Business Ethics: Corporate Morality - Literature review Example

of Ethics and number: Introduction The thesis is based on developing of ethics which will include the standard of ethical as well as moral conduct. It will illustrate the source and foundation of ethical values and principle of any individual or professional. Code of ethics allows any individual to position the integrity of the profession and interests of the stakeholders above their own interest (Somers, 2001). The discussion will elaborate different procedure to evolve the code of ethics. This procedure mainly involves training and communication planning, implementation of different ethical regulation and proper leadership role design (Ferrell, Fraedrich & Ferrell, 2013). This thesis will also communicate the impact of current laws and regulations and corporate social issues on the proper implementation of the ethical code of conduct. Statement of Value The term “Ethics” refers to the ability to judge fair and unfair attitude and action. Proper ethical codes allow individuals to understand the differences between moral and immoral activities (Stevens, 2008). The primary motive of ethical code is to align individual behavior as per the social and organizational framework (Ferrell, Fraedrich & Ferrell, 2013). Religion, culture and the structure of legal system can be considered as the major sources and foundations of ethical values and principle. Religion norms provide varying influence in my social and professional ethical approach. The religious traditions provide a number of valuable instructions regarding the right and wrong attitudes (Stevens, 2008). My religious beliefs assist me to act ethically within my social life as well as in professional atmosphere. Another important source is the family and social culture, which enable me to understand the ethical behavioral pattern. Organizational work culture and interpersonal relationship also provides a huge impact on the professional behavior. The legal system of the state has also laid down a set of guidelines to maintain the organizational and social behavioral pattern of any individual (Stevens, 2008). These legal regulations play a vital role in constructing the foundation of my ethical principles. These sources and foundations has developed a number of ethical values such as honesty in action and communication, maintaining personal integrity, loyalty towards the stakeholders, fairness in dealing, respect towards the fellow workers, openness to challenges and accountability. It has also assisted to develop leadership and cooperative qualities (Somers, 2001). This ethical values and principles have been developed over a period of time and they are considered to be non-negotiable towards any changes. These values need to be absolute and unchanging to ensure the social and organizational sustainability. In the ever changing world, the ethical values and principles can be considered as touchstones which define proper action and decision making procedures. It describes the proper behavioral norms and processes to treat other individual (Stevens, 2008). Strict consideration of ethical values connects us with the most powerful forces, such as self-respect and conscientiousness, which dictate the proper execution of our day to day actions (Stevens, 2008). These factors also represent the fundamental groundwork which assists me to shape my leadership capacity. Training and Communication Plan Along with the determination of the ethical values, it is also necessary to design a communication and training plan to impart the knowledge about the importance of these principles. The major reasons behind the limited impact of the ethical codes are the failure of management to effectively communicate with the intended audience. It is also essential to provide training to the employees regarding the code content and the processes to handle the ethical challenges (Somers, 2001). The communication procedure regarding the ethical commitment must include continuous message delivery process through diverse medium such as e-mail, newsletters and internet. It will assist an organization to properly engage employees to the ethical rules and regulations (Somers, 2001). The communication plan needs to follow few objectives, such as: The communication plan must ensure that every employee has received a copy of the detailed ethical code of conduct. It needs to confirm that everyone has an easy access to the details of these codes. Communication strategy should ensure that all the employees understand their personal responsibilities to strictly maintain the standard and provisions mentioned in the code. The proper communication plan will assist the management in determining the clarity of these codes of conduct. It will further help any organization to remove ambiguity regarding the ethical rules and regulations (Somers, 2001). Ethical awareness can also be generated through formal training procedures. In a professional platform, this training will provide more effective results in motivating the employees to follow the ethical practices (Carroll & Buchholtz, 2014). A number of informal ethical awareness programs, such as discussion of ethical guidance in regular organizational meetings, can be organized to increase the employee participation. The training procedure can be designed in a top-down structure. According