Ethics

All posts tagged Ethics

Sexual Harassment and Discrimination Laws – Part 2

Published September 25, 2013 by Mayrbear's Lair

Ethics

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Theories

Managers with an awareness of discrimination laws from a variety of vantage points, including ethics, can produce a more successful working environment and avoid lawsuits. Ethical theories help leaders decide what is morally acceptable. Geisler (1989) suggests that ethics can be defined in terms of what the organization deems as morally right and that each company creates its own set of ethical standards (Geisler, 1989). In a business environment, leaders look to their own views of morality and ethics to assist them in the decision making process. However, there are times when a leader is confronted with making a decision and is required to determine whether it is more important for the organization to engage in ethical practices or lawful ones. For example, when a claimant files a sexual harassment charge, they are seeking restitution for the violations they experience. In this situation, employers are obligated to manage both the legal ramifications as well as the ethical ones. In other words, while the proceedings are taking place, the employer must take the necessary steps to allow the justice system to prevail, while employers do what they can to support the individual that is suffering, rather than participate in efforts to isolate and humiliate the plaintiff further.

It is the employer’s responsibility to cultivate a climate that personnel feel safe in. Employees that experience discrimination feel unvalued and inadequate. In addition, employees that are subjected to sexual discrimination and harassment experience more physical and psychological problems. Employers need to protect themselves from these events occurring because victims have the support of the legal system to engage attorneys that will pursue restitution. Seaquist (2012) explains laws concern themselves with issues of right and wrong with the administration of justice. Business leaders should also take into consideration the topics of ethics and morality to help their personnel identify more clearly what is considered acceptable and unacceptable conduct (Seaquist, 2012). For example, business leaders that apply the ethical absolutism theory, accept that there are certain universal parameters that determine what is right and wrong. If stealing is wrong for instance, then it is always considered wrong regardless of the situation. Therefore a business leader that incorporates ethical absolutism will always consider stealing morally wrong. However, if the culture in a business has an open attitude towards sexual harassment and views this behavior as boys just being boys, then in an ethical absolutism environment, sexual harassment is accepted as morally right. Simply put, in an environment where many of the employees in upper management are engaged in extramarital affairs, these executives tend to hire employees that embrace the same attitude, or have a disposition in which they are happy to look the other way, or go with the flow, when it comes to ethical misconduct. Not only are personnel conditioned to accept this behavior, many in fact subscribe that there is nothing morally wrong with it. Corporations that cultivate a culture of religious fundamentalism on the other hand, base their code of ethics on scriptures written by prophets and would most likely reject a concept like this.  It is highly probable that they would view sexual discrimination and harassment as a sin and morally incomprehensible.

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Culture

American culture is slowly emerging from a patriarchal society that supported the male sexual dominance of women and employers that control their workers. For example, many corporate department heads from a former place of employment, hired assistants that were physically attractive with an uninhibited free spirit and disposition. Furthermore, they supported an environment that consisted of an open flirtatious atmosphere established by the leaders with various incentives like compensation, pay raises, promotions, free merchandise, or tickets and backstage passes to special events, the use of company limousines, and other similar perks to encourage and support that behavior. Sexual harassment complaints in this kind of culture are typically nonexistent because of the climate that has been cultivated by the supervisors that everyone conforms to, including low level employees.  In other words, they are able to maintain an unethical atmosphere because candidates for hire were only considered and remained as long as they embraced the established culture.

Employers also set the tone of a work environment by the people they hire. Adler’s (2013) research also indicates that many employers have a difficult time hiring and recruiting the best candidates because they are ineffective at implementing strategies to attract top performers (Adler, 2013).  One of the reasons for this is that many leaders have unhealthy perceptions of employee and subordinate roles in the workplace, especially those hired as personal or administrative assistants. Many executives view their assistants for example, as a reflection of themselves and therefore hire staff members that represent of a certain kind of image they deem appropriate for their department. For instance, in a corporate situation, the head of the legal department may hire staff members that adopt a conservative style based on skills and knowledge to represent the group of attorneys that operate that division. The publicity and promotion departments on the other hand, may hire staff members based on artistic and creative skills.  Staff members may consist of  more free spirited people with an open attitude, youthful drive and energy. In other words, the department heads set the atmosphere for the climate and ethical culture they develop and hire staff members that are an organizational fit in that arena.

There is no single law that covers all workers in the US. Walsh (2013) reminds us that employment laws consist of a patchwork of federal, state, and local laws that continue to evolve and are contingent upon many components including the size of the organization (Walsh, 2013). For example, as mentioned previously, many supervisors hire personal assistants based on certain components including, age, appearance, and physical type rather than seek individuals that are qualified with skills and knowledge. In addition, there are many executives that tend to view assistants as their trophy, rather than a skilled person best qualified for the job. This is indicative of a climate where women are perceived as objects, rather than individuals capable of innovation and considerable contribution to an organization’s success. In addition, these females are also viewed and discriminated against by other staff members of the same sex as well. For example, when I was hired as an administrative assistant in the music industry, issues of discrimination immediately began to surface in the corporate arena.  It was evident from the behavior of other staff members of the same gender and equal rank that I was an outsider to them. I later discovered that some of the women even jokingly referred to me as the new dish. In short, other staff members automatically made a judgment based on appearances, not because of my level of skills and knowledge. Rather than embrace and welcome me as a new employee, they engaged in acts of discrimination, making me feel isolated and friendless. In some cases, many employers and employees do not have a clear set of identifying acceptable and unacceptable relationship boundaries. This also fosters unhealthy relationships.

Legalities

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Legal and Political Aspects

Business leaders that understand the legal and political perspective of discrimination issues, are more likely to achieve the best legal outcomes. Palumbo and Wolfson (2011) suggest that patriarchal systems can also influence behavioral patterns that are enforced, legitimized, and perpetuated in a business arena (Palumbo & Wolfson, 2011). These systems can have a significant influence on politics and policy making. For instance, fundamental religion has played a significant role in the world in that many leaders use this position to justify totalitarian actions that are based on absolutist ideals. Leaders in this climate, reveal their ethical principles by the type of legal systems that support them. For example, the civil law system that is common in most of the European Countries (EC) meticulously outlines individual rights and responsibilities. In its quick implementation of justice and with limited power of judicial interpretation, it reinforces an absolutist kind of ethical philosophy with systems that require strict compliance to statutes that guide behavior and leave little room for deviation.

