Navigating the Ethical Storm: Entrepreneurs' Decision‐Making Under Radical Uncertainty

ABSTRACT Entrepreneurs today increasingly operate in conditions of radical uncertainty, where the future is difficult to predict and traditional risk‐based decision‐making models offer little support. In such contexts, decision‐making becomes particularly challenging as entrepreneurs often face ethical dilemmas in their relationships with customers, employees, and business partners, as well as when operating within weak, ambiguous, or inconsistently enforced regulatory frameworks. This study examines how entrepreneurs manage “ethical storms” characterized by the convergence of diverse ethical conflicts and high‐risk factors amid significant uncertainty. This study utilized a qualitative research design, incorporating narrative interviews and ethnographic observations involving ten founder‐led entrepreneurial firms across four Western Balkan countries (Kosovo, Albania, Montenegro, and North Macedonia). The Western Balkans are identified by institutional instability, regulatory uncertainty, and economic fluctuation. The research findings demonstrate that entrepreneurs significantly depend on personal values, prior experiences, and corporate culture in their decision‐making processes, particularly when formal regulations and probabilistic assessments are inadequate. In such uncertain settings, ethical reasoning emerges as an essential instrument for sustaining resilience, trust, and the generation of long‐term value. By examining ethical decision‐making under radical uncertainty, this study contributes to both entrepreneurial judgment and business ethics research. It shows that, in practice, entrepreneurs do not rely on formal ethical frameworks alone; instead, they draw on their personal moral compass as a pragmatic guide when navigating ambiguous and high‐pressure situations.