Business Ethics Strengths and Weaknesses

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Table of Contents

Introduction
Literature review
Analysis
Recommendations
Conclusion
References

Introduction

Since the wake of time, man’s actions have been governed by the moral bearing that exists within them. As a result, he is able to separate what is right or wrong using past lessons or experiences through his life. Most ethical predicaments in the place of work are at most complicated by the rationale behind them.

An array of ethicists believe that codes of ethics and conduct are to some extent closely related policies and regulations which are used to sort out legal matters. As such, the ethical issues stipulated in the code of conduct can be viewed as laws used to govern the occurrences of such matters. In addition to this, the values which are instigated in order to provide specific guidelines as to how employees conduct themselves are at times considered as moral values. Such values include: respect, integrity, fairness and accountability.

The concept of business ethics is understood differently by various people but it all comes down to doing what it right in the workplace as dictated by the set rules and regulations in regard to the conduct’s effects on products, services and the interactions with stakeholders. In light of this, there is no clear method or technique that can be utilized by managers as they try to solve ethical problems that may arise in the course of business.

Business ethics has come to be deemed as a managerial discipline, particularly since the dawn of the social responsibility movement in the 60s. During that period, social awareness associations elevated expectations of firms and organizations to utilize their huge financial and social power to deal with the ongoing social problems such as poverty, transgression, environmental degradation, inequality, public health and substandard education.

As globalization hit, commerce developed into a more complicated and dynamic topic and organizations realized that they required more regulations to ensure that their transactions and interactions worked towards the common good and did not harm others and thus, the concept of business ethics was developed.

Due to the importance of ethics in our lives, all schools are expected by law to have in their curriculum some lessons and training in ethical studies. Over the years, many developments have been made towards the management and monitoring of ethics at workplaces.

Good examples of how this have been achieved include the use of codes of ethics and conducts, establishment of ethical committees, policies and procedures all in a bid to resolve the ethical issues and problems that may arise as well as providing training to new employees. However, most people only understand ethics from a plain point of view and do not know the benefits that can be accrued from such guidelines.

Code of ethics refers to the highest values to which an organization aims to operate. The code therefore contains the guidelines as to how business activities should be handled and treated. In other words, it dictates what can or cannot be done by workers.

Some business ethics analysts disagree on the significance of the code suggesting that the codes by themselves are not powerful enough in managing ethics in the place of work. They acclaim that it’s the emergent and long-term dialogue around the code’s values that is vital. Codes of conduct include examples of suitable behavior that are deemed to be meaningful and useful to the business.

The establishment of an ethics program in any business not only benefits the business itself but also the society that surrounds the business. Attention to business ethics have been known to improve the moral status of a society as well as maintaining a moral course during difficult times.

In addition to this, ethics programs cultivates a strong teamwork and productivity in an organization, support workers growth and meaning within the organization and in most times, promote a great public image and can avoid the occurrence of criminal acts around the business.

With this in mind, this paper shall set out to critically analyze business ethics and what they entail in the work places. The strengths and weaknesses of this concept shall be put to light and recommendations made as to how best ethics can be utilized and implemented in the work places.

Literature review

According to Crane & Matten (2007), the effectiveness of the business ethics adopted by an organization purely depends on the willingness and morality of the workforce. The Authors claim that external factors such as globalization and aggressive competition may to an extent influence the decisions made by the employees and managers. The sheer lack of personal integrity may at such situations push the employees towards unethical tendencies in a bid to meet targets and deadlines in a bid to counter such aspects.

On the same note, due consideration should be given to the punishment or reward system formulated to tackle unethical conduct. The monitoring and reporting procedures should be made such that all organizational employees feel obligated to follow them even without supervision.

Lippke (1995) reiterates that the lack of precise guidelines on the punishment or reward system may cause the employees to overlook the ethical standards stipulated by the business purely due to ignorance in part of the repercussions that may arise from nonconformity. As such, it is always important to spell out such consequences to employees at all time to ensure that they do not digress from the standards.

