With the advent of ultra-modern communications technology and public awareness of suspicious business practices, the question of ethics in decision making has become extremely important in today’s business world, in commercial as well as government sectors. A. M. Senia (1403 AH/ 1982 AC) agrees with Dr. Mark Pastin of Arizona State University, that the key to the success of American business is to divert its attention to the study of, and implementation of ethics instead of turning to Japan for innovative ideas. Dr. Pastin concludes that the employees are more and more concerned about the worthwhileness of their work rather than their economic survival. He suggests that by giving “real world examples-if, for instance, a firm adopts its own stricter guidelines for certain governmental regulations, then it can meet the stringent governmental requirements and in the end, increase the firm’s share of market. A clear proof of increasing awareness of the ethics of decision-making is evident by the fact that the Center for Public and Private Sector Ethics has acquired great popularity since its inception in 1400 AH/1980 AC.
Decision-making is an integral part of both day-to-day and long-term affairs of a single individual or a group of individuals. Factors such as decision magnitude (major versus minor), decision impact (high versus low), the decision-making body itself (a single person, a family, or a committee of persons), and decision environment (under certainty, risk, uncertainty, or competition) etc., are the determinants of whether or not a single individual or a group of individuals makes a decision. While Green and Tull (1407 AHA987 AC) and others break down the decision process into several steps (i.e., recognition of the problem, generation of alternatives, evaluation of alternatives, and implementation of the selected alternative), the evaluation of alternatives is perhaps central to the entire decision process. It precedes the actual decision-making function and it is at this stage of the decision making process that ethics become extremely influential.
A considerable amount of ethics-related literature is devoted to business decision-making. Scholars have attempted to define ethics in general and business ethics in particular for a long time. The following are excerpts of definitions related by several authors:
“In a business sense, ethics involves the art of integration and compromise, not obedience and conformity. . . . Business ethics need not be and should not be either pious or radical.”-G. H. McCoy (1402 AHA983 AC). Contrary to the common belief of ethics being extremely important only in making major decision, McCoy believes that ethics should be applicable in day-today situations as well. “Ethics is commonly defined as a set of principles prescribing a behavior code that explains what is good and right or bad and wrong; it may even outline moral duty and obligations generally.” -V. E. Hendersen (1402 AHA982 AC) .
Even though these definitions have a common element of morality they depict some subtle differences, thus bringing to forefront a fundamental difficulty on part of ethicists, behavioral scientists, and management executives to provide a practical definition for ethics. The dynamicity of the business environment adds to this difficulty. It stems from several factors, (e.g., multinational nature of business, advent of computer technology involving “artificial intelligence” etc.). Under these circumstances, there exist a dire need for clearly establishing basic ethical guidelines of conducting business so that the firms can answer both day-to-day and long-term questions pertaining to ethics. J. Weber (1401 AHA981 AC) confirms this by suggesting that ethics need to be institutionalized in the sense that the concepts of ethics need to be incorporated into daily decision-making processes of firms.