Chapter 4: Making decisions in business ethics: descriptive ethical theories

1. Chapter 4: Making decisions in business ethics: descriptive ethical theories Descriptive business ethics theories seek to describe how ethics decisions are actually made in business, and what influences the process and outcomes of those decisions. Normative theories provide us what business people should do, whereas descriptive theories seek to tell us what business people actually do and why they do it. Stages in ethical decision-making: Jones model provides the most comprehensive model of ethical decision-making. According to this individuals move through a process whereby they: i)Recognise a moral issue ii) Make moral judgment about that issue iii)Establish an intention to act upon that judgment iv) Finally act according to their intentions. The model distinguishes between knowing what is the right thing to do and actually doing something about it; or between wanting to do the right thing, and actually knowing what the best course of action is.

2. Relationship with normative theory: The role of normative theory in the stages of ethical decision-making is primarily in relation to moral judgement. Moral judgements can be made according to considerations of rights, duty, consequences, etc. However, the issue of whether and how normative theory is used by an individual decision-maker depends on a range of different factors that influence the decision-making process Influences on ethical decision-making Two broad categories: individual and situational Individual factors: The unique characteristics of the individual actually making the relevantdecision.These include factors which are given by birth and those acquired by experience and socialization. Situational factors: The particular features of the context that influence whether theindividual will make an ethical or unethical decision. These include factors associated with the work context and those associated with the issue itself.

3. Individual influences 1) Age and genderResearch suggests:- Aged people are more ethical than young- Female are more ethical than men2) National and cultural characteristicsPeople from different cultural backgrounds likely to have different beliefs about right and wrong, different values, etc. and this will inevitably lead to variations in ethicaldecision-making across nations, religions and culturesHofstede (1980; 1994) influential in shaping our understanding of these differences – our ‘mental programming’a) Individualism/collectivismb) Power distancec) Uncertainty avoidanced) Masculinity/femininity

4. 3) Education and employment:- Educated people are more ethical than illiterate. Ex: research reveals that business students not only rank lower in moral development than students in other subjects such as law, but are also more likely to engage in academic cheating, such as plagiarism.- Relationship between employment experience and education and ethical decision making is still unclear4) Psychological factors:Cognitive moral development (CMD) refers to the different levels of reasoning that an individual can apply to ethical issues and problems. The important thing about CMD theory is that it is not so much what is decided that is at issue, but how the decision is reached in terms of the individual’s reasoning process.Pre-conventional: individuals define right and wrong according to self interest and expected rewards and punishment from authorityConventional: Individuals live up to what is expected of them immediate peers and those close to themPost-conventional: Individuals go beyond identifying with others’ expectations, and assess right and wrong according to the upholding of basic rights, values, and contracts of society.

5. Criticisms of CMD are the following: Gender bias: Carol Gilligan claimed that the theory was gender biased due to its emphasis on the abstract principles esteemed by Kohlberg and his male subjects. Carol argued women tended to use an ‘ethic of care’. Implicit value judgements: Darry and others suggest that CMD privileges rights and justice above numerous other bases of morality. Invariance of stages: we pass through discrete stages of moral development can be criticized if we observe that people either regress in CMD or use different moral reasoning strategies at different times and in different situations. An individual’s locus of control determines the extent to which they believe that they have control over the events in their life.Ex: If you had an external locus of control you might automatically blame your professor for setting a difficult test. If you had an internal locus of control, your first thoughts would be more along the lines of questioning whether you had really done enough preparation for the exam. 5) Personal integrity: Integrityis defined as an adherence to moral principles or values. The original meaning of the word is concerned with unity and wholeness/ one maintains a consistency or unity in one’s beliefs and actions, regardless of any inducement or temptation to deviate from them.

6. Moral imagination-Concerned with whether one has “a sense of the variety of possibilities and moral consequences of their decisions, the ability to imagine a wide range of possible issues, consequences, and solutions” Situational influences on decision-making Issue-related factors: If you worked in a bar you might think rather more deeply about the morality of taking $20 out of the cash register for yourself than you would about pouring your friends a couple of unauthorized drinks on the house. Context-related factors: our beliefs and actions are largely shaped by what we see around us : the group norms, expectations, and roles we are faced with; the nature of the climate in which we work; and the rewards and punishments that we can expect as a consequence of our actions. Issue-related factors: Moral Intensity Moral Framing

7. Jones proposes that the intensity of an issue will vary according to six factors: Magnitude of consequences:This is the expected sum of the harms or benefits for those impacted by the problem or action, such as health problems or death as a result of a faulty product. Social consensus: People are in agreement over the ethics of the problem or action. Probability of effect: Likelihood that the harms or benefits are actually going to happen. Temporal immediacy: Concerned with the speed with which the consequences are likely to occur. Ex: long term effects of smoking or other unhealthy products. Proximity: the feeling of nearness (social, cultural, psychological or physical) the decision-maker has for those impacted by his or her decision. Concentration of effect: cheating a person out of a hundred Euros is much more morally intense than cheating the same sum out of a large multinational with millions of shareholders. Moral framing: The same problem or dilemma can be perceived very differently according to the way that the issue is framed. Language important aspect of moral framing: integrity, honesty, fairness, propriety-or lying, cheating and stealing. The problem is that many people in business are reluctant to ascribe moral terms to their work, even if acting for moral reasons, or if their actions have obvious moral consequences-Moral muteness because of: a) Harmony,b) Efficiency and c) Image of power and effectiveness

8. Context-related factors: the organizational context in which an employee will be working-especially the expectations and demands placed on business people within the work environment that are likely to influence their perceptions of what is the morally right course of action to take. Main factors that can be addressed in order to improve ethical decision-making in the workplace. Systems of reward People are likely to do what they are rewarded for-Ex: many organizations offer commission or bonuses for salespeople in order to motivate them to achieve greater numbers of sales. Authority and Bureaucracy Authority People do what they are told to do – or what they think they’re being told to do Bureaucracy argue bureaucracy effects ethical decision-making

9. Work roles and organisational norms& culture Work roles Work roles can encapsulate a whole set of expectations about what to value, how to relate to others, and how to behave. Ex: work roles can be functional-the role of an accountant or engineer. Organisational norms and culture The group normswhich delineate acceptable standards of behaviour within the work community National and cultural context This differs from individual’s national and cultural characteristics Instead of looking at the nationality of the individual making the decision; now we are considering the nation in which the decision is actually taking place, regardless of the decision-maker’s nationality Different cultures still to some extent maintain different views of what is right and wrong