Business Ethics and Ethical Decision-Making

Business Ethics Fundamentals

• Ethics concerns how we should act and live.
• Business ethics examines our responsibilities to ourselves and others within a business context.
• Ethical decision-making occurs at individual, organizational, and broader social/governmental levels.

Goals of Business Ethics

• Develop knowledge and skills to identify ethical issues.
• Understand why people behave unethically.
• Decide how to act and the kind of person to be.
• Create ethical organizations.
• Think through social, economic, and political policies.

Ethics as Decision Making

• Ethical decision making and deliberation lead to responsible behavior.
• One perspective believes that ethics is no more than personal opinion and feelings.
• Another one is that ethics can offer clear, absolute, and unambiguous truths.
• Rational decision making leads to more reasonable, accountable, and ethical behavior.

Ethics as Reasoning

• Practical reasoning involves reasoning about what one ought to do.
• Ethics is part of practical reason, focusing on actions and behavior.
• Theoretical reasoning aims to establish truth.
• Humans should believe only what is reasonable and act reasonably.

How Should "We" Live?

• Individually, ethics is based on value structures, moral systems, and personal integrity.
• Morality underlies values, while ethics applies morals to decisions.
• Collectively, it refers to living together in a community, known as social ethics.
• Managerial decisions involve personal integrity, social responsibilities, and legal/political environments.

Ethics as Responsibility

• Ethics asks how we should live.
• Philosophers see ethics as normative.
• Social sciences describe actions, while ethics seek to prescribe how people should act.

Norms and Values

• Ethics deals with norms (standards of behavior).
• Norms guide actions and define what kind of person to be.
• Normative disciplines presuppose underlying values.
• Values incline us to act or choose one way over another.
• Ethical values serve well-being impartially.

Values vs Ethics Distinction

• Values underlie actions and decisions.
• Individuals and institutions have values, which can lead to ethical or unethical outcomes.
• Ethical values serve human well-being.

Utilitarianism

• An important ethical framework in business.
• Focuses on ethical traditions and practical relevance in evaluating ethics.
• Ethical tradition that directs us to decide based on overall consequences of our acts.

Ethical Frameworks

• Utilitarianism directs decisions based on overall consequences.
• Principle-based frameworks rely on moral principles like respecting human rights.
• Virtue ethics emphasizes moral character and happiness.

Utilitarianism

• Commonly produces the greatest good for the greatest number.
• Opposes policies benefiting only a minority.
• Pragmatic; no act is absolutely right or wrong in all cases.

Util Reasoning

• Acknowledges competing alternatives.
• Happiness is the ultimate good.
• Outcomes matter, influencing decisions based on consequences.
• A consequentialist approach aims for better consequences promoting human well-being.

Global Issue - Child Labor

• Marked by violation of child protection and human rights.
• An estimated 160 million are forced engage.
• Sub-Saharan Africa has the highest number of child laborers.

Utilitarianism in Business

• The free market and business ethics has a strong impact.
• Achieves goal of maximizing overall good.
• Free are competitive markets means for attaining the goal.
• Policy experts are familiar in predicting human actions.
• The "market and the administrative" versions of utilitarianism
• Egoism focuses on decision makers happiness.

Challenges to Utilitarianism

• Requires quantifying consequences and measuring it.
• Both ethical and unethical acts are determined by their consequences
• The end justifies the means.

Ethics of Principles and Rights

• Certain duties ought to be obeyed regardless of overall happiness.
• Important to remember utilitarian reasoning does not exhaust the range of ethical concerns.

Principles in Action

• Responsible ethical decision making involves principles and personal integrity.
• Some decisions should be matters of principle, not consequences.
• What principles should be followed is the key question in an ethics of principles and rights.

Ethical Duty

• Binding us to act or decide in certain ways.
• There are types: Legal rules, organization rules, role-based rules and professional rules
• Categorical requirements are better than hypothetical ethics.
• It is an overriding principle to ethics.

Integrity and Rights

• Protect individual dignity.
• Imply that some acts and some decisions are "off-limits."
• Our moral duty is to respect the human rights of others.

Moral Duty

• Humans have a fundamental human right of autonomy, or self-rule.
• There lies a difference between human rights and legal rights.
• There are three types of rights: Legal, Contractual and Moral Entitlements.
• Grounded in moral entitlements to which employees claim independently of any particular legal or contractual factors.

Challenges to Ethics

• There is big challenges in understanding the diverse nature of rights.
• There can be disagreements about rights and application to conflicting real life rights.

