Ethics

Basic definition of ethics:

• “The science concerning the right and wrong
of human action” (Boylan, 2000: 2).
• Science refers to an activity that undergoes
rational and systematic study, the objective
being to reach some exact conclusions about
specific decisions or actions.

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 Ethics
• ‘Right’ and ‘wrong’ relate to judgments that
assign praise for good acts/decisions or blame
for bad ones.
• Contemporary ethicists view the application of
concepts of ethics as a necessary condition to
organizational well-being.

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 Ethics
• Why should we incorporate ethics in decision-
making?
• Ethics is a set of values that guide us in our
decisions and activities of everyday life.
• Ethics can be viewed as a mode of life.

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 Ethics
How do we secure trust and loyalty?
• Influence the motivation and performance of
people.
• Enforce notions of care, respect and
rationality in the workplace.

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 Ethics
When confronted with ethical issues, one must:
• Preserve clarity of thinking.
• Act as rationally as possible.
• Apply rules of ethics to arrive at an acceptable
solution.

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 Ethics
EDM is dominated by
• Teleology
• Deontology

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 Teleology

• Refers to consequences.
• Is founded on the principle of utility
maximisation.
• The concept judges behaviour by its effects on
the overall welfare of stakeholders.

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 Teleology
Two main principles:
• Egoism
• Utilitarianism
Both are founded on consequences.

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 Egoism

Relies heavily on ideas of:

• Prudence
• Self-promotion
• Best self interests
• Selfishness
• Personal satisfaction.

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 Utilitarianism
• Individuals should produce the highest
possible benefit for the community.
• When faced with alternatives, the option that
leads to the highest level of utility should be
selected.
• Assess the costs and benefits likely to be
experienced, before picking the alternative
that yields the highest level of utility.

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 Deontology
Definition:
• Non-consequentialism
• Focus is on the notion of duty and respect for
people

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 Deontology
• Distinguish between the law and ethics
• The principle of duty goes beyond what the
law requires of the average citizen.
• Principles of duty emphasise the actual worth
of a decision or an action.

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 Deontology
• Deontology bases itself on the intrinsic worth
of the decision or act.
• No allowance is made for unethical conduct
under this philosophy.

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 Deontology
• Decisions should be judged on the
circumstances in which they are made: each
action has intrinsic worth and unconditional
value, and must be judged as such, not by the
consequences likely to follow from it.

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 Ethical Relativism
• Determinants of ethical conduct are a product
of time and place.
• An action considered as ethical in a particular
context may not be assessed as such in a
different setting.

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 Ethical Relativism
• Product of culture – values, beliefs, traditions
shape behavior
• Moral framework influences ethical choices
e.g. reward / punishment system,
expectations of society, moral determinants
which go beyond legal provisions.

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 Justice theory
• Under justice-based approaches, the emphasis
is on the cultivation of human values.
• Justice theory is based on the cultivation of
virtues, principles of formal justice. The
philosophy highlights human nature as the key
determinant of right or acceptable actions.

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 Justice theory
• The rational human being bases himself on his
experience and good judgement.
• The assumption is that human beings are
capable of directing their lives through a
process of rational thinking.

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 Justice theory
• It is somewhat similar to the theory of
deontology
• Absolute rules are used to rate specific
decisions or actions i.e. no allowance for
subjectivity is made

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 Ethics in a practical context
• EDM involves considering all alternatives.
• Decision makers normally create a mental
balance sheet when involved with choices:
 Consider all possible courses of action.
 List the pros and cons of the alternatives.
 Assess the costs and benefits likely to arise in
each case before picking the option that helps
maximise utility.
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Why do people make unethical decisions?

Discussion:
• What are the costs associated with unethical
conduct?

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 Unethical conduct
• The costs of being unethical in business are
significant.
• Ethics may appear to be something intangible
and insignificant.
• A lack of ethics and morality may damage what is
hard, tangible and measurable that is, the bottom
line.
• In the long-term, the reputation of both the
organisation and the people can be potentially
ruined.
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 Trust = Ethical Conduct

• It is important to preserve a good reputation –

as important for the individual as it is for the
organization.

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 Unethical Conduct = Loss of Trust
Loss of trust can lead to:
• Loss of confidentiality
• Poor communication
• Poor self-esteem
• Lack of commitment
• Diminished loyalty
• Resignation

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