What is the Role of Ethics in Negotiation?

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  • 0:03 Do the Right Thing
  • 2:00 Utilitarianism
  • 2:40 Distributive Justice
  • 3:16 The Rights Approach
  • 3:55 Classifying Actions…
  • 4:39 Lesson Summary
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Lesson Transcript
Instructor: David Whitsett

David has taught computer applications, computer fundamentals, computer networking, and marketing at the college level. He has a MBA in marketing.

If ethics are moral principles that guide our behavior, how do we apply ethics to a negotiation? In this lesson, we'll examine what ethical conduct is in a negotiation and how to tell if someone is behaving ethically.

Do the Right Thing

Many people are guided by ethics, or a set of moral principles, in their daily lives. Our sense of right and wrong should be founded in basic rights, like the right to life, the right to freedom from injury, and the right to privacy. Ethics can prescribe what people ought to do, such as being compassionate, honest, and loyal. Furthermore, ethics should not be based on what society accepts or what is legal.

It is possible to follow the law to the letter and still be unethical. For example, there was a time when slavery was legal and yet it was unethical. So, when parties enter into a negotiation (a discussion to resolve a question or divide an asset or resource), how can we measure their behavior in either ethical or unethical terms?

Some negotiation tactics that are certainly questionable from an ethical standpoint are:

  • Lies: when a negotiator makes a statement that is contrary to known facts
  • Puffery: when a negotiator exaggerates the value of something
  • Deception: when a negotiator makes a misleading statement
  • Nondisclosure: when a negotiator omits or hides a pertinent fact

Ethical theories fall into three broad categories. Consequentialist theories deal with the ethical consequences of actions, and conversely, non-consequentialist theories speak more to the intentions of the person making the decisions. Finally, agent-centered theories are more concerned with the ethical status of an individual than the morality of the action.

There are three widely used criteria for evaluating ethical behavior in a negotiation: utilitarianism, distributive justice, and the rights approach. Let's take a closer look at each of these:


The origins of utilitarianism date back to the ancient Greeks. The premise is that the best life to live is one that produces low levels of pain and distress. Utilitarianism evaluates actions based upon their consequences, both good and bad, and is often used in making decisions that affect large groups. The goal here for a negotiation is the greatest good for the greatest number of people. An example would be the government trying to develop a comprehensive health care policy - not everyone will be satisfied with the results, but the goal is to serve the highest number of people possible.

Distributive Justice

The basic principle of distributive justice is that we exercise our rights in such a way that it permits others to enjoy their rights as well, regardless of their station in life. It is based on the virtues of fairness and equity and is not as concerned with the consequences or outcomes of decisions. An example of distributive justice would be the argument for raising the minimum wage to $15 per hour. Proponents say everyone deserves a fair wage, but the consequences of the decision may be less hiring or positions being replaced by automation.

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