Ethical Decisions and Decision-making in Organizations

This literature review was conducted through the Google scholarly electronic databases. In order to ensure the literature was relevant, key words such as ethical decision making, ethical behavior, and ethical behavior in organizations were used. There were several peer-reviewed journals discovered pertaining to ethical decision making in organizations. The purpose of this study is to evaluate ethical decisions and decision-making in organizations as well as to extend one’s knowledge on current ethical decision-making in the workplace environment as well as identifying the gaps in which one should further delve into research in order to eliminate those gaps. This literature review will provide information on what one knows and what one should research further into ethical decision making in an organization or workplace environment.

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“In modern time, ethical behavior has been looked as important aspect of the business success. Ethical behavior is evidenced since human civilization had been evolved,” (Geeta, Pooja, and PN, 2016, p. 1). Ethical decision-making dates back to the Ancient Greeks and early philosophers. People and societies have taught and discussed ethics and decision-making. Philosophers throughout the years have analyzed ethical decision-making. According to Hastie and Hawes (2016), a good image for decision-making is a person pausing at a fork in the road and then choosing one path to reach a desired goal or to avoid an unpleasant one, (p. 25). Each person has their own definition of a decision. A decision is an idea that is dependent upon a course of action. There was much debate surrounding right versus wrong; good and poor ethical decisions. According to Hastie and Dawes (2016):

A decision in scientific decision theory terms is a response to a situation that is composed of three parts: (a) There is more than one possible course of action under consideration, ‘in the choice set’; (b) the decision maker can form expectations concerning future events and outcomes following from each course of action, expectations that are often described in terms of probabilities or degrees of confidence; and (c) consequences, associated with the possible outcomes, that can be assessed on an evaluative continuum reflecting personal values and current goals, (p.25-26).

The definition of a decision must in understood in order to define ethical decision-making. The most important evolutionary situations that selected Hastie and Dawes (2016) basic decision-making capabilities involved physical approach or avoidance, (p. 25).

Ethical behavior in business practice. It has been developed and redeveloped endlessly. Ethical decision-making in a workplace environment begins within oneself. An individual must make moral choices to succeed throughout life. The ethical theory of moral virtue states everything begins with people, and those who have good virtues and sense of character; thus, a good foundation of ethical behavior. By having good moral values, it creates good behavior and vice versa. Each person should have good morals which leads to positive decision-making. In any given workplace, one must make good decisions for the fear of losing their job. If one chooses to make poor decisions, one could lose their job. “For example, business executives often claim their decisions are intuitive, but, when questioned, demonstrate that they have systematically thought through the relevant alternatives quite deliberately before deciding which intuition to honor,” (Hastie and Dawes 2010, p.6).

There is no one definitive answer, response, or reaction when discussing ethical decision-making. Ethical behavior is closely examined in a work environment or organization. Ethical decisions also represent ethical standards in a workplace setting. Each decision a person makes is based upon an ethical manner. Unethical behavior often goes unchecked and unchanged. This type of behavior will continue to change unless something is done about it. One’s values and morals could be questioned. Some individuals may find it difficult to adapt to such change, but a change that is needed to make positive ethical decisions.

Organizational factors are factors which are external to an individual and exist in the workplace environment, and either directly or indirectly influence their ethical behavior. The ethical decision-making process goes through five stages: awareness, cognition, moral evaluation, determination, and action. One must be aware of the ethical issue at hand, use selective reasonings, evaluate or judge the situation morally, decide on the course of action, and act upon it. The action will either be ethical or unethical. There are a few concepts of organizational factors which are important like code of ethics and ethics training. There were significant findings of ethical behavior. Although there are mixed results on existence of the code of ethics, most of the review concluded that the code of ethics proved beneficial. The relationship of code of ethics and ethical decision-making provided varied results.

Ferrell and Weaver (1998) argued that the existence and enforcement of the code of ethics has no relation with ethical conduct. There should be more research into why there may not be a correlation between ethical conduct and the code of ethics as none was discovered. There may be a gap in research of workplace environments’ ethical conduct and code of ethics. If the code of ethics is not discussed, one may make poor ethical decisions and not know what they did was wrong. Peterson (2002) concluded that the codes of ethics were associated with less observed unethical decision-making behavior. Greenberg (2002) found individuals who worked at an office with a corporate ethics program proved helpful rather those workplaces that do not have an ethics program. The code of ethics should be well-known around a workplace setting.

Ethics training should be provided once, if not twice a year to workplaces. The knowledge of ethics training content among employees should provide positive feedback and a positive influence on employee’s ethical behaviors; in turn, their decision-making capabilities. A training program should positively influence on ethical behavior, (Delaney and Sockell 1992).  Ethics training should enhance ethical behavior within an organization. Ethics training provides information to individuals on policy rules, codes, and how to make morally right decisions that one may be approached with in a workplace setting. “For example, business executives often claim their decisions are intuitive, but, when questioned, demonstrate that they have systematically thought through the relevant alternatives quite deliberately before deciding which intuition to honor,” (Hastie and Dawes 2010, p.6).

In conclusion, this review should assist researchers to find the gaps between ethical and unethical decision-making within the workplace environment for training purposes. There were a few studies found to be linked to ethical decision-makings in a workplace environment. According to Hastie and Dawes (2016), if we aspire to give advice about how to make good decisions, we need to say something about what we mean by bad decisions. The quality of a decision cannot be determined unambiguously by its outcome, (p. 17). Research generally indicated that more education and employment or workplace experience would benefit from further training as well as positively affecting one’s ethical decision-making.

References

Delaney, J.T. and D. Sockell: 1992, ‘Do Company Ethics Training Programs Make a Difference? An Empirical Analysis, Journal of Business Ethics 11, 719-727.

Geeta, M., Pooja, J., and PN, M. (2016). “Ethical behavior in organizations.” Quest Journals: Journal of Research in Business and Management, Vol. 4 Issue 1, p.1-6. Retrieved from https://pdfs.semanticscholar.org/b468/5e88c94c22dc663e0f684ce2156400c23d2e.pdf

Greenberg, J (2002). “Who stole the money and when? Individual and situational determinants of employee theft.” Organizational Behavior and Human Decision Process 89, p. 985-1003.

Hegarty, W.H. and Sims, H.P. (1978). “Some Determinants of Unethical Behavior: An Experiment.” Journal of Applied Psychology, 451-457. Retrieved from https://psycnet.apa.org/doiLanding?doi=10.1037%2F0021-9010.64.3.331

O’Fallon, M.J. and Butterfield, K.D. (1994). “Ethical decision making: a review of the empirical literature.” Journal of Business Ethics, Vol. 13, Issue 3, p. 205-221. Retrieved from https://link.springer.com/content/pdf/10.1007%2Fs10551-005-2929-7.pdf

Peterson. D.K (2002). “The relationship between unethical behavior and the dimensions of the Ethical climate questionnaire.” Journal of Business Ethics, Vol. 41 Issue 4, 313-326.

Weaver, K.M., and Ferrell, O.C. (1977). The impact of corporate policy in reported ethical beliefs and behavior of marketing practitioners. In AMA proceedings 477-481.