to this structure, the primary ethical training will be provided to the leaders of the organization which will subsequently assist them to properly train their subordinate (Carroll & Buchholtz, 2014). The training plan should ensure that all the employees have been provided with the opportunity to learn essential decision making and behavioral skills. It will allow the employees to raise questions regarding the uncertainty of the application of these code of conduct (Carroll & Buchholtz, 2014). These trainings also educate the employees the different ways to handle ethical misconduct in the workplace as well as in their social life (Carroll & Buchholtz, 2014). Implementation Plan Developing code of conduct is not enough until it is properly implemented across the organization. One must engage the board of directors and secure the commitments of senior executives to implement the ethical values in an organization. Active participation and support from the senior management will certainly result in successful implementation of the ethical program (Stevens, 2008). Creating a board ethics committee is necessary to engage the board members in the implementation procedure. Placing ethical code of conduct in the board agenda will ensure the discussion about this matter in every board meetings. Integrating the core ethical values with the general operations and laws of organization will assist the leaders to impart proper knowledge to the employees about the guidelines (Stevens, 2008). The ethical values need to be built on the vision and mission statement of the organization. This implementation procedure will help the employees and management to understand that the ethical values are an integral part of the organizational operations (Stevens, 2008). The implementation plan of the ethical code will include the integration of the ethical guidelines in all the communicational aspect of the organization. Ethical guidelines need to be integrated to different communication materials of sales training, management courses, business plans and business meetings (Stevens, 2008). The effective implementation will also require sufficient and sustained human resources and finances. Allocating certain amount of staff and fund to the implementation procedure of ethical code will ensure the long term success of the organization (Stevens, 2008). Finally, the implementation procedure needs to make sure that the employees are properly applying the guidelines to handle complex challenges of the organization. Plan for the Role of Leadership The noticeable commitments from all the levels of leaders of the organization are undeniable for the success of the ethical code of conduct (Ciulla, 2014). Leaders of any organization are mainly responsible for establishing different working culture and regulations including the attitude of the employees towards ethics (Ciulla, 2014). Organisational leaders can encourage the employees to follow the ethical codes of conduct. Therefore, planning the roles of leaders in the ethical program is very essential for the proper implementation of their code of conduct (Avey, Wernsing & Palanski, 2012). It is mandatory for any leader to clearly understand the organization’s ethical program. They must have a clear idea about their contribution towards developing and maintaining the ethical culture (Avey, Wernsing & Palanski, 2012). The leaders in an organization must be responsible to- Ensure that all the employees have received the printed as well as electronic documents of the ethical codes. Communicate the organizational ethical standard to all the employees. Balance organizational culture to encourages the workers to comply with the ethical policies of the company. Provide examples regarding proper utilization and implication of the ethical regulations. Respond quickly to the queries of the employees. They must provide satisfactory solutions to these queries. Confirm that the employees have duly attended all the training and certification programs to sharpen their knowledge about ethical guidelines of the organization (Avey, Wernsing & Palanski, 2012). The engagement of all level of leadership is essential to properly execute all the above guidelines. The messages in the ethical guideline should not be modified when delivered from leaders to subordinates. It should remain constant across all the departments of the organization. The leadership commitment program towards the ethical code of conduct needs to involve ethics training, staff meetings, clear communications and new employee orientation (Ciulla, 2014). The leaders need to utilize every opportunity of communication to deliver the knowledge and awareness regarding the ethical practices of the organization. Most of the employees will certainly follow the footsteps of the leaders and managers of the organization (Ciulla, 2014). Corporate social issues A number of corporate and social issues affect the proper implementation and execution of ethical programs within the different departments of the organization. These issues generally hinder the smooth execution of the different operations within any organization. They can create ethical conflict within the workforce (Kuntz, Elenkov & Nabirukhina, 2013). Social ethics can be defined as the moral principles of any individual. These principles can vary person to person due to the cultural