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Summary Ethics and the Future of Busienss Session 2 (Grade 9,5)
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Lecture 2: Behaviours & ActionsCrane chapter 4 (2019)
Descriptive ethical theory: Theory that describes how ethical decisions are
actually made in business, and explains what factors influence the process and
outcomes of those decisions.
Ethical decision:
The decision is likely to have significant effect on others.
The decision is likely to be characterized by choice, in that alternative
courses of action are open.
The decision is perceived as ethically relevant by one or more parties.
Ethical decision-making models primarily seek to represent two things:
The different stages in decision-making that people go through in
responding to an ethics problem in a business context
The different influences on that process
Mark Schwartz (2016) distinguishes two broad perspectives on ethical decision-
making as ether rationalist or intuitionist/sentimentalist.
Ethical dilemma: a situation which is experienced as “uneasy”, where you have
to choose between two or more actions (e.g., to act or not act) and these options
involve moral/ethical aspects.
We cannot get rid of cognitive biases, but we need to learn how to minimize
them. Examples:
• Anchoring bias: the first impression is important for future impressions
• Confirmation bias: only listen to information that confirms our
preconceptions.
• Pro-innovation bias: We have a tendency to look for new (technical)
solutions, while sometimes getting rid of something might prove more
effective.
• Stereotyping: having expectations about a group without really having
information about the concerning qualities.
Economic decision-making: the motive of human decision-making is their own
economic interest and well-being. Humans are perceived as rational.
In practice:
1. People care about their economic interest.
2. People consider the interests of people close to them.
3. People will sacrifice their own economic interest to help those who are friendly
and punish
unfriendly people.
4. People consider the welfare of strangers when making decisions.
5. People are interested in their reputation.
6. People care about the self‐image
Individuals move through a process of ethical decision-making in four stages:
, The role of normative theory in these stages is primarily in relation to moral
judgement (stage 2). This is mostly consequentialism in business.
Influences on ethical decision-making:
Individual factors: unique characteristics of the individual making the
decision including factors given by birth such as age or gender and those
acquired by experience and socialization such as education and
personality.
o Age and gender
o National and cultural characteristics
Hofstede dimensions (individualism/collectivism, power
distance, uncertainty avoidance, masculinity/femininity, long-
term/short-term orientation, indulgence)
• Criticism: does national culture exist?
Intra-cultural wars: within cultures, there is a divide. Between
individualizing and binding moral orientations because of
this.
o Education and development: experience brings decision-making
skills, it helps us in revisiting/refine our mental models (e.g. “What if
everyone did the same as me?”). We rely on these heuristics when
making a decision.
o Psychological factors:
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