Nature of ethics 1 / 5

What are ethics?

Nature of Ethics

Ethics are principles that guide behaviour to enable us to make the right decision, when we are facing an ethical dilemma.

  • Ethical dilemmas involve unclear choices about what is right and wrong. 

    Situations that have only one possible solution, or straightforward black and white solutions will not lead to ethical dilemmas.

How are ethics relevant to professional accountants and business?

For a professional accountant, ethics are professional guidance that will guide the accountant’s behaviour in an ethical dilemma to make the right decision. 

Professional guidance is needed to guide an accountants behaviour in an ethical dilemma, because sometimes ethical dilemmas can arise due to a conflict between personal and professional values, in this situation, professional guidance should be followed.

Ethical Approaches

  • Relativist

    They will consider the context in which they are making their decision, since what is wrong in one country may not be considered wrong in another.

  • Egoist

    They will consider an ethically correct outcome to be whatever is best for them in their role as directors of an organisation.

  • Utilitarian

    They will consider each alternative in order to arrive at the outcome which will involve the greatest balance of benefits over harm for the most people affected.

  • Absolutist

    They will consider whether is is always wrong to damage the eco-system, regardless of where in the world the damage occurs.