Insights
Ethics in Business Negotiations
Posted January 31, 2019 in Articles
How important are ethics in business negotiations? If you were to take a poll, you would likely find that there is not a single consensus answer. Cultural and individual differences would affect respondents’ opinions, as would past experience with ethical and unethical negotiators.
But, if you start from the position that ethics matter, then the question becomes: How do you negotiate ethically? An article published by Harvard Law School’s Program on Negotiation offers five basic principles for ethical business negotiations:
5 Principals of Ethical Business Negotiations
- Reciprocity: “Would I want others to treat me or someone close to me this way?”
When negotiating a business deal, the ethical principal of reciprocity calls for counterparties to assess how they would feel if they were on the other side of their own actions. However, negotiating ethically does not mean conceding auspiciously to the other party. Even taking the principle of reciprocity into consideration, each party should fully expect the other to diligently seek its desired outcome. - Publicity: “Would I be comfortable if my actions were fully and fairly described in the newspaper?”
How would your actions during negotiations be perceived by members of the public? If publicity would harm your public reputation, then your negotiation tactics may fall outside of ethical norms. - Trusted Friend: “Would I be comfortable telling my best friend, spouse, or children what I am doing?”
How would your actions during negotiations be perceived by your peers or loved ones? Among those who know you best, the perception of your actions in negotiations should cultivate respect, not criticism or disdain. - Universality: “Would I advise anyone else in my situation to act this way?”
Put yourself in the position of an advisor rather than a party to the negotiation: Would you still recommend your current course of action? If you would maintain your current negotiation strategy taking into consideration all relevant business and cultural factors, then you are practicing the ethical principle of universality. - Legacy: “Does this action reflect how I want to be known and remembered?”
Finally, do your negotiation tactics reflect how you want to be known and remembered? If you feel as though you should be holding yourself to a higher standard, then you may choose to reconsider the ethics of your approach to negotiations. - Contingencies and Conditions: Maintaining Control in Complex Negotiations
- Cross-Cultural Communication Skills for International Negotiations
- “Rules of Three” in Cross-Border Business Negotiations
Along with these ethical principles, parties to domestic and cross-border business negotiations should address a variety of other considerations as well in order to maximize the value of their transactions and maintain strong post-closing relationships to the extent desired. For discussions of these additional considerations, we encourage you to read:
Mithras Investments | Consultants for Complex Business Negotiations
Mithras Investments provides consulting services for complex business negotiations in domestic and cross-border transactions. We have experience helping to close deals in a broad range of industries, from banking to utilities and alternative energy. For inquiries, please call (305) 517-7911 or request an initial consultation online today.
