Chapter Three
Ethical Principles, Quick
Tests, And DecisionMaking Guidelines
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Chapter Topics
1.
2.
3.
Decision criteria for ethical reasoning
Ethical relativism: A self-interest approach
Utilitarianism: A consequentialist (results-based)
approach
4. Universalism: A deontological (duty-based)
approach
5. Rights: An entitlement-based approach
6.
Justice: Procedures, compensation, retribution
7. Immoral, amoral, and moral management
8. Four social responsibility roles
9. Individual ethical decision-making styles
10. Quick ethical tests
11. Concluding comments
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Decision Criteria for Ethical
Reasoning
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A first step in addressing ethical dilemmas is to
identify the problem and related issues.
Laura Nash developed twelve questions to ask
yourself during the decision-making period to help
clarify ethical problems.
These twelve questions can help individuals:
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Openly discuss the responsibilities necessary to solve ethical
problems
Facilitate group discussions
Build cohesiveness and consensus
Serve as an information source
Uncover ethical inconsistencies
Help a CEO see how managers think
Increase the nature and range of choices
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Decision Criteria for Ethical
Reasoning
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The following three criteria can be used in
ethical reasoning:
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Moral reasoning must be logical
Factual evidence cited to support a person’s
judgment should be accurate, relevant, and
complete
Ethical standards used should be consistent
A simple but powerful question can be used
throughout your decision-making process in
solving ethical dilemmas:
What is my motivation for choosing a course
of by
action?
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Decision Criteria for Ethical
Reasoning
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A major aim of ethical reasoning is to gain a
clearer and sharper logical focus on problems to
facilitate acting in morally responsible ways.
Two conditions that eliminate a person’s moral
responsibility for causing harm are:
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Ignorance
Inability
Mitigating circumstances that excuse or lessen a
person’s moral responsibility include:
A low level of or lack of seriousness to cause harm
Uncertainty about knowledge of wrongdoing
The degree to which a harmful injury was caused
or averted
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Ethical Relativism:
A Self-Interest Approach
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Ethical relativism holds that no universal
standards or rules can be used to guide or
evaluate the morality of an act.
This view argues that people set their
own moral standards for judging their
actions.
This is also referred to as naïve
relativism.
The logic of ethical relativism extends to
culture.
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Ethical Relativism:
A Self-Interest Approach
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Benefits include:
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Problems include:
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Ability to recognize the distinction
between individual and social values,
customs, and moral standards
Imply an underlying laziness
Contradicts everyday experience
Relativists can become absolutists
Relativism and stakeholder analysis.
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Utilitarianism: A
Consequentialist (ResultsBased) Approach
 The basic view holds that an action is
judged as right, good, or wrong on the
basis of its consequences.
 The moral authority that drives
utilitarianism is the calculated
consequences or results of an action,
regardless of other principles that
determine the means or motivations
for taking the action.
 Utilitarianism includes other tenets.
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Utilitarianism: A
Consequentialist (ResultsBased) Approach
 Problems with utilitarianism include:
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No agreement exists about the definition
of the “good” to be maximized
No agreement exists about who decides
How are the costs and benefits of
nonmonetary stakes measured?
Does not consider the individual
Principles of rights and justice are ignored
 Utilitarianism and stakeholder
analysis.
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Universalism: A Deontological
(Duty-Based) Approach
This view is also referred to as
deontological ethics or
nonconsequentialist ethics and holds that
the means justify the ends of an action,
not the consequences.
 Kant’s principle of the categorical
imperative places the moral authority for
taking action on an individual’s duty
toward other individuals and humanity.
 The categorical imperative consists of
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Universalism: A Deontological
(Duty-Based) Approach
 The major weaknesses of universalism
and Kant’s categorical imperative
include:
 Principles are imprecise and lack
practical utility
 Hard to resolve conflicts of interest
 Does not allow for prioritizing one’s
duties
 Universalism and stakeholder analysis.
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Rights: An EntitlementBased Approach
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Moral rights are based on legal rights and
the principle of duty.
Rights can override utilitarian principles.
The limitations of rights include:
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Can be used to disguise and manipulate
selfish, unjust political interests and claims
Protection of rights can be at the expense of
others
Limits of rights come into question
Rights and stakeholder analysis.
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Justice: Procedures,
Compensation, Retribution
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The principle of justice deals with
fairness and equality.
Two recognized principles of fairness that
represent the principle of justice include:
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Equal rights compatible with similar liberties
for others
Social and economic inequality arrangement
Four types of justice include:
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Compensatory
Retributive
Distributive
Procedural
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Justice: Procedures,
Compensation, Retribution
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Problems using the principle of justice
include:
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Justice, rights, and power are really
intertwined.
Two steps in transforming justice:
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Who decides who is right and who is wrong?
Who has moral authority to punish?
Can opportunities and burdens be fairly
distributed?
Be aware of your rights and power
Establish legitimate power for obtaining rights
Justice and stakeholder analysis.
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Immoral, Amoral, Or Moral
Management
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Immoral management means intentionally
going against ethical principles of justice and
of fair and equitable treatment of other
stakeholders.
Amoral management happens when others
are treated negligently without concern for
the consequences of actions or policies.
Moral management places value on
equitable, fair, and just concern of others
involved.
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Four Social
Responsibility Roles
 Figure 3.3 illustrates four ethical
interpretations of the social roles and
modes of decision-making.
 The four social responsibility modes
reflect business roles toward
stockholders and stakeholders.
 Two social responsibility orientations
of businesses and managers toward
society include:
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Stockholder model
Stakeholder model
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Individual Ethical
Decision-Making Styles
 Stanley Krolick developed a survey
that interprets individual primary and
secondary ethical decision-making
styles, that include:
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Individualism
Altruism
Pragmatism
Idealism
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Quick Ethical Tests
 The Center for Business Ethics at
Bentley College suggests six questions
to be asked before making a decision.
 Classical ethical tests:
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The Golden Rule
The Intuition Ethic
The Means-End Ethic
Test of Common Sense
Test of One’s Best Self
Test of Ventilation
Test of Purified Idea
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