Description
This is a presentation describes the role of ethics in business decision making.
Ethical Decision Making in Business
Ethical Model
?
Importance :? Benchmark to set standards ? Basis for normative judgment
?
Practicality
? Not easily understood by business theorists ? Normative
Three Prominent Model
?
Rights Theories
? Advocated by Kant (Personal Rights) and Locke (Property Rights) ? Protection of legal and moral rights
?
Justice Theories
? Advocates all persons should be guided by fairness, justice, equity and by a sense of impartiality ? Equality based on justice
?
Utilitarianism
? Action is right if it maximizes utility ? Teleological approach to ethics ? Double-edged focus to an ethical problem
Other Model
?
The Virtue Approach
? Decisions should be consistent with certain morally acceptable virtues ? Full development of humanity ? What kind of person will I be if I do this ?
?
The Common Good Approach
? It suggests “the interlocking relationships of society” ? It draws attention to certain condition such as effective system of law and order, policing, public education etc.
Ethical Decision Making with Cross Holder Conflicts and Competition
?
Barry’s decision making rules :-
? Choose the more important obligation between two or more conflicting obligations ? Choose an action of higher ideal when two or more ideals conflict ? Choose the action that produces the greater good or the lesser harm, when effects are mixed
Need for Kohlberg’s Model
Ethical decision making ? 6 stage model of cognitive development ? It explains why people make different decisions in similar ethical situations ? Not directly related to the business context
?
Kohlberg’s Model of Cognitive Moral Development
The stage of punishment and obedience ? The stage of individual instrumental purpose and exchange ? The stage of mutual interpersonal expectations, relationships and conformity ? The stage of social system and conscience maintenance ? The stage of prior rights, social contract or utility ? The stage of universal ethical principles
?
Kohlberg’s model in 3 stages
Immediate self interest ? Social expectations ? General ethical principles
?
Influences of ethical decision making
Three major influences – Personal moral standards, their workplace ethics and culture and the nature of the issue concerned ? Work place ethics ? They depend on corporate culture and values of the organizations
?
CORPORATE VALUES AND ETHICAL DECISION MAKING
In a person’s work environment, vision and mission of the company have a greater influence on him than his own values and moral standards.
•
•
Generally decisions- ethical or otherwise, are jointly made through committees, consultations, discussions or at meetings.
corporate culture can be defined as “a set of values, beliefs, norms and ways of solving problems”.
•A
• The ethical climate of a company will provide a clear indication to outsiders on whether it has an ethical conscience, otherwise companies whose goal was to make huge profit- as in the case of Enron, have always had ethical conscience as the secondary object on their mind.
ROLE OF CORPORATE GOVERNANCE IN ENSURING ETHICS IN THE WORKPLACE
?
For the past three decades companies have been following internationally accepted governance practices to reduce conflicts of interest within the employee and the organization.
?
Such practices help mitigate conflicts among employees, through formal codes, policies and rules and subsequently help reduce ethical dilemmas.
?
The board of directors play an important role to ensure that these corporate values are in place and are scrupulously followed. OECD (Organization for Economic Cooperation and Development) is one such body that explains in detail the functions of the board, which include
risk-taking, corporate performance, fair accounting and reporting systems.
• OECD was established in 1961 • Its headquarters are located in Paris, France • Mission- To promote policies that will improve the economic and social well being of people around the world. OECD’s Core Values • Objective: Our analyses and recommendations are independent and evidence-based. • Open: We encourage debate and a shared understanding of critical global issues. • Bold: We dare to challenge conventional wisdom starting with our own. • Pioneering: We identify and address emerging and long term challenges. • Ethical: Our credibility is built on trust, integrity and transparency.
FRAMEWORK OF ETHICAL DECISION MAKING
Components of making a good choice:- Take Choices Seriously
- Good Decisions are both Ethical and
Effective
- Discernment and Discipline
Process of making good Ethical Decisions
?
Recognize and identify the kind of ethical issue you need to resolve Pause and think Make sure of your goals Get your facts right
? ? ?
Continuing…..
?
Evaluate choices from different ethical perspective Consider Consequences Make a decision
Act, then reflect on the decision later
?
? ?
