Ethical Decision Making (Framework): Definition, Examples & More (2022)

Businesses have a responsibility to act professionally. Providing the best service to clients/buyers & workers is undeniably very important. Businesses can learn to manage the thin line between bad and outstanding customer service, offer excellent service, and at the same time retain good workers by adhering to a group of ethical principles. This article gives a broad overview of business ethics and professional standards of behavior.

What Exactly Is Ethics?

Ethics deals with having a perception of what is right and what is wrong. Usually by analyzing situations, & making decisions based on sound judgments supported by your professional or personal beliefs. Ethics can be employed in your professional or personal life. That is, in situations that concern your work or family. For instance, you may have a set of values in your personal life that differs from the values you have as a CEO, manager, or employee.

Personal Morals/Ethics

This is often referred to as a group of views that are unique to a particular person and are founded on either their personal experience, the influence of members of their family, or community. You may, for instance, have strong convictions about honesty, ethics, and accountability because of the family you grew up in, the society you find yourself in, or your experiences as a person.

Ethics in the Professional Or Business Sense

Business ethics deals with a group of ethical principles that govern how a business attends to its clients and how the business treats its workers. These principles are usually formed on the basis of the owner’s or manager’s personal ethics. Every sector and every company have their own set of ethical standards that influence organizational processes and systems.

Business owners are guided by personal and professional ethics, here are some of them.:

  • Business owners or businesses have to be transparent.
  • Businesses must always have integrity.
  • Businesses/owners have to be trustworthy.
  • Loyalty is a virtue that Businesses/owners should have.
  • Fairness – cutting corners to get ahead is no progress at all.
  • Compassion – genuine concern for others is important too.
  • Respect – respect is reciprocal and needed in any profession or workplace.
  • Lawfulness
  • Provide exceptional service
  • Responsibility
  • Maintaining an honest reputation
  • Always be accountable

Top 13 ethics

1. Transparency

This deals with properly presenting facts, revealing the entire truth, and passing across information as clearly as possible. While at it, you must also be honest about everything that is going on in the company that the employees need to know. It’s the cornerstone of an honest customer connection, which directly influences a company’s success or failure.

Customers will likely trust a company if it’s open and honest. This is often very true during PR crises when complete transparency is critical to resolving company problems.

(Video) Ethical Decision Making

2. Integrity

Honor is demonstrated by sticking to one’s decision, even when pressed to try to do differently. Companies exhibit strength and good character by doing what is ethically correct irrespective of the situation they find themselves in.

3. Trustworthiness/ Dependability

Businesses that maintain their pledges and follow through on their commitments to the people that work for them; workers, people that work with them; partners, or the consumers, demonstrate their dedication to ethics in business. People generally want to deal with individuals they feel are dependable. Trustworthiness may be considered a critical component of any business success.

4. Loyalty

We consider loyalty next. This covers all of a company’s connections; this includes connections with employees, partners, investors, as well as customers. Loyalty helps a company to make decisions that enhance these connections. This demonstrates that the company prioritizes the growth of the company and its employees over the personal advantages of the owner.

5. Fairness

Companies should make an attempt to be fair in all their actions and plan to exercise power in a just manner. To get ahead of the competition, leaders should only employ honest means. Fairness is additionally linked to equality, which means keeping an open mind as well as treating employees equally. Fairness & equality could also be utilized in employment procedures, marketing campaigns, business alliances, and competing with other brands for new customers or clients within the same market.

6. Compassion

Businesses that have ethical beliefs show true compassion, empathy, and concern for others’ well-being. In the business world, this suggests achieving company objectives in the most beneficial way possible. Counting all the costs, careful evaluation of the alternatives & the way they may influence an individual or community can help lessen the possible negative consequences of a business decision.

7. Respect

An essential corporate ethical norm is to have a fundamental respect for people’s rights and privacy, both inside and outside the company. Businesses that treat everyone with respect, no matter their religion, sex, ethnicity, nationality, and other identifiers, are frequently praised the world over.

