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According to Grell (1993) business ethics has now become the major issue for business industry, as this issue not only occur in the business industry where as it also involve in the healthcare industry, taxation or accounting firms, information technology industry, school and university as well as the Government sector. Therefore, a lot of research has been done are related to business ethics like the importance of code of ethics in the working place and how it will influence the managers and employees in a working place.
There is also papers that done by Pimental, et al., (2010), which in the research paper they include individual factors like (gender, age, working experience and moral value like severity), Organizational (the knowledge of the organizational norms), Ethical Environment (the social and legal policy, and individual like ethical decision maker's moral intensity) which this will influence one's decision maker performance and outcome. (Bartel, 1967; Ferrell and Gresham, 1985; Hunt and Vittel, 1986) has mention that culture plays an important role in influencing ethical behavior of an employee in and organization. Company which has a good culture will give a positive impact in ethical decision making among the managers in an organization in term of improving a firm's ability to create a competitive strategy, able to negotiate international trade, as for the case of multinational company, the managers were able to coordinate the internal activities Tse et al., (1988).
On the other hand, some of the famous model and theoretical framework also adopt by some of the researchers in their papers. For Example: the (Ford and Hensen, 1991., Jones, 1991) which it includes the variable like personal attribute of the decision maker that will influence the decision in ethical decision making. There is also the model adopted from Randall and Gibson (1990) by Ford and Richardson (1994) which a situation has been form for the decision maker to make decision.
According to Taylor (1975, p.1), ethics can be defined as the "inquiry into the nature and grounds of morality where the term morality is taken to mean moral judgments, standards, and rules of conduct". Jones (1991, p. 367) defined that ethical decision making (EDM) as "a decision that is both legal and morally acceptable to the larger community" and stated that unethical decisions are illegal or morally unacceptable. Currently, Manley et al., (2007) stated that some organization's managers and employees is particularly focus on the ethical decision making and they also increasingly search for the employees that will make good ethical decisions to help them to avoid any legal dispute.
In health care industry, the healthcare executives play an important role in public or in private sector healthcare industry Victoria Maddalena (2007). They can become the leaders, mentors for some of the practitioners, and teacher to some of the medical assistant in the healthcare industry. They often find out that their decision is really crucial to every individual in a healthcare industry and their action also held to a higher standard of conduct.
According to Victoria Maddalena (2007), leaders in the healthcare industry are facing critical ethical dilemmas as the health service is become more complicated as they facing the other situation like competing in managing the public, the political and professional pressure on the healthcare governing board and priority- setting on the beneficial programs and services. This kind of situation will lead them to take action on which kind of decision they will make whether it is ethical decision (proper planning, consideration of company stakeholder and other parties when making decision) or none-ethical decision (hurried or ill - conceived decision making), in the same time as well, moral intensity for an individual is important as this will decide their fate in heading for legal action Christensen and Kohls (2003).
In taxation or accounting organization, tax professionals also often face dilemmas when they reach to the stages of appropriate and supportable tax reporting decision due to the complex taxation laws that implement on certain taxation activity Marshal et al., (2006). Those tax professionals always face some of the pressure in their process of decision making especially from client, government revenue authority, employers, business and financial community and professional accounting association. Therefore, the occurrence of professional responsibilities inevitability ethical and moral issue will arise when they try to solve those pressures from certain authority.
In School level, countries like Australia, New Zealand, United Kingdom, Canada and the United States of America, principals are now facing with drastic change in school environment. The drastic change is cause by the result of policy transform towards school- based management in their nation's education system. There also the changes in the social environments in the school that is operating which is mention by Dempster et al., (2004). As a two - way interaction was done by the researcher like Dempster et al., (2004), they found out that the most ethical dilemmas that face by school administrators is conducting their responsibility and the ethical reasoning or thinking that they used to inform their school's operating decisions. By overcome the ethical dilemmas in school compound, the administrators should know how to apply one of the suitable ethical standpoints in that particular situation Dempster et al., (2004).
Ethical issues are prominent in the Information Technology industry. According to Haines and Leonard (2007) there are evidence that the widespread distribution of illegal intellectual property, privacy violations, security breaches and well - known crimes like fraud, forgery, and theft have resurfaced in new forms. As mention by (Marshall, 1999) the rapid development of (IT) has surpassed of the development of the ethical guideline for (IT) and this also will become one of a reason that the information Technology's crime occurs. In the world of (IT), those employees that work in (IT) firms remain a very high threat to security for mis - using the information technology elements as mention by Haugen and Seling (1999). There is one survey has been conducted by Carr (2002) which stated that 80 percents of all computers and internet related crimes which happen in an organization is caused by the employees that work in the same particular organization with the lost of average $110,000 per corporate victim.