and regional differences. Language, race, education, cultural belief and family values create differences between individuals from diversified social and cultural backgrounds (Kuntz, Elenkov & Nabirukhina, 2013). Inadequate consideration of this issue during the creation of ethical codes of conduct can harm the values and beliefs of different employees. The interest and right of all the employees need to be considered during the development of organizational ethical codes (Kuntz, Elenkov & Nabirukhina, 2013). Conflicting concepts regarding homosexuality and immigration play major role in the creating ethical issues within the organization. Various misconceptions regarding these issues promote biasness in the behaviors within the employees. Gender differences also generate conflicting issues in any organization. Absence of proper ethical guidance can generate dissatisfaction within the employees (Kuntz, Elenkov & Nabirukhina, 2013). Apart from social issues there are a number of organizational issues that hamper the proper implementation of ethical guidance. Providing fair and non-discriminatory working condition to the employees is one of the major factors for the ethical code. Fair benefits and pay structure of the employees can increase the overall cost of the organization. Diversity training programs can also cause added expenses to the management of the organization (Somers, 2001). Lack of transparency and openness in different operational and accounting procedure can also generate unethical issues in any organization. This accounting and business scandal can hinder the overall productivity of the organization. Transparency in the message communication procedure and accuracy check in the financial report is essential to restrict these unethical acts (Kuntz, Elenkov & Nabirukhina, 2013). Ethical marketing issues of any organization involve environmental risks, advertisement truthfulness, fairness in pricing policies and respecting the consumer privacy. Implying ethical consideration assists organization to avoid misinterpretations of consumers (Kuntz, Elenkov & Nabirukhina, 2013). Ethical issues in the financial activities of any organization include misleading analysis of finances, securities fraud, tax avoidance, bribery and insider trading (Kuntz, Elenkov & Nabirukhina, 2013). The ethical code of conducts needs to evaluate all these problems to restrict the unethical practices within the organization. Recent laws and regulations impacting the corporation Laws, parliamentary orders and government regulations can be considered as the critical part of the ethical programs of any organization. Management of any organization often considers laws and regulations as the basis of the ethical code (De George, 2011). A number of legislations have been designed to properly monitor the ethical guidelines of organizations. Different ethical and financial misconduct within the small and medium organizations has encouraged the regulators to propose Section 406(a) legislation system. This legislation directs all the companies to disclose their ethical policies and practices to the regulators (Miller & Cross, 2012). It enables the regulators to judge the effectiveness of the ethical code of conducts of these organizations. The main objective of this legislation is to confirm whether the organizations have properly written ethical code which applies to all the managerial and departmental levels. This legislation also pay due attention towards the changes in the codes of ethics as per the requirement of the organizations. This regulation commands the information regarding all the waivers of the ethical guidelines. As per this regulation, all the companies need to disclose their ethical codes with the annual reports (Miller & Cross, 2012). Though the current legal structure assists organization to properly maintain their ethical codes and guidelines, the strict framework of this legislation also create some institutional problems. Though law is made to restrict certain unethical behavior of the organization and its employee, it sometimes harms the relationship between management and subordinates (Hoffman, Frederick & Schwartz, 2014). The decision makers need to follow the laws and regulations to improve the organizational values and meet the social expectations. Monitoring and enforcement of an ethics auditing plan Ethics auditing plans are designed to dig deeper into the records of the organization to ensure the accuracy and reliability in the areas of accounting system, legal compliance and financial reporting. The ethics audit procedures need to consider various qualitative research techniques (Ferrell, Fraedrich & Ferrell, 2013). Monitoring and enforcement of ethics auditing plan involves a number of important steps, such as- An audit committee needs to be created to monitor the ethical implementation of the organization. Members of this committee need to be selected as per their interests in the organization’s ethical policies and practices. The monitoring team will also be provided with adequate training facility related to the professional ethics. The committee will be responsible for reviewing the ethical issues of the organization. The monitoring process of ethics auditing involves the review of the formal ethics code, ethical training programs and the organizational compliance policies for legal