Business ethics are the principles of right and wrong that guide an individual in making decisions.

Last Updated: February 3, 2022 3:30:12 PM PST

Learn why ethics awareness is important to you and to UCSD.

Acting ethically is the right thing to do, but it's not always easy. Often, conforming to a high standard of conduct is not about clear-cut right and wrong decisions, but choosing the "lesser of two evils." Some decisions require that you prioritize and choose between competing ethical values and principles.

Ethical decision-making is based on core character values like trustworthiness, respect, responsibility, fairness, caring, and good citizenship. Ethical decisions generate ethical behaviors and provide a foundation for good business practices.

See a model for making ethical decisions. It will provide you with a framework and practical strategies as you make decisions.

Overview

• We are responsible for upholding the public trust.
• We are accountable to spend and use our resources the way they were intended.
• We are accountable to our “stakeholders” — donors, funding agencies, students, and parents.

Public employees are expected to be examples of responsible citizenship. Employees of the University have a responsibility to make all professional decisions based on merit, unimpeded by conflicting personal interests. We are expected to avoid even the appearance of impropriety.

Our reputation is important because it affects the University's ability to attract students, faculty, and staff. Our reputation also impacts the quality of research performed, the community's perception of us, and our standing as a renowned public institution.

Below are some consequences of unethical behavior:

• Criminal charges and/or fines
• Lawsuits
• Ruined careers
• Injured organization reputation
• Wasted time
• Low morale
• Recruiting difficulties
• Oppressive legislation
• Fraud and scandals

• Emphasize good internal controls. Our control environment sets the tone for our organization. The Office of the Controller offers information on best practices for incorporating internal controls into daily processes and creating an effective control environment. Control environment factors include integrity, ethical values, and competence of our staff and faculty.
• Promote an ethical environment. Our organization embraces ethical values and practices we deem central to a healthy environment. To facilitate a high level of integrity in your department:
  • Tell people what is expected of them.
  • Set the example.
  • Give the message and repeat it often.
  • Use the resources available to you.

Six key ethical values can help you build character in yourself and others.

Trustworthiness

Do what you say you'll do.

• Acts with integrity
• Is honest and does not deceive
• Keeps his/ her promises
• Is consistent
• Is loyal to those that are not present
• Is reliable
• Is credible
• Has a good reputation

Respect

Treat others better than they treat you.

• Is open and tolerant of differences
• Is considerate and courteous
• Deals peacefully with anger, disagreements, and/or insults
• Uses good manners
• Treats others the way they want to be treated

Responsibility

Do what you are supposed to do.

• Acts with self-discipline
• Thinks before acting
• Understands that actions create certain consequences
• Is consistent
• Is accountable for actions

Fairness

Play by the rules.

• Is open-minded and listens to others
• Takes turns and shares
• Does not lay the blame on others needlessly
• Is equitable and impartial

Caring

Show you care.

• Expresses gratitude to others
• Forgives others
• Helps people in need
• Is compassionate

Citizenship

Do your share.

• Cooperates
• Shares information
• Stays informed
• Is a good neighbor
• Protects the environment
• Obeys the law
• Exhibits civic duty
• Seeks the common good for the most people

 Copyright 2000 Josephson Institute of Ethics

The "Character-Based Decision-Making Model" model, developed by the Josephson Institute of Ethics, can be applied to many common problems and can also be used by most individuals facing ethical dilemmas.

It involves three steps:

1. All decisions must take into account and reflect a concern for the interests and well being of all affected individuals ("stakeholders").

   The underlying principle here is the Golden Rule — help when you can, avoid harm when you can.

2. Ethical values and principles always take precedence over nonethical ones.

   Ethical values are morally superior to nonethical ones. When faced with a clear choice between such values, the ethical person should always choose to follow ethical principles.

   Perceiving the difference between ethical and nonethical values can be difficult. This situation often occurs when people perceive a clash between what they want or "need" and ethical principles that might deny these desires. If some rationalization begins to occur, this situation is probably present.

3. It is ethically proper to violate an ethical principle only when it is clearly necessary to advance another true ethical principle, which, according to the decision-maker's conscience, will produce the greatest balance of good in the long run.

   Some decisions will require you to prioritize and to choose between competing ethical values and principles when it is clearly necessary to do so because the only viable options require the sacrifice of one ethical value over another ethical value. When this is the case, the decision-maker should act in a way that will create the greatest amount of good and the least amount of harm to the greatest number of people.

Ethical decision-making refers to the process of evaluating and choosing among alternatives in a manner consistent with ethical principles. In making ethical decisions, it is necessary to perceive and eliminate unethical options and select the best ethical alternative.

The process of making ethical decisions requires:

• Commitment: The desire to do the right thing regardless of the cost
• Consciousness: The awareness to act consistently and apply moral convictions to daily behavior
• Competency: The ability to collect and evaluate information, develop alternatives, and foresee potential consequences and risks

Good decisions are both ethical and effective:

• Ethical decisions generate and sustain trust; demonstrate respect, responsibility, fairness and caring; and are consistent with good citizenship. These behaviors provide a foundation for making better decisions by setting the ground rules for our behavior.
• Effective decisions are effective if they accomplish what we want accomplished and if they advance our purposes. A choice that produces unintended and undesirable results is ineffective. The key to making effective decisions is to think about choices in terms of their ability to accomplish our most important goals. This means we have to understand the difference between immediate and short-term goals and longer-range goals.

