How Groups Make Ethical Decision

Because of frequent business scandals, business ethics have received more and more attention. Decisions made by managers in business activities will inevitably affect others’interests and concerns, thus exerting moral influences on stakeholders and the society. How to improve the ethical level of business decision-making has been a hot topic in business ethics research. Group decision-making is widely believed to be more valid and accurate than individual decision-making. However, it still remains controversial whether group can improve ethical decision-making or not. Some studies reported that group process can improve ethical reasoning, while others did not find significant difference between group and individual ethical decision. Current literature on group ethical decision-making simply contrasted the results of decisions made by group with individual while neglecting the group interactive process. Moreover, cultural factors were also neglected. In common sense, social culture acts as the foundation of cognition, behavior and interaction of individual and group. Existing group ethical decision-making studies are all based on Western culture, American and Australian culture for examples. As a typical representative of Eastern culture, Chinese culture is different from Western culture in ethical cognition and group interpersonal interaction. So as conducting a study under the Chinese context, the factor of Chinese culture should also be considered.The objectives of this study are exploring the process of group ethical decision-making, verifying and explaining the difference between group and individual ethical decision-making. In order to describe group ethical decision-making accurately in Chinese culture, Social decision scheme theory (SDS) was introduced to ethical decision-making research. Based on this theory, a Chinese social decision scheme which entitled "Zhongyong Social Decision Scheme" was established firstly. This study used this special decision scheme to explain the difference between group and individual ethical decision-making, and to verify the influence of Chinese culture.61groups consist of200undergraduates were experimented in business ethical scenarios. This study investigated Chinese group ethical decision-making process from the social decision scheme theory perspective and established the "Zhongyong Social Decision Scheme". In detail, group would first select the choice advocated by the majority, and if there were no majority-supported choice, group would then select a compromised choice. Consistent with this process, no significant difference between group and average group member in ethical decision-making was found, while group decision was outperformed by its most ethical group member significantly. Moreover, the moderate effect of lian (moral face) on group ethical decision-making was identified. On one hand, group decisions were more ethical than individual decisions (not significant) for groups with a higher level of lian; on the other hand, group decisions were significantly less ethical than individual decisions for groups with a lower level of lian. Finally, zhongyong social decision scheme was positively related to lian (not significant). Group might use the zhongyong process to keep group members’ lian. Heated discussion and extreme opinion may yield conflict and destroy harmony. Zhongyong decision scheme followed the perspective of the majority. So someone might not feel losing face when his choice was not accepted by group or criticized by others. Chinese tend to employ this process to make group ethical decision-making. The gender effect was also tested in this study. As found in many business ethical researches, females are more ethical than males on both group level and individual level. However, just like males, the ethical decisions were not improved by group process for females.