Transcript ETHICS IN BUSINESS MANAGEMENT

ETHICS IN BUSINESS
MANAGEMENT
FACTORS IN FLUENCING
BUSINESS ETHICS
1. Individual Factors
(1) Knowledge
(2) Values
(3) Morals
(4) Personal goals
(5) Personality
2. Social Factors
(1) Cultures
(2) Family
(3) Education
(4) Media
3. Code of conduct
4. Corporate Cultures
5. Ethical Climate of the Industry
6. Role of Government in Business Ethics
7. Legal system
8. Religion
9. Society expectations
10. Leadership
ETHICAL ORGANIZATION
• An ethical organization exhibits a number of key
characteristics, such as honesty, integrity,
accountability, respect, loyalty and concern.
CHARACTERISTICS OF AN ETHICAL ORGANIZATION
1. Mission and Vision Driven
2. Management Focus
3. Honesty
4. Integrity
5. Accountability
6. Respect
7. Loyalty
8. Concern
9. Leadership Effectiveness
10. Long-term perspective
11. Honor
12. Customer focus
13. Results-oriented
14. Risk-taking
15. Passion
16. Persistence
Important factors of building an ethical
infrastructure in the organization
1. Commitment from Top Management
2. Code of Ethics
3. Communicating Ethics
4. Ethics Training
5. Establishment of ethics committee
6. Ethics Officer
7. Response and Enforcement
8. Rewarding ethical acts and punishing unethical
ones
9. Audits, Revisions and Refinements
10. Involvement of the employees at all the
levels
CODE OF CONDUCT AND ETHICS FOR
MANAGERS
1. Honesty
2. Accountability
3. Integrity
4. Respect
5. Flexibility
6. Separation of Private and Company Matters
7.Transparent Management of Information and
Accounting
8. Fair Treatment
9. Upholding the Law
10. Responsibility towards different
stakeholders
CAUSES OF UNETHICAL BEHAVIOR
A. Individual Factors
1)Certain personality traits.
2)Certain ethical philosophical beliefs/values.
3)Propensity or tendency to rationalize/morally
disengage.
4)Low cognitive moral development
5)Poor ethical decision-making
6)Misguided loyalty
B. Organizational/Situational
1)Unethical organizational climate or culture
2)Weak and/or unethical leadership/supervision
3)Certain job characteristics
C. Situational factors
D. Other factors
1. Organizations favour their own interest above the
well-being of their customers, employees, or the
public.
2. Organizations reward behavior that violates
ethical standards, such as increasing sales
through false advertising.
3. Organizations encourage separate standards of behavior at work
than at home, such as secrecy and deceit versus honesty.
4. Individuals are willing to abuse their position and power to enhance
their interests, such as taking excessive compensation for
themselves off the top before other stakeholders receive their fair
share.
5. Managerial values exist that undermine integrity, such as the
pressure, managers exert on employees to cover up mistakes or to
do whatever it takes to get the job done.
6.Organizations and individuals overemphasize the short-term results
at the expense of themselves and others in the long run.
7.Organizations and managers believe their knowledge is infallible
(incapable of making mistakes) and miscalculate the true risks, such
as when financial managers invest organizational funds in high-risk
trading options.
WAYS TO PREVENT UNETHICAL
BEHAVIOUR
1. Create a Code of Conduct
2. Continuous review of the code
3. Lead by Example
4. Reinforce Consequences
5. Appreciation to the employees
6. Reward system
7.Ethics training
8. Communication and Meetings
9. Immediate Correction and coaching
10. Hire for Values
11. Build a Culture of Transparency, Openness
and Communication
12. Whistle - blowing
13. Empower employees