Internal
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Outline on Organizational
Ethics
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External
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BECAUSE THE CONSEQUENCES OF ORGL DECISIONS ARE GREATER THAN
EVER BEFORE, THE DUTY OF MGRS TO ACT ETHICALLY IS INCREASINGLY SIGNIFICANT |
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Ethical transactions & behaviors should be an essential aspect
of life for all: professionals & lower level employees alike |
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The basic idea of maintaining ethical orgl practices is to be able
to determine right from wrong when it comes to making decisions & choosing
the right decision |
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There are myths about business ethics such as ethics meaning simply
to do what's right, when there is much more involved in an ethical lifestyle |
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Many orgs are holding workshops & having training programs
to teach their wkrs about ethics |
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Mgrs balance diverse & contradictory & demands of multiple
constituencies, eg owners, customers, suppliers, the community, & more |
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Balancing the needs of constituencies must be done while allocating
& managing limited resources |
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The consequences of orgl decisions affect more people & environments
(physical & social) than ever before |
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ORGS MUST BALANCE THE INTERESTS OF MANY ORGL ACTORS,
CONSTITUENTS,
STAKEHOLDERS,
COMMUNITIES,
&
MORE |
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Never have so many conflicting demands confronted mgrs, orgs, govts
& societies |
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Powerful interests, ie special interests, include constituencies such
as the construction industry, cigarette corps, the military, environmentalists,
the nuclear industry, teachers, school boards, the Baby Boomers, etc |
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Less powerful interest include constituencies such as children, the
poor, the homeless, the disadvantaged minorities, the undereducated, the
elderly, etc |
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With accelerating social change & the explosion of the availability
of info & tech, the pace of life & orgl events is relentless; almost
too fast to manage |
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Typical pressures on orgs, which may lead to unethical behavior, are
to
- improve qual of products & ops
- increase productivity
- stay close to suppliers & customers
- value diversity
- react swiftly to global changes |
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Ethical issues include the rights & duties btwn a company &
its wkrs, suppliers, customers & neighbors, its fiduciary responsibility
to its shareholders |
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Issues concerning relations btwn different companies include hostile
take overs & industrial espionage |
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Related issues include corp govt; corp soc entrepreneurship; political
contributions; legal issues such as the ethical debate over introducing
a crime of corp manslaughter; & the marketing of corps' ethics policies |
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ETHICS, VIEWING ACTIONS IN LIGHT OF STANDARDS
OF HONESTY & HONORABLE CONDUCT, AFFECT COUNTLESS ORGL DECISIONS |
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Orgl ethics is a form of applied ethics or professional
ethics that examines ethical principles & moral or ethical problems
that arise in an orgl or business env |
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Orgl ethics applies to all aspects of orgl conduct &
is relevant to the conduct of individuals as well as the entire org |
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Ethics is the branch of philosophy concerned w/ human values &
conduct, moral duty & obligations |
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Morals are values concerned w/ what is right or wrong, or beyond righteousness
to virtuousness |
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Ethics is concerned w/ what constitutes right & wrong human conduct,
including actions & values |
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Business ethics address the issue of right & wrong in the
context of commerce & orgl conduct |
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A person's or grp's ethics are influenced by the morality of individuals |
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Religious beliefs, training, education, political beliefs, econ beliefs,
socialization from family, peers grps, work experience all produces a person's
moral code of ethical values |
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Ethical provides two principles that may guide ethical conduct:
consequential principles & non consequential principles |
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Consequential principles make judgments based on the consequences of
that action |
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Utilitarianism advocates that people & orgs should strive to achieve
the greatest good for the greatest number; the needs of the many compared
to the needs of the few |
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Consequential ethics determines the 'rightness' or 'wrongness' of an
action by determining the ratio of good to evil that the action produces |
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The 'right' action is that action that produces the greatest ratio
of good to evil or any of the alternatives |
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Some temper this w/ basic or fundamental rights & / or minority
rights |
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Non consequential principles tend to focus on the concept of duty |
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A person is ethical, regardless of consequences, if they fulfill their
duty |
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The greatest good occurs because the duty of the individual is carried
out |
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If each person carries out her or his duty, society knows what to expect
from each individual |
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Link
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The Survey on Personal Ethics & Commitment
to Social Responsibility emphasizes that understanding one's
own ethics & commitment to soc resp is necessary to functioning
in an ethical & socially resp manner |
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Danny Cox complied a list of 10 characteristics common to great leaders
& one of those characteristics is that one should cultivate a high
standard of personal ethics |
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At the core of any personal ethics is the declaration of personal responsibility |
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Many business leaders agree that good business begins w/ ethics |
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Successful people & orgs take ethics seriously |
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Ethical attitudes determines how one treats wkrs, suppliers, stockholders,
& consumers, competitors, the govt, other members of the community |
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Ethical orgs suffer less resentment, inefficiency, litigation, &
govt interference |
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Survey
on Personal Ethics & Commitment to Social Responsibility
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The following questions are designed to determined to your
personal ethics & commitment to acting in a socially responsible manner.