and ethical guidelines. The team needs to make sure that the organizational ethics policies cover all the ranges of business issues including employee discrimination, equal opportunity of employment, financial management, environmental impact and customer relationship. The team needs to review the earlier records of the organization to evaluate the past breaches of the ethical code of conduct. If the committee can find any negative records of the organization they need to analyze the implication of unethical activities in those areas. They need to communicate these issues with the senior management of the organization and should demand for proper clarification. The members of the audit committee must have one to one conversation with the employees to gather their opinion regarding the ethical commitment of the organization. This will provide an opportunity for the employees to share their point of views regarding the managerial actions of the organization. The committee needs to identify the ethical misconduct within the organizational structure and therefore, need to file it properly to find out the right solution. This document will demonstrate the fairness of the ethical practices of the organization. Ethical considerations for working internationally During the international expansion activities, organization faces various ethical issues due to the differences in ethical standard. Corporate governance, corruption, bribery, targeted marketing and working conditions are the major issues confronted by organizations during their overseas ventures. The management needs to modify their ethical codes of conduct to properly deal with these issues (Tan & Ko, 2014). Social responsibility can be described as the current issues of any country those are debated by the public, government, critics and organizations. During their international expansion, businesses must include different guidelines to their ethics code to ensure that their activities are not affecting the human right of those regions. These guidelines will also confirm that their business venture will improve the living standard of the population of those countries (Tan & Ko, 2014). Corruption and bribery is another important ethical issue for global organizations. Organizations may find these illegal issues as a part of the business process in various countries. The ethical code of conduct must encourage the employees and management to avoid being a part of these illegal activities. Any payment made or received by the organization must follow the legislation of both the local countries (Tan & Ko, 2014). Ethical approach towards corporate governance will assist organization to be open and transparent in their finances, organization culture, behavior and operations in the global and local markets. This transparency will be beneficial for the organization to build up a large customer database in the international market (Tan & Ko, 2014). Conclusion The discussion has emphasized the standard of ethical codes of conduct for an organization. It has described different sources and foundation of ethical values and principles and demonstrated the different procedure of incorporating them into a business culture. The importance of communication plan and training procedure has been detailed in terms of implementing the ethical approaches within an organizational workforce. The thesis has also illustrated various corporate, social and legal issues that affect the proper implementation of ethical codes of conduct in the business operations. Therefore, the study has elaborated the proper monitoring procedure of the ethical code implementation. References Avey, J. B., Wernsing, T. S., & Palanski, M. E. (2012). Exploring the process of ethical leadership: The mediating role of employee voice and psychological ownership. Journal of Business Ethics, 107(1), 21-34. Carroll, A. & Buchholtz, A. (2014). Business and society: Ethics, sustainability, and stakeholder management. Connecticut: Cengage Learning. Ciulla, J. B. (2014). Ethics, the heart of leadership. California: ABC-CLIO. De George, R. T. (2011). Business ethics. New delhi: Pearson Education India. Ferrell, O.C., Fraedrich, J. & Ferrell, L. (2013) Business ethics & social responsibility. [OMM640 Custom edition]. Ohio: Cengage Learning. Hoffman, W. M., Frederick, R. E. & Schwartz, M. S. (2014). Business ethics: Readings and cases in corporate morality. New York: John Wiley & Sons. Kuntz, J. R. C., Kuntz, J. R., Elenkov, D. & Nabirukhina, A. (2013). Characterizing ethical cases: A cross-cultural investigation of individual differences, organisational climate, and leadership on ethical decision-making. Journal of business ethics, 113(2), 317-331. Miller, R. & Cross, F. (2012). The Legal Environment Today: Business in Its Ethical, Regulatory, E-commerce, and Global Setting. Ohio: Cengage Learning. Somers, M. J. (2001). Ethical codes of conduct and organizational context: A study of the relationship between codes of conduct, employee behavior and organizational values. Journal of Business Ethics, 30(2), 185-195. Stevens, B. (2008). Corporate ethical codes: Effective instruments for influencing behavior. Journal of Business Ethics, 78(4), 601-609. Tan, B. S. & Ko, S. (2014). An evolutionary logic towards the convergence of international business ethics. 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