
• Ethical and
Illegal
Codification
Manifestation
Corporate
Decisions
Ethical
Unethical
LegalIllegal
24

25. Benefit & Categorical
Imperative
2.Benefit Cost Test
25
 Do the benefits exceed the costs to
whomsoever they accrue?
3.Categorical Imperative
 Are you willing to allow to everyone to practice
the proposed action or do you want to be a
special case?

26. Light of Day & Do onto Others
26
4.Light of Day Test – What would be
your reaction if the action were brought
out into the open for public scrutiny
5.Do onto Others Test – Golden Rule –
If you would like others to do the same
to you - passes the test
6.Ventilation Test – Seek out others
views. Discuss the 5 tests with them. If
others feel it is OK – passes the test

27. A Venn Diagram Model for
Ethical Decision Making
Ethical
Responsibility
Legal
Responsibility
Economic
Responsibility
3
1
2a
2b
Area 1
Profitable
legal, ethical, G
o for it
Area 2a
Profitable and
legal, Proceed
cautiously
Area 2b
Profitable and
ethical, Probably
legal, Proceed
cautiously
Area 3
Legal, and ethical but
not profitable find
ways to seek
profitably .
27

28. Thank
You
28