The Impact of Ethics on Decision Making

Impossible to talk about supporting our customers without touching a subject that is really important to all organizations: ethics. This is a paper I wrote back in February 24, 2004, as part of preparation for a MSCS. Any comments will be welcome.


In this document I will discuss the impact of ethics on the decision making process. There are moral philosophic factors to take into consideration, and also unconscious behaviors and attitudes that may have implications in the way ethics is used. Having a written code of ethics helps organizations to guide their decision makers to the best ethical decisions.

The Impact of Ethics on Decision Making

The decision-making process will always present ethical challenges to managers. Is this the right thing to do? This question is the essence of the ethical dilemma for any decision maker in today’s corporations. A collection of factors will be taken in consideration in answering to this question. Is it right for the company? Is it right for the shareholders? Is it right for the society? For the customers? For the decision maker himself? There are many ways to approach the ethical subject, and different ethical values may and will emerge from these different approaches. The way a decision will be evaluated is fully dependent on the values and interests of the person or group of people evaluating that decision. Some of the stakeholders will not care that much if the decision was made based on ethical values counting it generated the results they expected. This is where the risk lies, because the decision maker will also have this in mind when deciding about the subject; depending on how much he or she is results-driven, he or she may overlook some ethical issues in the name of a good outcome and good earnings. This is especially true when the decision maker is a materialist moral philosophy. Shannon Bowen (2002, pg 271) tells us that “moral philosophy can be summed up in three approaches: materialism, utilitarianism, and deontology”.

The ground rules about which a decision maker will care are highly dependent on the moral approach. The decision maker may use a self-interest and materialist approach and make decisions that will be always directed towards his or her own benefit; these decisions may sometimes cause also good results for the company even though the decision maker has only the self-benefit in mind. Even though this is not properly a school of moral philosophy (Bowen, 2002, pg 272), it is not rare that managers will make decisions using this approach. A different approach may be used and the decision happens based on the actual number of people benefited by it. Usually this utilitarian approach takes into consideration the consequences of a decision as the main method for evaluating its morality. And also, the decision maker may evaluate that the consequences are not really a factor that will determine whether a decision is ethical or not; in this situation deontological approach would be in use.

Whatever moral philosophy is guiding the decision making process, one must be aware that “only those who understand their own potential for unethical behavior can become the ethical decision makers that they aspire to be” (Banaji, Bazerman, and Chugh, 2003). Even though a decision maker is consciously looking after his or her own behavior in order to be ethic and unbiased on the decision process, there are unintentional conducts that may interfere with one’s ability to judge and make a fair decision. In their work, Banaji et al (2003) explore four involuntary conducts: implicit forms of judgment, in-group favoritism, over-claiming credit, and conflict of interest. Those are unconscious factors that have the potential to intervene on the process and cause a biased decision even for those who have a good evaluation – and self-evaluation - as ethical decision makers. Unconscious attitudes are proven to make our judgment to be far from what we think it is. The way we consciously think about race, religion, gender age, et cetera, is not really what may be the ultimate factor that influences our decisions. Banaji et all (2003) applied Implicit Association Testes to more than 2.5 million people, the research shows that there are unconscious biases:

· At least 75% of test takers show an implicit bias favoring the young, the rich, and whites.

· The mere conscious desire not to be biased does not eliminate implicit bias.

· Although people tend to report little or no conscious bias against African-Americans, Arabs, Arab-Americans, Jews, gay men, lesbians, or the poor, they show substantial biases on implicit measures.

· Minority group members tend to show less implicit preference for their own group than majority group members show for theirs. For example, African-Americans report strong preference for their groups on explicit measures but show relatively less implicit preferences on the tests. Conversely, white Americans report a low explicit bias for their group but a higher implicit bias.

· Those who show higher level of bias on the IAT are also likely to behave in ways that are more biased in face-to-face interactions with members of the group against which they are biased and in the decisions they make. (Banaji et al, 2003)

For any company, well defined ground rules for acceptable ethical behavior will emerge from a written code of ethics, and this code will offer regulation for answering ethical and moral problems (Bastien, 1997). Those ground rules should establish behavioral guidance to decision makers inside a corporation. Some companies will require that, before taking any action, one should answer the questions: Is it fair? Is it right? Is it legal? (Bastien, 1997). Any decision will be evaluated not only by the decision maker alone, or by his or her superiors; it will rather be inserted into a social context; in order to know if a decision brought good results, its outcome has to be assessed from many points of view. Some of these points of view will show the decision as beneficial, while others may demonstrate that the decision causes flawed results. Having an ethical approach while analyzing the situation before making a decision will help to soften its implications or rather to understand all implications and choose the decision that will bring better long term results to the organization. One cannot stress enough how time is important for the decision making process. If a decision is made taking into account only the short term outcome, it may cause trouble to the company in the future. If the decision maker is using a strictly materialist moral philosophy, he may bring good results for himself and good short term results for the organization, but in the long term he may more harm than benefit the company. One must think of its decisions as if they had the potential to be on the first page of the city’s newspaper: is this decision something that will make me proud? Is this something that I want everyone to know? Most probably, decisions that must he hidden from everyone are not candidates to be good decisions, and they should be carefully examined using critical thinking skills to proof it against unethical behaviors. Even though a manager may think of him of herself as highly ethical and good decision maker, the only way to assure that is by being constantly vigilant on his or her own decisions and actions. Extraordinary managers are relentless in their quest to be ethical (Stanley, 2002).



Bowen, Shannon A. (2002). Elite Executives in Issues Management: The Role of Ethical Paradigms in Decision Making. Journal of Public Affairs. February 2002, Vol. 2 Number 4 pg 270-283. Retrieved from EBSCO Host on February 23, 2004.

Banaji, Mahzarin R., Bazerman, Max H., Chugh, Dolly (2003). How (Un)Ethical Are You? Harvard Business Review. December 2003, Vol 81, Issue 12, p56, 9p, 13c. Retrieved from EBSCO Host on February 23, 2004. AN 11587432.

Bastien, J. Robert (1997). Can Ethics Improve The Bottom Line? Security Management. August, 1997. Vol. 41, Iss. 8, Pg. 136, 2 pgs. Retrieved from Proquest on February 23, 2004. Doc ID 13358297.

Stanley, T. L. (2002). The Making of an Ethical Manager. The American Salesman. July 2002, Vol. 47, Iss. 7; pg. 3, 7 pgs. Retrieved from Proquest on February 23, 2004. Doc ID 127278251.