Content area
Full Text
J Bus Ethics (2011) 104:311323 DOI 10.1007/s10551-011-0910-1
A Model for Ethical Decision Making in Business: Reasoning, Intuition, and Rational Moral Principles
Jaana Woiceshyn
Received: 11 February 2011 / Accepted: 16 May 2011 / Published online: 28 May 2011 Springer Science+Business Media B.V. 2011
Abstract How do business leaders make ethical decisions? Given the signicant and wide-spread impact of business peoples decisions on multiple constituents (e.g., customers, employees, shareholders, competitors, and suppliers), how they make decisions matters. Unethical decisions harm the decision makers themselves as well as others, whereas ethical decisions have the opposite effect. Based on data from a study on strategic decision making by 16 effective chief executive ofcers (and three not-so-effective ones as contrast), I propose a model for ethical decision making in business in which reasoning (conscious processing) and intuition (subconscious processing) interact through forming, recalling, and applying moral principles necessary for long-term success in business. Following the CEOs in the study, I employ a relatively new theory, rational egoism, as the substantive content of the model and argue it to be consistent with the requirements of long-term business success. Besides explaining the processes of forming and applying principles (integration by essentials and spiraling), I briey describe rational egoism and illustrate the model with a contemporary moral dilemma of downsizing. I conclude with implications for further research and ethical decision making in business.
Keywords Ethical decision making Integration
by essentials Intuition Moral principles
Rational egoism Reason
Introduction
Whether people make decisions ethically or not is not a trivial matter, as the outcome of those decisions can make a signicant difference to their lives and to the lives of others. For example, they can choose to be honest with themselves and others or not. They can pretend that their business is doing well when, in fact, it is losing money or they can face the facts and try to save the business. Or they can defraud their customers like Bernie Madoff did or deal with them honestly like many other business people do. Honesty is just one moral principle, but these examples alone illustrate the signicance of ethical decisions. The better we understand how people make ethical decisions, the better we are equipped to make such decisions and to affect their outcomes.
Ethicalor...