Common law systems, on the other hand, like those established in the US, leave wide latitude for interpretation and provide a multi-faceted frame for the appellate courts to determine (Palumbo & Wolfson, 2011). In other words, civil laws leave little room for misinterpretation, while common law offers latitude for litigants to argue. For example, in a country where civil laws pervade, a sexual harassment issue can be resolved quickly by the laws. In a country where common law systems pervade, both sides of the case must produce substantial evidence to support their position and in many instances, the defense will engage in tactics that degrade, belittle, and present the victim in an unfavorable manner to provide reasonable doubt with respect to a claim. Because of this, many victims do not come forward to avoid the humiliation of such an experience in addition to the violation they are processing and working to recover from.

References:

Adler, L. (2013). The essential guide for hiring and getting hired. Atlanta, GA: Workbench Media.

Chopra, D. (2013, August 16). 21 day meditation challenge: Miraculous relationships. Retrieved August 16, 2103, from chopracentermeditation.com: https://chopracentermeditation.com

Clarkson, K., & Miller, R. (2012). Business law: Text and cases: Legal, ethical, global and corporate environment. Mason, OH: Cengage Learning.

Fredman, S. (2011). Discrimination law. New York, NY: Oxford University Press.

Gordon, L. (2007). The sexual harrassment handbook. Franklin Lakes, NJ: The Career Press, Inc.

Hanh, T. (2012). Work: How to find joy and meaning in each hour of the day. Berkeley, CA: Parallax Press.

MacKinnon, C. (1979). Sexual harrassment of working women. Boston, MA: Yale University.

McGraw, P. (2012). Life code. Los Angeles, CA, USA: Bird Street Books.

Palumbo, C., & Wolfson, B. (2011). The law of sex discrimination (Fourth ed.). Boston, MA: Cengage Learning.

Rassas, L. (2011). Employment law: a guide to hiring, managing, and firing employers and employees. New York, NY: Aspen Publishers.

Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc.

Walsh, D. (2013). Employment law for human resource practice. Mason, OH: Cengage Learning.

Wilde, S. (1987). Life was never meant to be a struggle. Carlsbad, CA, USA: Hay House, Inc.

Ethics and Law

Published August 14, 2013 by Mayrbear's Lair

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Ethical theories help individuals to decide what is morally right. The concepts of right and wrong are determined by the group to which one belongs to. Geisler (1989) suggests that ethics is defined in terms of ethnics or what the community deems as morally right and that each society creates its own ethical standard. Similarities that exist between different social groups for instance, result from common needs and desires rather than universal moral prescriptions (Geisler, 1989). In a business environment, leaders must rely on their own views of morality and ethics to assist them in the decision making process. However, there are times when a leader is confronted with making a decision and is required to determine whether it is more important for the organization to engage in ethical practices or lawful ones. For example, many lenders in the mortgage and loan industry approved home loans for individuals who were not qualified. These practices were justified because of loopholes in the legal system. In this case, executives acted under the notion that their conduct was well within the parameters of the legal framework, and skirted past the ethics issue.

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Leaders that find themselves in situations such as this, where they confront challenges that require them to make a choice that is lawful or ethical can draw from a variety of philosophical theories to help them make the most effective decision that will benefit the organization and their stakeholders. Seaquist (2012) outlines the following philosophical theories that help guide the decision makers: (a) ethical absolutism, religious fundamentalism, utilitarianism, deontology, ethical relativism, Nihilism, virtue and justice ethics (Seaquist, 2012). For example, if a leader in the mortgage and loan industry relied on the religious fundamentalism of Christianity, the executive would look to God’s will as to what is right or wrong to help guide their actions. This philosophical style is similar to the ethical absolutism, in that right and wrong concepts are absolute and do not change. Religious fundamentalism relies on the doctrines of truths laid out by the prophets and interpreted from Biblical scriptures. In this respect, an executive’s views are defined on a Christian’s perspective of ethics based on God’s will, which is absolute. From this philosophical view, an executive may choose to assist families that are at a disadvantage for making a first time home purchase, and engage in business practices they deem lawful, even though it may be considered unethical. In this respect, as a Christian, the individual’s choice is to find a way to help others first which in God’s eyes is good, even though the behavior, in the eyes of the financial institution they represent may consider it unethical.

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A leader, on the other hand, that draws conclusions from a philosophy that embraces ethical relativism, rejects the concept of absolute moral values. These leaders do not conform to ideas that moral judgments are finite. Huemer (2005) postulates, that ethical naturalism and intuition also play a role that can influence individuals. Ethical naturalism for instance holds the view that right and wrong can be identified by whatever promotes human welfare and happiness. Ethical intuitionism, on the other hand, refers to a philosophy that some things (actions, states of affair, etc.) independently consist of one’s attitudes towards various situations (Huemer, 2005). This view embraces an attitude that at least some moral truths are known intuitively and subject to individual interpretation. In other words it is generally understood that some moral truths are known directly and not through the perception of a person’s five senses, or based of other truths. Like the ethical relativism philosophy, they deny the existence of absolute moral principles. Leaders that conform to this kind of philosophy are focused on following the parameters of the laws and although are concerned with ethical values, do not place it as a priority in the decision making process. For example, an executive that embraces this philosophy may approve a loan to the tobacco industry to make a huge profit for the organization, even though it may be deemed unethical to support an industry that hides the harmful effects of their products. In conclusion, each leader must decide for themselves the kind of leadership style they intend to embrace and how they run their business efficiently. Hanh (2012) reminds us that business leaders do not have to sacrifice happiness or their values, to make a profit (Hanh, 2012). Business leaders that cultivate an ethical climate will automatically operate their organization within the framework of the law and incorporate this attitude into their codes of conduct. This effective leadership strategy is more likely to ensure an organization’s long term success.

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References:

Geisler, N. (1989). Christian ethics. Grand Rapids, MI: Baker Publishing Group.

Hanh, T. (2012). Work: How to find joy and meaning in each hour of the day. Berkeley, CA: Parallax Press.

Huemer, M. (2005). Ethical intuitionism. New York, NY: Palgrave MacMillan.

Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc.