Businesses are morally bound to keep information like checking account data, health history, and SSNs secret; thus, respect also extends to client or customer privacy. Maintaining this degree of confidentiality demonstrates respect. This also ensures compliance with several industry-specific requirements.

8. Lawfulness

Compliance with legal requirements and duties concerning the company activities, such as taxes, employee safety, as well as employment & labor laws, is a part of business ethics. Companies that operate within the legal framework tend to be more credible. This will help them build a good reputation and attract high-quality people to fill vacant positions.

9. Providing Exceptional Service

Ethical businesses aim for excellence by ensuring that their clients and consumers receive the very best of service or product. They strive to reinforce company performance, customer happiness, and staff morale by pursuing creative ideas & innovation to seek out the simplest ways to supply their goods or render their services.

11. Responsibility

Businesses that have a strong ethical standard are conscious of their obligations to their workers and customers. They are also conscious of how the owners and leaders affect the business. Companies must lead bearing in mind the organization’s values & mission before making rational decisions that will be beneficial to everyone. Business owners should adopt ethical standards & function as role models for others by exhibiting them.

12. Maintaining Good Reputation

To create an interesting work culture, businesses need to keep investors interested, and offer excellent service to consumers. Ethical firms will do all it takes to preserve and defend a positive reputation. A good name/reputation is valuable in business. Maintaining a positive reputation has to do with acting in a way that benefits the organization. If a company’s reputation is harmed, executives must address the matter correctly, employing other ethical principles like openness, responsibility as well as accountability.

(Video) A Framework for Ethical Decision Making

13. Accountability

Businesses that respect ethical values take responsibility for the choices and decisions made and accept their errors to all or any stakeholders. This includes shareholders, workers, & the general public. They not only embrace responsibility but also shoulder any repercussions which may arise and they do this in a transparent manner.

Why Is Corporate Ethics So Important?

Ethical business behavior has several advantages for both the owners & consumers. Some of them include;

1. Ensures that every operation is lawful

Ethical codes establish a group of rules and regulations with the goal of keeping the business operating within legal boundaries, protecting the business owner, employees, & customers. Environmental restrictions, financial regulations, & employment fairness are a number of legal sectors.

2. Consumers and businesses are going to be ready to trust one another.

Business ethics contribute to healthy and trustworthy connections between businesses and their customers. Consumers are more likely to opt for a company that consistently demonstrates good ethical behavior over others.

A Quick Overview of Ethical Business

By definition, an efficient ethics and compliance program results in ethical business decisions. You do not have to be a philosopher, historian, or professional ethicist to bring ethics into the equation, believe it or not.

Making ethical decisions may be a discipline. It is a method for detecting and addressing problems within the workplace. Of course, it’s going to be found during a sort of other situations. it is also impossible to conclude that all ethical corporate decision-making processes can be easily summed up as “doing the proper thing.” It’s more complicated than that.

To apply ethics within the business environment, one must remember and be sensitive to moral concerns which will emerge. Also, one must have a process for resolving relevant issues as a part of a bigger decision. A variety of fundamental questions could also be evaluated to ensure a correct assessment of ethical concerns. This method could also be utilized in many situations and may be tailored to a company’s specific needs.

Ethical business decisions frequently need a radical debate among all stakeholders involved. Conducting and evaluating the discussion is crucial. A company and its management can use this discipline to form crucial decisions supported by ethical standards if it’s consistently practiced.

We are not proposing that each company’s choice necessitates gathering board members. However, Certain significant and unique choices, on the other hand, should be exposed to debate and discussion among interested parties. The tactic itself exemplifies a desire to bring ethics to the forefront for everybody to debate.

(Video) Ethical Decision Making

Assume that the firm is faced with a critical strategic choice, like entering a replacement market, exiting an existing market, or terminating a line.

Here are some inquiries to ask to uncover and evaluate the moral implications of a particular decision.

