Module II

Ethics & Moral Standards

Module Object

This module discuss the process of decision-making in organizations and the decision
making models. It also discusses the ethical dilemmas faced by organizations. It also
discusses how our ethics reflect to the need to our Indian society and how work culture
refers to certain norms of behavior.

Course Outcome
From this module we will learn and understand that
 In certain situation how individuals come to crossroads in taking decision
 How they ethically implement it.
 How Indian managers manages work ethos at different levels of management.
 It also teaches us the roles and responsibilities of ethics in management.

Sub Modules as per the syllabus

Values , Morals, Beliefs , Work life in Indian Philosophy: Indian ethos for work life, Indian
values for the work place, Moral standards , Ethical Decision making.

Morals
Dictionary meaning : of or relating to principles of right and wrong in behavior, expressing or
teaching a conception of right behavior, conforming to a standard of right behavior, capable of
right and wrong action. Morals are the prevailing standards of behavior that enable people to
live cooperatively in groups. Moral refers to what societies sanction as right and acceptable.

Most people tend to act morally and follow societal guidelines. Morality often requires that
people sacrifice their own short-term interests for the benefit of society. People or entities that
are indifferent to right and wrong are considered amoral, while those who do evil acts are
considered immoral.
While some moral principles seem to transcend time and culture, such as fairness, generally
speaking, morality is not fixed. Morality describes the particular values of a specific group at a
specific point in time. Historically, morality has been closely connected to religious traditions,
but today its significance is equally important to the secular world. For example, businesses and
government agencies have codes of ethics that employees are expected to follow.

Some philosophers make a distinction between morals and ethics. But many people use the terms
morals and ethics interchangeably when talking about personal beliefs, actions, or principles. For
example, it’s common to say, “My morals prevent me from cheating.” It’s also common to use
ethics in this sentence instead. So, morals are the principles that guide individual conduct within
society. And, while morals may change over time, they remain the standards of behavior that we
use to judge right and wrong.

Do “ethical” and “moral” mean the same thing?

The terms ethical and moral are often used as synonyms, and we will adopt this convention and
use these terms interchangeably. For most purposes this works fine, but some authors and
teachers do see a distinction between these ideas. Usually when the terms are distinguished it is
because “morals” can connote very culture-specific norms or expectations.
Moral Reasoning
Moral reasoning applies critical analysis to specific events to determine what is right or wrong,
and what people ought to do in a particular situation. Both philosophers and psychologists study
moral reasoning.

How we make day-to-day decisions like “What should I wear?” is similar to how we make moral
decisions like “Should I lie or tell the truth?” The brain processes both in generally the same
way.

Moral reasoning typically applies logic and moral theories, such as deontology or utilitarianism,
to specific situations or dilemmas. However, people are not especially good at moral reasoning.
Indeed, the term moral dumbfounding describes the fact that people often reach strong moral
conclusions that they cannot logically defend.
In fact, evidence shows that the moral principle or theory a person chooses to apply is often,
ironically, based on their emotions, not on logic. Their choice is usually influenced by internal
biases or outside pressures, such as the self-serving bias or the desire to conform.

So, while we likely believe we approach ethical dilemmas logically and rationally, the truth is
our moral reasoning is usually influenced by intuitive, emotional reactions.

Moral Absolutism
Moral absolutism asserts that there are certain universal moral principles by which all peoples’
actions may be judged. It is a form of deontology.

The challenge with moral absolutism, however, is that there will always be strong disagreements
about which moral principles are correct and which are incorrect.

For example, most people around the world probably accept the idea that we should treat others
as we wish to be treated ourselves. But beyond that, people from different countries likely hold
varying views about everything from the morality of abortion and capital punishment to
nepotism and bribery.

Moral absolutism contrasts with moral relativism, which denies that there are absolute moral
values. It also differs from moral pluralism, which urges tolerance of others’ moral principles
without concluding that all views are equally valid.

So, while moral absolutism declares a universal set of moral values, in reality, moral principles
vary greatly among nations, cultures, and religions.

Moral Relativism
Moral relativism is the idea that there is no universal or absolute set of moral principles. It’s a
version of morality that advocates “to each her own,” and those who follow it say, “Who am I to
judge?”
Moral relativism can be understood in several ways.
Descriptive moral relativism, also known as cultural relativism, says that moral standards are
culturally defined, which is generally true. Indeed, there may be a few values that seem nearly
universal, such as honesty and respect, but many differences appear across cultures when people
evaluate moral standards around the world.
Meta-ethical moral relativism states that there are no objective grounds for preferring the moral
values of one culture over another. Societies make their moral choices based on their unique
beliefs, customs, and practices. And, in fact, people tend to believe that the “right” moral values
are the values that exist in their own culture.
Normative moral relativism is the idea that all societies should accept each other’s differing
moral values, given that there are no universal moral principles. Most philosophers disagree
however. For example, just because bribery is okay in some cultures doesn’t mean that other
cultures cannot rightfully condemn it.
Moral relativism is on the opposite end of the continuum from moral absolutism, which says that
there is always one right answer to any ethical question. Indeed, those who adhere to moral
relativism would say, “When in Rome, do as the Romans do.”