David (2006) acclaims that business ethics are a prerequisite to strategic management. He suggests that no matter how flawless the management is in organizing and strategizing business transactions, the lack of ethics during these dealings may prove to be a cost to the organization. Vices such as Bribery, corruption and embezzlement may affect the objectivity of the employees and consequently lead to poor decision making based on personal gains which in turn affects the integrity and productivity of the employees.

In addition to this, employees must be made aware of the vitality of confidentiality of all information pertaining to the organization or its clientele. According to Trevirio & Nelson (2006), trust alone does not suffice within an organization. Access to private information is tempting to all simply because it always provides an edge against other players.

For example access to inside stock information may be viewed as an opportunity to make a quick and hassle free buck. additionally, sharing of information regarding to business clients or transactions to friends or even family may seem harmless but may at the end lead to court proceedings due to breach of contract. It is therefore important that the use and access of such information be under strict supervision and restrictions in order to avoid such incidents.

Maxwell (2003) claims that there is no such thing as business ethics. He insists that businesses are controlled by one golden rule: decision making. To elaborate this, he asserts that the decisions of employment, firing, promotions and demotions and the allocation of resources are based on performance and necessity rather than ethical standings.

He further indicates that the presence of codes of conduct and ethics may only slow down the occurrence of unethical manners but whether an employee does the right thing is purely a matter of deciding on what feels right to them irrespective of the existence of ethical codes.

Codes of ethics and conduct can help establish a health reputation for an organization. This is because they clearly state what an organization stands for and the standards at which they operate. They also improve the market base and consumer loyalty towards the products or services that are offered by the firm. Yardley-Nohr (2006), states that the public perception towards the organization is pivotal to the growth and development of the same.

How the employees behave and takes care of the environment affects how the public views the organization. It is therefore important that they exercise caution while doing their duties even in private because the truth always finds a way to reveal itself.

Additionally, Mitchell (2003) drives home the point that the essence of business ethics has been the corner stone of debates on an international level. He acclaims that most universities and business schools in the UK and US have taken the initiative to train students on ethical conducts and mannerism.

This is mainly due to the realization of the importance of ethics towards the success of businesses. As such, these institutions train the students on the basics and the laws that govern ethics in today’s business community in the hopes that the students will assimilate and utilize these lessons in their practical lives as they fight forward to career actualization.

According to Braybrooke (2003), rational egoism presents an obstacle to full-hearted commitment towards the common good of the organization. He states that selfishness in a business environment impairs teamwork and consequently output.

This is because as the employees refuse to share ideas with their colleagues, it brings about diversity between them leading to divisions among the workforce. This is common in workplaces due to competition for raises and promotions and if unchecked, it may lead to a huge loss for the organization.

Sabath (2002) offers very concise and detailed tips on how business organizations and employees can develop good mannerisms in their day to day activities. She insists that the efficiency of an ethics program depends to a large extent on the culture that an organization has developed over the years.

Culture in this case refers to the way an organization relates with the public, provides accountability, and handles its transactions. In addition to this, she insists that the strength of the culture developed can be maintained through the procedural retraining and educating of new and current employees. A strong organizational culture facilitates means of easily adopting and transitioning to the new codes of ethics and conduct introduced to an organization.

Robinson (2000) reiterates that it is never a difficult task to learn or adapt to new professional etiquette. This he insists is because the world is full of change and our survival depends on how fast we adapt to these changes.

In addition to this, he suggests that employees should at all times invest some time into studying the ethics codes and thereafter challenge themselves towards better performance and behavior. In so doing, they will have mastered the art of good conduct all the while improving on their productivity, attitude and confidence while tackling their endeavors.

Analysis

In the United States, a large percentage of the population believes that the country is afflicted by an ethics crisis (Reder, 1995). Actions such as deceit, cheating, misrepresent, and misdemeanors that were once considered as wrong have over the past few years become tolerable or necessary practices. Managers profit from unlawful use of insider stock information and various prominent members of both the public and government involve themselves in corruption.

