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Business ethics is the social responsibility that a business is supposed to have towards the community in general, particularly the one in which it operates or has any interests .It has been said that having ethics is doing the right or moral thing when no one is looking. Ethics is a personal choice and therefore, how workplace ethics are governed depends upon the personal ethics of those who are in authority over that workplace and also those who work in that environment.
Workplace ethics are codes of conduct that influence the development of an ethical culture within the workplace. Going beyond what is considered legal in the area where the business operates, workplace ethics inspire communication between employees, allow for respect to be extended to each person within the organization, and promote customer relationships that are based on honesty and integrity. While there are core elements that tend to define a work-based code of ethics, the specific expressions of these central values vary from one corporate setting to the next.
It is important to remember that workplace ethics are shaped by two important factors. First, work place policy must be in harmony with all laws and regulations that are currently in force in the jurisdiction where the business operates. This helps to ensure that basic workplace ethics preclude any pressure or
coercion to engage in actions that are considered to be illegal, promote discrimination in the workplace, support unfair hiring and firing practices, or allow wages to be set that are below the minimum legal standards for the area.
Need for the business ethics:
Decisions taken within an organisation may be made by individuals or groups, but whoever makes them will be influenced by the culture of the company. The decision to behave ethically is a moral one; employees must decide what they think is the right course of action. This may involve rejecting the route that would lead to the biggest short-term profit.
Ethical behaviour and corporate social responsibility can bring significant benefits to a business. For example, they may:
attract customers to the firm's products, thereby boosting sales and profits
make employees want to stay with the business, reduce labour turnover and therefore increase productivity
attract more employees wanting to work for the business, reduce recruitment costs and enable the company to get the most talented employees
attract investors and keep the company's share price high, thereby protecting the business from takeover.
Unethical behaviour or a lack of corporate social responsibility, by comparison, may damage a firm's reputation and make it less appealing to stakeholders. Profits could fall as a result.
Workplace Ethics for Employees:
Commitment Towards Work: :
This is the most important of all ethics in the workplace, because work is our god, while at office. Since being hired to work, one should invariably keep ones side of the bargain it set a very bad example of professionalism in the workplace. Such behaviour rarely goes unnoticed by the management. Hence, sooner or later one will have to bear the consequences of lack of commitment towards work
Loyalty Towards Organization:-
While on the payroll of organization, one should bestow all our loyalties towards our organization. A loyal employee rarely needs to be reminded regarding his duties and responsibilities. One should always consider the interest of their organization before personal interest. Dishonest behavior, which can malign the image of the organization or prove to be unprofitable to the organization in any way is highly unethical and unprofessional.
Compassion Towards Coworkers:
As a professional, it is understandable that comparing ones successesand failures with colleagues. A fair amount of competitiveness amongst employees is acceptable. However, do not let personal ambitions rise above the interest of the organization. One can never truly succeed in life if one steal other's credit or follow unethical practices to accomplish task. It is important to have compassion for your coworkers and respect their work. The employees should learn how to work together as a team. This will result in better output for the organization.
Workplace Ethics for Employers:-
Transparency While Hiring:-
Oftentimes, it is seen that management hires unproductive and incompetent people due to personal interest of one or the other top management personnel. A worthy potential employee may be left out due to such hiring policy. Since, employees are an asset for any organization, unfair hiring practices inflict a lasting damage to the organization in the long run.
Equality Towards All Employees:-
The organization should not discriminate employees based on any ground. All employees should be treated as equal irrespective of their age, gender, religion, color, nationality, etc. The management should not have its favorite 'handpicked' employees in the organization. Similarly, they should also not hold grudges against some employees due to personal conflicts. Employee's performance and productivity should be considered as the only parameters for an appraisal or promotion.
Human Behavior Towards Employees:
Oftentimes, the top executives of an organization adopt inhuman practices to promote productivity or multiply the profits of the organizations. Unreasonably long working hours, undue workload, etc. all adversely affect the morale of the employees. Though, this may result in short term profit for the organization, it hampers the growth of the organization in the long run. Due to such practices, the organization may even lose some of its valuable employees.