  • What are the pertinent facts during this case? What can we know, and what can we still get to learn? Can we have enough information to arrive at an informed decision?
  • What are your choices? Have we considered all relevant possibilities and ruled out others?
  • Will someone, some group, or stakeholder(s) suffer as a result of the company’s decision? How significant are these issues?
  • Is there a trade-off between the positive and negative options within the decision?
  • Is this a drag that goes beyond legal compliance or economic efficiency?
  • Which choice will provide the foremost advantages while causing the smallest amount of harm? Which option is more beneficial to the company?
  • Which choices are the foremost ‘in line with our company’s values?
  • Which solution best handles the matter, taking under consideration all of the aforementioned factors?
  • What would the public’s reaction be if this were to be disclosed within the media tomorrow?
  • Assuming we elect a particular solution, how can we put it into action while keeping our stakeholders’ interests in mind?

These questions might function as a useful beginning point for creating ethical decisions. They’re not intended to be exhaustive but rather to function as examples. The questions also can function as a typical framework for key company choices made by management, senior executives, and therefore the board of directors.

Compliance with the law is compulsory; you cannot make an ethical judgment if you break the law. However, simply because something is legal doesn’t imply it’s ethical. Business ethical considerations are linked to corporate principles, company culture, and therefore the firm’s reputation among stakeholders and the general public.

Examples Of Companies That Practice Ethical Marketing

1. TOMS

TOMS was established in 2006 by Blake Mycoskie after a vacation to Argentina. During his stay, he saw firsthand that individuals living in poor regionslacked even the basic necessities such as a pair of shoes.

This motivated him to establish an enterprise that would not only earn him money but also enhance the lives of others. Since 2006, TOMS has paired each pair of shoes with a donated pair for a kid; this hasdeliveredalmost 100 million shoes.

Now, the business is committed to spending $1 out of $3 with a wider range of humanitarian groups such asChildren International. The companyalso has given money from its 2011 eyeglasses sales business to organizations to assist inrestoringeyesight via prescription glasses along withmedical treatments and TOMS Roasting Co., its coffee division for clean water initiatives. Lest I forget, they have a wonderfulcoffee.

TOMSsupports charities involved in the prevention of bullying and solar lighting and donated $5 million to groups fighting to eliminate armed violence in 2018.

This company’s list of items is infinite. It is also a fantastic example of a brand that has established a reputation for doing good.

2. ConsciousCoffees

This company was established by Mark and Melissa Glennare in 1996, who put it up for sale and eventually soldit to new owner Craig Lamberty. Since its foundation, this coffee growers and producers worldwide have been striving to improve circumstances.

One of the company’s socially aware activities is to introduce a CAFE livelihood programthat enables individuals to own and run their own coffee companies in Nicaragua, Guatemala, El Salvador, and Mexico. Overfour years, Conscious Coffees conducted technical and managerial training seminars.

(Video) PM Ready™ Ethics, Ethical Decision Making Framework

The business also frequently contributes coffee to the Community Cycles local program, an initiative operated by cycling fans who assist other bikers in repairing, maintaining, and renovating old and used bicycles.

As part of the USAID-based Farmer-to-Farmer initiative, Conscious Coffee’s team of coffee experts offers technical advice and support to growers and farmers, which helps coffee producers throughout South America learn new technologies to maximize returns and engage in fair trade economic practices with North American suppliers.

I mean, both of these firm produces excellent coffee and enables individuals to start their own company.

3.Patagonia

The Patagonia story is a brilliant illustration that it is never too late to alter business methods and to change things. Patagonia is an American outdoor apparel business established by Yvon Chouinard in 1973.

Patagonia has committed 1% of yearly sales to environmental conservation since 1985 and changed the whole supply chain in 1994 to guarantee ecologically friendly and safe working conditions. This is also when the business has moved to organically produce cotton to prevent pesticides and has since used it for all its goods.

But Patagonia is not just a business that helps you reconsider your decisions. It introduced a “Don’t Buy This Jacket” campaign in 2011, which forced customers to reconsider unnecessary purchases. As they explain on their website, “Businesses need to make fewer things but of higher quality. Customers need to think twice before they buy.”

