Leadership and Ethics - Essay Example

Running Head Leadership and Ethics Leadership and Ethics ical moral tradition gives managers and leaders little help regarding obligationsto future humans. Yet we sense a vague generalized duty to them, as when we leave wood and a clean campsite for unknown future campers. The problem is that the further we project into the future, the greater are the unknowability and unpredictability. We do not know much about all the children who will be born during the next eight months, though their genetic makeup is entirely fixed. Yet we can form some generalized rules. The "nature good, man-made bad" ideology of many ecological zealots rarely informs us of the hazards of nature's own pesticides. The task and duty of managers, leaders and administrators is to apply moral and ethical principles to business world and meet social responsibility issues and take into environmental concerns. As a decision maker experiences the outcome of a moral choice, not just the external outcome but the internal one as well, the entire decision-making process can be affected. Self-esteem may increase or decrease, leading to modifications (or not) in the perceptual net, the analytic tools, the approach to synthesis, choice, and action planning. Such a learning process is clearly, if slowly, unfolding with the implementation of affirmative action programs in the United States. Racial and gender discrimination are perceived and analyzed differently by most of us today than they were twenty years ago (Crane and Matten 2004). In order to know what the business can do for the community, it must first thoroughly know and understand its own resource capability in the areas of money, manpower, equipment, space, and managerial and technical expertise. Once this is known, then it can be correlated with the various community needs to determine how helpful, if at all, the company can be to the community. It may be as simple as supplying a few employees for local volunteer work to assisting the community in an in-depth study program or building program in a particular area. It is just as important to know the community and its needs as it is to know the company's capabilities. Someone within the company must work with the community to become familiar with the community needs, or the company must establish some type of internal committee or board to study community problems (Sims, 2003). The committee or board should be composed of people from the company and various representatives of community organizations. Finally, once a program selection has been made it must be carefully monitored; this must involve both review and control. Proper monitoring will enhance the image of the company and improve the chance of program success. Project feedback and follow-up will ensure that the project is being executed within time and funds limitations (Beauchamp and Bowie 2003). Courage is necessary if one is to improve the world. Once you open the door on differences, you have crossed into new intellectual territory forever. There is no turning back to the simple pleasures of taxonomies and typologies about who human beings are. Competitor selection policies contain provisions by which the corporate strategist seeks to consolidate his control over the competitors in his colony (Crane and Matten 2004). He can consolidate control, according to Porter, by placating good competitors, turning bad competitors into good competitors, and attacking bad competitors who could not become good competitors. The corporate strategist who governs this colony is no fool when it comes to dealing with good competitors. According to Porter, the effective corporate strategist "must allow good competitors enough successes to lead them to perpetuate their strategies" (Beauchamp and Bowie 2003). This allowance is a central feature of the strategic convention by which the strategist and his good competitors get along. The upshot is that the difference between successful and unsuccessful competitor selection is the strategist's ability to placate and to punish his colonial subjects, and to know when the time is right to practice one act or the other. On the other hand, the strategist's stakeholder in any given game is a bit player. We know that this stakeholder has strategic options, receives payoffs, values those payoffs in some hierarchy, and is sufficiently "streetwise" that she bases her moves on what the corporate strategist does. We know that stakeholder always "rationally" prefers more of something to less of something (Beauchamp and Bowie 2003). To make the world better, a manager and leader should take into account needs and expectations of diverse stakeholder groups. To make the world a better place, managers, leaders and administrators should rediscover their concern for the environmental impact of institutional action. After a decade and a half of relative silence, the environmental theme is once again on the national agenda, as it was in the early seventies. During this silence, the business community has in many ways and for many reasons become more comfortable with a moral vocabulary that should improve the dialogue. More than ever before corporations are open to the suggestion that they need a conscience as much as they need a strategy (Crane and Matten 2004). There is more to the story, for the conditions that must be satisfied if there is to be an environmental conscience are significant, extending the boundaries of business ethics. First, corporations must be clear about the concept of conscience in general, distinguishing it clearly from its counterfeits: public relations, government relations, competitive strategy, a marketing orientation, legal compliance, and issues management. Corporate