Ethics in the Global Marketplace

Published August 5, 2013 by Mayrbear's Lair

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The global marketplace continues to expand because of the increasing number of organizations that are now engaged in commerce outside of their own jurisdiction. Boatright (2009) purports that as large multinational corporations (MNC) cross their own boundaries intense competition is at the core for the elevated levels of ethical problems that arise because in most cases, leaders and managers are unprepared to address them (Boatright, 2009). For example, many MNCs often engage in practices that exploit inexpensive labor and natural resources from less developed countries (LDC) and most do so without making investments in them that would help advance their economic development. Corporate leaders, for example,  find themselves in situations where they are forced to make unethical choices because they are being asked to place the procurement of profits as their primary goal disregarding the health and welfare of the consumers that support them. Leaders in one case study were asked to provide products that contained harmful substances and export them to other markets outside the US where little restrictions apply. The fact that managers even have to consider this as an option personally is appalling and at heart of why we are seeing so many examples of corporate misconduct exposed in the headlines like a pharmaceutical manufacturing plant that shipped contaminated vaccinations, or a peanut farm that was exported products contaminated with salmonella. When corporate leaders are faced with issues like these, profit is usually at the forefront of their decisions over safety.

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Corporate leaders are driven and have a duty to make sure their organization is run efficiently to achieve successful outcomes. Byron (2006) suggests that with the guidance of corporate leaders, a company’s purpose is to articulate their dominant values, translate those values into their principals and allow those principals to influence corporate culture. For example, the old version of corporate culture was characterized by such values like freedom, individuality, competition, loyalty, efficiency, self-reliance, power, stability, contractual obligations, and profit. If these values are not regulated and controlled, unworthy values like greed and the motive to dominate rather than serve can propel individuals and organizations to engage in ethical misconduct. In the new corporate climate however, leaders are embracing and learning to comprehend the ethical connection between the organization and a broader picture of its stakeholders which include employees, supplies, consumers, the community and the environment (Byron, 2006). Regardless of the situation an individual find themselves in, the final decision should reflect good judgment and the right choice, which in my view, does not include bringing harm to stakeholders. This in the long term, is a best practice choice.

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Unfortunately, many leaders are forced to make a decision between profits and the welfare of their consumers.  Some are aware of how other companies handle similar situations and feel immense pressure to adapt those industry practices to save their own hide and remain competitive in their market, or as Ferrell et al. (2013) describe, “When in Rome, do as the Romans do” (Ferrell, Fraedrich, & Ferrell, 2013). Leaders face a multitude of pressures because (a) their organization is showing signs of eroding market share, (b) unethical supervisors put pressure on team leaders to cut costs or layoffs would result, and (c) they are usually under a time restriction to yield results. In addition, rather than work in partnership with colleagues to find the best solution, sometimes supervisors make it clear the weight of the decision is on one person’s shoulders. In a case like this, the decision could yield a positive outcome and everyone is victorious. However, if the decision should prove disastrous, that manager is on their own.  In conclusion, many organizational leaders find themselves facing similar issues because they have not established an ethical culture and instead created a climate that is vulnerable to ethical misconduct.

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References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Byron, W. (2006). The power of principles: Ethics for the new corporate culture. Maryknoll, NY: Orbis Books.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Cultivating an Ethical Corporate Climate

Published July 31, 2013 by Mayrbear's Lair

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The corruption and scandalous behavior of organizational leaders has prompted corporations to set up more effective policies to reduce ethical misconduct. In fact, as a result, many organizations have taken a proactive approach when it comes to cultivating an ethical climate. Recent studies suggest that 90% of fortune 500 companies now employ codes of conduct and new laws require CEOs to sign off on documents that state they have no conflict of interest financially or personally that may cause unethical operations. These are some of the measures corporate leaders take to maintain the trust of their stakeholders. Boatright (2009) posits that there are three kinds of codes of ethics. The most common specify rules for various situations and are identified as codes of conduct or statements of business standards and practices. Another kind of statement addresses core values or the vision of an organization. This is referred to as a mission statement or company credo. These include affirmations of the commitments an organization makes to key stakeholders. The third form is the corporate philosophy which describes the beliefs that guide the company. Philosophy statements are usually written by the founders of new industries, like when innovative technology is developed that introduces new ways of doing business. In addition, there are some companies that develop an aspiration statement which describes the kind of company they aspire to evolve into (Boatright, 2009). These various codes of ethics provide the stakeholders an explanation of the organization’s values and ethical principles that guide their actions.

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The institution examined for this blog post is The Chopra Center for Well-being. Deepak Chopra and David Simon, two highly esteemed medical doctors, created the Center for Well-being to offer a medical facility that integrates both eastern and western medicine to help people experience physical and emotional healing (Chopra & Simon, 2013). Organizations that manage public health and welfare have a responsibility to their clients and a higher need to establish codes of conduct because errors and ethical misconduct in this industry can result in the loss of life. Because of this, stakeholders require assurances of an effective ethics program to detect and prevent criminal conduct. The Chopra Center’s homepage clearly states their goal which is to guide guests and provide tools and healing principles that nurture health and restore balance to help them live a more joyful life. These statements clearly communicate their organizational goals and  the methods they employ as ethical medical practitioners.

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It is important that stakeholders trust the leaders that run a corporation. Ferrell et al. (2013) postulate that the development of an effective business ethics program outlines an organization’s objectives and devise systems to manage, evaluate, and monitor their operations (Ferrell, Fraedrich, & Ferrell, 2013). Stakeholders want to feel confident that leaders are engaged in actions that do not include abuse of power or misuse of organizational resources. For example, in addition to stating their goals on the homepage, The Chopra Center website also has a link to their mission statement which professes they exist to serve as a global source for healing and transformation. By clearly publishing their mission statement, their goals, their history, media information, a FAQs page to address questions and other information to address concerns, the Chopra Center website helps minimize risk and manages stakeholder fears by providing a wealth of information with openness and transparency. The information provided on their website displays a formal control of input that indicates is supported by a strong support staff whose shared values help establish a sturdy structural system. In conclusion, the Chopra Center team clearly seems to comprehend the importance of establishing an effective ethical culture because as an organization in the health care industry, it helps them avoid legal issues that could end up with disastrous consequences.