Answer each honestly o get an accurate picture of where you stand |
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Always
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Sometimes
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Never
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1. I like to approach problem solving w/ a consideration of how
my solution will affect others |
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2. When an action is legal,, it is acceptable to engage in it |
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3. When making decisions, I like to bounce my thinking
off of others |
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4. When considering actions, I think about their impact on society |
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5. One test for determining if decisions are acceptable is to
ask how I would feel if my thinking were known to friends & family |
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6. I think that when a decisions hurts one party so that another
can benefits, it is an unethical decision |
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7. When I see someone at work stealing from the org, I let those
in authority know about it |
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8. I think that if the org does not care about ethics or soc
responsible behavior, doing so personally is not important to my career |
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9. When I see litter in the office at work, I clean it up |
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10. I feel good about my actions |
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The Survey on Personal Ethics & Commitment to Social
Responsibility emphasizes that understanding one's own ethics &
commitment to soc resp is necessary to functioning in an ethical
& socially resp manner |
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Internal
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Outline on Ethical
Compliance
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External
Links
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KEYS TO ORGL ETHICAL CONDUCT ARE COMPLIANCE W/ NORMS OF BEHAVIOR,
MAKING CONTRIBUTIONS TO SOCIETY, RECOGNIZING THE CONSEQUENCES
OF ONE'S ACTIONS, & TRAINING |
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Most people are honest & are able to resist serious temptations,
esp if they are helped by others |
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Everyone has a conscience, a warning voice inside that tells one that
an action might be wrong |
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Guilt, shame, fear, remorse, & dread are but a few of the emotions
one experiences when faced w/ the temptation or ramifications of improper
conduct |
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See Kohlberg: Stages of Moral Development |
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Solomon & Hanson, 1985, business ethics is nothing less than the
full awareness of what one is doing, its consequences & complications |
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1. COMPLIANCE IS THE YIELDING OR CONSENTING TO THE LAW, ORGL
POLICY, & A CODE OF ETHICS |
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Compliance is living & behaving according to the law, corps code
of ethics, orgl rules, principles of morality, community expectations,
& such general concepts s equity & fair play |
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Orgl actors must go further than simple obedience to what the law demands |
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Shortcuts in quality which lead to customer dissatisfaction may be
legal, they are discourage repeat business |
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Treating wkrs w/ respect & fairness is essential to building trust
& a productive, stable wkforce |
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To promote ethics, orgl actors must forge credibility which is the
power to elicit belief |
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2. CONTRIBUTIONS
ARE WHAT ORGS GIVE BACK TO SOCIETY |
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Contributions are what orgs give back to society |
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Typical orgl contributions might include a valuable product, employment,
meeting needs of people & society, improving the quality of life for
wkrs & the community, & charitable contributions |
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In 1990 US corps gave $7.8 bb to charities |
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Gifts can include cash, goods, services |
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Gifts of time can help communities, charities, non profits, etc w/
talent, expertise & willing hands |
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Gifts of inventory & depreciated property can cut costs for non
profits |
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Each yr American's vie over $100 bb to non profits, not including the
hours donated to help others |
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3. IT IS ONLY THROUGH
ORGL
SELF AWARENESS, RECOGNIZING THE CONSEQUENCES OF ONE'S ACTIONS,
THAT ETHICAL BEHAVIOR IS POSSIBLE |
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The social dynamics are the same for people & orgs:
to achieve a level of moral development one must become self aware |
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Awareness of the self is only possible in the context of an awareness
of others |
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A child gains a self of self just as it gains a sense of others |
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An org can only attain ethical behavior & soc responsibility through
an awareness of itself as an actor in a context or env of their actors
& that it's & the others' actions have consequences for each other |
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A child is often, at first, unaware that it's actions may harm a pet;
orgs are often unaware how & where it's actions harm, or help, other
orgs or social actors |
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HISTORICALLY ORGS HAVE EITHER
BEEN UNAWARE OR UNCARING ABOUT THEIR IMPACT ON OTHERS &
SO THE GENERAL RECOURSE WAS A LEGAL SUIT |
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Inventor Robert W. Kearns was awarded $11.3 mm, or 90 cents
/ vehicle, from Chrysler Corp or infringing on his patent for his intermittent
windshield wipers |
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Ford awarded Kearns $10.2 mm, or 30 cents / vehicle, on his patent
for his intermittent windshield wipers |
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Rockwell Intl Corp paid $ $18.5 mm in criminal fines because it violated
federal waste disposal & clean water laws at its Rocky Flats nuclear
weapons plant in Colorado |
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4. TRAINING IS NECESSARY
FOR AN ORG TO GAIN COMPLIANCE, TO BE ABLE TO CONTRIBUTE, & TO RECOGNIZE
THE CONSEQUENCES OF IT'S ACTIONS |
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Without some way to communicate & enforce codes of
ethics, the law, policies, orgl rules, etc. they will be just words on
paper |
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Madsen, 1992, director at Carnegie Melon University's Center for Advancement
of Applied ethics separates ethics training into compliance training &
cognitive thinking exercises |
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Compliance training alerts people to policies, regs, & laws that
establish acceptable behavior w/in a company |
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Cognitive thinking exercises that develop skills to allow people to
think through various moral mazes that may occur in the wkplace |
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Ethics & legal compliance programs should estb culture &
peer pressure system that spells out what is acceptable & isn't &
why should involve training, ed, follow up & inspection |
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Orgl leaders should devote time & resources to estb commitment
to ethics programs |
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Orgl leaders should assert expectations through clearly written &
communicated codes & conduct surveys to monitor compliance |
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GE, Citicorp, the Forest Service, Walmart, et al are typical examples
