Business ethics can often be confusing as there is the effort to determine whether doing right by the company or doing right by one’s own morals is the appropriate position to take. In this case study, the decision to be made is whether or not to reveal the truth to a client, essentially doing away with a deal that the boss told him to seal. Because of the economy his job as well as others are in jeopardy and this decision could decide whether or not he keeps his job.
There are a couple of issues to be decided here. One of those is the definition of implied falsity in the business world. This means that a message has been given that has the intent to mislead, confuse or deceive and is not necessarily a true false statement. In this case the companies representative could say that there was indeed the possibility that if that is the highest bid in this climate that was probably what the business was worth. This would be fraud however, when it is known by you that the answer is different.
There are a couple of theories that might be considered in a effort to decide what to do here. One is the Deontological theory in which there is a right or wrong answer and you should choose the right one and the other is the Teleological theory which says yes, there is a right and wrong but it must be decided in perspective with the consequences of the decision. In this case we need to look at what those answers might be.
Using the Deontological theory one must consider the right and wrong of the situation which is more difficult than it seems. If it is determined to tell the client that the new bid is below what the company is worth, he will lose his job and his company who needs the business will lose a case. If he lies none of those things will happen now. However, lying is never the right answer so in this theory, the decision must be to tell the client the truth and let the client make the next decision.
Using the Teleological theory one must remember that the results of the decision is more important than the decision. We have determined that to tell the client the truth will possibly end your job and damage your company. However, if you tell a falsehood what will be the result. Certainly the deal will go through and your boss will be happy, it will help your company, and you will probably keep your job.
The other company though has sold a business that was important to their income and in the end the result of selling at too low a price will affect their business. Not telling the truth may bring the client back later with accusations of unethical dealing with them and this would lead to a later loss of business. So, in this case, even if we use the second theory, the right answer has to be to tell the truth. This business should not be sold at this price and hope that the company who is trying to re-bid will reconsider but if not, post the business for sale again.
Making an ethical decision is not always easy and that has certainly been shown in the last few years with Enron and so many other unethical company decisions. One must evaluate the steps of a decision to assure that the appropriate decision is made. When it does not feel right or in the case that one must think about what might happen if…one must then look at the need to use ethical decision making.
Ferrell, O. Fraedrich, J. Ferrell L (2008) Business Ethics, Ethical decision making and cases. 7th ed. Houghton Mifflin Company: Boston