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References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Chopra, D., & Simon, D. (2013). The Chopra Center for Well-Being. Retrieved July 14, 2013, from The Chopra Center for Well-Being: http://www.chopra.com/welcome-chopra-center

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Ethics Audit Programs

Published July 29, 2013 by Mayrbear's Lair

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Most organizations incorporate some form of ethics system regardless of whether it is formally established or informally understood. Campbell and Houghton (2005) contend that ethical behavior does not simply translate to complying with legal and professional regulations; it is a state of mind in which individuals follow unwritten tenets and exist in a culture of making choices that does not bring harm to others or the environment (Campbell & Houghton, 2005). For example, leaders of ethics audit programs should require that individuals that manage them should  have adequate training to run ethical compliance programs. In other words, they should make sure the individual appointed to this position is sufficiently qualified. For example, one company that appointed an employee to manage the ethics committee for their organization was appointed merely because he was conveniently located near the office, not because of his experience in ethical or legal matters. In addition, he was reluctant to take the position unless he was substantially compensated for his time. This means his motives were driven by a reward system not by his moral values or principles. This component changes the dynamic of his role as an authoritative figure.

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Rules and policies in an organization are made to include the culture and values of a company. Boatright (2009) posits that these guidelines are outlined in a company’s formal documentation which includes their mission statement, a code of ethics policy, personnel manuals, training material and management directives. Orientation training, compensation, promotion, auditing and monitoring systems serve as various devices that help support a company’s rules and regulations (Boatright, 2009). In another  case study, the organization conducted its own ethics auditing report and concluded it was doing a good job of monitoring ethical issues and even complied with the report’s recommendations to establish a confidential hotline for employees to report legal concerns. However, one of the organizations top executives discovered another reality actually existed. One where: (a) employees are violating operational procedures, making unauthorized short cuts to meet deadlines that have resulted in harm to employees and the environment, (b) an inequality and glass ceiling situation that exists with respect to the compensation between male and female employees, and (c) discrimination issues in targeting a specific ethnic group and taking advantage of their unfamiliarity with labor laws. In addition without organizations like the EPA and OSHA monitoring their activities it is easier for them to engage in practices that violate regulations. Now that the leader is cognizant of these issues if he does nothing to change the situation or report it, when it is eventually discovered, he will find himself in dire need of an ethical crisis management and recovery plan to save his hide.

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Organizations that do have an ethical program or implement an ethics auditing system will face challenges that can result in legal and ethical misconduct. Ferrell et al. (2013) suggest that to help prevent a crisis from erupting, the development and implementation of a crisis management plan can serve to help leaders respond and recover faster from unethical and scandalous events that may occur (Ferrell, Fraedrich, & Ferrell, 2013). Although executives are not responsible for the events of the past, they are charge of guiding the organization’s future. If they are not able to manage ethical issues they face, he and the organization could face substantial legal and financial ramifications which will in turn disrupt company operations, prevent employees from performing their duties, slow production, damage the institution’s reputation, and lose the confidence of their stakeholders. If leaders avoid these issues they will only escalate until they reach the tipping point and at that juncture, it may be too late to recover. In the meantime, the executive’s job and reputation will be on the line because investigators will look to them for answers. It is recommended therefore, that leaders work on developing a crisis management plan because executives that cultivate an unethical environment steer organizations straight into the maelstrom of a managerial catastrophe.

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References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Campbell, T., & Houghton, K. (2005). Ethics and Auditing. Canberra, Australia: ANU E Press.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Leadership and Corporate Culture

Published July 26, 2013 by Mayrbear's Lair

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Executives have the power to shape corporate culture and motivate ethical conduct. Most leaders consider themselves ethical. Some, however, question whether ethics is a relevant component of leadership. Boatright (2009) contends that it is just as important to embrace ethical behavior in public life as well as in private life. Most corporate moguls are under the impression that behaving ethically alone is enough to sustain them as an effective leader. In fact, studies suggest that leaders do not believe specialized skills or knowledge in ethics are necessary to produce effective results in the work place (Boatright, 2009). This is a false perception. Situations arise more often than not in a business environment where leaders cannot easily resolve issues without identifying the ethical implications. This research focuses on the role a leader plays in the development of an ethical corporate culture. It takes a closer look at the importance of ethical leaders and the various roles they serve in an organization.  In addition, this study will illustrate the relationship between ethical leaders and their stakeholders. The analysis will also examine various leadership styles, the impact they have on corporate culture, how they affect ethical-decision making, and draw from examples to support this investigation. The findings of this research will conclude that leaders, who engage in business practices without ethical rules and regulations, will eventually discover that ethical misconduct behavior can easily become an inevitable component in their future.

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Importance of Ethical Leadership

The most successful leaders use their power to shape corporate culture and motivate ethical conduct. Because they are in the business of making a profit, they design strategies to achieve desired outcomes. Deepak Chopra (2012) reminds us that life is riddled with challenges, obstacles, and situations that leave many individuals asking the question, “Why is this happening?” No matter what advantages an individual may possess – money, intelligence, charismatic personality, a positive disposition, or influential social connections – none of these elements offer a magic key to effective leadership (Chopra, 2012). Managing directors are continually faced with difficult challenges. How they manage these trying situations can make the difference between the prospect of success and the threat of failure (Chopra, 2012). For example, when leaders cultivate an environment of fraud and deceit, they are fertilizing the ground for failure and destruction. In order for an executive to be considered an effective leader, they must have the ability to: (a) guide a corporation to profits for the sake of the stakeholders, (b) achieve organizational goals in an ethical manner, and (c) motivate their employees to adhere to behavior that is in alignment with the organization’s code of conduct.

Consistency also plays an important role for successful executives. The most effective leaders incorporate policies that inspire high performance levels and motivate organizational behavior that goes beyond just observing regulations. When leaders establish trust with subordinates, they earn the loyalty of their staff. In return, employees trust their leaders to protect them from harm in return for their services, dedication, and loyalty. By making choices to work in partnership with their employees, leaders can help them achieve greater levels of success than perhaps even they realized were capable of achieving. Employees who respect their supervisors, feel supported and appreciated by them, are more likely to become motivated and go beyond just achieving organizational goals.