of orgs doing ethics training |
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Internal
Links
Top
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Outline on Organizational
Culture
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External
Links
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Culture may be defined as the shared content of society & thus
organizational culture is the shared content of an org |
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The content of a society or org is it's shared knowledge, beliefs,
values, & norms ( K B V N ) & the physical & abstract manifestations
of that content |
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Org culture is the shared knowledge, beliefs, values, & norms of
an org |
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Org culture is the interaction of the formal & informal structures
of an org w/ the goals & objectives of the org leaders |
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Org culture is a special type of subculture that is unique to the network
that includes & surrounds an org |
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An org culture includes all of an org's stakeholders or constituencies
including customers, suppliers, govt regulators, families, similar orgs,
etc. |
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All orgs have an org culture which is based on the social relationships,
as organized by the formal org structure, that emerge among the people
who work in or w/ the org |
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Lauer & Handel, 1983, found that all orgs have an org culture,
a negotiated order |
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W/in an org, there are frequently org subcultures among the different
org constituencies, such as employees in a dept, employees at a particular
level of the org such as blue collar workers, middle mgt, & upper mgt |
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An example of a slice of an org culture is where two workers in an
engineering firm may become friends & help each other w/ their work
which a third worker may be excluded from this friendship & thus not
have help w/ her/his work |
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Org culture has a impact on how the bureaucracy of the org actually
operates, in contrast to how it operates "on paper" |
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Org culture & the groups w/in an org, each of which who may possess
it's own org subculture, often called a workplace culture |
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Org culture & workplace culture may facilitate or hinder the attainment
of stated org goals |
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The org, w/ it's org culture & workplace culture may even develop
their own goals, which may be inferior or superior to the org's stated
goals, depending on one's perspective |
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Org & workplace cultures are sometimes known as the org's "negotiated
order" in recognition of their emergence from the ongoing informal negotiations
among different members of the org (Fine, 1984, Ouchi, & Wilkins, 1985,
Miller, 1991) |
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Scott, 1992, holds that regardless of the formal structure, people
ultimately make the org |
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The negotiated order is the aggregation of the org's members needs,
objectives, & experiences of others in the org |
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People in orgs push to get what they want, try things out, test the
limits of the rules |
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Anselm Strauss, et al, 1964, found that the nature of the hospital
they studied at any given time was the outcome of pressures, actions, &
reactions of the people who made up the org |
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The doctors, attendants, nurses, administrators, patients, & others
each has their own objectives, understandings or reality, and ideas about
mental illness, which governed his or her behavior & relationships
to others |
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Compromises, "looking the other way" & "agreements to disagree"
were abundant in the hospital & were always subject to change as the
situation changed or as new people entered the org |
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Strauss held that the hospital on one day is not the same as the hospital
at a later time even though the formal structure stayed the same |
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Org culture is unique to each org & cannot be understood by examining
the org's formal structure (Fine, 1984, Ouchi, & Wilkins, 1985) |
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As w/ any culture, new members must be socialized into the org culture
& new employees who do not become socialized or accept the org culture
experience conflict |
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The grapevine is the informal communication structure of the
org culture |
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The national culture of a nation impacts the org & it's org culture |
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Internal
Links
Top
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Outline on Ethics
& the Law
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External
Links
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ORGS FACE LEGAL CONSTRAINTS ON THEIR ACTIONS, BUT ETHICS
CONSTITUTE MORE THAN JUST LEGAL CONCERNS |
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Mgrs cultivate an awareness of the role of law in orgl & individual
conduct |
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In a nation of laws, presumptions influence decision making at many
levels |
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From the broad context of constitutional rights to municipal regs,
orgs & their leaders are witting & unwitting creatures of the law |
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The relationship of the law to ethics is that there are no fixed boundaries
or guidelines to follow |
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There is no formal codes of ethics which sets the standards |
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The legal profession has a Code of Professional Responsibility |
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The med profession has its Hippocratic Oath |
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The accting profession has a code of ethics |
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The real estate industry has a code of conduct |
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Other professions have codes to guide them |
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But business has no 'road map' of ethical conduct |
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The closest thing business has is the law |
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If a business obeys the law, it is acting legally, & it is seemingly
meeting its minimum social requirements |
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The minimum requirement of the law offers only a structure; however,
void of content & context |
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Laws & polices from an ethical foundation |
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The law is a moral minimum |
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No law or policy is going to cover every situation |
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Sooner or later orgs must use people, not rules, guidelines, codes,
strats, etc, to make decisions when there is no on point law or policy
to follow |
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The best ethics training goes beyond legal compliance |
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Although the law is useful in alerting us to moral issues & informing
us of our rights & responsibilities, laws cannot be taken as an adequate
standard of moral conduct |
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Conformity w/ law is neither requisite nor sufficient for determining
moral behavior any more than conformity to rules of etiquette is |
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Non conformity w/ law is not necessarily immoral, because a law may