conscience may have secondary effects that connect with each of these arenas, but it is not to be confused with any one of them or it loses its meaning (Beauchamp and Bowie 2003). Management must take steps to orient, institutionalize, and sustain the corporate conscience or value system in ways that are as realistic as those that guide strategy formulation and implementation. Rhetoric and value statements are not enough. Rewards, incentives, controls, audits, and clear leadership action are critical to this task. Management must be "given permission" to think and act environmentally, a condition that affects organizations more deeply than statements or credos (Sims, 2003). As important, leadership must give itself permission to think and act in ways that have hitherto been considered somewhat beyond the standard limits of stockholder, and even stakeholder, concern. And where specific environmental needs outstrip the power, and therefore the responsibility, of the individual corporation (since ought implies can), conscience demands more-reaching out to and eventually with other corporations in an industry, a geographical area, or a technological network in an effort to be part of a solution, rather than part of a problem (Crane and Matten 2004). All decision making begins with the decision maker's perception of his or her environment. Perception is not a passive and neutral process as we are sometimes tempted to think. Observers have long recognized that perception has an active aspect to it and that an agent gathers, structures, and packages information in accordance with certain interests and purposes. Drug addicts, for example, often refuse to look at the effects of their habits on themselves and those around them (Donaldson, et al. 2002), To look, presumably, might lead to action that would be painful or difficult. Perception is here distorted by the fear of withdrawal or the pursuit of euphoria. Everyone's perception is active and selective. It is impossible for us to know all the facts, past, present, and future, that bear on a decision before us. And even if it were possible, we could not realistically keep all the relevant ones before our mind at once. Thus the ethical aspect of perception has to do with how an actor scans the environment and selects what is of concern to conscience (Beauchamp and Bowie 2003). The same kind of learning seems to be taking place in the environmental arena. We are more prepared today than in times past to take seriously the effects of corporate behavior on environmental pollution, resource conservation, and the preservation of species, for example, than ever before. We learn. It is no contradiction to say that we have an ethical responsibility to keep tabs on our responsibly made ethical decisions, to reverse them if and when the situation warrants (Donaldson, et al. 2002), Another learning step that we have taken in recent years is from what might be called industry principles to impact principles. In the past when the action of a given company was contributing to a problem even though the company was (alone) not to blame, we would look to local laws or industry norms for some kind of resolution, as with automobile safety standards. Sometimes, however, as we learned in South Africa, the problem is not industry specific. It has to do with the joint impact of many or all industries on a social problem (racial injustice). Such problems call for sets of principles that cut across industries and focus on a problem area directly. The Sullivan Principles served this purpose for many years in the South African context. The newly issued Valdez Principles can serve this purpose in relation to the environment. A prime target in that critique is the idea of "corporate strategy" (Frederick, 2002). Corporate strategy is a central part of modern business talk and ethical issues. Corporate strategy has become the wellspring of guidance about how to run ethical issues of business through marketing, manufacturing, human resources, and financing activities. Autonomy is a claim to think and act differently from anyone else. A lifetime of efforts at accomplishment is a prime avenue for staking this claim to a distinctive life (Frederick, 2002). The relationship of business with the community has had a long and changing role and involves many areas. It starts out by creating and supplying an employment base within the community where the business resides; from this point it expands into involvement in the areas of education, the arts, environment, urban development, job training, volunteerism, minority enterprises, summer jobs for youth, health, housing, alcohol and drug abuse, nutrition, philanthropy, prison rehabilitation, and many other areas. It is almost impossible for any business not to become involved in some kind of community affairs. Some of this involvement is primarily charitable, while other community affairs with which business becomes involved pays a direct return to the company (Frederick, 2002). It is difficult to separate one from the other because in most instances both community and business reap positive rewards from any business participation in community affairs. The general theory behind much of it is that by business participating in community affairs it makes the community a better place in which to live (Sims, 2003). By making the community a better place to live, it helps improve the community for all those who live there and as an inducement for hiring new employees from distant communities -- possibly needed experts from other cities. By being able to bring in needed key people from other localities, the business will be able to remain competitive, increase sales and profits, and make more money for the