Business ethics are moral principles that guide the way a business behaves.

• Acting in an ethical way involves distinguishing between “right” and “wrong” and then making
the “right” choice.

Personal ethics are usually considered as the foundation for running ethical businesses.

Decision making involves a great degree of value clarity, ethical decision making involves more! Unlike
certain financial, inventory and production decisions, ethical decisions cannot be coded into digital
machines. They require critical thinking and evaluation.

What makes ethical decision making so difficult? Why cannot ethical decisions be programmed like other
decisions? What leads to dilemmas in ethical decision making? In the coming paragraphs we try to answer
all these questions. We also try to understand basic difficulties involved in ethical decision making.

An organization is an amalgamation of various individuals and there is a conflict of interest at the

personal level between these members, each one is concerned about his benefits and neutral or
opposing to the benefits or good of others. This conflict of interest leads to situations that are morally
challenging to the manager who wants to be moral and righteous to his own conscience and serve the
interests of the organization. Here the dilemma arises on deciding upon the course of action.

In the second case a conflict arises when there is a distinction to be made about facts and values. This
implies a situation where a manager confronts ‘what is’ and weighs the same against ‘what ought to be’.
For example an organization may spend lots of resources upon developing, researching or upgrading a
certain product and service, which gets reflected in the final price of the latter. This increase in price may
be looked upon as exploitative by the end users!

Yet another difficulty arises in cases when there is a fine line dividing the good from the bad or the evil and
in situations when there is a difference of opinion on what is morally permissible and what is not.
Undoubtedly, in our society the good and the evil exist side by side. Example in case, Nestle infant formula
lead to many deaths in Kenya because the formula was prepared in contaminated water. The same formula
proved life saving in other countries. The challenge lies in minimizing the evil and trying to arrive upon a
consensus.

In an era of uncertainty, it is almost impossible to predict the outcomes of decision making. One of the
principles of ethical decision making assumes that the outcome of a decision is known and that the
decision that results in greatest good for greater number of people is the best. Practically, anticipating
the exact outcome of a course of action is impossible. This uncertainty is at the root of all difficulties in
ethical decision making.