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cmm_session_5_compatibility_mode.pdf
30/07/2015
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Session 5 – Ethical behaviour and social responsibility
Ethical behaviour and social responsibility
Learning objectives:
• What is ethical behaviour?
• How do ethical dilemmas complicate the workplace?
• How can high ethical standards be maintained?
• What is organisational social responsibility?
• How do organisations and government work together in society?
What is ethical behaviour?
• Ethics: set of standards as to what is good or bad, or right or wrong in a person’s conduct.
• Ethical behaviour is accepted as ‘right’ or ‘good’ or ‘proper’ in the context of a governing moral code.
• If an act is legal, some will proceed with it confidently, while others might believe that the ethical test goes beyond legality. This is a matter of personal values.
• Values are broad beliefs about what is or is not appropriate behaviour.
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Alternative views of ethical behaviour
• There are many different interpretations of what constitutes ethical behaviour:
– The utilitarian view considers ethical behaviour as that which delivers the greatest good to the greatest number of people.
– The individualism view considers ethical behaviour as that which advances long‐term self‐interests.
– The moral‐rights view considers ethical behaviour as that which respects and protects the fundamental rights of people.
Alternative views of ethical behaviour
• The justice view considers ethical behaviour as that which treats people impartially and fairly according to guiding rules and standards.
– Procedural justice is concerned that policies and rules are fairly administered.
– Distributive justice is concerned that people are treated the same regardless of individual characteristics.
– Interactional justice is the degree to which others are treated with dignity and respect.
© John Wiley and Sons Australia
Four view of ethical behaviour
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Cultural issues in ethical behaviour
• Cultural relativism
– There is no one right way to behave; ethical behaviour is determined by its cultural context.
• Universalism
– Alternative positions, in which ethical standards apply across all cultures.
– Critics call this a form of ethical imperialism, an attempt to impose one’s ethical standards on other cultures.
Ethical dilemmas
• An ethical dilemma arises when action must be taken but there is no clear ‘ethically right’ option.
• Cause stress until they are resolved.
• The burden is on the individual to make good choices.
Ethical dilemmas
• Sources of ethical dilemmas include:
– Discrimination
– Sexual harassment
– Conflicts of interest
– Customer confidence
– Organisational resources
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Rationalisations for unethical behaviour
Four common rationalisations that are used to justify misconduct:
1. Convince yourself that the behaviour is not really illegal.
2. Convince yourself that the behaviour is really in everyone’s best interests.
3. Convince yourself that nobody will ever find out what you’ve done.
4. Convince yourself that the organisation will ‘protect’ you.
• When in doubt about taking an action, don’t do it
© John Wiley and Sons Australia
Factors influencing ethical behaviour
Ethics in the workplace
• Factors influencing ethical behaviour:
– The person – family influences, religious values, personal standards and personal needs.
– The organisation – formal policy statements and written rules establish an ethical climate
– The environment – government laws and regulations, and social norms and values.
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Ethics training
• Ethics training seeks to help people understand the ethical aspects of decision‐making, and incorporate high ethical standards into their daily behaviour.
• Many ethical dilemmas arise as a result of the time pressures of decisions. Ethics training is designed to help people deal with ethical issues under pressure.
Checklist for making ethical decisions
• Step 1. Recognise the ethical dilemma.
• Step 2. Get the facts.
• Step 3. Identify your options.
• Step 4. Test each option: Is it legal? Is it right? Is it beneficial?
• Step 5. Decide which option to follow.
• Step 6. Double‐check decision by asking follow‐ up questions.
• Step 7. Take action.
Whistleblower protection
• Whistleblowers
– People who expose the misdeeds of others in organisations in order to preserve ethical standards and protect against wasteful, harmful or illegal acts.
• Whistleblowers face the risks of impaired career progress and other forms of organisational retaliation, up to and including dismissal.
• Federal and state laws in Australia/NZ offer whistleblowers some defence against ‘retaliatory discharge’.
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Ethical role models
• Top managers in large and small businesses have the power to shape their organisation’s policies and set its moral tone.
• All managers must act as ethical role models and set an ethical tone in their areas of responsibility.
• Part of the manager’s ethical responsibility is to be realistic in setting performance goals for others.
Codes of ethics
• Codes of ethics
– Written guidelines that state values and ethical standards intended to guide the behaviour of employees.
• Codes of conduct may cover:
– Discrimination
– Forced labour
– Working conditions
– Freedom of association.
Social responsibility
• Organisational stakeholders – Directly affected by the behaviour of the organisation and hold a stake in its performance.
– May include government, competitors, shareholders, customers, employees, civil society, suppliers, pressure groups and regulators.
• Corporate social responsibility – The obligation of an organisation to act in ways that serve its own interests and the interests of its stakeholders.
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Stakeholder issues and practices
• Leadership beliefs that guide socially responsible practices:
– people do their best in healthy work environments
– organisations perform best when located in healthy communities
– organisations gain by treating the natural environment with respect
– organisations must be managed and led for long‐term success
– reputation must be protected for support.
Perspectives on social responsibility
• The classical view holds that management’s only responsibility in running a business is to maximise profits.
• The socioeconomic view holds that management of any organisation must be concerned for the broader social welfare and not just for corporate profits.
Evaluating social performance
• A social audit is a systematic assessment of an organisation’s accomplishments in areas of social responsibility.
• Is the organisation’s:
– economic responsibility met? Is it profitable?
– legal responsibility met? Does it obey the law?
– ethical responsibility met? Is it doing the ‘right’ things?
– discretionary responsibility met? Does it contribute to the community?
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© John Wiley and Sons Australia
Social responsibility strategies
How governments influence organisations
• Governments often pass laws and establish regulating agencies to control and direct the behaviour of organisations.
• Managers must stay informed about new and pending laws as well as existing ones.
• Laws and regulations are usually in the form of minimum standards which must be met in terms of occupational health and safety (OHS), fair labour practices, environmental protection and the like.
How organisations influence governments
• Just as government takes action to influence organisations, representatives of organisations take action to influence government.
• Through personal contacts and networks, executives get to know important people in government. These contacts can be used for persuasion.
• Lobbying expresses opinions and preferences to government officials.
• Executives can unfortunately resort to use of bribes or illegal financial campaign contributions in the attempt to gain influence over public officials.
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Why managers make the difference
• Trends demand that managerial decisions reflect ethical as well as high‐performance standards.
• Decisions must always be made and problems solved with ethical considerations standing side by side with high‐performance objectives.
• It is the manager whose decisions affect ‘quality‐ of‐life’ outcomes in the critical boundaries between people and organisations and between organisations and their environments.
Session 5 – Ethical behaviour and social responsibility
Summary:
• What is ethical behaviour?
• How do ethical dilemmas complicate the workplace?
• How can high ethical standards be maintained?
• What is organisational social responsibility?
• How do organisations and government work together in society?