Copyright 2002 Josephson Institute of Ethics

• If it's necessary, it's ethical: This approach often leads to ends-justify-the-means reasoning and treating non-ethical tasks or goals as moral imperatives.
• The false necessity trap: "Necessity is an interpretation and not a fact." We tend to fall into the "false necessity trap" because we overestimate the cost of doing the right thing and underestimate the cost of failing to do so.
• If it's legal and permissible, it's proper: This substitutes legal requirements for personal moral judgement. This alternative does not embrace the full range of ethical obligations, especially for those involved in upholding the public trust. Ethical people often choose to do less than what is maximally allowable but more than what is minimally acceptable.
• It's just part of the job: Conscientious people who want to do their jobs well often compartmentalize ethics into two categories: private and job-related. Fundamentally decent people may often feel justified doing things at work that they know to be wrong in other contexts.
• It's for a good cause: This is a seductive rationale that loosens interpretations of deception, concealment, conflicts of interest, favoritism, and violations of established rules and procedures.
• I was just doing it for you: This rationalization pits values of honesty and respect against the value of caring and overetimates other people's desire to be "protected" from the truth. This is the primary justification for committing "little white lies."
• I'm just fighting fire with fire: This is the false assumption that promise-breaking, lying, and other kinds of misconduct are justified if they are routinely engaged in by those with whom you are dealing. This rationale compromises your own integrity.
• It doesn't hurt anyone: This rationalization is used to excuse misconduct when violating ethical principles so long as no clear and immediate harm is perceived. It treats ethical obligations as simply factors to be considered in decision-making rather than as ground rules.
• Everyone's doing it: This is a false "safety in numbers" rationale that often confuses cultural, organizational, or occupational behaviors and customs as ethical norms.
• It's OK if I don't gain personally: This justifies improper conduct for others or for institutional purposes.
• I've got it coming: People who feel overworked and/or underpaid rationalize that minor "perks" (acceptance of favors, discounts, gratuities, abuse of sick leave, overtime, personal use of office supplies) are nothing more than fair compensation for services rendered.
• I can still be objective: This rationalization ignores the fact that a loss of objectivity always prevents perception of the loss of objectivity. It also underestimates the subtle ways in which gratitude, friendship, anticipation of future favors and the like affect judgement.

Source: Josephson Institute of Ethics

Making ethical choices requires the ability to make distinctions between competing options. Here are seven steps to help you make better decisions:

1. Stop and think: This provides several benefits. It prevents rash decisions, prepares us for more thoughtful discernment, and can allow us to mobilize our discipline.
2. Clarify goals: Before you choose, clarify your short-term and long-term aims. Determine which of your many wants and "don't wants" affected by the decision are the most important. The big danger is that decisions that fullfill immediate wants and needs can prevent the achievement of our more important life goals.
3. Determine facts: Be sure you have adequate information to support an intelligent choice. To determine the facts, first resolve what you know, then what you need to know. Be prepared for additional information and to verify assumptions and other uncertain information. In addition:
   • Consider the reliability and credibility of the people providing the facts.
   • Consider the basis of the supposed facts. If the person giving you the information says he or she personally heard or saw something, evaluate that person in terms of honesty, accuracy, and memory.
4. Develop options: Once you know what you want to achieve and have made your best judgment as to the relevant facts, make a list of actions you can take to accomplish your goals. If it's an especially important decision, talk to someone you trust so you can broaden your perspective and think of new choices. If you can think of only one or two choices, you're probably not thinking hard enough.
5. Consider consequences: Filter your choices to determine if any of your options will violate any core ethical values, and then eliminate any unethical options. Identify who will be affected by the decision and how the decision is likely to affect them.
6. Choose: Make a decision. If the choice is not immediately clear, try:
   • Talking to people whose judgment you respect.
   • Think of a person of strong character that you know or know of, and ask your self what they would do in your situation.
   • If everyone found out about your decision, would you be proud and comfortable?
   • Follow the Golden Rule: treat others the way you want to be treated, and keep your promises.
7. Monitor and modify: Ethical decision-makers monitor the effects of their choices. If they are not producing the intended results, or are causing additional unintended and undesirable results, they re-assess the situation and make new decisions.

Before making a difficult decision, consider asking yourself the following questions to see if you are on ethical thin ice.

• Does your decision conflict with any of the core ethical values?
• Think of someone whose moral judgment you respect. What would that person do?
• How will your decision affect others?
• Ask yourself: Are my actions legal?
• Are there regulations, rules, or policies that restrict your choices/ actions?
• Would your decision be perceived as unethical?
• How would your decision look if it were reported on the news or in another public forum?
• What would a reasonable person do? How would they percieve your decision?
• Would you be proud of your choice if your child were to find out? Would you want them to make the same choice?
• Could you rationally and honestly defend your decision?
• Will you sleep soundly tonight?

Copyright 2000 Josephson Institute of Ethics