Every organization should promote good workplace ethics, as they often result in the betterment of the organization as well as employees. Employers should set an example of ethical behavior for the employees to follow.
workplace is about prioritizing moral valuesÂ for the workplace and ensuring behaviors are aligned with those values - it's values management. Yet, myths abound about business ethics. Some of these myths arise from general confusion about the notion of ethics. Other myths arise from narrow or simplistic views of ethical dilemmas.
Myth 1: Business ethics is more a matter of religion than management.Â Diane Kirrane, in "Managing Values: A Systematic Approach to Business Ethics,"(Training and Development Journal, November 1990), asserts that "altering people's values or souls isn't the aim of an organizational ethics program - managing values and conflict among them is â€¦"
Myth 2: Our employees are ethical so we don't need attention to business ethics.Â Most of the ethical dilemmas faced by managers in the workplace are highly complex. Wallace explains that one knows when they have a significant ethical conflict when there is presence of a) significant value conflicts among differing interests, b) real alternatives that are equality justifiable, and c) significant consequences on "stakeholders" in the situation. Kirrane mentions that when the topic of business ethics comes up, people are quick to speak of the Golden Rule, honesty and courtesy. But when presented with complex ethical dilemmas, most people realize there's a wide "gray area" when trying to apply ethical principles.
Myth 3: Business ethics is a discipline best led by philosophers, academics and theologians.Â Lack of involvement of leaders and managers in business ethics literature and discussions has led many to believe that business ethics is a fad or movement, having little to do with the day-to-day realities of running an organization. They believe business ethics is primarily a complex philosophical debate or a religion. However, business ethics is a management discipline with a programmatic approach that includes several practical tools. Ethics management programs have practical applications in other areas of management areas, as well. (These applications are listed later on in this document.)
Myth 4: Business ethics is superfluous - it only asserts the obvious: "do good!"Â Many people react that codes of ethics, or lists of ethical values to which the organization aspires, are rather superfluous because they represent values to which everyone should naturally aspire. However, the value of a codes of ethics to an organization is its priority and focus regarding certain ethical values in that workplace. For example, it's obvious that all people should be honest. However, if an organization is struggling around continuing occasions of deceit in the workplace, a priority on honesty is very timely - and honesty should be listed in that organization's code of ethics. Note that a code of ethics is an organic instrument that changes with the needs of society and the organization.
Myth 5: Business ethics is a matter of the good guys preaching to the bad guys.Â Some writers do seem to claim a moral high ground while lamenting the poor condition of business and its leaders. However, those people well versed in managing organizations realize that good people can take bad actions, particularly when stressed or confused. (Stress or confusion are not excuses for unethical actions - they are reasons.) Managing ethics in the workplace includes all of us working together to help each other remain ethical and to work through confusing and stressful ethical dilemmas.
Myth 6: Business ethics in the new policeperson on the block.Â Many believe business ethics is a recent phenomenon because of increased attention to the topic in popular and management literature. However, business ethics was written about even 2,000 years ago - at least since Cicero wrote about the topic in his On Duties. Business ethics has gotten more attention recently because of the social responsibility movement that started in the 1960s.
Myth 7: Ethics can't be managed.Â Actually, ethics is always "managed" - but, too often, indirectly. For example, the behavior of the organization's founder or current leader is a strong moral influence, or directive if you will, on behavior or employees in the workplace. Strategic priorities (profit maximization, expanding marketshare, cutting costs, etc.) can be very strong influences on morality. Laws, regulations and rules directly influence behaviors to be more ethical, usually in a manner that improves the general good and/or minimizes harm to the community. Some are still skeptical about business ethics, believing you can't manage values in an organization. Donaldson and Davis (Management Decision, V28, N6) note that management, after all, is a value system. Skeptics might consider the tremendous influence of several "codes of ethics," such as the "10 Commandments" in Christian religions or the U.S. Constitution. Codes can be very powerful in smaller "organizations" as well.
Myth 8: Business ethics and social responsibility are the same thing.Â The social responsibility movement is one aspect of the overall discipline of business ethics. Madsen and Shafritz refine the definition of business ethics to be: 1) an application of ethics to the corporate community, 2) a way to determine responsibility in business dealings, 3) the identification of important business and social issues, and 4) a critique of business. Items 3 and 4 are often matters of social responsibility. (There has been a great deal of public discussion and writing about items 3 and 4. However, there needs to be more written about items 1 and 2, about how business ethics can be managed.) Writings about social responsibility often do not address practical matters of managing ethics in the workplace, e.g., developing codes, updating polices and procedures, approaches to resolving ethical dilemmas, etc.