be unjust / immoral |
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Link
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The Table of the Legal / Ethical
Types of Behavior shows that orgl behavior can be ethical (ie
have positive outcomes for stakeholders), unethical (ie have
negative outcomes or stakeholders), legal (in compliance w/ the law),
or illegal (in violation of the law) |
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Corps & their wkrs take actions every day that affect
the lives of countless people from their constituents to their stakeholders |
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Laws form boundaries & a basis for human & corp conduct |
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Law & ethics together define acceptable behavior |
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Ethics comprises more than legalities |
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Ethics should protect & promote the interests of society in general
& the corps's constituents in particular |
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Good ethics strengthens the bonds of personal & social relationships |
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The CA education system has stayed ahead of legal demands in the area
of pollution control by focusing on the best interest of its customers
& of society as a whole |
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In four combinations of ethics & legalities, one can sort out alternative
resolutions of any issue posing an ethical dilemma |
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An unambiguously positive resolution occurs only w/ alternative qualifying
for quadrant 1 (ethical / legal ) which poses no potentially negative consequences
for decision makers, org or constituents |
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All other quadrants present a legal & / or ethical dilemma |
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SOME ORGL LEADERS BELIEVE ORGS
SHOULD ONLY FOLLOW THE LAW, & NOT DEVELOP A CODE OF ETHICS
OR SOC RESPONSIBILITY |
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Very often it is held that business is not bound by any
ethics other than abiding by the law |
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The economist Milton Friedman is a lead advocate of the view that only
the law should constrain corps |
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Friedman held that corps have the obligation to maximize profit w/in
the framework of the legal system, nothing more: no orgl ethics nor
any soc responsibility should constrain the corp |
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Friedman made it explicit that the duty of the business leaders is,
"to make as much money as possible while conforming to the basic rules
of the society, both those embodied in the law & those embodied in
ethical custom" |
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Ethics for Friedman is nothing more than abiding by 'customs' &
'laws' |
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The reduction of org ethics to abidance of laws & customs, however,
has drawn serious criticisms |
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ORG LEADERS WHO EMBRACE ORGL ETHICS & SOC RESPONSIBILITY
NOTE THAT THE LAW IS A MINIMUM STANDARD & THAT THERE ARE MANY
ADVANTAGES
TO ORGL ETHICS & SOC RESPONSIBILITY |
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Counter to Friedman's logic, it is observed that legal procedures are
technocratic, bureaucratic, rigid & obligatory where as ethical act
is conscientious, voluntary choice beyond normativity |
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Law is retroactive whereas crime precedes law |
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For a law to be passed, the crime must have already happened |
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Laws are blind to the crimes undefined in it |
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Further, as per law, conduct is not criminal unless forbidden by law
which gives advance warning that such conduct is criminal |
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Law presumes the accused is innocent until proven guilty & that
the state must establish the guilt of the accused beyond reasonable doubt |
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As per liberal laws followed in most of the democracies, until the
govt prosecutor proves the firm guilty w/ the limited resources available
to her, the accused is considered to be innocent |
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Though the liberal premise of law is necessary to protect individuals
from being persecuted by govt, it is not a sufficient mechanism to make
firms morally accountable |
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FOLLOWING ORGL ETHICS & SOC RESPONSIBILITY INSULATES
AN ORG AGAINST THE SLIPPERY SLOPE OF LAW BREAKING |
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A corp that embraces policies based on orgl ethics & soc responsibilities
avoids the weaknesses a corp policy based on or contained only by law |
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Orgl ethics & soc responsibility have an advantage over the law
in that orgs following orgl ethics & soc responsibility are less likely
to test the limits of the law & so slide down the slippery slope to
criminality |
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While the law is retroactive & a crime may precede the law orgl
ethics & soc responsibility is proactive in that an org will try to
consider legal & ethical implications of a policy or behavior before
the fact |
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While laws are blind to the crimes undefined in it, orgl ethics &
soc responsibility attempt to discern all transgressions across legal or
ethical boundaries |
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While it is difficult to prove someone has broken a law, any degree
of guilt as far as breaking orgl ethics & soc responsibility is liable
to sanctions; that is while legal guilt is all or nothing; partial guilt
or responsibility is recognized under policies of orgl ethics & soc
responsibility |
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AN EFFECTIVE CODE OF ETHICS & SOC RESPONSIBILITY
MAY HAVE PREVENTED SEVERAL CORP SCANDALS & ECON COLLAPSES |
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During the Savings & Loan crisis of the 1980s, then FBI director
William Sessions said :Experience demonstrates that insider abuse is a
major factor in almost all of our investigations involving failed financial
institutions" |
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William Black, former director of the now defunct Fed Savings &
Loan Insurance Corp said, "Evil triumphed because too many good men &
women did nothing to stop the looting of thrifts [savings & loans banks'." |
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World Com |
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Enron |
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Billionaire investor |
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Collapse of banks & Wall Str investment firms Lehman Bros, Goldman
Sachs |
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WHILE THE LAW IS GETTING
MORE
EFFECTIVE W/ WHITE COLLAR CRIME, IT IS STILL NO SUBSTITUTE
FOR ORGL ETHICS & SOC RESPONSIBILITY |
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Legal sanctions against individual & corp criminal
behavior can be significant |
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Since 1909 when the Sup Ct held that corps can be held liable, as individuals
can be, for crimes involving intent corp liability has translated into
fines & jail terms for corp officials |
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More than half of the 50 states have some form of corp criminal liability
laws under which business owners can be prosecuted for criminal negligence |
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The trend is toward escalating criminal penalties that can be drastically
reduced if the org can show it has a place a legal compliance program |
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In Nov 1991 the trend toward harsh penalties for white collar crime
continued, as new fed guidelines went into effect |
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Offenses include those that are committed by wkrs w/o a org owner's
