Business Ethics and Decision-Making Process Essay Sample

Business ethics can be a challenging field for decision-makers as they often face dilemmas that put their moral compass to the test. One such problem is whether to engage in unethical practices to save a company from financial distress, even if it appears to be a low risk. The outcome of this decision can have far-reaching consequences, such as affecting the company’s ethical standing, internal culture, and long-term viability. As such, the ramifications of such choices, guided by ethical principles and teachings from the Bible, underscore the significance of integrity and moral conduct in business.

Decision on saving the company

The decision to save the company by engaging in an unethical opportunity, despite its low risk of exposure, is not advisable. The primary reason for this stance is the commitment to ethical principles and integrity, which are foundational to any business’s long-term success and reputation. Choosing an unethical path undermines core values and compromises the business’s and its leadership’s moral integrity. Firstly, the act of engaging in unethical practices sets a dangerous precedent. It signals a willingness to compromise on fundamental values for short-term gains. This erosion of moral standards can permeate the organization, affecting the company culture and employee morale. Secondly, the potential long-term consequences of such an action are significant. If the unethical behavior were to be discovered, it could lead to irreparable damage to the company’s reputation. Trust, once broken, is difficult to rebuild. Customers, investors, and partners may lose confidence in the company, leading to a loss of business, legal repercussions, and possibly the company’s downfall.

Moreover, the impact on employees must be considered. Workforces are integral to the company. Engaging in unethical practices can create a work environment where dishonesty is tolerated, detrimental to employee engagement and loyalty. This issue could lead to high turnover, difficulty attracting talent, and a decline in overall productivity and morale. As such, while the temptation to quickly bring the company out of financial distress is understandable, the decision to engage in unethical practices is fraught with risks that far outweigh the immediate financial relief. Upholding ethical standards, even in challenging times, is crucial for any business’s sustainable success and reputation. Therefore, the ethical imperative to maintain integrity and maintain core values far outweighs the fleeting benefits of engaging in unethical practices, ensuring the long-term health and reputation of the business.

Ethical approaches

Deontological ethics is centered on the adherence to moral duties and rules. Megias, de Sousa, and Jimenez-Sanchez (2023) note that this framework is relevant in business decision-making, advocating for actions that align with established moral principles. Deontological ethics provides a clear stance when a business faces financial challenges. This approach opposes decisions compromising fundamental moral duties, such as honesty and fairness. This concept places a higher value on moral obligations than unethical actions’ potential benefits or advantages. It posits that some actions are intrinsically right or wrong, asserting that ethical behavior should be upheld, even under challenging or adverse circumstances. As such, deontological ethics is a guiding principle, emphasizing the significance of maintaining ethical integrity in business decisions.

Virtue ethics emphasizes the role of character and virtues in ethical decision-making. This approach diverges from rule-based or consequence-focused beliefs by centering on the individual’s moral character (Cruz, 2020). Business ethics underscores the importance of embodying virtues such as honesty, integrity, and responsibility. When faced with challenging decisions, such as rescuing a financially struggling company, virtue ethics guides leaders to act per these virtues, prioritizing moral character over expedient solutions. This approach encourages maintaining a consistent moral stance, even in adverse financial situations. The focus is on fostering a corporate culture that values and upholds these virtues. This tactic plays a crucial role in shaping ethical leadership and decision-making to ensure that actions align with the core values of honesty and integrity, essential for long-term success and ethical business practice.

Future impact on the company

Engaging in unethical practices can profoundly impact a company’s future, particularly regarding reputation damage. When customers discover an organization’s involvement in unethical activities, the loss of trust can be immediate and long-lasting, leading to reduced loyalty and patronage. This shift in consumer perception is critical in an era where ethical practices are increasingly valued in purchasing decisions. Similarly, investor confidence can be severely shaken, resulting in the withdrawal of crucial financial support and investment, which affects financial stability and ability to attract future investments.

Furthermore, unethical actions often lead to legal repercussions, ranging from fines to more severe penalties, depending on the nature of the misconduct. These legal issues consume financial resources and distract from the company’s core business activities. Additionally, a tarnished reputation can weaken a company’s market position and competitiveness, as competitors may seize the opportunity to capture market share. In essence, engaging in unethical practices can damage reputation, eroding customer trust, investor confidence, and market position and jeopardizing a company’s long-term sustainability and success.

The internal cultural impact of engaging in unethical practices can harm a company’s future. When a firm compromises its ethical standards, it risks a considerable decline in employee morale and an increase in turnover, as workers often seek to align with organizations that reflect their values. This shift can hinder the company’s ability to attract and retain top talent, crucial for innovation and performance. Besides, the normalization of unethical behavior within the company culture can create a cycle where such behavior becomes justified, leading to further ethical breaches. This situation affects employee conduct and undermines the credibility of leadership. When leaders condone unethical practices, it erodes their authority and respect among employees, impairing their ability to lead effectively and make sound decisions. Therefore, these internal cultural issues stemming from unethical practices can significantly compromise a company’s integrity, leadership effectiveness, and long-term viability.

Bible verses

In this ethical dilemma, two Bible verses offer profound guidance. Proverbs 11:3, “The integrity of the upright guides them, but the crookedness of the treacherous destroys them,” speaks directly to the heart of ethical decision-making in business (English Standard Version Bible, 2001, Prov. 11:3). This verse underscores the fundamental role of integrity in guiding actions and decisions. It implies that upholding integrity, even in challenging times, leads to stability and respect. Conversely, the verse warns that treachery and unethical behavior lead to destruction. Furthermore, Philippians 4:8, “Finally, brothers, whatever is true, whatever is honorable, whatever is just, whatever is pure, whatever is lovely, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things,” provides a blueprint for ethical thought and action (English Standard Version Bible, 2001, Phil. 4:8). This verse encourages individuals and businesses to focus on and engage in actions that are true, honorable, just, and pure.

In the business context, this means making legally compliant and morally commendable decisions. Pursuing excellence and praiseworthy actions should be at the forefront of business decision-making. This approach fosters a positive internal culture and builds a strong, respectable brand in the eyes of customers, investors, and the wider community. These verses from Proverbs and Philippians emphasize the importance of integrity and virtue in business, guiding leaders toward ethical practices that ensure stability and respectability.

Retrospectively, the ethical dilemma of choosing between short-term financial gain through unethical means and maintaining integrity presents a significant challenge in business. The decision to uphold ethical standards, guided by deontological and virtue ethics, is a moral imperative and crucial for the long-term success and reputation of the company. The potential consequences of unethical practices, including reputational damage, legal issues, and negative impacts on internal culture and employee morale, highlight the importance of ethical conduct. Furthermore, the teachings from Proverbs and Philippians reinforce the value of integrity and virtue, which is a moral compass in business decision-making. Ethical principles are essential for building a sustainable, respected, and successful business.

References
Cruz, J. S. (2020). Virtue ethics: In pursuit of excellence. Rev Med (Sao Paulo), 99(6), 591-600, http://dx.doi.org/10.11606/issn.1679-9836.v99i6p591-600.

English Standard Version Bible. (2001). ESV Online. https://esv.literalword.com/.

Megias, A., de Sousa, L., & Jimenez-Sanchez, F. (2023). Deontological and consequentialist ethics and attitudes towards corruption: A survey data analysis. Social Indicators Research, 170(1), 507-541, https://doi.org/10.1007/s11205-023-03199-2.