Values
Values are individual beliefs that motivate people to act one way or another. They serve as a
guide for human behavior. Frequently when used in discussions of ethics the term values is used
to refer to the fundamental ideals that an individual relies on to describe praise-worthy behavior.
A person’s values are the bedrock concepts used to determine their ethical decisions. Most
generally speaking values represent aspirational goals common within your culture or society.
Values such as honesty, benevolence, wisdom, duty, or compassion are universally recognized
laudable and desirable features of a well-developed character. But which values are most
important may differ from individual to individual, or across cultures. We could refer to the
values of the feudal Japanese samurai culture placing the highest emphasis on the concept of
personal honor. We could compare and contrast that with the European knightly virtues as a
similar yet distinctively different set of cultural values. We could draw on political beliefs to
describe the concepts of equality and freedom at the heart of democratic ideals, contrasting them
with a constitutional monarchy that perhaps places the highest importance on duty and tradition
as its central political ideals

Generally, people are predisposed to adopt the values that they are raised with. People also tend
to believe that those values are “right” because they are the values of their particular culture.
Ethical decision-making often involves weighing values against each other and choosing which
values to elevate. Conflicts can result when people have different values, leading to a clash of
preferences and priorities.

Some values have intrinsic worth, such as love, truth, and freedom. Other values, such as
ambition, responsibility, and courage, describe traits or behaviors that are instrumental as means
to an end.

Still other values are considered sacred and are moral imperatives for those who believe in them.
Sacred values will seldom be compromised because they are perceived as duties rather than as
factors to be weighed in decision-making. For example, for some people, their nation’s flag may
represent a sacred value. But for others, the flag may just be a piece of cloth.

So, whether values are sacred, have intrinsic worth, or are a means to an end, values vary among
individuals and across cultures and time. However values are universally recognized as a driving
force in ethical decision-making.

Many of today’s most pressing issues of social ethics are complex and multifaceted and require
clear and careful thought. Some of these issues include:

 Should states allow physician-assisted suicide?

 Is the death penalty an ethically acceptable type of punishment?

 Should animals have rights?

 Is society ever justified in regulating so-called victimless crimes like drug use, not

wearing a helmet or a seatbelt, etc.?

 What are our responsibilities to future generations?

 Are affluent individuals and countries obligated to try to prevent starvation, malnutrition,

and poverty wherever we find them in the world?

 Is there such a thing as a just war?

 How does business ethics relate to corporate responsibility?

To reach careful conclusions, these public policy issues require people to engage in complicated
ethical reasoning, but the ethical reasoning involving personal issues can be just as complex and
multifaceted:

Business values
A business value refers to a set of beliefs pursued by an organization. Business values like
‘customer satisfaction’, ‘enthusiatic teamwork’ and ‘state-of-the-art provision for production’ are
some of the commonly pursued values by several organizations. When such values are pursued
effectively and with zeal by executing them in the daily activities of the management and the
employees of the organization, they are believed to pay back in manifold returns and success.
Pursuing business values plays a vital role in the growth and survival tactics of an organization.
In general, the most common values that facilitate in improving profits and the image of the
organization are as follows:
 Persistent progress: It refers to an eagerness and enthusiasm on the part of the organization to
keep its functioning as an ever efficient and up-todate working endeavour towards progress.
 Customer satisfaction: It refers to making the customers feel important and responding to
their needs, interests and, if need be, providing solutions to their problems in case of any
documentation processes regarding the purchase of the organization’s product.
 Personnel development: When it comes to development, organizations can benefit more by
developing the skills of their employees. Besides considering the satisfaction of its customers
and management, it should also take into account the satisfaction of its employees, which in turn
can yield sincere work performance from the employees.
 Innovation: It refers to the enthusiasm to take on new challenges and responsibilities on the
part of the employees and a desire to diversify and try out new ventures on the part of the
organization.
Optimal use of resources: It refers to making sincere efforts to enhance overall business
performance by maximum utilization of the organization’s current resources.
 INDIAN ETHOS AND WORK PHILOSOPHY