knowledge to those of misrepresenting a product, bribery of a public
official |
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If an orgs has taken steps to ensure compliance w/ the law, an org
could pay as little as 5% of the base fine |
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On the other hand, if mgrs have encourages or taken part in law breaking,
fines can reach 400% of the base rate |
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Some believe that corp ethics policies are primarily rooted in utilitarian
concerns, & that they are mainly to limit the company's legal liability,
or to curry public favor by giving the appearance of being a good corp
citizen |
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Ideally, the company will avoid a lawsuit because its wkrs will follow
the rules |
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Should a lawsuit occur, the company can claim that the problem would
not have arisen if the wkr had only followed the code properly |
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While some see the use of orgl ethics & soc resp policies to avoid
liability, the outcome remains that orgs are holding themselves & wkrs
to a standard higher than the minimum requirements of the law |
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Table
of the Legal / Ethical Types of Behavior
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1. Ethical / Legal
A decision to allow orgl actors to engage in a behavior w/ positive
effects for stockholders or minimally no negative effects, &
is in compliance w/ the law |
2. Ethical / Illegal
A decision to allow orgl actors to engage in a behavior w/ positive
effects for stockholders or minimally no negative effects, but is
a violation of the law |
3. Unethical / Legal
A decision to allow orgl actors to engage in a behavior w/o positive
effects for stockholders, but is in compliance w/ the law |
4. Unethical / Illegal
A decision to allow orgl actors to engage in a behavior w/o positive
effects for stockholders, & is a violation of the law |
The Table of the Legal / Ethical Types of Behavior shows
that orgl behavior can be ethical (ie have positive outcomes for
stakeholders), unethical (ie have negative outcomes or stakeholders),
legal (in compliance w/ the law), or illegal (in violation of the law) |
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Internal
Links
Top
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Outline on Ethical
Decision Making: Boundary Dilemmas
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External
Links
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TO MAKE ETHICAL DECISIONS, KNOW YOUR VALUES, GOALS, ALTERNATIVES,
INFO, OUTCOMES, & ACTIONS |
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Because the future is unpredictable, there is no such thing
as a perfect choice |
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Some options are better than others & finding the right choice
for each situation can make life less stressful & more successful |
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In relation to ethics & boundaries, essentials factors in decision
making include: |
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1. knowing your values |
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2. establishing your goals |
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3. expanding your alternatives |
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4. seeking info on each alternative |
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5. predicting outcomes for the alternative |
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6. taking action |
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The values one chooses depend upon the situation one
faces |
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Values should be the things important to the person, not those important
to significant others |
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When estbing values, one must be honest w/ oneself |
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Evaluate goals according to how it satisfies values |
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Good decisions move one closer to their goals |
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Short term goals should lead toward long term goals |
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Alternatives developed to address problems/ goals are the heart
of the decision making process |
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The more alts developed w/ which to address problems, the better the
chances of making a good & ethical decision |
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Identify the factors in a situation & devise alts to address each
of the factors |
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Collect as much info about each alt |
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Keep an open mind as info is gathered & note that other alts may
develop |
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Info sources often lead to other sources |
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The more facts, the better the chances of being aware of all the alts |
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In relation to dec mking, the more facts the better, so don't make
assumptions |
|
|
Separate facts from opinion by being a critical listener |
|
|
In dec mking, in choosing an alt, there is no perfect alt, so settle
for the best choice |
|
|
Predict outcomes for the various alts, considering the desirability,
probability & weaknesses of each alt |
|
|
Consider each alt before narrowing the list |
|
|
In dec mking, any choice is risky & the future is unpredictable |
|
|
In dec mking, involve the emotional, intuitive, imaginative right side
of your being |
|
|
After the choice of the best alt, for a plan of action & prepare
to see that choice through to the end |
|
Internal
Links
Top
|
Outline on the
Options for Dealing w/ Unethical Behavior
|
|
External
Links
|
|
- Project: Options for
Dealing w/ Unethical Behavior |
Link
|
|
- Reading: What Can Mgt
Do About Unethical Behavior Nielson 1987 |
Link
|
|
THE OPTIONS FOR DEALING W/ UNETHICAL BEHAVIOR INCLUDE:
1. DON'T THINK ABOUT IT
2. GO ALONG & GET ALONG
3. PROTEST
4. CONSCIENTIOUSLY OBJECT
5. LEAVE |
6. SECRETLY BLOW THE WHISTLE
7. PUBLICLY BLOW THE WHISTLE
8. SECRETLY THREATEN TO BLOW THE WHISTLE
9. SABOTAGE
10. NEGOTIATE & BUILD CONSENSUS FOR CHANGE |
|
|
|
In 1985 there were over 1300 scholastic articles in print in the area
of ethics in administration, mgt, business & public admin, business
etc., focusing on what was ethical or unethical in typical business practices |
|
|
Richard Nielson (1987) focuses on what people in orgs can actually
do when they believe behaviors / practices are unethical |
|
|
While it is important to know what is or is not ethical, it is just
as important to know what to do when confronted w/ unethical behavior |
|
|
1. DON'T THINK ABOUT IT |
|
|
Not thinking about unethical beh avoids a zero sum game btwn superiors
& peers |
|
|
Not thinking about, not engaging in a zero sum game avoids getting
into the situation where someone has to win & someone has to lose |
|
|
Not thinking about one path of action makes one more susceptible to
go down the wrong path, strategically or otherwise |
|
|
One risks becoming similar to the good Nazi as one tries to make the
best of a bad situation, but participating in the evil policy / practices |
|
|
The bad Nazi may be kind, even reluctant, but ultimately they are involved
in evil policy / practices |
|
|
The ability of people to compartmentalize, to not think about what
is going on, questions the validity of assuming that all mgrs naturally
understand what is right or wrong; there are powerful pressures to obey
orders & not think about what is going on |
|
|
2. GO ALONG & GET ALONG |
|
|
Going along has the same advantage as not thinking about unethical
behavior: one avoids the situation where someone has to win &
someone has to lose |
|
|
Going along means that one must think about the unethical beh at least
for a while |
|
|
Thinking about & going along unethical beh has the quality of an
injury or illness as it slowly bleeds the individual conscience or as guilt
consumes one like a cancer |
|
|
Under constant pressure, mgrs & wkrs simply give in & become
good 'organization people' |
|
|
Conforming might affect areas of dec mking & action unrelated to
the unethical beh as it reigns in thinking, initiative, enthusiasm, etc.