Virtue Ethics

• Integrity and Character are important.
• It's the foundation by which we can achieve a good human life.
• Helps shift from questions of what a person should do to whom that person is.
• Person's character is not independent of that person's identity.

The Business Culture - Implications and impact

• Influenced, limited, shaped and sometimes determined by the corporate culture of the firm.
• Chapter explores major issues surrounding influence of the business culture.
• Explores the role of business leaders in enhancing and preserving cultures that support ethica behavior.

Corporate Culture

• Has an essence remaining even with decentralized organizations.
• Comprises a shared pattern of beliefs, expectations, and meanings that influences the thinking of its members.
• Communal expectations, norms, beliefs and values guide behaviour organization.

Influence of Strong Leadership

• Culture is not static, it will change by time and strong leaders can have a signifcant impact within can organization
• A firm's culture can be a sustaining value.
• Corporate cultures are defined from the top-down, and others are developed by the employees themselves.

Ethical Business

• Strong ethical culture deters stakeholder damage and improve bottom-line sustainability.
• If ignored the culture can destroy long term sustainability in financial and employee retention.
• Key responsibility for creating ethical business is upon leaders.
• True that individuals can shape an organization, it also affects the organization shape of an individual.

Business Culture

• Defined by component areas within an organation, that include: Tempo, approach to humor, solve methods, incentives and Hieracrchical structure.
• Corporate Culture: Conformance to an organization's values, it is referred to as it being values based instead of rules.

Effective Business Practices:

• Focus on identifying risks along with an approach to improve transactions.
• Corporate leadership that stewardship the organizations culture.
• Stakeholders follow the "tone at the top" and employees and all members follow.
• In the early 1990s, the financial support they received indicated its relevance and influence.

Leadership in Action

• A leadership sets the tone through their behaviours and actions by setting the budget.
• Ethical leaders are determined but the methods used in leading to the goals.
• The leader drives productivity, efficiency and has minimal goals, while maintaining socially responsible behaviours.
• They lead through communication, integrating assessment, and monitoring cultural behaviours.
• Codes make a difference in ethical practices.

Creating Value

• Establishes the core tenets through a participatory process.
• Lays down the law for all future decisions.
• Mission statement articulates the fundamental principles that guides the overall decision making.
• It's critical to know what the company stands for and should inspire and provide a vision for the company.

Ethics

• Should be clear on the objectives the objective is to accomplish.
• Support and ideas for the code from all levels of the organization
• Be aware of the latest developments in the laws and regulations that affect your industry.
• Respond to real-life questions and situations and provide resources for information for employees to use.
• Is user freindly because no one will use it otherwise

Cultural Intergration

• Takes form depending on the organizations and ultimate goals of the processes.
• The communications aspect it incorporated with the firm's vocabulary, habits and attitudes.
• Effect integrations have to be encouraged for decision making.
• This is evaluated during the workers performance.

The importance of Communication

• Crucial in ethical matters.
• Reporting ethical behavior can be very difficult.
• Nobody likes a "tattletale" and could retaliate against actions.

Whistle Blowing

• Reporting organisation actions publicy or in authority.
• A classic issue in business ethics that requires a sense of environment and awareness.
• Vocabulary impacts the workforce when contributing to corporate culture.

External Reporting

• External firms can be harmful for an organization and they should be done internally.
• To allow confidentiality, it makes internal actions possible.
• Internal reporting makes sure the rights of accusers are valid.
• Norms and cultures will give insights into internal activity
• Reporting systems is clear and makes it acceptable within the business

How to Create a Successful Scheme

• Leaders will model the report or wrongdoing.
• Leaders can easily explain the decision making conclusion.
• Drills of the events is a very valuables exercise that can be followed effectively.
• Expectations of shareholders can encourage implications and ensure communications of all stakeholders.

Monitoring The Corporate Culture

• Allows vulnerability challenges to discover silent vulnerabilities.
• Positive objectives and the ability to allocate resources.
• Determine the pace and keep-up-date within the workforce.
• Whether the positive results are being accurate and reword ethical behaviours.
• Ensure the "tone at the top" is maintained.
• Determine a lack of values and measure employees.

Sources of Ethical Culture

• Maintaining a responsible control and level environmental.
• Constant / Consistent with communications within the business.
• Integrating communications of practices between an employee/employer.
• Review, assessment, ongoing history to improve within the work environment.

Explore business ethics, focusing on norms, utilitarianism, and decision-making. It covers values, practical reasoning, and challenges in ethics education. Includes utilitarianism and child labor region analysis.