Determinants of Ethical Behavior / The Roots of Unethical Behavior

Personal Ethics

Generally accepted principles of right and wrong governing the conduct of individuals

 Our personal ethical code exerts a profound influence on the way we behave as
businesspeople

 The first step to establishing a strong sense of business ethics is for a society to
emphasize strong personal ethics

 Expatriate managers may experience more than the usual degree of pressure to
violate their personal ethics

Decision-Making Processes

 Several studies of unethical behavior in business have concluded that businesspeople

sometimes do not realize they are behaving unethically primarily because they
simple fail to ask….
…. “Is this decision or action ethical?”

 Often the result of applying straight-forward business calculus to a decision without

considering important ethical issues

Organization Culture

 The climate in some businesses does not encourage people to think through the
ethical consequences of business decisions
  Result of an organizational culture that deemphasizes business ethics, reducing all
decisions to be purely economic

Unrealistic Performance Expectations

 Pressure from the parent company to meet unrealistic goals that can only be
attained by cutting corners or acting in an unethical manner

 This often results in managers will violating their own personal ethics and engage in
unethical behavior

 An organizational culture with values that reinforce ethical behavior is an essential

ethical component

Leadership

Leaders help to establish the culture and values of an organization, and they set the
example that others follow