& deprive mgrs & wkrs of info |
|
|
3. PROTEST |
|
|
An advantage of protesting is that one can feel good about making an
effort to stop the unethical beh |
|
|
The disadvantage of protesting is that the org can usually disregard
objections & punish those who objected |
|
|
4. CONSCIENTIOUSLY OBJECT |
|
|
Conscientiously objecting to unethical beh means that one refuses to
participate in it in any shape, manner, or form |
|
|
Conscientiously objecting makes a clear statement to the org that at
least one person considers the beh unethical & refuses to participate
in it |
|
|
Like protesting, conscientiously objecting makes one feel good about
oneself as one stands up for what they believe |
|
|
Consc obj may encourage others by example |
|
|
If the org recognizes the right to consc obj, then one may also be
able to keep one's job |
|
|
Because very few orgs recognize the right to consc obj, one is likely
to lose one's job, & thus the org loses an important voice against
the unethical beh |
|
|
By protesting or consc objecting one often loses the ability to advance |
|
|
5. LEAVE |
|
|
Leaving gives a signal that it will lose good people if it continues
unethical beh |
|
|
If we leave & work for a competitor we help a more ethical org
gain mkt share |
|
|
We feel better because we had the courage not to cooperate w/ unethical
beh |
|
|
The disadvantage of leaving is that most wkrs are very replaceable
& so the org loses an ethical voice when we leave |
|
|
If the situation was a zero sum game, then mgt might see wkrs / mgrs
leaving as a victory; the opposition has retreated / surrendered |
|
|
If we leave & someone else cooperates, we have only helped ourselves |
|
|
The example one sets is that if one encounters unethical beh &
leaves, that is the only / best option |
|
|
Leaving sets up the 'love it or leave it' mentality in the org |
|
|
At some point we may realize that we did not have the courage to stay
& fight |
|
|
"The courage to be is the ethical act in which
man affirms his own being in spite of those elements of existence which
conflict w/ his essential self affirmation"
Tillich, 1952
|
|
|
Leaving cuts off dialogue & thus the org & even the person
loses the chance to learn more about the situation |
|
|
There are limits to dialogue in a zero or negative sum game in that
everything one says can be used against one if people are not interested
in transforming the situation into a positive sum situation |
|
|
Dialogue has little utility unless one is solely focused on the phil
/ spiritual transformation that can be a part of peacemaking as an end
in itself (Brinton, 1973; Buber, 1965) |
|
|
6. SECRETLY BLOW THE WHISTLE |
|
|
Blowing the whistle can be very effective if the org is likely to react
to publicity, public pressure, govt intervention, profl accreditation orgs,
the courts, etc. |
|
|
An advantage of blowing the whistle is that the whistle blower cannot
be retaliated against |
|
|
A disadvantage of blowing the whistle is that one might feel dishonest,
cowardly, traitorous, paranoid of being caught, etc. |
|
|
Secretly blowing the whistle can create an atmosphere of distrust in
the org & create a 'witch hunt' mentality w/in the org |
|
|
Because many orgs investigate leaks, the secret whistle blower may
have to face additional ethical questions bout whether to tell the truth
in the leak investigation |
|
|
If the secret whistle blower is discovered, they may be fired, or they
may find it difficult to be trusted by other mgrs, wkrs, clients, etc. |
|
|
7. PUBLICLY BLOW THE WHISTLE |
|
|
Publicly blowing the whistle can be just as effective as secretly blowing
the whistle |
|
|
People who publicly blow the whistle are often treated both as heroes
as well as pariahs |
|
|
The major disadvantage of publicly blowing the whistle is that the
org may retaliate w/ a legal suit, firing, transfer, smear campaign, etc. |
|
|
Publicly blowing the whistle makes it difficult to interact w/ the
people one is criticizing |
|
|
Publicly blowing the whistle makes colleagues feel betrayed, attached,
harmed it |
|
|
Publicly blowing the whistle does not help the reputation of the org,
& may even put it out of business |
|
|
8. SECRETLY THREATEN TO BLOW THE WHISTLE |
|
|
Secretly threatening to blow the whistle has all the advantages of
secretly blowing the whistle w/ the additional advantage that, when it
works, i.e., when the org changes its unethical beh, the org doesn't have
to be hurt by bad publicity & / or sanctions that could follow |
|
|
Secretly threatening to blow the whistle has the disadvantage of secretly
blowing the whistle in that it does not permit dialogue btwn the unethical
people & the whistle blowers |
|
|
9. SABOTAGE |
|
|
Sabotage in the face of unethical beh usually entails hurting or destroying
the larger program in which the beh is found so that mgt shuts it down |
|
|
The advantage of sabotage is that it can be effective & ones identity
is protected |
|
|
The disadvantages of sabotage are that one may be caught, one may feel
guilty, there is often an investigation, innocent people may be hurt, etc. |
|
|
The biggest disadvantage of sabotage is that there is no dialogue so
there is no opportunity for real change |
|
|
10. NEGOTIATE & BUILD CONSENSUS FOR CHANGE |
|
|
Because in general when one person opposes a group of people in cooperate
beh, that one person is likely to lose, it is difficult for one person
in an org to bring about change |
|
|
The advantages to building consensus for change are that
- there is strength in numbers
- the org is less likely to retaliate against a grp
- it builds a cooperate climate |
|
|
The best negotiation strat for change is the tit for tat ( TFT ) strat
where the change agents respond to positive moves by the other side w/
positive moves, and response to negative move w/ negative moves |
|
|
The difficulty of the TFT strat is that the change agents might not
have positive or negative responses available, while the org has nearly
unlimited options |
|
|
It is not uncommon for people who are pursuing bad / unethical goals
to use bad / unethical methods to cover them up or punish those that threaten
them |
|
|
Negotiating & building consensus are more likely to be successful
when the org is accustomed to positive sum solutions to problems |
|
|
Unfortunately many mgrs are only accustomed to negative sum solutions
where they attempt to win & punish the loser |
|
|
It is only natural to have the 'fight or flight' reaction, even in
orgs wherein when one is confronted w/ a threat at work, one often wants
to leave or attack rather than calmly negotiate & build consensus |
|
|
An additional reward to negotiating & building consensus is that
for many, these activities are in themselves satisfying; negotiating &
peacemaking can be empowering, transformative, & satisfying |
|
Internal
Links
Top
|
Outline on Social
Responsibility
|
|
External
Links
|
|
ORGS MUST INTEGRATE INTO THEIR CULTURES, PLANNING,
DECISION
MAKING, & OPS A CONCERN FOR ETHICS &
SOC RESPONSIBILITY |
|
|
Davis, 1975, holds that social responsibility is the principle that
people & orgs have certain obligations, in addition to their orgl interests,
to protect & benefit others & to avoid actions that could harm
them |
|
|
Social responsibility is an ethical ideology or theory that an entity,
be it an organization or individual, has an obligation to act to benefit
society at large |
|
|
Social responsibility can be passive, by avoiding engaging in socially
harmful acts, or active, by performing activities that directly advance
social goals |
|
|
The principle of soc resp first began to take hold in the developed
nations major corps in the 1980s |
|
|
Western nations corps have tremendous power & thus people, grps,
other orgs, societies themselves rely on them to meet various individual
& societal needs |
|
|
At one time, orgs did only what they had to, & many still operate
on this principle, eschewing the principle of soc resp |
|
|
SOC RESPONSIBILITY ENTAILS SOLVING
SOCIAL
PROBLEMS, MAKING ETHICAL DECISIONS THAT BALANCE NEEDS, &
MAKING DONATIONS |
|
|
Most orgs are open systems & most of what they do generates
direct benefits & costs for their societies |
|
|
Today society demands that orgs join in the urgent task of solving
societies' problems |
|
|
Some political philosophies go so far as to hold that private orgs,
eg businesses, non profits, non governmental orgs (NGOs), private charities,
etc are all better, or could be better than govt in addressing soc problems
if society & it's laws, regs, & structure were reformed |
|
|
