Ethical dilemma is a decision-making problem between two possible moral imperatives, neither of which is unambiguously acceptable or preferable.
So to resolve this kind of ethical dilemma, we can use either rules based approach or principles based approach.
Most professional institutes use a principles-based approach to resolving ethical dilemmas.
Use of a rules-based approach is normally inappropriate as rules cannot cover every eventuality.
Rules-based approach | Principles-based approach |
(1) Establish ethical rules that members must follow. | (1) Establish fundamental ethical principles that members must follow. |
(2) Ensure members are aware of the rules. | (2) Ensure members are aware of the principles. |
(3) Ensure members comply with those rules. | (3) Require members to identify and address threats to compliance with the principles and make an appropriate response to mitigate each threat. |
Rules-based approach:
Benefits:
– Easy to check compliance as based on fact.
– Easy to amend rule set as required.
Disadvantages:
– The list of rules may not be complete.
– There is no room for individual decision making.
Principles-based approach:
Benefits:
– Recognises that every threat cannot simply be ‘listed’.
– Allows for subjective judgement, so the member can apply the principles in accordance with their specific situation and nature of the threat.
Disadvantages:
– In somesituations it may be difficult to confirm that the compliance action was appropriate as two people may make different and valid decisions based on the same threat and circumstances.
Ethical conflict resolution:
Ethical conflicts can be resolved as follows:
(1) Gather all relevant facts.
(2) Establish ethical issues involved.
(3) Refer to relevant fundamental principles.
(4) Follow established internal procedures.
(5) Investigate alternative courses of action.
(6) Consult with appropriate persons within the firm.
(7) Obtain advice from professional institute.
(8) If the matter is still unresolved, consider withdrawing from the engagement team/assignment/role.
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