Well said, Patagonia. Now I will certainly support a business that tries to decrease consumption rather than attempt to promote it.

Conclusion

The success or failure of any business is dependent on whether or not the decisions they make daily are good or bad. So what makes a decision good or bad?

What makes a decision a good one?

Good decisions have two characteristics, they are both effective and ethical.

Effective choices are effective if they achieve what we want to be done and if they advance our goals. A decision that generates unexpected and undesired consequences is useless. The key to making successful judgments is to think about options in terms of their potential to achieve our most essential objectives. This implies we have to grasp the distinction between immediate and short-term objectives and longer-range goals.

(Video) Ethics: A Framework for Decision-Making

Ethical choices create and maintain trust; show respect, accountability, fairness, and care; and are compatible with good citizenship. These behaviors offer a basis for making better choices by establishing the ground rules for our conduct in the business world.

FAQs

What is ethical framework for decision making? ›

A Framework for Ethical Decision Making provides valuable information on: Recognizing and Ethical Issue; Getting the Facts; Evaluating Alternative Actions; and Making and Testing a Decision.

What are the 5 frameworks for ethical decision making? ›

The following are five universal approaches to consider when making those decisions.
  • Utilitarian Approach. What benefits and what harms will each course of action produce, and which alternative will lead to the best overall consequences? ...
  • Rights Approach. ...
  • Fairness/Justice Approach. ...
  • Common Good Approach. ...
  • Virtue Approach.
Jul 18, 2022

What are some examples of ethical decision making? ›

Ethical behavior suggests someone is honest and forthright in communications whether written or oral. A salesperson explaining potential problems with a product is being honest. A customer service representative taking responsibility for failing to follow through with a service action is making an ethical decision.

What are the three 3 framework for ethical decision making? ›

Based upon the three-part division of traditional normative ethical theories discussed above, it makes sense to suggest three broad frameworks to guide ethical decision making: The Consequentialist Framework; The Duty Framework; and the Virtue Framework.

What are the 4 ethical frameworks? ›

The most widely known is the one introduced by Beauchamp and Childress. This framework approaches ethical issues in the context of four moral principles: respect for autonomy, beneficence, nonmaleficence, and justice (see table 1).

Why is the ethical decision making framework important? ›

Ethical frameworks are designed and implemented to ensure that the choices and actions of an organization or company reflect and uphold its ethics. Rather than providing step-by-step processes, frameworks outline the key aspects of ethical solutions to routine problems.

What are the 6 steps of ethical decision making? ›

Terms in this set (6)
  1. Identify the ethical Dilemma. most critical step. ...
  2. Collect info. gather information to make an informed decision. ...
  3. State the options. Brainstorming to identify all possible options. ...
  4. Apply the Ethical principles to the options. ...
  5. Make the decision. ...
  6. Implement the Decision.

What do you mean by ethical decision making give one example? ›

Ethical decision-making is based on core character values like trustworthiness, respect, responsibility, fairness, caring, and good citizenship. Ethical decisions generate ethical behaviors and provide a foundation for good business practices.

How do you answer an ethical question in an interview? ›

The general rule of thumb behind answering ethical interview questions is to emphasize the importance of ethics and morals. It is essential to include reasons why ethics are important in every answer given and to avoid saying that you have never experienced an ethical dilemma.

What are the 3 types of ethics? ›

Understand the concept and types of ethics

Ethics is traditionally subdivided into normative ethics, metaethics, and applied ethics.

What are the key aspects of ethical framework? ›

Being trustworthy: honouring the trust placed in the practitioner. Autonomy: respect for the client's right to be self-governing. Beneficence: a commitment to promoting the client's wellbeing. Non-maleficence: a commitment to avoiding harm to the client.