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Leaders and Stakeholders

Stakeholders provide leaders another reason to cultivate an ethical culture. As a leader, it is their responsibility to make sure the company is guided towards the path of success and profit for the benefit of the stakeholders that support them. Executives, therefore, must incorporate effective strategies and hire the appropriate talent to reach desired outcomes as part of their responsibility to the employees, consumers, suppliers, and society as a whole. Ferrell et al. (2013) posit that because stakeholders have the ability to affect corporate policies it is imperative that leaders find methods to use their power to influence positive outcomes. There are five power strategies leaders utilize to achieve their goals: (a) reward power, (b) coercive power, (c) legitimate power, (d) expert power, and (e) referent power. Studies suggest these five power bases can be implemented to achieve both ethical and unethical outcomes (Ferrell, Fraedrich, & Ferrell, 2013). For example, a leader that incorporates legitimate power believes they have the right to exert their influence and that others are obligated to accept it. This kind of power is typical in hierarchical environments where leaders are assigned titles and specific positions of authority. In this type of culture, stakeholders readily acquiesce to leaders who command legitimate power. In some instances, however, leaders use this power to engage in behavior that is opposite of their belief systems. These individuals use strict protocol and the chain of command to their advantage. This is typically one way leaders can influence individuals to engage in misconduct. In this setting, it is easier to establish a climate of deceit because subordinates are hesitant to disobey orders for fear of the punishment or termination. The leaders at the well-oiled Enron machine, for example, employed all five power strategies to maintain their grand illusion.

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Leadership Styles

An individual’s leadership style also plays a significant role in shaping the corporate culture and motivating ethical conduct. Glanz (2002) reports there have been many studies conducted to help determine the best leadership styles. Most conclude that effective leaders exhibit varying degrees of the following virtues: (a) courage, (b) empathy, (c) judgment, (d) impartiality, (e) enthusiasm, (f) humility, and (g) imagination (Glanz, 2002). The best leaders, however, continue to expand their knowledge, re-examine outdated business strategies, maintain smooth operations and high production levels, and motivate staff confidence. In his book, Leadership Aikido, John O’Neil (1999) introduced six concepts to achieve victorious leadership skills without harming others. These concepts were inspired by the martial arts tradition of Aikido. He ascribes the following six practices that enable leaders to assess and develop their fullest potential: (a) cultivating self-knowledge, (b) practicing the enigmatic art of planning, (c) speak the language of mastery, (d) allowing values to drive the decision-making process, (e) changing the outcome of failure to one of success, and (f) abiding by the law of unintended consequences. This method of leadership embraces the elements of aikido to help executives identify and overstep five major obstacles that impede progress: (a) failure to grow emotionally, (b) failure to make creative decisions, (c) failure to empathize, (d) failure to manage ego, and (e) failure to overcome boredom and alienation (O’Neil, 1999). Leaders that continue to develop effective leadership skills will most likely achieve higher levels of organizational success.

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The Decision-Making Process

The decision-making process also plays an integral role in how leaders influence corporate culture and motivate ethical conduct. Hanh (2012) posits that because leaders can get into difficult situations, they must have the ability to handle strong emotions in the workplace in order to maintain effective relationships. To achieve this they must keep communication open and become cognizant to avoid the creation of a negative or repressive work culture. The most successful leaders incorporate practices that help manage strong emotions and become educated on how to utilize these strategies in good times before strong emotions arise. This strategy offers leaders the ability to respond in a more skillful fashion and incorporate effective methods during a crisis (Hanh, 2012). For example, Hanh’s Plum Village organization has developed a culture that incorporates three positive influences of power to guide their code of conduct. They are love, understanding, and letting go. The leaders at Plum Village posit that these three influences of power help in the decision-making process because they are used as effective tools that focus on the release of suffering. Their strategies of operation are designed in a way that does not incorporate punishment or destruction. In addition, they conduct their business practices in a manner that protects the environment and all living things.

Leaders that incorporate ethical choices and learn corporate social responsibility operate a business free of worry and fear concerning their future because their business practices support the stakeholders and the environment rather than exploiting or depleting them. Leaders that possess the ability to listen to their own pain and to that of others are capable of finding solutions for transformation. The most successful leaders learn that ethical leadership can help them realize their goals with the support of their stakeholders. In short, leaders that continue to learn to take care of themselves first, have better knowledge of how to take care of others. This is one effective strategy that ethical leaders use to establish a culture that embraces harmony and respect; one that encourages employees to feel pride and joy.

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Conclusion

Organizations like Plum Village that focus on creating a culture of happiness have produced a community that stakeholders are motivated to invest in. Hanh (2012) posits they have created a model that does not focus solely on profit. They also cultivate a climate to create joy and happiness (Hanh, 2012). Businesses should not have to sacrifice happiness to achieve high levels of profit. Organizations that are destructive, engage in fraud, and operate without regard for stakeholders do not enjoy longevity. Leaders in this arena cultivate an atmosphere of discontent and anxiety. Executives on the other hand, who focus on cultivating a climate that motivates ethical conduct without compromising their ability to profit, are more likely to succeed and maintain the confidence and support of their stakeholders. For a workplace to function successfully and harmoniously there must be a code of behavior that everyone is willing to accept. The most effective method of making sure this is accomplished is for leaders to make it a part of their organization’s culture. The most successful do so by setting an example and participating in a leadership style that reflects ethical behavior. They must also include strategies to incorporate supportive speech and engage in actions that bring content and cheerfulness to themselves, their organization, and the community at large. The findings of this research conclude that leaders who engage in ethical misconduct and cultivate a culture of deceit will achieve disastrous results like Enron unless they embrace effective leadership skills that have the power to shape a corporate culture that supports and motivates ethical conduct.

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References

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Chopra, D. (2012). Spiritual Solutions. New York, NY: Random House, Inc.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Glanz, J. (2002). Finding your leadership style. Alexandria, VA: Association for Supervision and Curriculum Development (ASCD).

Hanh, T. (2012). Work: How to find joy and meaning in each hour of the day. Berkeley, CA: Parallax Press.

O’Neil, J. (1999). Leadership Aikido. New York, NY: Three Rivers Press.