Even school students in their various levels seem to have become entangled in the wave whereby academic institutions confirm trivial increases in cheating on examination Crane & Matten (2007). The distress over this alleged decline in ethical values is therefore being addressed by organizations and governments across the globe, while companies depend on their various departments to develop an ethical culture.

The most important question managers should ask themselves is; why is ethics important to a business? When workers in organizations decide to act unprofessionally, they not only affect the business itself, but also its stakeholders, staff and clientele. Employees make countless number of choices daily in businesses.

If these decisions are morally wrong, they can affect the organization’s productivity, earnings and status. The breach of ethics are presented in different ways, for example, an employee who uses office time to interact in his own separate agendas , a quality surveyor who falsifies reports in order to meet a stipulated deadline or a manager who uses his position to exploit and harass his subordinates.

All of these entire events are short of ethics. In most organizations today, the ability to compete effectively lies particularly on its employees. As such, these workers must be trusted to do the right thing even when under minimal supervision. However, It is always important that the code of ethics and conduct is relayed to the employees so that they can have a clear grasp of what should be done. After all, ethics is one aspect that evolves around people.

The standards of behavior from employees cannot be divided. The Human Resource (workers) and ethics are connected and must be incorporated. In today’s high-pressured atmosphere, management must ensure that all employees understand the fact that ethics come before target or bottom lines.

This is because employees may easily overlook these ethics in the work place especially if they feel pressured to breach company policies in a bid to achieve organizational objectives. Statistics indicate that an estimated 56% of all employees find themselves in some compromising situations which force them to breach the ethical code established in their organization.

A study undertaken in 1997 also showed that 48% of workers interviewed confessed that they had been involved in one or more unethical actions during the last year. Among the most frequent infringements were: disregarding the quality standards, covering up incidents, lying to their superiors, misleading customers, and taking credit for a fellow worker’s ideas (Braybrooke, 2003).

It is therefore prudent that managers inform and show all employees that they do not tolerate nonconformity when it comes to conducting business in an ethical manner. In the workplace where decisions are being strained down to the very lowest level, the worker must recognize the significance of making that choice right at the first time.

The establishment of business ethics is becoming a necessity in the business realms. As such, the responsible departments should endeavor in establishing codes of ethics, setting up ethics training programs and employing ethics officers. As we commemorate this mounting empowerment of workers, organizations must ensure that these employees always perform ethically.

The application of ethics in the decision making structure should not be debated and should come out naturally. Unlike the past decades where managers gave instructions and employees followed them without question, employees now need that support system created by ethics programs to clarify any questions they might have; queries that managers and supervisors are at times not around to answer.

Elaborate guidelines help set the standards and requirements for employees. The central part of an ethics program is raising awareness levels amongst workers. Organizations with ethics programs discover that many “unethical” decisions are made on purpose, but out of ignorance.

The use of an ethics program can therefore be used as an effective technique to boost the morale of the employees as well as monitoring their own actions during working hours. Theses programs have in some cases helped to build up confidence and a sense of belonging in the employees thereby improving their productivity and attitude towards the organization and their jobs.

On the same note, an effectively explained code of ethics plays a critical role in employee self-building by clarifying any questions on their own. A code of ethics is a proper document that indicates an organization’s main ethics and values that all employees are to conform to. It has been recommended that codes should be precise enough to show workers the spirit in which they handle their activities, yet lucid enough to permit sovereignty of judgment.

Human Resources must be cautious when instituting a code of ethics. They should ensure that they do not exclude the employee’s personal behaviors, the effects of the ethics program to the environment or even the civil impacts that may arise from the establishment or implementation of those codes.

On the same note, the effectiveness of the business ethics largely depends on whether management embraces them and how the workforces who breach the codes are treated. When management deems them important, back their content, and openly scold rule breakers, codes can provide a strong basis for an effective ethics program. However, winning the ethics encounters is not only about how an organization penalizes those who engage in unethical conduct, but how the organization recompenses both good and bad deeds.

