Wednesday, October 20, 2010

Solutions for Ethical Problems in Business

My research on articles about business ethics has a profound influence on finding solution for ethic problems in future from the perspective of both ethics/compliance management and ethical behavior/action in an organization.

First, from the perspective of ethics/compliance management, I think that the number one factor to endorse the effectiveness of ethics/compliance policy is the fair treatment in the company. The fair treatment must root in all the area of management. Companies need to make sure that they have compensation and reward systems that guarantee all employees are fairly recognized and rewarded for their contribution to the growth of the company. For example, salary must base on job description; bonus must base on quality of work done and the employee's creativity; total compensation must be at least up-to-date for an employee to cover basic living expenses. No matters what people may say during the recruitment process, basically, they all work to earn money and recognition. Because "employees" perception of fair treatment emerged as a powerful factor linked to the success of an ethics/compliance program", failing to guarantee the fairness in compensation and reward systems will inevitably fail all ethics/compliance policy.

Second, an effective ethics/compliance policy must focus on the areas where the laws have not yet regulate and on the potential breaking points where ethical problem can become legal problems. In the modern life, it is very easy for a person or an organization determines what is legally acceptable and what is not. However, determining what is ethically acceptable, and what is not, is much more complicated. In an ethics situation, we often have to consider many variables some of which are opposite to the others. In addition, we all tend to judge the importance of each variable based on our personal values, which may differ from those of other people. As such, a behavior acceptable to us may not be acceptable to other people. Consequentially, ethics dilemmas are very common in the workplace and in the daily life. According to Craciun, "when the law has nothing to say, morality is the only available guide of our actions". Yet, the morality frequently leads to ethical dilemmas. Therefore, an effective ethics/compliance policy must be able to help employees to deal with ethical dilemma. By pointing out the line where an ethics issue will easily become a law issue, the ethics/compliance policy can help minimize the ethics/compliance problems in the company.

Last, an effective ethics/compliance policy must take its root in cohesive teams. This means that the policy needs the endorsement of every single team in the company. In the research on The Role of Cohesion on Group Member Actions, the authors concluded, "Cohesion, by providing motivational impetus to members to facilitate group performance, enables individuals to carry out actions that benefit the group, regardless of their ethicality". This is probably the reason why Plante wrote, "You need to surround yourself with like minded people" in his advice on how to live ethically. This definitely supports the idea that the effectiveness of an ethics/compliance policy will be much higher if it has its root in cohesive teams of the company.

From the personal perspective, this research has provided me with valuable knowledge to deal with ethics issues at work. Thanks to this experience, I have come up with three guidelines to be ethical at work as follows:

- First, look for favorable ethical environment. This guideline bases on the way number three to live ethical suggested by Plante, "You need to surround yourself with like minded people", and the conclusion of Narayanan, Ronson and Pillutla about the way cohesiveness of the group may influence ethical behavior. Seldom do we work alone. Rather, we usually work as a member of a team or organization and the way our teammates and especially of our leaders will have profound influence on our thinking, judgment and behavior. The influence may be supportive or unsupportive to our personal set of values. As such, it is ideal for us to have a favorable ethical environment in which we can have the endorsement for our personal values, ethical behaviors and actions.

- Second, understand the ethical issues. Although it is great to work in a favorable ethical environment that supports our set of values, we are not always that lucky because we cannot understand all about the team or the organization that we are going to serve. Moreover, even if we are working in a good environment, we may also encounter ethical issues that we need to deal with. "There will always be unethical actions and ethical dilemmas in the work place", wrote Ryan Scholz in his research on Ethics in the Work Place. However, it is not easy to understand the ethical issues. According to Sally Bibb, "ethical issues can be difficult to identify in the first place". That is why we need to have resources to understand the issues clearly in order to handle it properly. We can research on the ethics/compliance policy of the company to have an overview on what is the relation between the issues with company's principles. This may help find the guidelines for our decision making process. We can seek for someone we can "use as a sounding board". We need to "Understand the different ‘rationalisations'" that may impair our knowledge about and judgment on the nature of the issues. Once we have a good understanding of the issues, we can figure out where the issues come from, who are involved in, what can guide the situation, how many resolutions are there and when we need to make decision.

- Finally, choose the right resolution for ethical issues. In general, a right resolution for ethical issues must support us to answer "yes" to the question "Would you make the same decision again?" as discussed by Barbara Floria in her discussion. Definitely, after having a good understanding about the issues, we have to decide what to do with the issues. A right solution need to base on a right decision, and we tend to repeat what we think is good. To come up with a right decision, it is advisable that we need to do some checks by answering important questions related to ethical attitude and behavior. Ryan Scholz suggested six questions to ask ourselves to help us make an right ethical decision. Amongst these suggestions, I think the three questions "Would I be happy for this decision to be on the public record?", "What would happen if everybody did this?" and "How would I like it if someone did this to me?" are very critical to help us come up with the best resolution for the ethical issues. Undoubtedly, when we do the right thing, we will more or less expect that it recognizable to the others. We always expect all people others could do what we think is right to us and to the society. Any solution failing to answer any of these three questions satisfactorily will be ethically unacceptable. The concept of "acid test" discussed by Sally Bibb suggested other four questions to check the ethical decision. These four questions look different from the six suggested by Scholz but share the same ideas.

Arthur Andersen (1999). Ethics/compliance management programs and their effect on ethical behaviour. The Canadian Manager, Vol. 24, Issue 4, p. 23. Retrieved from: http://proquest.umi.com.proxy.msbcollege.edu

Bibb, S. (2010). How to be Ethical at Work. Retrieved from: http://www.articlesbase.com

Craciun, D. (2009). Challenges to business ethics. Metalurgia International, Vol. 14, Issue 16, pp. 226 - 236. Retrieved from http://ehis.ebscohost.com

Floria, B. (2005). Everyday ethics: How to do the right thing. Vitality Magazine. Retrieved from: http://www.scu.edu

Jamrog, J. J. (2005). The state-of-the-art in ethics. The Ethical Enterprise: Doing the Right Things in The Right Ways, Today and Tomorrow : A Global Study of Business Ethics 2005-2015. Retrieved from: http://msbcollege.skillport.com

Lowery, C. M. & Beadles, N. A (2009). Differences between work-related ethics and non-work ethics, and the effects of religiosity. Journal of Managerial Issues, Vol. 21, Issue 3, pp. 421 - 435. Retrieved from: http://proquest.umi.com.proxy.msbcollege.edu

Narayanan, J., Ronson, S. & Pillutla M. M. (2006). Groups as enablers of unethical behavior—the role of cohesion on group member actions. In A. E. Tenbrunsel (ed), Ethics in Groups: Research On Managing Groups and Teams, Vol. 8. Retrieved from: http://msbcollege.skillport.com

Plante, T. (2010). Four ways to live more ethically. Psychology Today. Retrieved from: http://www.psychologytoday.com

Scholz, R. (2009). Ethics in the Work Place. Retrieved from: http://www.articlesbase.com

Stanley, T. L. (n.d.). Ethics in Actions. Retrieved from http://ehis.ebscohost.com

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