Ethics in Organizations

Question 1

Ethics

Answer 1

• Code of moral principles and values that governs the behaviors of a person or group with respect to what is right or wrong
• Ethical values set standards as to what is good or bad in conduct and decision making
• Most ethical dilemmas involve conflict of the needs of the part and the whole.

Question 2

Ethical behaviour -

Answer 2

honest communication, fair treatment, special consdieration, fair competition, responsibility to organization, corporate soical responsibility, respect for law

Question 3

3 Ethical Principels/ Decison Criteria

Answer 3

• Utilitarian
• rights
• justice

Question 4

Utilitarian

Answer 4

• Behavior is ethical if it delivers the greatest good to the greatest number of people
• Focuses on outcomes; ends justify the means

Question 5

Rights

Answer 5

• Behavior is ethical if it respects the fundamental rights shared by all human beings
• e.g., Charter of Rights and Freedoms, free speech, due process, privacy, life and safety, etc.

Question 6

Justice

Answer 6

• Behavior is ethical if it is fair and impartial in its treatment of people
• Impose and enforce rules fairly (procedural justice)
• Equity

Question 7

Advantages and Disadvantages
Utilitarian

Answer 7

• Promotes efficiency, productivity
• Ignores rights of some individuals
• Difficult to apply to values that cannot be easily quantified (e.g., health, life, employment)

Question 8

Advantages and Disadvantages
Rights

Answer 8

• Protects individuals from injury consistent with freedom and privacy
• Creates overly legalistic environment
• Hinders productivity and efficiency

Question 9

Advantages and Disadvantages
Justice

Answer 9

• Protects interests of under-represented and less powerful
• Encourages sense of entitlement
• Difficult to agree on the definition of “fairness”
• Reduces risk-taking, innovation and productivity

Question 10

Causes of Unethical Behaviour

Answer 10

• bounded ethically
• bottom line mentality
• whistle - blowing

Question 11

Bounded ethically

Answer 11

• the psychological process by which people come to engage in behaviour that violates their own ethical standards
• Can be personability, gain, extreme performance pressure, role conflict, strong organizatonal identification, competition, organizational and industry culture

Question 12

Bottom line mentality -

Answer 12

a narrow focus on organizatioanl economic indicators such as profits or stock price to the exclusion of espoud or organizational values and fair procedures

Question 13

Whistle-blowing

Answer 13

disclosure of illegetiate practices by a current or former organizational that may be able to take action to correc these practices

Question 14

Ethical Behaviours (themes)

Answer 14

Ethics are particularly apparent when managers must make decisions related to:
- honest communication
- fair treatment
- fair competition
- responsibility to organization
- corporate social responsibility
- respect for the law

Question 15

Honest communication

Answer 15

evaluate employees candidly, advertise honestly, etc.

Question 16

Fair treatment

Answer 16

-pay equitably, do not use people as scape-goats
Special consideration
- help the disabled, long-term employees, etc.

Question 17

Fair competition

Answer 17

e.g., avoid bribes and kickbacks, do not fix prices, etc.

Question 18

Responsibility to organization

Answer 18

act for the good of the org, not out of self-interest, etc.

Question 19

Corporate social responsibility

Answer 19

do not pollute, think about community impact, etc.

Question 20

Respect for the Law

Answer 20

do not bribe others, follow labor/taxation laws.

Question 21

Causes of Unethical Behaviours
lecture

Answer 21

• “bad apple” - personality causes
• “bad barrel” - situatonal causes

Question 22

“Bad Apple”

Answer 22

• Need for power, Machiavellianism, Risk taking, Moral identity
• personaility causes

Question 23

“Bad Barrel”

Answer 23

• Situational causes
  Gain (e.g., anticipation of reward or lack of punishment)
  Role conflict (remember Challenger engineers?)
  Competition/Scarce Resources
  Pressures to conform
  Social modeling
  Anonymity/Lack of accountability
  Organization/Industry Culture

Question 24

Signaling Theory

Answer 24

• Evolutionary theory
• Applies when there is information asymmetry between sender and receiver
• High cost (honest) signals communicate fitness (and survivability)
• Ethical initiatives signal the fitness of the organization
• Actions signal the ethical nature of the leaders and the business

Question 25

Ethical/Unethical Beahviours Send Signals

Answer 25

Leadership that demonstrates normatively appropriate behaviors through actions and relationships. Ethical leaders promote ethical conduct through communication, reinforcement, and decision-making.

Question 26

Ethical/Unethical Beahviours Send Signals Positively related to:

Answer 26

Subordinate ethical behavior, job satisfaction, organizational commitment, organizational voice (i.e., suggestions for positive change), trust in leader, job performance

Question 27

Ethical/Unethical Beahviours Send Signals Negatively related to:

Answer 27

Subordinate work stress, deviance, turnover

Question 28

Corporate Social Responsibility (CSR)

Answer 28

Refers to management’s obligation to make choices and take action so that the org contributes to the welfare and interest of all organizational stakeholders

Question 29

CSR Seen to relate to:

Answer 29

- respect for the environment - relationship between the business and society - sustainable economic development - fair treatment of employees, suppliers, customers, communitites - adhering to ethcial values

Question 30

How do Employees Respond to CSR

Answer 30

- Employee perceived CSR of their organization - Evaluation of an organization’s social performance - Captures perceptions of met responsibilities toward employees, consumers, government, the public, and environment

Question 31

CSR Positively related to:

Answer 31

Organizational trust, organizational identification, work engagement, organizational commitment, job satisfaction, job performance, citizenship behaviors

Question 32

CSR Negatively related to:

Answer 32

Turnover intentions, organizational deviance

Question 33

Sources of Ethical Values in Orgs

Answer 33

- personal ethics - role of leaders - org culture - embed ethical values - org systems - employee selection, prescene of ethics codes - external stakeholders - reward/value ethical behaviour

Question 34

Formal Structure

Answer 34

Assigning ethics committee or ethics officer

Question 35

Disclosure Mechanisms

Answer 35

- Visibly reward ethical acts and punish unethical ones - Provide protective mechanisms so that employees are able to discuss ethical dilemmas and report behavior against the code of ethics

Question 36

Code of Ethics

Answer 36

Used by an increasing number of organizations Not enough to have a policy, must also be followed

Question 37

Training programs

Answer 37

- formal structure