 Ethos
Ethos is a discipline that examines one’s morality or the moral standard
of the society. Ethics means expected standards in terms of your
personal and social welfare. It includes honesty, morality, responsibility
etc
 Needs of Indian ethos
Management attitude:
Top management having firm belief in value oriented involving whole in
the management. Profit is earned through service and satisfaction of all
stakeholders, employees, customers, shareholders, and citizen.
Fulfillment of social responsibility.
Humanizing organization:
Looking at the three aspects of humane organization ie., inter
personal relations, man machine equation where main in the prime
concern and inner management through mental and spiritual growth of
individual.
Interiorizing (self) management:
Self management are management by consciousness. When the soul
manages the other four members of the human being namely the body,
mind, intellect and the heart, the conflict these four have amongst them
can be resolved. This management my consciousness. The objective of
self management is to first know and manage oneself and then manage
others.
Self introspection
Embark upon self study, self analysis and self criticism to locate areas of
friction and disharmony, a self examination of one’s thought, feelings,
emotions, sensation, passion and desire to reduce and subdue the ego
Brain stilling
For rational enduring decisions silent mind is a necessity. A perfect
mounum (calm mind enjoying tranquility) is necessary. Brain stilling is
the most reliable method to discover solution to problems and
difficulties which seems to be difficult to tackled by reason and intellect
because through this one can come into contact with the inner mind and
high consciousness
Stepping back
Never decide anything, never speak a word, and never throw yourself
into action without stepping back. The stepping back from a situation for
whiles enable one to control and master a situation
Self dynamising meditation
A dynamic meditation is meditation of transformation of lower
consciousness into higher consciousness and hence called transforming
meditation. Through meditation in a silent and calm mind one can
reaches a high level of consciousness which offer guidance in the form
of institutions to tackle the multitude problem. This is called
consciousness approach to management
Role of intuition (feeling)
Intuition is the act of coming to direct knowledge or certainty without
reasoning or inferring. It is immediate cognition by the inner mind and
when fully developed is efficient and effective for taking prompt and
sound decisions. Intuition skills enable one to cope with confidence the
fluctuating environment and rapid changes. Faith is pre-requisite to
develop and realize the power of intuition.
 Purpose of Indian ethos
To develop proper management
To develop proper management system in the organization. Management
systems based on principles as per ancient wisdom are of immense help
for the smooth conduct of business. Value oriented management system
can be established with the help of Indian ethos
To ensure all round development
To ensure all round development growth and prosperity i.e. .,
productivity, marketing, profitability
Work sincerely
Indian ethos teaches us that if you work sincerely for the society, for
your organization and for the nature you will really enjoy your life
through money harmony, peace and happiness your image is bright
Productivity of human being
Indian wisdom indicates that productivity of human being is more
importance than plant capacity
Values for Indian managers
The managerial values are categorized in 3 parts in an organizational
environment
1. Physical values
Accuracy
The precesion, exactness and conforming to the fact in details of work
Cleanliness
In offices, production and warehouses facilities, equipments, customer
service areas, raw material and finished product inventory, bathrooms
and so on.
Maximum utilization of resources
The desire and ability of the company to improve its performance by full
utilization of its current resources (time, money, equipment, material,
space people etc)
Orderliness
In offices drawers file cabinets, shelves, paper work, files, phone
numbers, priority of work, daily and weekly plan
Punctuality and timeliness
In arriving on time work, from breaks, from lunch, to meetings, in
replying to letters and phone calls, in paying bills on time, etc. Occurring
at the most suitable or opportune time
Quality of products and services
In terms of presentation, functionality, choice value, speed , timeliness,
suitability, repeatability, life span, courtesy, friendliness etc
Regularity
Of meeting, reports, sales calls, performance reviews and so forth
Responsiveness
The way people, the organization, systems etc react to a need coming
from within or from outside the organization
Safety
In office, warehouses, production and research facilities, vechiles for
employees, vendors and customers
2. Organizational values
Accountability
Of individuals, department and division for performance, results,
problems and so on.
Communications
Up, down and sideways within the company, with customers and
vendors, in terms of openness, frankness, clarity, frequency, accuracy,
timeliness and brevity
Cooperation
Among individuals, departments in terms of plans, activities and systems
Coordination
Horizontally between departments in terms of plans, activities and
systems. Discipline in adherence to company policy, rules, systems,
procedures, schedules, standards, and ethics and so on
Freedom for initiative
To make suggestions, develop plans, make decisions, carry out or
modify actions and so on.
Integration
For smooth operation vertically between different levels of the
organization in terms of plans, decisions, priorities.
Standardization
In terms of forms, files, procedures, reports, performance evaluations,
equipment, training, recruitment, orientations, communications and so
on.
Systemization
In sales, marketing, customer service accounting, research, production,
engineering, recruitment, training, promotions, communications,
coordination, reporting and so on.
3. Psychological values
Continuous improvement
The desire and ability of the company to develop and incorporate ways
to improve itself
Creativity
In terms of new products, new ideas, new systems, new production
methods, new applications of technology, new methods of financing,
new marketing strategies
Customer delight
The positive emotional response and joy that the customer feels from
interaction with our people and our products and services
Decisiveness
In solving problems, planning, executing plans in terms of speed and
commitment to decisions once made.
Develop people
The desire and ability of the company to improve the lot of the
employees working for it
Agreement
The overall atmosphere and interaction between people, departments,
divisions, systems, activities, rules, and policies within the company and
between these elements and the external environment, customers,
vendors, community laws and so on
Innovation
The desire and ability of the company to venture into new, breakthrough
areas of opportunity
Integrity
Keeping to one’s word, promise, agreements being truthful, non
deceitful etc.with employees, customers, vendors, government etc
Respect for the individual
In establishing rules and policies, design of systems, making decisions,
executing instructions and so on in terms of people’s health, safety, self
esteem, feelings and opinions
Service to society
Community welfare, environmental protection, development of products
and services that meet real physical, social or psychological needs are
the primary activities of managers