Being soc resp does not mean making everyone happy; it means making
ethical decisions that balance costs & benefits among many, if not
all stakeholders |
|
|
Orgs face conflicting demands & at times a socially responsible
action puts the needs of one grp of stakeholders ahead of the needs of
others , such as donating money to charity rather than giving stockholders
a larger dividend or giving wkrs a raise |
|
|
Orgs make these difficult decisions based on past practices, policies,
codes of conduct, ethical guidelines, & more |
|
|
WHILE SOC RESPONSIBILITY TOOK HOLD OF CORP AM IN THE 80s,
IT'S ROOTS GO BACK TO THE EARLY INDL REV |
|
|
Ben Franklin may have been the first to advocate a socially responsible
business |
|
|
Franklin believed that "public service & philanthropy were legitimate
concerns... because it is god business to improve the health of the communities
from which wealth is derived & because public problems can benefit
from private solutions." |
|
|
Buchholz, 1989, expresses the need for businesses to act in a
soc resp manner: 'corps are more than econ instit & have a resp
to devote some of their resources to helping solve some of the pressing
soc problems, many of which corps help to create' |
|
|
Haas, CEO of Levi Strauss notes that corps can be short sighted but
believes corps will discover the price they pay for such behavior |
|
|
For Haas when corps ignore the needs of others, they are ignoring their
own needs in the long run |
|
|
Corps may need the good will of a neighborhood to expand, they may
need instits of higher learning to train wkrs, they may need adequate community
health care to curb absenteeism, they may need fair taxes to build infrastructure
& compete in the world econ |
|
|
SOC RESP STRATS INCLUDE DENIAL,
RESISTANCE,
REACTION,
& ANTICIPATION |
|
|
Orgs adopt different strats & structures in relation
to their goals, the env, their resources, & the demands placed upon
them |
|
|
Some orgs vehemently resist the accommodation to societal needs, whereas
others eagerly seek ways to accommodate societal needs |
|
|
Orgs can adopt any of three primary strats to manage the issue of social
resp, ranging from resistance, to reaction, to anticipation |
|
|
Individual orgs may choose resistance, reaction, or anticipation from
the days of their founding, or they may embrace one strat to find that
another appears more suitable & thus shift such strats |
|
|
Some orgs may choose resistance, reaction, or anticipation for different
parts of their op & thus appear to have inconsistencies |
|
|
Thus orgs may appear to be a complicated, chaotic conglomeration of
strats related to soc resp; no one approach dominates today although the
resistance strat appear to be losing momentum while anticipation strat
has been gaining ground since the 1980s |
|
|
SOC RESPONSIBILITY IS ESSENTIALLY
'SELF REGULATION' W/ THE LAW & A CODE OF ETHICS AS THE
STANDARDS OF REG |
|
|
Businesses can use ethical decision making to secure their
businesses by making decisions that allow for government agencies to minimize
their involvement with the corporation |
|
|
If an org is proactive & follows govt guidelines for a particular
issue such as pollution or labor regs & even goes an extra step to
get involved in the community & address those concerns that the public
might have; they would be less likely to have the govt investigate them
for these or any other concerns |
|
|
Soc Resp stresses "self regulation" rather than mkt or govt mechanisms
for following the law & ethical, or responsible standards |
|
|
Most rules & regs are formed due to public outcry, if there
is nt outcry there often will be limited reg |
|
|
CRITICS OF SOC RESP HOLD
THAT: ORGS SHOULD PURSUE ONLY ECON GOALS; IT IS SUPERFICIAL;
IT IS OBFUSCATING; IT IS AVOIDANCE OF REGS BY THE GOVT |
|
|
Critics of social responsibility argue that it distracts
from the fundamental economic role of businesses & thus should be denied
or avoided |
|
|
Critics of social responsibility argue that it is nothing more than
superficial window dressing |
|
|
Critics of social responsibility argue that it is an attempt to pre
empt the role of govts as a watchdog over powerful multinational corps
though there is no systematic evidence to support these criticisms |
|
|
A significant number of studies have shown no negative influence on
shareholder results from soc resp but rather, a slightly positive correlation
w/ improved shareholder returns |
|
|
Internal
Links
Top
|
Outline on the
Responsibilities to Stakeholders
|
|
External
Links
|
|
ORGS BEAR INHERENT OBLIGATIONS TO WKRS, OWNERS,
STAKEHOLDERS,
& SOCIETY |
|
|
Orgs hold the best interests of their society in trust; society grants
the right of enterprise to all orgs |
|
|
Stakeholders are those who have an interest in or who are affected
by how a business conducts its ops |
|
|
Stakeholders in most businesses include their owners & stockholders,
wkrs, customers, suppliers, & communities |
|
|
Society as a whole can be considered a stakeholder as well if the business
is large enough to affect people & en beyond its physical location |
|
|
The new org is characterized as having stakeholders as opposed to the
old org structure & strat that excluded a consideration of anyone but
owners |
|
|
Problems occur in new, changing orgs because they consist of multiple
stakeholders carrying out multiple but overlapping activities |
|
|
It is clear that the situation is not simply one of the soc resp firm
deciding to embrace a broader array of stakeholders |
|
|
The situation is that today more & more stakeholders are striving
to be recognized as having legit connections to a wide range of orgs |
|
|
Thus the rise of stakeholder power is an important factor in the development
of the new org, the modern org, the soc resp org |
|
|
Orgs & stakeholders are now keenly aware that any orgl change may
or may not be compatible w/ the goals & needs of various stakeholders |
|
|
For 'old orgs,' they had many SOP's that allowed them to maintain stability
such as concentration, closed mkts, standardized tech, commitment of wkrs,
stakeholders, et al |
|
|
Today in a climate of instability / change, commitments of customers,
wkrs, & other stakeholders are fragile & short lived |
|
|
THE STAKEHOLDERS INCLUDE
THE INTERNAL & EXTERNAL STAKEHOLDERS |
|
|
INTERNAL STAKEHOLDERS
INCLUDE THE DOMINANT COALITION, PROFESSIONALS, CLIQUES,
COALITIONS,
LOWER
LEVEL EMPLOYEES, & OTHERS |
|
|
The dominant coalition includes upper level mgrs, directors, major
stockholders, & other powerful actors |
|
|
The ethical & soc resp needs of the dominant coalition primarily
relates to econ goals of maximizing profits, but given their place of leadership,
the dom coalition is responsible for directing the org to the ethical &
soc resp needs of other internal & external actors as well as any favored
needs of the dominate coalition itself |
|
|
Professionals in an org include those higher level employees who meet
the general criteria of professionals including a high level education
or specialized knowledge, autonomy, a unique evaluation (done by other
professionals, not mgrs), high rewards sometimes unrelated to traditional
measures of productivity, & membership in a prof assoc |
|
|
The ethical & soc resp needs of professionals relate to the large
view of the org & society that they may often have, eg believe that
the org should limit pollution even though it may lower profits, or even
though the level or effects of the pollution is indeterminate |
|
|
Cliques & coalitions include any spontaneously formed subculture
w/in an org such as women, the night shift, a group formed to deal w/ a
safety issue, a party group, etc. |
|
|
The ethical & soc resp needs of cliques & coalitions can be
as wide ranging as the types of cliques & coalitions |
|
|
The ethical & soc resp needs of cliques & coalitions might
include activism in the org or community related to the knowledge,
beliefs, values, & norms of the subculture at the center of the clique
or coalition, eg women organizing around pay equity in the org or even
the community |
|
|
Lower level employees usually include the vast majority of the actors
in an org, but those actors have little authority, low pay, low status,
& little chance for advancement |
|
|
The ethical & soc resp needs of lower level employees are often
related to quality of work life in the org, job security, safety, respect,
etc. |
|
|
The ethical & soc resp needs of lower level employees are often
related to charitable work in the community such as clean up, feeding the
poor, assisting the elderly, literacy, & more |
