Quiz 7: Ethics and Business Decision Making


Company C can only file this suit in California State court if it can prove that the state of California has a personal jurisdiction over the defendant i.e. company E. Company C would have to prove that company E has some close relation with the state of California. This would be difficult to prove because personal jurisdiction exists if the defendant resides in that territory in which the court is located. In this case it does not seem to be the case and therefore, it can be assumed that company C cannot bring this suit in California state court. There are two conditions which should be met before company C can file this suit in federal court. First is the diversity of citizenship of the parties involved and the second is that the amount involved in dispute should be $75,000 or more. In this case, first condition suffice i.e. both the companies involved in the dispute are situated in separate states. However there is no information in this case about the amount involved in the dispute and therefore it cannot be determined that whether the case could be filed in the federal court or not.

Ethics can be defined as that branch of philosophy which involves systematizing, recommending, and defending the concept of correct and incorrect conduct. It helps in studying the moral behaviour among humans along with fundamental principles and concept of human conduct. Business or corporate ethics can be defined as a form of professional or applied ethics which examine ethical or moral issues which arise in business environment. Business ethics is applicable to all the aspects conduct in business and is important to the conduct of employees and organizations. Business ethics are important for an organization due to below-mentioned reasons: 1) It helps an organization to attract customers which result in increased sales and profits. 2) Increases employee retention, reduces labour turnover and increases productivity. 3) Helps in attracting investors which results in high share prices for the company.

Business and personal ethics may sometimes overlap. Business persons may not essentially adopt different sets of principles for guiding their personal and professional life. Business activities are just one part of life and business related ethics are also a subset of ethics. Ethical decision making can get complicated during business due to the number of people providing input into those decisions. Very few business persons have a complete control over decision making process. Personal ethics should essentially play a role in ethical decision making in businesses. It would be quite hypocritical to apply different set of ethics in different situations. However, there are various other factors also which influence ethical decisions in business.

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