Finally, since the ethics issue is causing an impact for an organization, and it is important for the academic community to come up with a study that focus on finding out what lead the managers and employees behave ethically and unethically in order to give advice to managers for formulating competitive strategies to enhance the ethic knowledge and to prevent unethical behavior among the managers and employees.
Business is a human activity and it involves the decisions that are based on the moral intensity of an individual Degeorge (2005). Given the ethical issues keep arising in the present times, the factors that influence the individual's (managers and employees) ethical decision must be critically revisited from an ethical point of view Ulrich (2008). Business and ethics suppose to be come together and it must be understand as mutual dependent aspects Werhane and Freeman (1999).
A set of theoretical framework need to be create in order to enhance how some of the factors will influence the managers and employees in an organizations. The papers that was done by, Ford and Richardson (1994) shows that the variables that they use as the individual factors that influence the ethical decision making is not specific as they suggest 23 variables that will influence the ethical decision making of an individual.
Therefore, the purpose of this paper is to form a theoretical concept that can provide a better understanding of what factors (Personal Attribute of a manager) that will influence the ethical decision making of a manager in an organization. The independent variable that will include in this research paper is Personal Attribute which consists of (Gender, Age, Religion, Education Background and Years of Working Experience) of a manager.
Besides, most of the research paper that done on the ethical decision making was mostly focus in Western country context and some of it was done on the oriental context. For example: Holian, (2006) paper was done on the Australian context in some of the management or consultant agency. This paper was related to how the knowledge, skills, and abilities of a manger in terms of judgment of a situation, integrity among the employers and managers, the courage to make ethical decision, and the quality of humanity of a manger will influence the ethical decision making which means that the leadership is included in this study as well.
There are still shortage of research regarding to ethical decision making was done in the South - East Asian context before and this current paper was aim to study on South - East Asian Context. Organizational crisis was one of the important factors that can influence the ethical decision making of a manager in organizations. As mention by Maddalena (2007) problem solving and appropriate decision making skills is essential tools for the managers as most of the problem that encountered in the workplace are being resolved without a proper decision making framework.
There are some issues that might arise from time to time that may affect the organization's administrators or management team. Therefore, it is essential that the organizational crisis should be include in the study because in Maddalena paper, it shows that organizational crisis can bring implication on the ethical decision making of a manager by giving pressure on them on how they going to make an ethical decision to solve their organization's crisis.
As mention by (Bartel, 1967; Ferrell and Gresham, 1985; Hunt and Vittel, 1986) in theirs paper that climate plays an important role to influence an employee and a manager's ethical decision making process. Since there is a research that has been done by Singhapakdi et al., (1994), and the authors does not include any of the organizational climate in the research paper. Schein (1985a, p.17) has mention that company that with strong culture is more efficiency in terms of making decision compare to the company that has weak and lack of awareness in their company's culture.
As an extent on this paper, it is viable that to include organizational climate as one of the moderating variable that will influence the ethical decision making of a manager. In Perri et al., (2009) paper, it shows that they do not include the leadership context in their research paper. By selecting employees that could make a good decision in ethical decision making, it is important that the context of leadership should be including in the variable as well. This is because leadership are consider as an important element for a leader where leadership can provide those leader a proper guiding direction, how to lead their team, make a good decision and it can be measurable as well Intaglia et al., (2000).
To what extent that the culture of an organization will influence the ethical decision making of a manager in an organization?
To what extent that the personal attribute of a manager will influence his or her ethical decision making in an organization?
Is there any association between organizational crisis and the ethical decision making of a manager in an organization?
To what extent that the leadership skills of a manager will influence his or her ethical decision making in an organization?
To identify the level of organization's culture impacts towards the ethical decision making of manages in organizations.
To determine the managers in organization for the level of adherence in ethical decision making.
To examine that how the personal attribute of managers influencing their ethical decision making.
To determine the relationship of the leadership and its influence towards the ethical decision making of managers in organizations.