stockholders and the IRS. The result is that everyone is happy and better off because of community involvement by business -- the community, the business and its employees, the stockholders, and the local, state, and federal government (Beauchamp and Bowie 2003). In future, managers should involve community in their decision-making. In the not too distant past, when one spoke of community involvement, it usually meant the immediate or close vicinity (town, city, county, or state) of where the business was located. In today's modern world of high-speed travel and communication and many multiple business locations, it has in many instances expanded so that today it can encompass total regions, nations, or even the entire world. National and multinational businesses thus have a large complex of communities with which to concern themselves (Frederick, 2002). When and how deeply should a business involve itself in community affairs, other than supplying basic jobs to the people of the community, presents a set of questions that each business will have to evaluate on an individual basis. Certainly economics enter into the picture (Sims, 2003). If a business is new and just starting up it can be expected to participate only minimally; if it is long established, stable, and profitable then it will be expected to get more deeply (Crane and Matten 2004). Inclusion and institutional transformation frame a perspective with which we can understand many public and private initiatives that have sparked debate in our democratic society. These initiatives include national health care, public education reform, the so-called digital information superhighway, affirmative action, disposal of toxic and nuclear wastes, abortion, and immigration. In each instance, the breadth of membership in a particular "we" is at issue. In some of those instances, belonging to a "we" in the first place is at issue.(Sims, 2003). Immigration and affirmative action are cases in point. In each instance, significant changes loom in the lives of those who belong to a "we." In each instance, competing proposals for transforming an institution-such as health care in the United States-are central features of the debate. In each of these contemporary cases, members of a particular "we" seek ways to protect what is important to them, and they frame the prospects for particular kinds of institutional change in such terms. The opportunity to retain the services of a family physician in any new national health care system is a case in point about a politics of inclusion tied up in a politics of institutional change (Crane and Matten 2004). The first step in the process of integrating business decisions and environmental conscience is perception. Once one has identified the stakeholders and environmental effects, a matrix can be constructed with the columns representing the costs, benefits, rights, and duties that either support or discourage the option in question. Pros for the company may be clear, in the form of high margins and high market share on a patented product that may be banned for use in the U. S. Pros for the host country and farmers may also be significant, in the form of improved crop yields and reduced hunger (Sims, 2003). Cons may include not only poisonings and direct health effects on farmworkers but indirect effects on U.S. consumers and host country ecosystems. Analysis is not simply an exercise in altruism. Most people would put themselves (their company, the objectives of their job) at or near the top of their list of stakeholders. This natural tendency is hardly a failure of conscience (Sims, 2003). The failure would be to include only oneself or one's company. Ethics includes rational self-interest and self-respect in addition to respect for others. Analysis does not in and of itself resolve a problem or make a decision. It is, after all, only analysis (taking apart), not synthesis (putting together), choice, or action. But neither is it a purely detached, intellectual exercise. The very process of identifying affected parties and environmental effects involves the use of the imagination in a way that can lead to a natural empathetic or caring response to those parties in the synthesis, choice, and action phases of decision making (Sims, 2003). This is a contingent connection, however, not a necessary one. It is possible that once we have taken the analytical step, our perception of the situation, the options available to us, or the key decision makers may change (Crane and Matten 2004). In sum, to make the world better, managers and administrators should follow strict moral values and control ethical issues and social responsibilities. They should design corporate strategy and planning in accordance with ethical rules and environmental concerns of the society. Unless it is a life-and-death situation, it will do little good to force a company out of business by demanding immediate changes when corrections over a limited reasonable time would accomplish the same thing, keep the company in business, and save manyjobs. This is not to say that where stakeholders have a legitimate problem or complaint that they should not take appropriate action to rectify the situation. References 1. Beauchamp, T., and Bowie, N. (eds). 2003, Ethical Theory and Business, 7th edn, Upper Saddle River, NJ: Prentice Hall. 2. Crane, A. and Matten, D. 2004, Business Ethics: A European Perspective, Oxford: Oxford University Press. 3. Donaldson, T., et al. 2002, Ethical Issues in Business, 7th edn, Upper Saddle River, NJ: Prentice Hall. 4. Frederick, R. (ed.) 2002, A companion to business Ethics. Blackwell Publishers. 5. Sims, R.R. 2003, Ethics and Corporate Social Responsibility: Why Giants Fall. Praeger. Read More