For instance, a company can offer ethics course of action and thorough conduct codes; HR can put forward outstanding training and institute an ethics hot line for inquiry and problems, but it’s the incentive system and the organizational actions that let people know the actual facts. If a manager decides to look the other way when a top salesman who lies about an expense accounts or agrees to improper gifts, that action sends a powerful message to other employees and members of the public about his ethical standing.

The preferred conduct must at all times begin from the top ranks and sip its way through the whole organization. This means that managers as well as supervisors must be straightforward and expect integrity from their workers by establishing definite policies, procedures, and rewards. It’s also up to HR to make sure that employees fully comprehend the consequences of ethical transgression, and that such conduct will not be accepted.

Ethics programs must be simple to use and even appealing to workers. A good ethics program offers both oral and written back up and provides a variety of options for employees to gain knowledge of or talk about ethics. Although a functional ethics code and a reachable ethics officer will facilitate getting the significance out, a triumphant effort needs active communication, instruction and guidance a pivotal role played by the HR department.

Growingly HR departments are establishing hot lines, tutorials and similar ethics training programs in order to try and amplify ethical conduct. Recent estimates point out that 33% of organizations currently provide some ethics training to all the members of staff (Chappell, 2006).

However, the major debate is whether or not an organization can actually tutor ethics. Critics insist that the attempt is futile since humans create their personal value system through their life experiences. On the other hand, believers have noted that a number of studies have established that morals can be learned even after an array of experiences. Data collected indicate that teaching ethical problem solving can make a concrete difference in ethical manners (Braybrooke, 2003).

The next question asked should be; how can businesses teach ethics? Human Resource departments around the U.S. are developing innovative ways to train ethics to their workers. In addition to this, many organizations are working towards establishing a strong relationship between various departments and the established ethical office. For example, an inquiry arises about sexual harassment or prejudice, it is up to HR to handle it and the ethics office will accordingly transfer related issues to the HR.

On the other hand, if a member of staff inquires from a HR manager whether a gift from a client is acceptable, the manager will pass on the matter over to the ethics department (Chappell, 2006). The Human Resource department can also play a role in updating new employees about the ethics program and at the same time; work hand in hand with the ethics office to improve ethical policies and guidelines.

Ethical training sessions are very beneficial to business organizations. For starters, they strengthen the organization’s conduct standards, they are a reminder of the importance of ethical consideration in all decision making by employees and managers and they provide guidelines on what practices are and are not allowed.

Comprehensively, when managers and workers discuss familiar concerns between themselves, they are confident that they are supported while making ethical decisions. This can in turn build up their confidence when they are faced with ethically compromising situations which may confuse them. As discussed throughout this study, an in-depth communicative endeavor is fundamental to spreading the word out. The significance of ethics must seep into the entire organization from the top to the bottom.

Also, communication must also be backed by thorough education and training. A well-built ethical status can give an aggressive edge to an organization against the rivals, boost up recruitment and help maintain current workers. It can develop worker relations and create a workplace environment based on honesty, equality, veracity and dependence thereby lowering barriers in communications.

Honesty and trust are the fundamentals for any solid business association. You cannot establish a close and open relationship with suppliers, clients, and the general community if you don’t posses integrity or ethics (Trevino & Nelson (2006). In addition to this, ethics come at no cost but the lack of ethics can be tremendously expensive.

Therefore, all that has to be done is establishment of good communication, training and educating channels through which employees can learn of the importance of their decisions to the organization. An organization that finds means to amend the system so that employees and other stakeholders can be subjected to act ethically and dutifully is far more likely to prosper.

Recommendations

The significance of ethics and good conduct cannot be understated and as a result, all organizations must devote their resources to ensure that both the new and current employees get the necessary training so that they can familiarize themselves with and maintain the desired standards of conducts and ethics set by the organization.

To facilitate this, it is the sole duty of the HR managers to organize seminars and conferences that offer different training in employee behavior, their roles and obligations, guidelines to how things ought to be done and most importantly; customer care.