 Values for managers in India

a) Core values of mangers in India
There may be divergent values in tune with the nature and goals of
different functional departments and also the overall organizational
culture. However there are some dominant values also known as core
values that are considered as crucial by majority of managers
Integrity
Trust
Achievement motivation
Truthfulness
Humility and contentment
b) Personal traits of managers in India
Personal traits are enduring characteristics of an individual by which
he/she can be identified and also to a certain personal traits which make
him / her successful and efficient. The respondent executives indicated
that the following are the dominant traits
Stability
Skill
Creativity
Achievement
Flexibility
C) Goals of a typical manager in India
Values of a manager will have a direct influence on the goal and
objective he sets. Personal goals of a manger may vary depending on
goals, culture and philosophy of the concerned organization.
Nevertheless, each manager works with a certain aim and purpose in his
mind. The following are the goals of a typical manger in India
 Customer satisfaction
Achievement of department and organizational goals
Completion of tasks within scheduled time frame
Employee motivation
Career progress
d) Important personal qualities of a manager
Managers with limited abilities and skills with static values and goals
may not be able to achieve success in all circumstances. Certain personal
qualities (height, complexion, voice, dressing habits, gregariousness,
versatility, etc.Should supplement and stand in good stead of an
individual supplement and stand in good stead of an individual to
accomplish all round success, The respondent executives reported that
the following five qualities are important for a typical manager in India
today
Self control
Articulation abilities
Sociability
Physical stature
Dress
e) Private values for managers
Private values of a manager refer to all those values which he holds
while undertaking activities besides organizational responsibilities. If an
individual daily goes for a walk in the morning, it is a value and if he /
she spend an hour every night helping the child doing the home work
gives by the teachers at school. Therefore all the other roles that a
manager has to play called private life values. All those who hold
important position in organizational related activities. However there is a
small proportion of managerial workforce who ignores organizational
responsibilities and work for the promotion of personal interest
 Elements of Indian ethos:
Indian management methods are bound to work in India. Indian ethos is
better than other ethos present in other countries. Indian believe
1. Ego sublimation rather than ego assertion
2. Sacrificing spirit rather than fighting spirit
3. Team achievement rather than individual achievement
4. Spiritual attainment rather than material prosperity
5. Self control rather than outside control
6. Concept of duties rather than concept of rights
7. Yielding rather than dominating
8. Concern for this age world and improvement
9. Respect for and search for all truth whatever be its source

 Work ethos
Work ethos refers to certain norms of behavior governing the conduct of
workers involved in workers involved in work situations to achieve
certain desired objectives. In other words work culture is the
involvement of workman with work.
The degree of one’s involvement impacts his performance to give high
or low productivity, high or low quality i.e. higher the degree of
involvement, higher well be the productivity and quality.
 Works ethos at different levels of management:
Work ethos will be different at different levels.
 At Basic level
1. Discipline
2. To maintain punctuality
3. Coming to work on time
4. Behaving properly with superior, colleagues and subordinates
5. Not wasting time during working hours
6. Dignity in relating to peers, semorn and subordinates
7. To do things those are morally good or sight

 At Top level
At the top level, it is about commitment and accountability feel
responsible for the task assigned to him. Some more points related to top
level are
1. Work culture
Good work culture means one is fully devoted towards work and has
high morale. On the other hand, poor work culture results in high rate of
wastage, poor quality, low productivity and low morale
2. Loyalty
Work culture is also concerned with a workers loyalty and sense of
belongingness to the organization. One should protect the interest of thee
organization. No employee should make any adverse comments about
the organization in the public
3. Commitment responsibility
Every man should work like a master not like a slave. The workers
should take full responsibility for the task assigned to them and furthest
efforts to achieve what is expected from them.
4. Sense of belongingness
The worker should exhibit by his behavior a sense of belongingness of
the organization. A feeling of respect should be there for the
organization. One should maintain good relationship with peers, sub
ordinates and superiors and treat them well
5. Protecting the interest of organization

6. No adverse comment about the organization in public

P’s of work ethics

Whenever an individual joins an organization he /she is under an obligation of job

contract, which confers a right to be duly compensated against what he is
committed to perform. To fulfill his obligation and committed he is expected to
preserve certain degree of skills and attitudes such as regularity, punctuality,
discipline, initiative etc. All these together combine an ethical value system which
every employee must follow however sometimes organizations atmosphere may be
different. Even then an individual is expected to be ethical at his own level.
Generally at work place, people are concerned for three factors or 3p’s i.e. pay,
prospects, promotion but one 4th P i.e. performance is the most important factor
which determines the organizational as well as personal development.

