The impact of ethical decision making in the individual and organizational context

Abstract

In this globalized and dynamic business environment, ethical decision-making has generated more concern to the business leadership. Its impact and significantly widespread effect on day-to-day business practices is advancing rapidly. Issues and risks that associated with unethical decision makings have created enormous uncertainty and cost to organizations. The unstable economic environment has thrust the business leaders to adhere to the pressure and challenges of ethical decision-making hence theories have suggested that it is purely different from individual traditional and rational decision-making. In much literature review in business ethics, contradictions and inconsistencies have evolved in organizational ethical decision-making. In this review paper, this current study will critique some effects and impacts of ethical decision making in the organizational and individual context. It will extend our understanding of ethical decision making on the part of leaders by merging social role and self-construal perspectives. The practical implication of this review paper indicated that for an organization to maintain its competitive advantage in this dynamic business environment, implementation of a rightful and thoughtful ways of ethical decision-making is essential to both the leaders and organizations to maintaining their reputation and competitive advantage. In this paper, some of the ethical model and approaches were reviewed, their essential importance to enhance ethical decision making and managerial implication in organizations. Many factors influencing organizational unethical decisions were investigated to discover the gaps and loophole thereby creating further and future research recommendations to cover the gaps.