In addition to this, the management of these organizations must organize a schedule through which workers can in turns teach each other on the various ethical issues that affect them during their activities. This is in the hope that other recruits may gain knowledge of and apply the same etiquettes when faced with similar situations.

On the same note, various ethicists should be invited on a monthly basis to offer advice and training concerning business ethics and conduct. All employees are expected to attend the lectures without fail.

Also, assessments in form of questionnaires should be distributed to the employees at the end of each month in order to evaluate their knowledge and understanding of the designed code of ethics and conducts. In so doing, the management and the ethics department will be able to identify those employees who have not understood the ethics program and from there decide on how best these employees can further be assisted in order to grasp the concepts as well as apply them in their day to day activities.

A good ethics program should be subjected to change. In any business, there are new and differentiated opinions and developments that may affect a proposed course of action. It is therefore always important that each aspect of the business is designed with some level of flexibility and room for change in case of such circumstances.

It is also important that organizations establish an ethical committee within its employees whose main purpose shall be to monitor, evaluate and propose amendments to this ethics program. This is very crucial considering that each employee reacts differently to similar situations.

Through interviews and open discussions between the management and employees, the committee shall be able to identify areas of strengths or weakness in the program. Additionally, the presence of a committee offers the employees an opportunity to air their opinion without fear or tension that is always present between employees and their superiors.

In addition to this, the selected committee should at any time make adjustment to the program in order to build a sense of fairness and balance in the organization. The decision to do so should however be based purely on the validity and applicability of the complaints or amendments made by the workers and other participants of the organization.

On the same note, organizations should establish a special hotline through which employees and other workers can be able to report or inquire on matters pertaining to the code of ethics and conducts. Additionally, they should also set up a suggestion box incase the employees want to remain anonymous while reporting incidences of an unethical nature.

Conclusion

Business ethics have become a vital aspect towards the management strategies and development of organizations across the globe. Data collected indicate that without such ethical standards, consumers and the environment would be at the mercies of business merchants who evidently would do anything to make more money.

As such, an elaborate and informative discussion has been held in a bid to analyze the importance, impacts and implementation of various ethics that can be used to maintain moral standards in terms of quality and behavior of an organization.

An analysis has also been carried out on the basis and necessity of ethics in a business setting and recommendations made on how best these ethics can be implemented and monitored. The establishment of such will with no doubt help make the world an ethical and morally upright place to be even for the generations to come.

References

Trevino, L, K & Nelson, K, A. (2006). Managing business ethics: straight talk about how to do it right, (4^th Ed.).USA: Wiley publishers.

Maxwell, J, C. (2003). There’s no such thing as business ethics: there’s only one rule for making decisions. New York: Warner Books.

Lippke, R, L. (1995). Radical business ethics. USA: Rowman & Littlefield.

David, F, R. (2006). Strategic management: concepts and cases, (10^th Ed.). USA: Prentice Hall.

Braybrooke, D. (2003). Natural Law Modernized. Toronto: University of Toronto Press.

Mitchell, C. (2003). A short course in international business ethics: combining ethics and profits in global business. USA: World Trade Press.

Reder, A. (1995). In Pursuit of Principle and Profit: Business Success Through Social Responsibility. Chicago: G.P. Putnam’s Sons.

Sabath, A, M. (2002). Business etiquette: 101 ways to conduct business with charm & savvy, (2^nd Ed.). USA: Career Press.

Robinson, D, F. (2000). Business etiquette: your complete guide to correct behaviour in business, (2^nd Ed.). New York: Kogan Page Publishers.

Chappell, T, D, J. (2006). Values and virtues: Aristotelianism in contemporary ethics. USA: Oxford University Press.

Crane, A & Matten, D. (2007). Business ethics: managing corporate citizenship and sustainability in the age of globalization. USA: Oxford University Press.

Yardley-Nohr, T. (2006). Ethics for Massage Therapists. USA: Lippincott Williams & Wilkins.

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