Transcript Strategic HRM (Key Points)

Ethics: Ancient Greek origins
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Socrates, Plato and Aristotle
Fundamentals of ethics involve truth/virtue
Happiness is entwined with virtue (and
success): it feels good to do good
Flourishing means acting on the truth and
therefore with virtue (an active state)
‘know thyself’ − Socrates
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Ethics: definitions
1. (used with a singular or plural verb) A system
of moral principles: the ethics of a culture
2. The rules of conduct recognised in respect to
a particular class of human actions or a
particular group, culture, etc.: medical ethics;
Christian ethics
3. Moral principles, as of an individual: His ethics
forbade betrayal of a confidence
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Ethics: definitions
4. (usually used with a singular verb) the branch
of philosophy dealing with values relating to
human conduct, with respect to the rightness
and wrongness of certain actions and to the
goodness and badness of the motives and
ends of such actions
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Capitalism
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An economic system in which the means of
production and distribution are privately or
corporately owned and development is
proportionate to the accumulation and
reinvestment of profits gained in a free market
An absolute system in that it reproduces its
structure through an infinite chain of causal
circumstances and events (everything goes in)
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Normative ethics: two approaches
Absolutist philosophy
• Eternal universally applicable moral principles
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Right and wrong are objective qualities that can be
rationally determined
The philosophy of Emmanuel Kant
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The outcome to self is unimportant
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Normative ethics: two approaches
Relativist philosophy
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If it helps the majority then even the ‘wrong’
could be seen as right
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Utilitarian approach
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Morality is context-dependent and subjective
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Used a lot in international business thinking
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What is an ethical issue?
Questions that could inspire an ethical debate:
1. Should a manager report an employee to their
employer over personal information that has
been given in confidence?
2. In what circumstances should a manager
withhold information from an employee when
that information may have damaging
consequences?
3. In what circumstances is whistle-blowing the
right action to take?
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Ethics: key quotes
‘Ethics is the study of individual and collective
moral awareness, judgement, character and
conduct’
Winstanley and Woodhall, 2000
‘Not automatically the main business goal’
Legge, 1995
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An ethical discussion
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Invites us to consider the consequences of
certain actions
Invites us to decide if we are comfortable with
these consequences
Invites us to consider what could be done
Who should take responsibility for professional
decisions with ethical consequences?
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Ethical perspectives
In business there are a number of ethical
perspectives including:
• the classical approach
• the stakeholder approach
• the corporatist approach
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The classical approach
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The Chicago School of Economics
Milton Friedman
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Friedrick Von Hayek
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‘The social responsibility of business is to increase
its profits’
Milton Friedman
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Stakeholder theory
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The idea that organisations can enhance the
interests of stockholders without damaging
interests of wider stakeholders
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Stakeholders are those groups without whom
the organisation would cease to exist
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It could be considered ethically unjustified to
ignore these groups in the achievement of
business aims
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Corporatist theory
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Suggests that since the actions of independent
businesses can detrimentally affect the larger
economy, that the public sector should
establish, via licensing, commissions and
government policy (specific, monetary and
fiscal) bodies that ensure responsible outcomes
in business practice
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Ethical theories: the moral maze
Consequentialism
• Utilitarianism
• Happiness for the
greatest number
• The end justifies the
means
• Language of
economic utility
Non-consequentialism
• Kantianism
• What is right for one
is right for all
• Universal moral rules
• Treat others as you
would be treated
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Ethics of duty
Kant’s three principles of categorical imperative:
1. To act consistently in accordance with
universal law
2. To act in such a way as to treat humanity
always as an end, never as a means.
3. To act so that your action could be regarded
universally as lawgiving
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Shaping an ethical workforce
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From above: company and managers
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From below: workers’ own self-help
organisations (TU or staff association)
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From without: the state/economic necessity
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90% of FTSE 100 companies now have a code
of business ethics (Balch, 2005)
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Only 45% provide training on ethics (Balch,
2005)
USA prefers a compliance-based response, so no
code
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Chartered Institute for Professional
Development
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Clearly defines HR role as a change agent,
influencing the top management team,
embedding good practice in organisational
culture, helping to communicate and implement
policies
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Using learning and development to enable
organisations to stand up to scrutiny
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Conflicts of interest
‘Organisations that are truly concerned about
ethics must first ensure that there are few
conflicts of interest present’
Stuart Parkinson, 2004
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Learning summary
By the end of this chapter you should:
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Understand the context for ethical behaviour
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Be aware of different options in introducing
ethical approaches
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Have a grounding in ethical theories
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Have knowledge of the barriers to
implementation
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Be aware of business examples
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