Dimension of the work ethos:–

disinterest shown by worker to the work. This creates poor work

culture in the organization and results in poor quality of product
1. Protecting the interest of the organization

Interest of organization must be on the top agenda of employees. Their activities

must focus on the protection of interest of the organization. Workers can protect the
interest of their organization through higher productivity and quality of a product.
They should make their best efforts in this regard.

2. Work ethics through appropriate system

Clear cut policies, rules and regulations, reward system etc. are supportive in
establishing work ethics. Clarity of these will make work-ethics more purposeful.

3. Work ethics in terms of proper communication system

Communication system is said to be life line of an organization. Proper

communication channel will promote work ethics in the organization. Any
misunderstanding, mistrust, suspicion etc. may be eliminated through
communication system.

Reasons for poor work ethos/culture:

Lack of commitment :– Lack of commitment refers to the

Lack of discipline: Discipline includes regularity, punctuality

such as to come in time to work place, to complete the task in
given time, to follow rules and regulations if any, do not waste time
during working hours etc. Hence, lack of discipline will create
poor work culture which may cause delay in operations.
3. Poor working condition: Poor working conditions includes
unhealthy working climate, lack of pure drinking water, lack of
ventilation, lack of canteen facilities, lack of safety devices and
norms, industrial pollution etc. These are the constituents of poor
working conditions in an organization.

4. Political interference :– Most of the unions in the companies are

affiliated to some political party. Political leaders, sometimes,
destroy the peace and harmony in the organization for the sake of
power and ego only. This is one of reasons that causes industrial
conflict.

5. Decline in moral standard :– Moral standards provide tool for

judging the moral value of a decision. They provide the basis for
deciding whether an act is right or wrong. If there is decline in the
moral standards, the culture of the work in an organization
becomes poorer

MORAL STANDARDS
The meaning of Moral Standards and the Law Moral standards are bases for moral behavior and
bases for determining whether a certain act is moral or immoral and for someone to be
responsible or not. These are the guides of human behavior and decision making. These
standards are not only applied to individual persons but also to a group or corporation.
Something is unethical if it does not conform to a particular standard of morality. They may not
be written but observed and they are assumed norms of moral conduct (Articulo, 2005). These
norms are point for checking if certain action is good or bad. The concerns of moral standards
are norms, not theory which explains why certain act is good or bad. Moral standards are not the
same with social norms but they are beyond social norms. Though social norms are code of
conduct within a particular society but they are not moral standards. Moral standards are beyond
borders or may be called universal that are accepted by all rational being everywhere. The
coverage of social norms is local, while the coverage of moral standards is universal. Therefore,
the function of moral standards is to check if the social norms are moral or immoral
Example, certain society allows killing in the name of God or offers human as a form sacrificial
lamb to God. Moral standards will tell us that it is immoral, though social custom declares that it
is accepted
These standards should encourage individuals to make the right decisions for their actions, and
give them the courage to come forward should they notice dishonest and unethical behavior.
Individuals need to follow the norms prescribed by all rational agents. Therefore, in
deontological systems, being morally good is defined as obeying certain moral rules
(Harris1986). When you follow those rules and do your duty, then you are good — regardless of
any other considerations like whether the consequences of that obedience lead to suffering or
happiness. On the other hand, if you ignore or break any of those rules then you are not doing
your duty and are morally bad — once again, regardless of any consequences. These moral
duties are absolute and unconditional duties such as telling the truth, being honest, being fair, etc.
They apply whatever consequences might follow from obeying them. Example is the order not to
steal. It is our duty not to steal, though the consequences of stealing would save the life the one
who is stealing. It does not explain why one should not steal because it is the concern of moral
philosophy.

HOW ARE MORAL STANDARDS FORMED?

There are some moral standards that many of us share in our conduct in society. These moral
standards are influenced by a variety of factors such as the moral principles we accept as part of
our upbringing, values passed on to us through heritage and legacy, the religious values that we
have imbibed from childhood, the values that were showcased during the period of our
education, the behaviour pattern of those who are around us, the explicit and implicit standards
of our culture, our life experiences and more importantly, our critical reflections on these
experiences. Moral standards concern behaviour which is very closely linked to human well-
being. These standards also take priority over non-moral standards

Moral Standards Vs. Non-Moral Standards

1. Moral standards deal with matters, which can seriously injure or seriously benefit human
beings while it is not the case with non-moral standards. Examples of non-moral
standards include the standards of etiquette.
2. Moral standards are not formed or changed by the decision of particular authoritative
bodies and the validity of these standards lies on the adequacy of the reasons that are
taken to support and justify them.
 3. If a person has the moral obligation to do something, then the person is supposed to do
that even if this conflicts with other non-moral values or self-interest.
4. Moral standards does not evaluate standards on the basis of the interests of a particular
individual or group, but one that goes beyond personal interests to a universal stand point
in which everyone’s interests are impartially counted as equal.
5. Moral standards are associated with special emotions and a special vocabulary. If a
person tells a lie so as to fulfill a purpose and then afterwards he starts feeling guilty or
ashamed of his behavior.