|
|
EXTERNAL STAKEHOLDERS INCLUDE
CUSTOMERS,
SUPPLIERS,
COMMUNITIES,
THE GOVT, & OTHERS |
|
|
The govt becomes a stakeholder in the sense that it is
an independent actor who is charged w/ representing the legal rights as
well as the ethical & soc responsibilities of other stakeholders |
|
|
The ethical & soc resp needs of external stakeholders, like lower
level employees, are wide ranging, including activism in the org or community,
quality of work life in the org, job security, safety, etc. |
|
|
Internal
Links
Top
|
Outline on the Public
Policy Process
|
|
External
Links
|
|
- Project: Policy Actors |
Link
|
|
- Project: The Public Policy
Process, Domhoff's Analysis, & Reform of Campaign Financing & Lobbying |
Link
|
|
SUMMARY |
|
|
Industry & interest group lobbying has influence at all stages
of the public policy process, & beyond |
|
|
Congress passes laws |
|
|
Lobbyists, industry, government agencies, the Public, et al offer "advice"
( lobbying & influence ) |
|
|
The prospective law is signed or vetoed, or line item vetoed
by the President |
|
|
The law given to the appropriate government agency for
implementation |
|
|
Agencies make draft rules which are printed in Federal Register
for public approval |
|
|
Agencies review public comments & write
final rules |
|
|
Agencies implement rules |
|
|
During implementation, rules must be interpreted & decisions
must be made |
|
|
Courts interpret laws & rules |
|
|
THE UPPER CLASS |
|
|
The upper class directly shapes govt policy by impacting the
public policy process |
|
|
Govt. policy & the public policy process is the least recognized
by the general public, but it is the area where the public could have great
influence |
|
|
Several types of policy are "routine" in that they are specified
in the Constitution or law & occur regularly |
|
|
FISCAL POLICY |
|
|
Fiscal policy is perhaps the most visible govt policy |
|
|
Fiscal policy is the most open to the democratic process &
thus highly influenced by the upper class, the corporate class & the
upper middle class |
|
|
Fiscal Policy includes primarily fed law on taxing & spending |
|
|
MONETARY POLICY |
|
|
Monetary policy
is "insulated from politics" which results in
almost no input from the general public & great power by the President |
|
|
Broad monetary policy issues include unemployment & interest rates
which are “insulated from politics” by independent boards |
|
|
The Federal Reserve Board's members appointed for 7 yr. terms during
which they set major interest rates & the money supply |
|
|
Federal Reserve Board members are very difficult to remove, so a President
picks them carefully |
|
|
DOMHOFF ON GOVERNMENT POLICY |
|
|
1. Domhoff believes that the upper class, the corporate
class & the upper middle class provide most of the money in the political
process |
|
|
2. Domhoff believes that the upper class, the corporate
class & the upper middle class provide most of the money to fund think
tanks, foundations, university research, etc |
|
|
3. Domhoff believes that the info from think tanks, foundations,
university research, etc. is funneled into the policy process as evidence/data |
|
|
4. Domhoff believes that the info from think tanks, foundations,
university research, etc. is funneled directly to the government to influence
the policy making process |
|
|
5. Domhoff believes that the info from think tanks, foundations,
university research, etc. is funneled directly to the media to influence
policy & public opinion |
|
|
The policy formation process is seen as increasingly important in our
information
age society |
|
|
THE ACTORS IN THE POLICY FORMATION PROCESS |
|
|
There are many "players' or actors in the policy formation
process, that lobby & produce policy documents, including:
1. corporations
2. the upper class (i.e. those w/ personal fortunes)
3. foundations
4. universities ( granting agencies )
5. policy planning groups ( think tanks ) |
6. govt. commissions, councils, etc.
7. national news media
8. executive agencies, president, congressional committees,
courts
9. social movements (conservative, liberal, centrist,
etc.) |
|
|
|
Each of the players in the policy formation process has a direct role
in making policy, & lobbying the other players |
|
|
Miscellaneous interest groups (e.g. environmental groups, gun
groups, anti- & pro- abortion, etc.) & the general public
(& organized publics) have input into the public policy process through
letters, phone, email, direct contact: spontaneous or "solicited" |
|
|
Interest groups & the general public (& organized publics)
sometimes produce policy documents as do the "players" discussed above,
but more often they simply lobby by voicing their opinion |
|
Link
|
See Also: Policy Formation Process ( Making Law ) |
|
|
See Also: Participants in the Env Debate |
|
|
EXAMPLES OF POLICY PLANNING GROUPS |
|
|
Brookings Institute |
|
|
American Enterprise Institute |
|
|
Cato Business Council |
|
|
Heritage |
|
|
Council on Foreign Relations |
|
|
Committee on Economic Development |
|
|
RAND Corporation |
|
|
University boards are influenced & staffed by members of
the upper class |
|
|
Profs & other researchers understand that there are political implications
to their work & that policy planning grps will line up for or against
them |
|
|
Blue ribbon panels are "independent," temporary committees
which are tasked w/ examining special problems such as riots, the CIA,
energy, corruption, accidents, etc |
|
|
The media is often said to be liberal, but it is becoming increasingly
focused on info-tainment, centralized, controlled by major corps, &
big money oriented |
|
|
Turner vs. Murdock; Time, Newsweek, US News & World Report |
|
|
MONEY & POLICY FORMATION |
|
|
There are many processes for transferring money in the policy formation
process, including:
a. gifts ( donations to politicians & the other players,
gifts to universities, etc. )
b. endowments
c. grants
d. contracts
e. direct financing of projects |
|
|
INFORMATION TRANSFER |
|
|
There are many process for transferring information in the policy
formation process, including:
1. research findings
2. personal research reports
3. policy recommendations |
4. reports & news items
5. govt. reports
6. think tank reports |
|
|
Internal
Links
Top
|
Outline on Market
Failures
|
|
External
Links
|
|
Market failures are built in, normal functions of the mkt in which
the system produces (1) Externalities or Spillovers, (2)
Public or Social Goods, (3) Mkt Instability in the form of
Booms or Busts, (4) Unjust Distribution of Resources,
(5)
the Problem of the Commons, (6) Mkt Assimilation |
|
|
(1) An externality, aka a spillover, is
a benefits or cost associated w/ the consumption or production of a good
or service which is obtained by or inflicted w/out compensation on a party
other than the buyer (user) or seller (producer) of the good or service |
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There are both spillover benefits & spillover costs |
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(2) Public or social goods are mkt relationships where
there is a failure to allocate any resources whatsoever to the production
of certain goods & services whose output is economically justified |
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(3) Mkt instability is seen in the econ cycle,
which is the periodic, repetitive cycle of growth, peak, decline, &
trough of econ output |
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See Also: Unemployment |
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(4) Unjust distribution of resources: stratification |
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The distribution of resources is not a question economists usually
discuss because it is often viewed as normal or functional |
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(5) The problem of the commons is the mkt failure
wherein public, or common land is mis utilized because everyone may benefit
from it while no one is responsible for, or pays for, it |
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The landlord tenant problem is a special case of the problem
of the commons where the common property is owned by one & rented by
another, who is induced to mis utilize that & not be responsible for
that property |
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(6) Mkt assimilation, aka pacman econ, is the mkt
failure whereby smaller econ enterprises are assimilated, bought up or
run out of business by bigger econ enterprises, eventually leading to monopolies |
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