Myth 9: Our organization is not in trouble with the law, so we're ethical.Â One can often be unethical, yet operate within the limits of the law, e.g., withhold information from superiors, fudge on budgets, constantly complain about others, etc. However, breaking the law often starts with unethical behavior that has gone unnoticed. The "boil the frog" phenomena is a useful parable here: If you put a frog in hot water, it immediately jumps out. If you put a frog in cool water and slowly heat up the water, you can eventually boil the frog. The frog doesn't seem to notice the adverse change in its environment.
Myth 10: Managing ethics in the workplace has little practical relevance.Managing ethics in the workplace involves identifying and prioritizing values to guide behaviors in the organization, and establishing associated policies and procedures to ensure those behaviors are conducted. One might call this "values management." Values management is also highly important in other management practices, e.g., managing diversity, Total Quality Management and strategic planning.
The effective management of ethics is sound business practice. Employees' morale is raised; bottom-line performance be improved, corporate image is enhanced; and customers choose to form business relationships with companies that adhere to high standards of ethical conduct. One of your key management tasks is to persuade employees to accept your organization's ethical values. Here are some points to consider...
1. Understand the benefits of ethical conduct:
All key parties benefit from ethical conduct within the organization. Employees who have confidence in their management contribute to their organization's prosperity. Conversely, in an unethical climate, employee productivity declines, creativity is channeled into seeking ways to profit personally from the business, loyalty diminishes, and absenteeism and staff turnover increase. Customers prefer to be associated with and remain loyal to companies that adhere to codes of ethical behavior.
2. Focus on ethical conduct:
When referring to codes of behavior, the term 'ethical conduct' is more comprehensive and more meaningful than 'ethics'. The best ethical values and intentions are relatively meaningless unless they generate fair, just, and observable behaviors in the workplace. Ethical conduct focuses on demonstrated behaviour doing, not just saying.
3. Develop a code of ethical conduct:
The best way to handle ethical dilemmas is to avoid their occurrence in the first place. The process involved in developing a code of ethical conduct helps to sensitize employees to ethical considerations and minimizes the likelihood that unethical behavior will occur.
4. Promote process:
When it comes to managing ethics and, in particular, developing a code of ethical conduct, the journey is just as important as the destination. Codes, policies, procedures, and budgets are important. Where possible use group decision making to actively involve participation in, and ownership of, the final outcome.
5. Link ethics to other management practices:
The development of a code of ethical conduct should not occur in isolation.
6.Demonstrate ethical practices:
The best way for organization to gain a reputation for operating ethically is to demonstrate that behavior-the most important way to remain ethical is to be ethical. And the best advertisement your ethics management program can have is everyone's commitment to it.
7. Allocate roles and responsibilities:
â€¢ An ethics management committee, representing the entire organization, with responsibilities to include implementing and administering an ethics management program. The creation and monitoring of a code of ethical conduct would be part of that overall program.
â€¢ An ethics officer who ideally should be a senior executive but not from HR or the Legal Department. He or she must be trained in matters of ethics in the workplace and have ultimate responsibility for managing the program.
â€¢ Demonstrated involvement and support of top management. Staff and Board must see that senior management takes ethical conduct seriously.
8. Identify and model industry benchmarks:
An increasing number of companies strive to match practices with espoused values. The Soul of a Business (Bantam, 1993), for example, is an account of the way in which ethical considerations guided the day-to-day operations of the American company,
Â Strong corporate values must not only be firmly established among the top executives, but also must be filtered down within the operations of the business.Â If employee incentives are not aligned with the overall corporate values established at the top, there will be a breakdown in the system.Treating employees with dignity and respect is part of creating value for an important group of stakeholders.Â executives should ask themselves whether they could explain that same decision to their families with a clear conscience. Â This is an explanation for why CEOs tend to consider opinions of the Board of Directors first.Â Additionally, few boards of directors factor in ethics and compliance issues when evaluating a CEO's performance, so there is little incentive in this regard for a CEO to put a high value on ethical behavior.Â Despite these problems, if a company is serious about gaining public trust, considering all groups of stakeholders in strategic planning, outside of company shareholders, will be crucial.