The document outlines a framework for ethical decision making in business that includes 4 pillars: ethical issue intensity, individual factors, organizational factors, and opportunity. Ethical issue intensity refers to how important an ethical issue is perceived. Individual factors relate to a person's characteristics. Organizational factors involve workplace culture, peers, and authority. Opportunity concerns conditions that allow or prevent ethical/unethical behavior.

2. Framework For Ethical
Decision Making In Business
 Model of Ethical Decision making includes 4 basic
pillars;
 Ethical-Issue Intensity
 Individual Factors
 Organizational Factors
 Opportunity

3. Framework For Understanding
Ethical Decision Making in Business
Ethical
Intensity
Individual Business
Factors Ethics Ethical or
Evaluation Unethical
s& Behavior
Organizational
Intentions
Factors
Opportunity

4. Ethical Issue Intensity
The relevance or importance of an ethical issue in the
eyes of the individual, workgroup or organization
 How intense the dilemma is
 Reflects the ethical sensitivity of the individual
or work group that faces the ethical decision
making process
 “Spheres of Influence”
(Workplace, Family, Religion, Legal System,
Community & Profession)

5. Ethical Issue Intensity (Cont’d)
 Moral Intensity relates to a person’s perceptions of
social pressure and the harm the decision will have on
others
 Difference of opinion sets stage for Ethical Issue
 Perception of Ethical Issue Intensity can be influenced
by;
 Management’s use of rewards & punishments
 Corporate Policies
 Corporate Values

6. Individual Factors
Factors that are more relevant to an individual
perceptions & personality
 Personal issues more typically involve;
 Honesty
 Conflicts of Interest
 Discrimination
 Nepotism
 Theft of Organizational Resources
 Some professions are perceived to be less
ethical (Telemarketers, Advertising Agencies,
Salesperson, Brokers)

7. Individual Factors (Cont’d)
 Few Individual factors are;
i. Education
 Education Vs. Working Experience
 Education is irrelevant of impact on ethics
ii. Nationality
 Legal relationship between a person and the country
 MNCs try hiring businesspeople who can make decisions
regardless of nationality
iii. Age
 “The older you are, the more ethical you are”
iv. Locus of Control
 Relates to Authority/ Power
 External Control Vs. Internal Control

8. Organizational Factors
 Ethical choices in business are more often
made jointly, in work groups and
committees or in the conversations
 The outcome of this learning depends on;
a) Strength of person’s personal values
b) The opportunity to behave unethically
c) The exposure he/she has to others who behave
ethically or unethically

9. Organizational Factors (Cont’d)
 Corporate Culture
 a set of values, beliefs, goals, norms, and
ways to solve problems that an
organization’s members share.
 What is unique about the corporate cultures
of Wal-Mart, McDonald’s, Hershey Foods,
and Southwest Airlines?
 Ethical Culture
 Reflects whether the firm also has an ethical
conscience

10. Organizational Factors (Cont’d)
 Significant Others
 those who have influence in a work group
including peers, managers, coworkers, and
subordinates
 Any corporate examples in which a “bad
apple” spoiled a barrel? (when a key
organizational member damaged the
organizational reputation in the ethics/legal
area)

11. Organizational Factors (Cont’d)
 Obedience to Authority
 Helps to explain why many employees resolve
business ethics issues by simply following the
directives of their supervisors
 The bigger the company, the more unethical it
has the potential to become

12. Opportunity
 conditions that limit or permit ethical or
unethical behavior
 opportunity to engage in unethical behavior
can be limited through formal codes of ethics,
policies, and rules that are adequately enforced
 Immediate Job Context –
“Carrots & Sticks”
 Opportunity also comes from knowledge
 “Gatekeepers”

13. Business Ethics Evaluations &
Intensions
 Ethical dilemmas are uncertain
 No magic formulas, no substitute for critical
thinking
 When an individual’s intentions and
behaviors are inconsistent with his/her
ethical judgment, the person may feel guilty