Week 4 - Debate an Ethical Issue

Week 4: Mini Lecture

Ethics in Business

Managers often find themselves in situations making decisions regarding what is right or wrong for the organization and the stakeholders. Although there are many good arguments and incentives for doing the right thing, some businesses and people at all levels of organizations still act unethically. Managers must know how to properly deal with situations regarding ethics and how to avoid the consequences of poor decision-making to ensure alignment with ethical behavior.

In 2014, Gino et al. (2014) reported that a recent survey revealed that nearly three-quarter of employees who responded said that they had observed unethical or illegal behavior by coworkers in the past year. While unethical business behaviors generally end up in the news, companies are still greatly concerned with the unethical behavior of employees for many reasons. Employee unethical behaviors leads to decreases in work performance, organizational financial losses, reputation and brand damage, safety concerns, and a loss of customers and other stakeholders.

Needless to say, managers are held to a higher standard of ethical behavior because they make key decisions that affect the company, its stakeholders and the society as a whole. Ethical managers are obligated to set an example for others by not succumbing to unsound ethical practices and making the best decision when there is an ethical dilemma. Even when there is pressure to compromise values, managers must keep the promise of and commitment to ethics for their team, customers, and shareholders.

Because of the possible impacts of ethical dilemmas, they are more than just “sticky” situations. Managers must make decisions while being sensitive to the organization’s ethical markers. Some factors that managers must consider in making decisions or determining any consequences when faced with an ethical dilemma include if there is a legal implication, conflicting interests, harm to one or more parties while benefitting others and the impact on stakeholders. Often the best solution to an ethical problem is one that will uphold the most important values to the greatest extent avoiding the violation of as many values as possible.