THANKYOU
doc_103700919.pptx
This is a presentation describes the role of ethics in business decision making.
Ethical Decision Making in Business
Ethical Model
?
Importance :? Benchmark to set standards ? Basis for normative judgment
?
Practicality
? Not easily understood by business theorists ? Normative
Three Prominent Model
?
Rights Theories
? Advocated by Kant (Personal Rights) and Locke (Property Rights) ? Protection of legal and moral rights
?
Justice Theories
? Advocates all persons should be guided by fairness, justice, equity and by a sense of impartiality ? Equality based on justice
?
Utilitarianism
? Action is right if it maximizes utility ? Teleological approach to ethics ? Double-edged focus to an ethical problem
Other Model
?
The Virtue Approach
? Decisions should be consistent with certain morally acceptable virtues ? Full development of humanity ? What kind of person will I be if I do this ?
?
The Common Good Approach
? It suggests “the interlocking relationships of society” ? It draws attention to certain condition such as effective system of law and order, policing, public education etc.
Ethical Decision Making with Cross Holder Conflicts and Competition
?
Barry’s decision making rules :-
? Choose the more important obligation between two or more conflicting obligations ? Choose an action of higher ideal when two or more ideals conflict ? Choose the action that produces the greater good or the lesser harm, when effects are mixed
Need for Kohlberg’s Model
Ethical decision making ? 6 stage model of cognitive development ? It explains why people make different decisions in similar ethical situations ? Not directly related to the business context
?
Kohlberg’s Model of Cognitive Moral Development
The stage of punishment and obedience ? The stage of individual instrumental purpose and exchange ? The stage of mutual interpersonal expectations, relationships and conformity ? The stage of social system and conscience maintenance ? The stage of prior rights, social contract or utility ? The stage of universal ethical principles
?
Kohlberg’s model in 3 stages
Immediate self interest ? Social expectations ? General ethical principles
?
Influences of ethical decision making
Three major influences – Personal moral standards, their workplace ethics and culture and the nature of the issue concerned ? Work place ethics ? They depend on corporate culture and values of the organizations
?
CORPORATE VALUES AND ETHICAL DECISION MAKING
In a person’s work environment, vision and mission of the company have a greater influence on him than his own values and moral standards.
•
•
Generally decisions- ethical or otherwise, are jointly made through committees, consultations, discussions or at meetings.
corporate culture can be defined as “a set of values, beliefs, norms and ways of solving problems”.
•A
• The ethical climate of a company will provide a clear indication to outsiders on whether it has an ethical conscience, otherwise companies whose goal was to make huge profit- as in the case of Enron, have always had ethical conscience as the secondary object on their mind.
ROLE OF CORPORATE GOVERNANCE IN ENSURING ETHICS IN THE WORKPLACE
?
For the past three decades companies have been following internationally accepted governance practices to reduce conflicts of interest within the employee and the organization.
?
Such practices help mitigate conflicts among employees, through formal codes, policies and rules and subsequently help reduce ethical dilemmas.
?
The board of directors play an important role to ensure that these corporate values are in place and are scrupulously followed. OECD (Organization for Economic Cooperation and Development) is one such body that explains in detail the functions of the board, which include
risk-taking, corporate performance, fair accounting and reporting systems.
• OECD was established in 1961 • Its headquarters are located in Paris, France • Mission- To promote policies that will improve the economic and social well being of people around the world. OECD’s Core Values • Objective: Our analyses and recommendations are independent and evidence-based. • Open: We encourage debate and a shared understanding of critical global issues. • Bold: We dare to challenge conventional wisdom starting with our own. • Pioneering: We identify and address emerging and long term challenges. • Ethical: Our credibility is built on trust, integrity and transparency.
FRAMEWORK OF ETHICAL DECISION MAKING
Components of making a good choice:- Take Choices Seriously
- Good Decisions are both Ethical and
Effective
- Discernment and Discipline
Process of making good Ethical Decisions
?
Recognize and identify the kind of ethical issue you need to resolve Pause and think Make sure of your goals Get your facts right
? ? ?
Continuing…..
?
Evaluate choices from different ethical perspective Consider Consequences Make a decision
Act, then reflect on the decision later
?
? ?
THANKYOU
doc_103700919.pptx