Ethical and Moral Philosophies

Published July 19, 2013 by Mayrbear's Lair

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A person’s livelihood is a remarkable opportunity to express their dreams and passions. It can be the source of empowering nourishment, transformation, inspiration, and tranquility. It can also provide a source of anxiety, depression, pain, discomfort, stress, and discontent. Vietnamese Buddhist Monk Thich Nhat Hahn (2012) contends that the choices people make can determine the amount of joy and happiness they create in their home or at work (Hanh, 2012). Morality and moral reasoning play a pivotal role in the kinds of choices individuals make as well. Leaders, for example, rely on their principles or philosophies to help them decide what behavior is acceptable when making the most effective decisions in the workplace. This research centers on the role ethical and moral philosophies play in the decision-making process for business leaders. It will examine how moral philosophies are applied to affect behavior and illustrate how these values affect outcomes. In addition, the study will provide examples of corporations and the strategies they implement to shape moral philosophies into their culture and codes of conduct. These findings will deduce that ethical and moral philosophies influence the behavior of a leader in the decision-making process because they help them: (a) identify right and wrong behavior, (b) develop a code of conduct that guides business practices, (c) integrate global strategic planning efforts to avoid violations, and (d) navigate the company toward positive outcomes.

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A Closer Look at Ethics and Morality

Moral Philosophy Defined

Moral philosophies influence behavior because for one thing, everyone has an opinion about something. In other words, human beings make judgments and evaluations constantly. It is part of human nature. When the topic of philosophy is discussed, however, most people refer to it as the general set of values they accept. However, moral philosophy applies to specific regulations and principles that people follow to determine correct and incorrect behavior. It also offers an explanation and justification as to why things happen. Kurzynski (2004) points out that ancient Greek philosopher Aristotle (384-322 BCE) was one of the most significant principal figures of philosophical thought and considered a great, if not the greatest, thinker of his era. He was instrumental in asking questions that made people ponder character development, integrity, personal responsibility, and empathy towards others (Kurzynski, 2004).  In short, he made important contributions to society by providing insight into human behavior. This in turn helped individuals to identify the constructs of what makes life worth living.

Leaders that do not adhere to moral and ethical behavior justify their misconduct as a viable means to achieve the end goal. This kind of leader does so without taking into consideration the short or long term repercussions, as witnessed in the Enron scandal. This occurs because moral judgments differ. People judge behavior, omissions, and also form opinions on other people in general.  For example, a person might consider someone a shady character based on the kind of garments they donned. This kind of judgment, however, tends to lead to inaccurate conclusions. Barcalow’s (2007) research offers a blueprint for making moral decisions about right or wrong by asking some of the following important questions: (a) what are all the relevant facts about a situation, (b) how will the social and physical environments be affected, (c) what actions will produce the least and the most harm, (d) what rules apply to the situation, (e) what would be the most caring and compassionate thing to do under the circumstances, and (f) what (if any) violations have occurred  with respect to the rights of others that are relevant in this situation (Barcalow, 2007). By asking these and other pertinent questions, leaders can help ascertain the most logical course of action that will achieve the highest benefits.

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How Moral Philosophies Influence Behavior

Ethical and moral philosophies can play a significant role to influence a leader’s behavior in the corporate environment. Forsyth (1992) purported that a business leader’s moral judgments are influenced by two fundamental components – a concern for values and promoting well-being. For example, an individual with a teleological philosophy performs as a situationist that advocates setting goals for the best possible consequences regardless of moral tenets. A leader who acts from a virtue ethics philosophy is a subjectivist, on the other hand, and may veto moral guidelines and core judgments based on personal principles and practical concerns, whereas an individual that follows a utilitarian philosophy is an absolutist that assumes their actions are ethical, contingent upon yielding positive outcomes that conform to moral rules (Forsyth, 1992). Most experts agree, however, that an individual’s moral beliefs, attitudes, and values create an interconnected system that defines the makeup of their personal moral philosophy.  These set of values and beliefs dictate a leader’s decisions taking into consideration the nature of the issue.

Integrating Moral Philosophies in Business

Employers that integrate moral philosophies into their business practice look for more effective ways to achieve win-win solutions.  According to Mobley (2002), the upsurge in restructuring and the downsizing of organizations has limited professional advancement opportunities for employees. As a result, job security, fair wages, decent working conditions, and equitable treatment are now concerns that managers face. These dilemmas force leaders to manage the ethical implications of these changes. Most are inadequate because they lack the skills and tools to help employees transit. Studies indicate that education plays a significant role. Evidence suggests that training executives can help with the decision-making process. It helps equip them to handle the morality issues better that often result from such events like downsizing, outsourcing, or other significant occupational changes that occur, like incorporating greener business practices (Mobley, 2002). For instance, leaders at corporations like Patagonia and Esprit have taken more innovative approaches to adopt green business policies. Esprit, for example, created a product line called the E-collection which consists of socially aware products that are manufactured in an environmentally conscious manner. The Patagonia Corporation, on the other hand, has developed a self-imposed earth tax that is designed for the preservation and restoration of natural resources. These are two examples of how huge conglomerates have incorporated ethical and moral philosophies in their business practices. These companies adopted ethical business practices as part of their corporate wide culture. They consider these modifications as necessary efforts and sacrifices to maintain their commitment to a socially responsible process that is in continual motion.

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The Impact on Global Strategic Planning

The moral and ethical philosophies of an organization also impact global strategic planning. Callahan (2008) suggested that recognizing moral judgments often buried in arguments, especially that postulate matters of economic science, are likely to expose views based on moral assumption rather than rational examination. This can lead to closer scrutiny of the arguments which inevitably produces better policy choices (Callahan, 2008). For example, when corporate giant, The Gap, discovered their foreign manufacturing plants were creating toxic conditions that caused harm to the employees, local residents, and the environment, immediate actions were taken to find solutions to the situation. Events such as these, inspire executives to look closer at who they conduct business with and in many cases motivate leaders to implement more socially responsible choices in their business practices even if that equates to partnerships with smaller vendors.

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Codes of Conduct

Ethics and moral philosophies also play an integral role to help leaders establish a code of conduct that helps guide personnel behavior and achieve desired goals in alignment with an organization’s vision. Singer (2012) suggested that every great team, culture, society, religion, and organization that has stood the test of time have one thing in common – a simple set of powerful rules that guide internal behavior and expectations. This set of rules is known as a code of ethics. These policies guide and empower an individual or group to reach successful goals. Organizations that implement a code of ethics do so to maintain, enforce, and implement controlled growth for the entity. It can include parameters that identify acceptable personality traits, behavioral boundaries, outline desired performance levels, as well as identify social and work ethic expectations (Singer, 2012). The intent is to create a set of guidelines that organizations use to help influence employee behavior and organizational outcomes. For example, one organization may create a code of ethics that requests staff members to engage in the following virtuous conduct as a representative of the company: (a) stand up for the weak and defenseless, (b) engage in transparency business practices, and (c) always speak the truth. This code of ethics example, offers simple guidelines easy enough for any individual to follow.