What are the steps in ethical decision making? ›

Ethical Decision Making Process
  1. Step One: Define the Problem. ...
  2. Step Two: Seek Out Resources. ...
  3. Step Three: Brainstorm a List of Potential Solutions. ...
  4. Step Four: Evaluate Those Alternatives. ...
  5. Step Five: Make Your Decision, and Implement It. ...
  6. Step Six: Evaluate Your Decision.
Aug 21, 2018

What is the first step in ethical decision? ›

The first step is determining whether there is an ethical dimension to the issue requiring a decision. The second step is to collect relevant information for ethical analysis.

What is the most important step in ethical decision making? ›

Step 1: Define the problem

The most significant step in any decision-making process is to determine why a decision is called for and identify the desired outcome(s).

What are the 8 steps in ethical decision making? ›

The eight steps are as follows: 1) identify the problem or dilemma, 2) identify the potential issues involved, 3) review the relevant ethical codes, 4) know the applicable laws and regulations, 5) obtain consultation, 6) consider possible and probable course of action, 7) enumerate the consequences of various decisions ...

What is ethical decision making essay? ›

The term often used to describe the system or principles by which we choose right from wrong is ethics. Conflicts in ethics arise when one person or a group of people impede the beliefs of another person or group of people.

How do you handle ethical issues in the workplace? ›

Build a culture of integrity — from the top down.
  1. Talk about the importance of ethics.
  2. Keep employees adequately informed about issues that impact them.
  3. Uphold promises and commitments to employees and stakeholders.
  4. Acknowledge and reward ethical conduct.
  5. Hold accountable those who violate standards, especially leaders.
Oct 25, 2021

What are three important ethical questions to ask? ›

Three ethical questions that we should ask of ourselves every day
  • How do I want to be in the world?
  • Why do I want to be this way in the world?
  • What strategies must I use to remain true to my values and principles when I'm challenged or tested?
Sep 19, 2010

What are some good ethical questions? ›

Ethics
  • Do you consider yourself to be an ethical person?
  • Have you ever found a smart phone? ...
  • Would you risk your life to save another person?
  • Would you jump into a deep river to save a drowning animal?
  • What should a person do if they find a wallet? ...
  • What are some ethical dilemmas you have faced?
  • Is stealing ALWAYS wrong?

How many steps are there in the ethical framework? ›

Using the Ethics Framework

The IDEA: Ethical Decision-Making Framework is comprised of four steps and incorporates five conditions identified as important in the accountability for reasonableness framework developed by Daniels and Sabin (2002) and adapted by Gibson, Martin, and Singer (2005).

What are the 7 principles of ethics? ›

This approach – focusing on the application of seven mid-level principles to cases (non-maleficence, beneficence, health maximisation, efficiency, respect for autonomy, justice, proportionality) – is presented in this paper.

Why ethic is important? ›

Ethics is what guides us to tell the truth, keep our promises, or help someone in need. There is a framework of ethics underlying our lives on a daily basis, helping us make decisions that create positive impacts and steering us away from unjust outcomes.

What are the principles of ethics? ›

The Fundamental Principles of Ethics. Beneficence, nonmaleficence, autonomy, and justice constitute the 4 principles of ethics.

What is Blanchard Peale framework? ›

When faced with an ethical dilemma, the Blanchard-Peale Framework asks you to consider three questions. If your answer is negative to any of the three questions, then your decision should also be negative. The first question to ask, 'Is it legal? '. Will I be violating any criminal or civil laws?

What are the steps in ethical decision making? ›

Ethical Decision Making Process
  1. Step One: Define the Problem. ...
  2. Step Two: Seek Out Resources. ...
  3. Step Three: Brainstorm a List of Potential Solutions. ...
  4. Step Four: Evaluate Those Alternatives. ...
  5. Step Five: Make Your Decision, and Implement It. ...
  6. Step Six: Evaluate Your Decision.
Aug 21, 2018

Videos

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3. 5 Basic Ethical Principles and Steps to Ethical Decision Making
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4. Ethical Decision Making Framework for Communications Webinar
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5. Ethical Decision Making: Kinds of Ethical Dilemmas
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