ETHICAL DECISION MAKING

INTRODUCTION:

As we all know that the real identity of a manager is to make decisions regularly and correctly.

As Alvin Toffler says—“The very speed of change introduces a new element into management,

forcing managers to make more and more decisions at a faster and faster pace. Now a days

management simply has become the process of decision making. All the parts of management

pass through decision making toward goal achievement like.

Whatever decision of any kind has been taken by any manager has some ethical

implications. Here we are going to make the concept ethical decision making clear to the

world and show them How Ethics is involved in decision making.

ETHICAL DECISIONS (INDIVIDUAL/COMMUNITY) IN ORGANIZATION:

Most people believe that when they work in group /community, it matters about who are

ethical / unethical. They find that if they are ethical by themselves, they might be

considered as ethical, or ethically poor or unethical by others.

A typical characteristic of the functioning of a group or organization is that each member

has different role to perform. As they perform different functions with different

responsibilities so they cannot be evaluated on same yard sticks.

In short, we understand that ethical decision making is a very complex and difficult task.

There cannot be a single standard or process which can be followed by each and every one

at different stages in an organization. As organizations are not simply mass of people

working together but they are an ever present feature of human culture in which persons

interact for objectives. The people who work in the organizations are the moral agents, they

make collective decisions and act on them, they follow certain rules explicit / implicit, codes

of conduct, regulations and their actions based on the followed behavior can be subjected to

ethical appraisal.

STRUCTURE OF ETHICAL DECISION MAKING:

Identify the Problem

Generate alternative
solutions

Evaluate the alternatives

using cost benefit analysis

Select the solution

Implement the chosen

solution

A logical steps in analytical structure (Kitson and Campbell 1996) has been developed to help

out the students how they should make the decisions? Identification of the present situation is the

basic foundry and most crucial step. A manager must understand the very nature of the problem

or circumstances. Again ethical considerations are involved in alternations generated by

decision maker. Now evaluations and selection depend upon so many factors it involves ethical

reasoning of the decision maker. This can be further broken and magnified into eight steps:

EIGHT STEPS IN ETHICAL DECISION MAKING PROCESS

The following are the eight steps in ethical decision making.

1. Collection of facts & figures: Collecting all relevant facts & figures is a challenging job for
any manager. Though difficult this can be done with the cooperation of others.

2. Defining ethical issues: Foe making ethical decision , ethical issues have to be identified &
well defined. Other issues have to be separated from ethical issues. One cannot mix up various
issues like economic issues with ethical issues.

3. Affected parties: It is necessary to identify the affected parties. Some are benefitted & some
others are affected. Some are directly affected & some are others are indirectly affected.

4. Examination of consequence: Any ethical decision has to produce both short term & long term
effects. Examples like welfare measure like “no work, no play “ many produce some problems in
the short run but in the long run these problem can be solved. A decision maker has to examine
all the short term & long term effects.

5. Identification of obligations: While executing ethical decisions the manager have to make
certain obligation. Example are when a project is constructed people have to be evaluated &
measures have to undertaken for the alternative settlement of people, keeping up the promise &
building trust are important in making ethical decision.

6. Character of manager: The decision maker manager should look into his past achievement,
mental & ethical strengths as well as future prospects. Ethical decisions are implemented based
on the moral strength of the manager. Therefore only those decisions which can be really
implemented should be made. There should no regret at a future date for the present decision.

7. Creative thinking: While making an ethical decision a manager should try to use their creative
thinking. A good manager should find out the reasons for unethical behaviour & try to remove
these defects in an organization. There are different solutions for any ethical issues. Good
counseling by professional counselors can eradicate the problem at the root itself.
8. Guts of managers: The execution of any ethical decision ultimately depends on the guts and
strong will-power of the manager. Managers require moral strength and will power for
implementing of ethical decision.

Challenges of Ethical Decision-Making:-

1) Will this action produce the greater benefit to all avoiding least harm to anybody?

2) Are the rights and dignity of people protected?

3) Is it fair to all stakeholders?

4) Is it a common ground approach to the achievement of the original goals by working together?

5) Does this ethical decision embody the best human values so that it can be adhered in future
also?

PROBLEMS IN ETHICAL DECISION MAKING:

It we say or assure that unethical behavior in organization is just because of some wrong doers
or some greedy people, some bad individuals who are always behind money, then some where
we would be wrong.

Now-a-days, people who look decent, who seem to be ethical, do involve in unethical practices,
though they don’t think of doing anything illegal or immoral but they get backed into doing
something unethical by systems and practices of their own firms.