Conclusion

Leaders are influenced by ethical and moral philosophies. This helps them navigate their organizations with confidence to attain their goals.  Hanh’s (2012) teachings reminds us that people have a lot more influence than they realize when it comes to creating an ethical work environment. Leaders that are properly trained to make mindful decisions are presented with an opportunity to cultivate joy and passion in the workplace without creating harmful consequences that affect other sentient beings or contaminate the environment. When organizations work in partnership with employees and other stakeholders, there is great potential to contribute to positive outcomes that are beneficial to all living things (Hanh, 2012). In conclusion, the findings of this study deduced that leaders who operate without moral standards justify their reckless actions as a means to achieve high levels of success, usually without regard for consequences. Businesses with leaders who incorporate ethical and moral philosophies, on the other hand, influence positive results by establishing a code of conduct that guides their business practice. Leaders that design socially responsible business strategies ultimately encourage higher levels of integrity in staff behavior and achieve outcomes that equate to long term success.

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References:

Barcalow, E. (2007). Moral philosophy: Theories and issues. Belmont, CA: Cengage Learning.

Callahan, G. (2008, Summer). Economic analysis, moral philosophy, and public policy. The Independent Review. Oakland, CA, USA. Retrieved July 4, 2013, from http://search.proquest.com/docview/211307474?accountid=32521

Forsyth, D. (1992, May). Judging the morality of business practices: The influence of personal moral philosophies. Journal of Business Ethics. Dordrecht, Netherlands. Retrieved July 4, 2013, from http://search.proquest.com/docview/198100721?accountid=32521

Hanh, T. (2012). Work: How to find joy and meaning in each hour of the day. Berkeley, CA: Parallax Press.

Kurzynski, M. (2004). An examination of Peter F Drucker’s management philosophy as compared to Aristotle’s moral philosophy. ProQuest Dissertations and Theses. Ann Arbor, MI, USA. Retrieved July 4, 2013, from http://search.proquest.com/docview/305173891?accountid=32521

Mobley, S. (2002). The study of Lawrence Kohlberg’s stages of moral development theory and ethics: Considerations in public administration practices. ProQuest Dissertations and Theses. Ann Arbor, MI, USA. Retrieved July 4, 2012, from http://search.proquest.com/docview/305464221?accountid=32521

Singer, B. (2012). Team code of honor: The secrets of champions. Minden, NV: BZK Press LLC.

Ethical Training Programs

Published July 17, 2013 by Mayrbear's Lair

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Ethical training programs equip employees with strong reasoning abilities and intellectual skills that can help them comprehend and find more effective solutions to complex ethical challenges. Ferrell et al. (2013) identify six stages of moral development based on Kohlberg’s model of philosophy. They are: (a) punishment and obedience, (b) purpose and exchange, (c) interpersonal expectations, relationships and conformity, (d) social system and conscience maintenance, (e) prior rights, social contract or utility, and (f) universal ethical principles. Kohlberg’s studies also suggest that individuals continue to evolve and reshape their morals and ethical behavior based on training, education and experiences (Ferrell, Fraedrich, & Ferrell, 2013). For example, an ethical dilemma in one case, was created by an employee that works in customer service. In this situation, the employee received a gift from a customer as a small token of their appreciation. However, accepting gifts from clients goes against the company’s code of conduct policies. According to Ferrell et al., experts may identify this dilemma as stage one in Kohlberg’s cognitive moral development model. Identifying this stage, can help a supervisor address the nature of his moral dilemma to help find the best solution. In this stage of development individuals respond to obedience and punishment, where rules dictate the terms of right and wrong, and good and bad conduct, that help determine outcomes. Because the organization has clearly defined policies forbidding salespeople from accepting gifts from consumers and identifies what is acceptable business behavior, a supervisor may send the following email in response to the situation:

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By composing this letter, the supervisor is immediately taking responsibility of the seriousness of the matter and addresses the situation with recommendations to the employee for a swift resolution. The leader analyzes the issue, acknowledges the situation intensity, and identifies the matter as unethical behavior. By addressing these components, it is easier to decide on the appropriate action required to reach a mutually beneficial and ethical solution. These actions portray a skilled leader whose direct approach is sharp and swift while remaining sensitive to a valued employee’s unmitigated circumstances. There is nothing wrong with employees or clients showing appreciation for outstanding performances. However, this situation dictates that employees and clients follow the parameters of company policies to avoid situations where a staff member may lose their job by inadvertently participating in ethical misconduct by innocently receiving a reward. Boatright (2009) reminds us that justice requires that everyone has the right of equal opportunity to succeed in life (Boatright, 2009). However, receiving favors and rewards from certain clients is not fair to other employees who work just as hard and are not acknowledged for their excellent performances. Policies can change over time, however in order to do so, it must be done on a corporate wide level and implemented into the company’s culture and code of ethics throughout the organization so that employees have clearly defined parameters of what is right and wrong behavior. In conclusion, arming employees with strong reasoning abilities and intellectual skills can help them better comprehend ethical challenges and find more effective solutions to complex issues that are in alignment with corporate procedures and policies.

References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Ethical Decision Making

Published July 15, 2013 by Mayrbear's Lair

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Making difficult decisions in a corporate arena is a complicated process for leaders, especially if they lack sufficient skills to make effective ones. Ferrell et al. (2013) suggest there are a variety of components leaders take into consideration when making decisions. They include identifying: (a) the ethical issue intensity, (b) the individual factors, and (c) the organizational factors and opportunities. These are integral elements that influence the decision making process (Ferrell, Fraedrich, & Ferrell, 2013). When making decisions, leaders must comprehend that there are both advantages and disadvantages in each decision they make. For example, standing by their moral values, a loan officer may decline approval for a $10 million dollar loan to a subsidiary of a tobacco company because of their personal views on promoting deadly products. The advantage of this decision is that it supports that individual’s moral principles. This decision portrays an individual that has adopted an idealistic kind of approach in the way they conduct business, in that they have embraced special idealist values and applies them to help make decisions that reflect a socially responsible form of business practice. Because their views are not part of corporate policy, the disadvantage of this decision is that the client went to competitors instead and secured a loan. In short, the choices were ethical to the individual, but resulted in a huge profit loss for the corporation.

