Business Ethics For Real Estate
Noah George
Ethics is a general term for what is often described as the "science (study) of morality". In other words, ethical behaviour is that which is "good" or "right.“
Ethics is about behaviour. Behaviour is determined by accountability.
Drivers of Unethical Business Behavior: Faulty internal oversight allows self-dealing in the pursuit of personal gain, wealth, and self-interest. Short-termism pressure to meet or beat shortterm performance targets.
A culture that puts profitability and business performance ahead of ethical behavior.
Firstly, the economic nature of business distinguishes it from normal day to day activity. Employment also has its own standards of right and wrong
Secondly, another distinguishing factor is that business takes place essentially in organisations
PERSONAL VERSUS BUSINESS ETHICS…
Decision making takes place on three (3) levels: 1) Individual 2) Organisational 3) Sector/business practice
IDENTIFICATION OF THE REQUIRED LEVEL FOR A DECISION IS KEY
DECISION MAKING IN BUSINESS
•At the individual level, a person decides what he or she will do. •At the organizational level, decisions involve an individual acting within his or her organizational role and are often expressed in procedures and policies,
•Whereas the business system level involves systemic problems that concern industry practices and the economic system.
Moral, Economic and Legal
Morality is a key issue. Three issues must be considered when faced with decision making.
Ethics is just one aspect of decision making. Generally, there are three points of view to be considered:
Potential harm to the customer Misrepresentation/Manipulation Fairness- Golden Rule
What are the moral issues to consider when making decisions/telling the truth:
Seek out and act on reasons/rationale: One should try to justify rules set by good reasons.
Impartiality: One should think about the interests of others as worthy of consideration and ascribe all interests equal weight in deciding what to do.
How should we be guided when taking the moral point of view?
People discount the moral aspect of business, arguing that the key consideration in business is profit generation and efficiency. The legal perspective must also be considered, but this approach is seen as a constraint on the economic position.
Ethics is in part an attempt to think clearly and deeply about ethical issues in business and to arrive at a conclusion supported by the strongest possible arguments ie a moral point of view.
However, one should consider economic factors as well as the law.
THERE SHOULD BE AN INTEGRATED APPROACH TO DECISION MAKING
Ethics and Economics Economics teaches that businesses should operate with only profit in mind.
However, there is a relationship between economics and ethics
THERE SHOULD BE AN INTEGRATED APPROACH TO DECISION MAKING
Ethics and Law
Business decisions must also include the legal point of view because the law is a significant influence on business activity. Some argue that law is the only moral standard necessary to follow. (If it’s legal, then it’s morally okay.)
THERE SHOULD BE AN INTEGRATED APPROACH TO DECISION MAKING
Ethics and Law
The previous position is supported by two schools of thought: (1) that ethics is a matter of personal conduct, whereas law applies to public matters like business, and (2) that all unethical conduct in business has already been addressed by the law.
1) The law is not equipped to regulate certain aspects of business 2) Slow to develop in new areas
3) The law embodies certain moral concepts that are not properly defined
However, the Law is not enough:
4) In many cases, the law is unsettled
5) With the inefficiency of the law, additional legislation is required and there is increased litigation
The Law is not enough…
AREA Code of Ethics
A code of corporate conduct is an important management tool. It is the primary documentation for moving business ethics from the area of ideas to that of action at the various levels of an organized enterprise.
AREA Code of Ethics
However, the conduct patterns of business ethics are not limited to those that are assembled in the statements of a formal code. As stated previously, there are principles, practices etc, all of which provide guidelines for ethical conduct in business situations.
A role is a structured set of relationships with accompanying rights and obligations
Obligations of a particular role are sometimes added to those of ordinary morality ie someone who occupies a role assumes obligations above those of everyday life.
Roles and the Agent
Role Morality is specific to a particular role for professionals. In this case, the Real Estate Agent has responsibilities to different groups and should consider various interests.
Also, roles are created to serve society better. A proper system ensures advancement of society and benefits all.
Roles and Managers
Ethics as a philosophical endeavour is the study of morality It can be either Normative or Descriptive
•Normative refers to the possibility of justification •Descriptive involves an empirical research the actual rules or standards of a particular group or simply an appreciation of the ethical reasoning process
Ethical Theory and Business Ethics
Teleological theories Deontological theories
Concept of Virtue
Theories include:
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