The sources of ethical problems are various and varied:

1. Due to globalization, as companies deal with other countries where cross cultural diversity
issues arise. Managers working in MNC’S find it very difficult to standardize ethical standards
as they do change as society change.

2. Some-times the decision makers do not follow what they must follow as they have conflict
in individual values v/s organizational goals.

3. Individual moral standards affect whole organization decisions if they are morally strong,
ethical decisions would be the outcomes.
4. If the decision makers/managers/policy makers who are greedy, look for short cut routes to
earn in earliest possible time, they have an upper hand on the moral values, therefore ethically
the decision process would be corrupt.

5. Competitive pressure is also the main cause which forces decision makers to choose such
path where they have to kill their morals, values and move on unethical path just to cope up with
the competition.

6. Poor decisions without deep thinking of implications.

7. Ambiguous situations create problem which put the manager in dilemma as to which
decision they should make and follow.

8. Pressures of budget systems.

Methods of Ethical Decision-making in Organization:-

1) Bounded rationality: In this method, decisions are taken on the basis of some simplified
model based on rational thinking. A few variables like truth, honesty & sincerity are taken into
account for making ethical decisions.

2) Intuitive decision-making: Many decisions, in general, and ethical decisions, in particular,

are taken by conscious process. This process is dependent on the intuitive efforts of the manager.
The manager goes on mentally reviewing a lot of related events and arrives at a decision.

3) Heuristics: Heuristics refers to short-cuts in decision-making. Based on the information

available, decisions are taken into account. Some other times analogies are drawn and decisions
are taken. We have to find similar situations and similar cases. It should be noted that heuristics
is not the effective method of ethical decision-making.

4) Escalation of commitment: Increased commitment to previous decisions helps us to make

ethical decision based on previous commitment. Strictly speaking, a previous decision cannot be
effective in the present context also because a lot of changes take place in short duration of time.

CONSTRAINTS IN ETHICAL DECISION MAKING

1. Performance evaluation: It is not giving adequate importance to ethical practices, perform or

perish is the only maxim of performance evaluation.

2. Reward system: The existing reward systems are not giving importance to intangible ethical
practices. The reward systems focus only on tangible achievements.
3. Formal rules & regulations: The formal rules are not framed recently. These rules are copied
from other organizations. These rules do not have a provision for ethical practices.

4. Time constraint: In a fast moving world it is difficult to introduce ethical decisions because
people are not able to wait.

5. No historical precedence: There is no precedence based on ethical values. Most of the

decisions are from a practical platform.

6. Cultural difference: There are different ethical practices in different cultural environment.
Relativism is playing an important role in ethical management.

CRITERIA OF GOOD ETHICAL DECISION

1. Utilitarianism: Seeking the greatest good for the greatest number

2. Rights: Protecting the basic rights of individual.

3. Justice: Imposing & enforcing rules in a impartial way.

In fact many ethical decisions are far superior to the ordinary decisions. They are sometimes
taken according to the local cultural norms.

Preparation, concentration, incubation, illumination & verification are the important stages of
creative ethical decisions.

WHY DECISIONS FAIL

1. Copying of other decisions.

2. The decision may be good but difficult for implementation.

3. Not effective participation by all.

4. There are cultural differences in making & implementing ethical decisions. Examples are that
Americans are faster in implementing ethical decisions whereas Indians are slow in making &
implementing decisions.

INTEGRATING ETHICAL DECISION MAKING INTO THE FIRM

1. Developing a code of ethics & following it.

2. Establishing a procedure for reporting violations.

3. Involving employees in identifying ethical issues.

4. Monitoring ethical performance

5. Rewarding ethical behaviour.

6. Publicity to ethical efforts.

7. Analysing the various values involved such as honesty & good conduct.

8. Discussion with legal experts.

Guidelines to Moral Decision-Making:-

1) Recognition of the moral dimension of the issue.

2) Identification of the various parts who are involved in the issue.

3) Finding out the values like trust, autonomy, fairness and justice.

4) Comparison of advantages (benefits) with disadvantages (costs) by implementation of the

current ethical decision.

5) Finding out similar cases and decision taken on those cases.

6) Discussion of the decision taken with others to gather opinions and reaction.

7) Examining the decisions taken with reference to legal and organizational rules.

8) Finally, the manager has to find out how far s/he is comfortable with the decision taken and
implemented.

GUIDELINES FOR MANAGER FOR ETHICAL DECISION MAKING

1. Individual codes of conduct — Here we mean by a man’s personal code of ethics. What one
finds moral, right and ethical. He/she will choose that option.

2. Industry ethical codes — The ethical climate in the industry provides inspirational guidelines
and a list of do not’s like —

• Non deceptive ads.

• Fair dealing with customers

• Safety measures

• Quality products.

3. Professional managers who are more ethical do not go for any compromises.

4. Sometimes govt. rules and regulations bound people to follow all laws as well as ethics.
5. Corporate code of ethics — Companies own rules, values and beliefs guide managers to
follow ethics path in decision making.