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When leaders engage in important decisions, they must also consider both the ethical and legal aspects of the situation to make the most effective decisions. Ferrell et al. (2013) suggest that an individual’s locus of control influences their behavior. Their studies deduced that people who believe their destiny is controlled by others are usually not as ethical as those who believe they control their own destiny (Ferrell, Fraedrich, & Ferrell, 2013). For example, CEO’s and other top level executives are in a position of power and control for both the short and long term destiny of the company. Each want to make the best decision that is in alignment with the ethical culture of the corporation as well as their own. Ethical decisions include such things as deciding who to conduct business with and whether profits are more significant than outcomes and social responsibilities. By choosing to do business with people that are distributing and manufacturing products or services that bring harm and death to others, leaders must not only face the ethical issues involved but the legal ramifications as well. For example, by selling tobacco products outside the US where restrictions are less binding, a manager is essentially supporting profits over the welfare of innocent people. Corporations are entities and therefore do not experience feelings for people, however, the leaders and managers with families of their own, tend to feel a sense of moral obligation to protect humanity regardless of color or race. Even though a corporation is an entity that does not have feelings, it can still feel the ramifications should legal action be taken against the corporation in the future by victims for intentionally selling merchandise that causes harm from the addictive and toxic additives that are included in their products.

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Most people rely on their own principles to resolve moral issues on a day to day basis. Every leader has significant ethical and legal issues to consider that rely on the organizational culture and the moral philosophies they adapt to help in the decision making process. For example, leaders whose decisions are based on a philosophy known as virtue ethics can make decisions that turn down large profits because their choices are dictated in accordance with that individual’s ideals and the sense of morality that individual develops from their own character which tend to consist of good morals and mature perspectives. Other executives reject deals to sell products that harm consumers because of a deontological moral philosophy which is based on preserving individual rights and the intent to remain steadfast to those beliefs. A corporation on the other hand, is an entity and only interested in end results: profits. Therefore, corporations tend to fall under the teleological view of moral philosophy with focus on achieving end results that benefits all. Regardless of moral philosophy, all decision makers must carefully consider the legal parameters involved as well to avoid violations and harsh penalties.

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In conclusion, leaders want to perform at optimum levels and corporations want to enjoy success. However, as the global market continues to expand, executives, together with their corporations, are taking more measures to incorporate commitment to product integrity and social responsibility. Boatright (2009) contend that a distinguishing aspect of business is its economic character because relationships are based on economics and profit (Boatright, 2009). The bottom line is that leaders have discovered making decisions that are socially responsible is just a good way of doing business in the modern era. Corporations that behave as a tool for change, hire leaders that are motivated to make decisions in alignment with ethical policies. They are conscious of making decisions that do not create harmful outcomes to their stakeholders or the environment. Leaders and corporations whose basic tenets display socially responsible practices like recycling, adopting environmentally conscious policies, incorporate transparency in their operations, and are mindful of how their business generates profits, build trust and confidence from primary and secondary stakeholders which ultimately contributes to the overall success of that organization.

References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.

Stakeholders and Stakeholder Orientation

Published July 10, 2013 by Mayrbear's Lair

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Corporations establish stakeholder orientation because of the influence that ethical issues and social responsibility play in their success and longevity. Boatright (2009) posits that in the traditional system of corporate governance the decision making power is controlled by the shareholders. In addition to control, shareholders are also entitled to the profits (Boatright, 2009). In a business environment however, there are many other groups that have a claim or “stake” in some respect to an organization’s products and services. In addition to the shareholders and investors, the organization’s stakeholders also include the employees, customers, suppliers, government agencies, communities and other special groups that have a claim in some form of the organization’s merchandise, operations, markets, or other areas of interest. This group is known as the primary stakeholders. The secondary stakeholders are the special interest groups and the media that also help influence the operation of a company without direct economic exchange. In this context, primary and secondary stakeholders are in a position to help define an organization’s ethical policies.

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In addition, stakeholders influence business outcomes and businesses influence stakeholders as well. Ferrell et al. (2013) describes this as a two-way relationship. Stakeholder orientation is identified as the manner in which an organization comprehends and tackles stakeholder demands with respect to ethical and social responsibility issues. The corporate governance process is comprised of three sets of actions that include: (a) the collection of information and data throughout the firm, (b) the disbursement and integration of the information, and (c) the reaction of the organization to the information (Ferrell, Fraedrich, & Ferrell, 2013). In short, stakeholder orientation implements methods to address and manage stakeholder concerns with respect to social responsibility to the community and the environment.

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Because stakeholders have the ability to withdraw their resources, they are critical to an organization’s success and are in a position to define important ethical issues. Organizations that develop effective stakeholder orientation plans identify the corporate culture, stakeholder groups, their issues, and create an open atmosphere for feedback. These are corporate governance strategies that help leaders comprehend the importance of social and ethical responsibility. For example, when activist groups with the help of the media (secondary stakeholders) disclosed to the public that Burger King’s beef supplier was destroying the Brazilian Rainforests, primary stakeholders (consumers, employees, and government agencies) united to boycott the organization to change their behavior. This movement caused Burger King to experience huge profit losses and as a result was forced to implement more ethical decisions into their business practices. The media exposé made stakeholders respond to the significant environmental issue which influenced a change in the business policies that governed the corporation. By making this change, Burger King showed it was a socially responsible corporation. This tactic help them regain their fair share of the market again. In this context, the primary and secondary stakeholders clearly affected how the corporation engaged in tactics of social responsibility with honesty and fairness to achieve positive outcomes. The rain forest was no longer being destroyed by Burger King’s business practices and as a result embraced Greener policies. These actions displayed they were socially responsible by engaging in ethical practices. In doing so, they won back the public’s trust and confidence in their brand.

References:

Boatright, J. (2009). Ethics and the Conduct of Business (Sixth ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Ferrell, Fraedrich, & Ferrell. (2013). Business ethics and social responsibility (9th ed.). Mason, OH: Cengage Learning.