SCOPE OF STUDY
This is a cross - sectional study that takes place in the area of Kota Kinabalu in Sabah. The reason of selecting Sabah as one of the locations to conduct this research paper is because there are rapid grows in the number of bank industry in that particular area. This study also conducts towards the bank managers around Kota Kinabalu area, and the reason of choosing the bank managers around Kota Kinabalu area is because most of the research has conducted on the respondents like professional accountants in Marshall et al., (2006) study, school principals in Dempster et al., (2004) study, inexperienced students in Haines et al., (2007) study, Employed Undergraduate students in Manley et al., (2007) and Glover et al., (2002) paper. Therefore, it was such a great opportunity that the bank managers are included in this study as they will also involve in the ethical decision making as well in the organization.
As for the Dependent Variable, this paper is mainly focus in the ethical decision making of bank managers in the area of Kota Kinabalu, Sabah. According to Jones (1991, p.367), ethical decision making can be define as "a decision that is both legal and morally acceptable to the larger community" and stated that unethical decision are illegal or morally unacceptable. From the justification from introduction part, it is viable that the research on ethical decision making is viable to be conduct because it can help those managers to be aware of the ethical decision in an organization which is mention by Dempster et al., (2004).
There is Moderating Variable will be including in this study as well. That is Organization's Climate. In Singhapakdi et al., (1994) paper, the culture of an organization does not include in their study. As mention by (Bartel, 1967; Ferrell and Gresham, 1985; Hunt and Vittel, 1986) in theirs paper that culture plays an important role to influence an employee and a manager's ethical decision making process and in the same time it will also influence the outcome of a decision as well. According to Smircich, (1983, p.334), the organization culture can be define as sharing of company's value, social ideals and beliefs by organization members. The organization's culture consists of working norm and the cultural settings of the bank industry.
The Independent Variable in this research papers is the Personal Attributes of a manager, the scope of study will be his or her gender, the manager's age, the manager's religion, his or her education level, and their working experience as well. The personal attribute variable is adopted from the research paper by Ford and Richardson, (1994), Glover et al., (2002), Pimentel et al., (2010) and O'Leary and Stewart (2007). Besides, the Leadership Attributes will be included in the study as well because in Perri et al., (2009) paper, the leadership context was not included. The scope of study for the manager's leadership attributes are their interpersonal communication skills, personal management skills, and their decision making skills. These variables are adopting from a research paper that conduct by the Das and Kumar et al., (2011) where this paper also mention that a leadership skills play an important role as well in helping the managers in organizations in ethical decision making.
IMPORTANCE OF STUDY
The benefit of this research study is that it can help the banking industry in Sabah to create a banking industry that is aware of the ethical issue that has been arise from time to time. This paper also addresses the manager on examine the influencing of the culture in a bank on the ethical decision making behavior. It is important for a bank manager in the area of Sabah to have the knowledge on how the company's culture will affects their ethical decision making behavior because the culture of a company can be the determinant of influencing the ethical decision making behavior.
Once the banking managers have a good knowledge in making good ethical decision through (understand the culture of the bank and show good leadership skills among the members in the organizations) as mention by Das and Kumar et al., (2011), this could helps the firms to improve their ability to design an effective competition strategy, negotiate international sales and coordinate internal activities as mentioned by Tse et al., (1988).
This paper also identify the potential and limitations of the extent personal attribute and the leadership skills of a managers in banking industry with respect of the elements that has been selected and organization's culture between the ethical decision making. Other than that, this paper also propose a theoretical framework of ethical decision making which consist of the personal attributes and leadership skill or managers in banking industry and the organization's that will influence the ethical decision making of the managers. The criteria in the personal attribute and leadership skills has come into different level of analysis and to measure this criteria it must be incorporates a number of factors that account for variation in the analysis and interpretation of component in the knowledge of the organization working norms, and the cultural settings of the organization.
The main objective of this paper is to investigate to what extent that the culture of an organization, the context of the leadership and personal attribute of a manager will influence the managers in the banking industry in their ethical decision making. Understanding of the company's culture is very important to employees and managers because due to the rapid change and diversification of the culture, it will cause the occurrence of the ethical issues in organizations. The personal attribute of a manager is important as well as it can become the determinants that will influence their decision making when there is an ethical issue arise. In the same time, a good leadership skill should be implement by the managers in banking industry as well, so that they can built up a good management team and lead the team moving toward a organization that can make good ethical decision and aware of ethical issue in an organization.
Some of the members in the company do not have a clear view of their company's culture which their purpose that they went for the organization is to complete their task that is given by their superior. Therefore, before doing a task that is given by their superior, the awareness of ethical issues and ethical decision making is essential to have in each of the members from the top management and to every level of the organization. This is because, an organization that consists of a good managers or employees that can make good ethical decision will help the organization to build up a competitive strategies that can help to overcome the issue of ethical decision making in an organization.