A Framework for Ethical Decision Making

Contributed by Badre Alam, CEO of Badre Alam Traders, a complete trading house located in Pakistan.

To make good, ethical decisions requires a trained sensitivity to ethical issues, a practiced method for exploring the aspects of a decision, and weighing the impacts of a course of action. A method for ethical decision making is absolutely essential for building an ethical business environment. Here are some key questions to consider when assessing the ethical nature of your environment:

Recognize an Ethical Issue

  • Is there something wrong personally, interpersonally or socially? Could the conflict, the situation or the decision be damaging to the community, influence other businesses or make a finite position that speaks for itself?
  • Does the issue go beyond legal or institutional concerns? What does it do to people, who have dignity, rights, and hopes for a better life together?

Get the Facts

  • What are the relevant facts of the case? What facts are unknown?
  • What individuals and groups have an important stake in the outcome? Do some have a greater stake because they have a special need or because we have special obligations to them?
  • What are the options for acting? Have all the relevant persons and groups been consulted? If you showed your list of options to someone you respect, what would that person say?

Evaluate Alternative Actions from Various Ethical Perspectives

  • Which option will produce the most good and do the least harm?

Utilitarian Approach: The ethical action is the one that will produce the greatest balance of benefits over harms.

  • Even if not everyone gets everything they want, will everyone’s rights and dignity still be respected?

Rights Approach: The ethical action is the one that most dutifully respects the rights of all affected.

  • Which option is fair to all stakeholders?

Fairness or Justice Approach: The ethical action is the one that treats people equally, or if unequally, that treats people proportionately and fairly.

  • Which option would help employees participate more fully in the life you share as a family, community or society?

Common Good Approach: The ethical action is the one that contributes most to the achievement of a quality common life together.

  • Would you want to become the sort of person who acts this way (e.g., a person of courage or compassion)?

Virtue Approach: The ethical action is the one that embodies the habits and values of humans at their best.

Make a Decision and Test It

  • Considering all these perspectives, which of the options is the right or best thing to do?
  • If you told someone you respect why you chose this option, what would that person say? If you had to explain your decision on television, would you be comfortable doing so?

Act and Reflect on the Decision Later

  • Implementation of your decision. Watch carefully how the decision affected all parties involved. If you had it to do over again, what would you do differently?

These steps make it possible for an entrepreneur to create a healthy and ethical business environment for the employer and employees.

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