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What is an Ethical Dilemma? | Definition | GAN Integrity

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Ethical Dilemma. Ethics are the moral standards and principles by which entities (individuals and organizations) govern their behaviors and decision-making. ComplianceGlossary PreviousReturntoGlossary Next EthicalDilemma Ethicsarethemoralstandardsandprinciplesbywhichentities(individualsandorganizations)governtheirbehaviorsanddecision-making.Whenthesestandardsandprinciplesconflictwitheachotherinadecision-makingsituation,anethicaldilemmamayoccur. WhatisanEthicalDilemma? Anethicaldilemmatakesplaceinadecision-makingcontextwhereanyoftheavailableoptionsrequirestheagenttoviolateorcompromiseontheirethicalstandards. Weobservethatethicaldilemmascanbecharacterizedbythefollowingthreeelements: Theagentmustbefacedwithachoiceortheneedtomakeadecision. Theagentmusthavemorethanonecourseofactionavailable. Theagentrecognizesthatallavailablecoursesofactionrequirethemtocompromiseonsomepersonallyheldethicalstandardorvalue. Ethicalstandardsarethemoralframeworksthatindividualsandorganizationsusetoguidetheirdecision-makinganddifferentiatebetweenrightandwrong.Companiesandprofessionalorganizationsmayadopttheirownethicalstandardsandrequirethatemployees/membersadoptthosestandardsaspartoftheirpersonalbusinessethics. Commonethicalpracticesintheworkplaceinclude: Tellingthetruth Takingresponsibilityforone’sactions Followingcompanypolicies Fulfillingprofessionalobligations Followingthroughoncommitments Followingthelaw Actinginthebestinterestsofshareholders Actinginthebestinterestsofcustomers Actinginone’sownbestinterests Treatingothersequally Conductingsustainablebusinesspractices Maximizingprofits Avoidinglayoffs Ethicaldilemmashappenbecauseethicsareinherentlycontradictory.Employeesmayfacesituationswherecompromisingontellingthetruthorfollowingthelawseemstoserveothervaluedgoals,suchasmaximizingprofitsoravoidinglayoffs. TypesofEthicalDilemma Thereareseveraldifferenttypesofethicaldilemmasthatagentsmayencounterinthecourseofperformingtheirrolesandresponsibilities: Epistemicdilemmastakeplaceinadecision-makingcontextwheremoralstandardsconflictandtheagentcannotreadilydeterminewhichethicalprincipleshouldtakeprecedenceovertheother. Aself-imposeddilemmaisonecreatedbytheagent’sownerrorsinjudgment,suchasmakingcompetingpromisestomultipleorganizationsthatcannotbefulfilledsimultaneously.Incontrast,aworld-imposeddilemmaiscausedbycircumstancesoutsidetheagent’scontrol. Anobligationdilemmaisonewhereanagenthasmultipleoptionsandmorethanoneofthemisobligatory,whileaprohibitiondilemmaoccurswhenallavailableoptionsareprohibited. WhatisanExampleofanEthicalDilemma? Ethicaldilemmasoccurregularlyinthebusinessenvironmentwhereemployeesmakedecisionsthatimpactthesuccessandprofitabilityoforganizations. Employeesmayexperienceanethicaldilemmawhendecidingwhethertoreportanincidentofworkplaceharassmentordeclareaconflictofinterest.Inthefirstcase,theemployeemightunderstandthattheharassmentiswrong,butfeelguiltyaboutgettingtheircolleagueintrouble.Inthelattercase,theemployeemightrecognizetheirfiduciarydutytotheorganization,butfeelasenseofloyaltytotheirfamilyandfriendsthatmakesitdifficulttodotherightthing. HowDoYouIdentifyanEthicalDilemma? Expertsagreethatidentifyinganethicaldilemmastartswithrecognizingyourgutreactiontoaproblematicsituation.Ifadecisionseemstochallengeyourmoralcompass,it’stimetotakeastepbackandinvestigatefurther.  Youmightproceedbywritingdown: Thedecisionyouneedtomake. Thevariousoptionsorcoursesofactionavailable. Theethicalprosandconsofeachavailableaction. HowDoYouResolveanEthicalDilemma? Anethicaldilemmadoesnotalwaysofferaclearsolutionthatconformswithethicalnorms.Here’showentitiescancopewiththemostchallengingethicaldilemmas: TalkitOut–Thebestwaytodeterminewhetheradilemmaexistsistodiscussitwithotherpeople.Acollectiveanalysisofthesituationcanshedlightonwhetheradilemmareallyexistsandthemoralimplicationsofeachavailableoption.Thismightinvolvereportingtheincidenttoyourcompany’shotlinesothatyoumaydiscussthesituationwiththecomplianceteamandgetproperguidance.  UnderstandDuties&Obligations–Agreatwaytoapproachanyethicaldilemmasisfromthestandpointofunderstandingtheagent’sdutiesinthesituation.Inabusinesscontext,afiduciarydutytotheorganizationslegallyobligatestheagenttoactinthebestinterestsofshareholders.Contractualobligationscanalsoplayaroleindetermininghowtoresolveanethicaldilemma. MaximizetheGood&MinimizetheBad–Whenaproblemhasnoperfectsolution,thebestapproachistoanalyzetheoutcomesofeachpotentialactionandchoosetheactionwiththegreatestpositiveimpactandleastnegativeimpact. RelatedResources TheEUWhistleblowingDirective:FindingtheRightSolution ImprovingYourCompany’sRiskAssessmentProcess KeepLearning BestPractices WhatBuildinganEthicalCultureActuallyLooksLikeInPractice Ethicsandcomplianceprofessionalstalkabout“buildinganethicalculture”sooften,thatsometimesIworryaboutthatphrase—thatitcanbecomesomethingofacrutch,carryingtoobigofanideaforfoursmallwords. Solet’stalkaboutbuildinganethicalcultureinpractice.Whatdoesthephraseactuallyentail,whenacompliance…ReadMore CCOInsights “Technically”–orEthically? eBook ABlueprintforanAutomatedComplianceProgram:ThirdEdition MoreResources

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