Sunday, March 17, 2013

Business Ethics in the Organization




By Renee Lessard

            Ethics in the business setting are both necessary and complex at the same time. There are at times significant differences between what a person or organization should do and what they actually do. These differences are called prescriptive and descriptive threads of ethical theory. The study of business ethics also focuses on the behavior of individuals faced with unethical behavior and their response to it. While some people may be eager to report unethical behavior by individuals or the organization, others may be hesitant to report.
            For this post, I will be focusing on what businesses can do to establish ethics within their organization, how to bring those ethics to their employees and train them on their importance, and finally the importance of follow-through within the organization. I will bring focus to the different facets of ethics in the organization and the potential consequences to employees and the organization when good ethical behavior is not embraced.
            According to Sims, organizations can use a three part system to institutionalize ethics into their organization. The first step is to adopt a culture within the organization that encourages learning and openness to communication and purpose. The second step is for the organization to adopt a written code of ethics. This code should outline the ethics of the organization both involving its employees and its customers. The third step involves training. Employees of the organization should be trained in the ethics of the organization. This training should continue throughout the life span of the organization to keep all employees, old and new, up to date on the ethics of the organization.
            Bayley encourages organizations to incorporate ethics training within the organization as a proactive tool to the success of the organization. This training, according to Bayley, should involve educating employees about the ethics of the organization as well as empowering them to make ethical decisions within their work. He asserts that this training is essential for the success of the organization because the practice of ethics will produce better output for the organization as well as protect it from scrutiny.
            So far, I have focused on implementation and continuation of ethics within the organization. Within this scope, the importance of ethics are explained in theories and what ifs. There are very real consequences to a lack of ethics within an organization. These consequences can fall both on the organization and the employees of the organization. These consequences can be dire to the point of ending the organization so it is important to be aware of them as more than just a cautionary tale but a very real possibility.
            A general lack of ethics or an ethical code can lead to laxity in the organizational politics and work ethic. A code of ethics is the organizations outline of what behavior is acceptable and what is not. While individuals within the organization may have their own personal ethics, without a code of ethics established by the organization each person may use their own personal code of ethics. The friction here can be caused by one individual’s ethics conflicting with another’s. This friction may cause a lack of productivity or, at worst, detrimental conflict among employees that may lead to one or more employees losing employment.
            Another scenario involves an organization establishing a code of ethics, possibly even a training program, and then neglecting to follow through on their own policies regarding ethical behavior. Trevino and Weaver outline some of the possible consequences and the driving forces behind them. One of the reasons for employee strife in an organization can be a feeling of injustice. When a code of ethics has been established by an organization and that organization does not follow through on their policies the employees of that organization feel that the justice system within the organization is corrupt or lacking. This leads directly to dissatisfaction by employees and can directly contribute to low productivity and lack of employee morale.
            Trevino and Weaver also point out that a lack of follow through with an organizations code of ethics can lead to unethical behavior by employees within the organization. Unethical behavior can vary from theft and vandalism to a disregard for the well being of the organization involving possible acts of maliciousness against the organization such as the selling of trade secrets or misuse of organizational power. These can have lasting or permanent consequences or both the employees and the organization.
            It is well known that ethics play a key role in an organization’s well being and productivity. The complexity arises when organizations begin to take steps to implement and continue ethical values and training within the organization. If not done correctly, a focus on ethics within an organization can be as detrimental as a lack of an ethical code and policy.

References:
Bayley, B. K. (2012). Organizational ethics training: a proactive perspective. The Journal for
            Quality and Participation, 35.2, 15-19. Retrieved from
untid=12924

Sims, R. R. (1991). The institutionalization of organizational ethics. The Journal of Business
Ethics, 10.7, 493. Retrieved from

Trevino, L. K., Weaver, G. R. (2001) Organizational justice and ethics program “follow-through”:
            Influences in employees’ harmful and helpful behavior. Business Ethics Quarterly, 11.4,
            651-671. Retrieved from http://www.jstor.org/stable/3857765

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