6. If the decision makers understand the following process they would definitely follow ethics.

Larger the organization Higher the ethical conduct

Long term survival Result in great public image

Goodwill and high profits

Some Ethical Values to be Studied with Reference to Ethical Decision-making:-

AUTONOMY:

It means the freedom to make one’s own decisions. Under the broad framework, the employees
can have limited freedom.

BENEFICENCE:

Doing what is best in the given situation. Prompt reporting duty and using the work time for the
productivity of the organization.

JUSTICE:

Being fair to all and treating employees equally.

NON-MALEFICENCE:

Avoiding harm by deciding not to spread gossip.

Similarly in all discussion, the ethical values like compassion, confidentiality, fidelity, honesty &

respect have to be followed.

In the era of globalization ethical decision making has become an important aspect of every

organization. Managers by learning a well defined ethical decision making process can make
decisions ethically sound. By judging the suitability of utilitarian criteria or right criteria or

justice criteria, they should show brilliant ethical reasoning. Though a nos. of problems are

emerging as the complexities in business are multiplying, yet some guidelines have been

developed to help out the decision makers to make good ethical decisions.

Beneficence and Non-Maleficence

These ethical concepts which are mostly used in the fields of healthcare and medicine.
BENEFICENCE involves balancing the benefits of treatment against the risks and costs
involved, or Beneficent actions can be taken to help prevent or remove harms or to simply
improve the situation of others.  Beneficence prompts you to help others

Whereas

NON-MALEFICENCE means avoiding the causation of harm. As many treatments involve

some degree of harm, the principle of non-maleficence would imply that the harm should not be
disproportionate to the benefit of the treatment. Physicians must refrain from providing
ineffective treatments or acting with malice toward patients.  This principle, however, offers little
useful guidance to physicians since many beneficial therapies also have serious risks.  The
pertinent ethical issue is whether the benefits outweigh the burdens.

Nonmaleficence prompts you not to harm others. Since many treatment methods involve
some degree of harm, the concept non maleficence would imply that the harm shouldn’t be
disproportionate to the benefit of the treatment.

Respecting the principles of beneficence and non-maleficence may in certain circumstances

mean failing to respect a person’s autonomy i.e. respecting their views about a particular
treatment. For example, it may be necessary to provide treatment that is not desired in order to
prevent the development of a future, more serious health problem. The treatment might be
unpleasant, uncomfortable or even painful but this might involve less harm to the patient than
would occur, were they not to have it.
In cases where the patient lacks legal competence to make a decision, medical staff are expected
to act in the best interests of the patient. In doing so, they may take into account the principles of
beneficence and non-maleficence. However, it would be helpful for medical staff in such cases,
if the patient lacking capacity had made an advance directive. Nevertheless, as will be seen in the
following section on “the position of advance directives alongside current wishes”, problems
may arise when there is a conflict between what a person requested in an advance directive and
what in the doctor’s view is in their best interests, particularly in cases where it is no longer clear
that the person in question would still agree with the decision previously made.

Utilitarian (end-based approach) The utilitarianism system was originated by the British
thinker Jeremy Bentham (1748– 1832). It aims at creating the greatest degree of benefits for the
largest number of people. According to this system, a human conduct is considered as good if it
results in benefits for society and bad if it generates harm to the society. In-fact Utilitarianism is
a special version of “Teleology”. Teleology emphasise mainly upon the outcomes of on
individual’s action and not on the intent of the individual. That’s why it is called as
“Consequentialism” or end based ethics

Universalism (rule based): The approach of universalism is based on the duties and obligations
of an individual (Deontology). The moral worth on individual action should be judged by the
intention of the person, not by the outcome of the action. It assumes that good intentions always
result in good outcomes, ultimately if not immediately.

‘Immanuel Kant’ (1724–1804) proposed the “Categorical Imperative” — One should act only in
ways that one would wish all others to act faced with the same set of circumstances, and also to
treat others with dignity and respect. Everyone’s value is equal. Hence no one’s rights should be
subordinated to those of others.

Care-based Approach

You have to reserve the dilemma keeping in mind that you have an obligation to care for those
with whom you have close relationship or who cares for you. You must care for them just to
maintain a strong bond in the relationship but some great-men put some argument against it that
it would create favoritism while working with those you have valuable relationship as well as it
can degenerate into unjust favoritism and sacrifice of own needs to care for children, parents,
spouse and friends with whom you have close relationships.

SHORT QUESTIONS:
1. How moral obligations and moral relativism differs in their views.

2. How values can be instilled in individuals and how the instrumental and terminals values are
different in what respect. Explain with three examples from our daily life.

3. How Indian managers follow work ethos to run the business.

4. What are the different values which the manager tries to instill in their employees?

5. What is the concept of Beneficence and Non-Malfeasance.

6. Why individuals in certain situations resort of no taking the right decision ethically.

7. What are the steps taken to make an ethical decision?

8. What is the difference between moral and immoral standards?