Ethical Corporate Citizenship - Term Paper Example

? [Insert Case] Employee Ethics and Integrity [Insert Texas A&M Commerce In partial fulfillment of the requirements for [Insert Subject] [Name of Professor] [Date of Submission] Table of Contents Abstract………………………………………………………………………………………...3 Ethics Defined………………………………………………………………………………….4 Integrity Comes From the Individual…………………………………………………………..5 The Link of Integrity and Ethics……………………………………………………………….6 Integrity of the Company and the Employee…………………………………………………..7 Following the Leader…………………………………………………………………………..8 Summary……………………………………………………………………………………….9 References……………………………………………………………………………………10 Appendix A…………………………………………………………………………………..11 Appendix B…………………………………………………………………………………..13 Abstract In order to create a more cohesive and effective organization, every entity of the organization must be fully aware of one’s role and expected output so as there is no confusion of conflict of tasks and obligations. This would also entail that there should be a set of ethics and rules of integrity that should be followed in whatever dealings of the organization so as to set a concrete guideline that needs to always be followed and not compromised. In this light, conflicts regarding decision making and the overall welfare of the organization will be well taken care of and would ultimately lead to a better performance. The top management even up to the lowest position, and any employee for that matter, shall not forsake such code and will do no such thing that will promote disillusionment within the ranks of the organization. The chain is only as strong as its weakest link, and with that premise, the organization’s success depends on each of its employees (Czimbal & Brooks, 2007). This is important to stress especially in merging or expanding organizations wherein it involves acquisition of existing other organizations. If the practice of integrity and ethics are not in parallel with one another, or if there is a breach of such, not only the newly acquired unit but most catastrophically the mother organization and its operations might be put in jeopardy. Thus, herein locates the timely relevance of the Employee Code of Ethics that shall be observed by the whole company and any entity for that matter that is and will be involved with such the organization. Ethics Defined Before further proceeding on with defining what constitutes ethical responsibilities of an employee in an organization, we must first scrutinize what ethics is really all about and what it means. It must be first established that ethics is something that is external in nature to the employee. It is a system of rules that is set by a governing body and thus also offers the burden of implementation and sanction (Czimbal & Brooks, 2007), if need be. Therefore, it is clear that ethics comes from a certain higher entity than an employee and these are the codes of conducts that are expected from the constituents of the said entity. It may be an organization, a group, or a company, that will decide on the presiding body that will decide and implement such ethical conduct. This is important to note since different job descriptions have different prescribed code of ethics but nonetheless the underlying principle still remains to promote doing what is right and fair in order to create a climate conducive to working and progress of healthy working environment. This also fosters the common interest of everyone in the organization. But this is where disagreement rises, for the definition of right or wrong is, most often than not, very subjective and differs from one individual to another In the world of business, where competitiveness is an innate attitude closely tied to survival, lines are blurred regarding ethical maters in order to gain upper ground or to even avoid penalties that would render an organization disadvantaged if found out. There is also the common notion that as long as nobody finds out and the desired results are delivered, then protocols and ethics can be just disregarded anyway. But a strong disregard for proper protocol (although delivering desired results at the moment) is never a good organizational practice for it shall also tarnish the capability and capacity of its employees and in the long run, most importantly, it will hinder the potential of an organization to perform to its optimum. It should be highlighted that it is the executives and the bosses of the organization that really have a sway on this department, and they are the ones who dictate and even question the ethicality of things and if whether it can be done away in order for the business to thrive more (Dubinsky & Richter, 2009). Thus, whatever the top management deems to be ethical or “acceptable” behavior will also influence how the subordinating employees will view the ethics and practices of their organization. If the boss endorses unethical decisions, it shall create and result to a bad employee that will serve the system and so the cycle will perpetually continue until it is corrected. Thus there have been rules and legalities that have been set in order to standardize ethical conduct in business and even in the organization. But there is also a problem posed about global trade since different countries also differ in the implementation of such legal business ethics and would therefore complicate trade globally. Integrity Comes From the Individual On the other hand, integrity, unlike ethics which comes from a governing higher power, comes from the individual himself (Czimbal & Brooks, 2007). It is a system of principle which guides the person on his behavior and decisions. This can also be perceived as the conscience of the person to make the right calls and to do away from undesirable actions. But since it is from the individual, it is also subjective from his past and his experiences and views in life. Unlike ethics and codes where it has legal support for implementation and following, the rewards (and also the punishments) are only intrinsic in nature. By having integrity means having that contentment from within that one does the right thing and is living by conditions and codes that are amenable to his nature. Integrity is always being tested in all the decisions we do in life. Therefore, having a strong integrity also takes practice in doing what is right. There are many things that are easier said than done, and such is also the fate of integrity. It is never easy to do what is right. The right choice is subjective and therefore can be different from individual to individual, but in a society there is such a thing as the common morality wherein everyone adheres to what is deemed right and what is wrong. Everyone knows what is right or wrong (Heathfield, n.d.). This also consummately applies in the organizational structure wherein the society (the organization) has its moral base of principles (the established ethical code) which everyone must adhere to. The Link of Integrity and Ethics So while it can be said that the integrity comes from the inner functions of an individual, it cannot be made to neglect the impact that ethics has and its influence over the person’s view and attitude towards integrity. Czimbal & Brooks mentions in their article that “there is a dynamic relationship between integrity and ethics, where each strengthens, or reinforces, the other”. For after all, ethical code of conduct is the product of a strong integrity. And in this cycle, a good and fair standard of ethics will also encourage the practice of integrity. This is of utmost importance to establish since this details how our top management must then proceed to better this organization. And further on this paper, the steps on how to achieve this will be further elaborated. This is also important to understand so as to have a better know how on handling the welfare of the employees wherein company practices, especially the unethical ones, affects worse the employees with utmost conviction of their job (Doty, 2007). And seldom organizations cannot also prosper because of their roster is full of people of questionable integrity. To illustrate the effects of having a good ethical practice in an organization, Appendix A shows the list of companies that were awarded as the most ethical companies and Appendix B depicts how the company has improved in its profitability, growth, and efficiency variables after they were deemed as having very good and notable ethical practices. Integrity of the Company and the Employee Our company must primarily focus on the simplest building blocks of the organization: its people. We must therefore first ensure that the manpower that constitutes our company all men of integrity. While this may be difficult to quantify, and methods of assessing integrity might not also be full proof, but still our company must strive for that. First and foremost, it should be an imperative that all employees and also the future applicants must undergo thorough background checks by an entity independent of the company (for obvious reasons that bias and other personal connections with members of the organization might be a hindrance in giving an honest report). We must ensure that the paper works and the credentials are all at least true, lest we hire people that are really incapable of performing the duties that would be assigned to them in their respective role in the organization. By hiring incompetent individuals, we allow ourselves to be crippled by their ineptitude. We should not only look at the credentials but also on the personality of the person as a whole. It is a known fact that people, who lack self-esteem, friendships, and financial stability, have high chances of neglecting integrity (Czimbal & Brooks, 2007). Our company must be capable enough (If not, we should hire to bolster and improve our human resource department to handle such) to identify such individuals and at the very least closely monitor their performance, if not bar them from our organization. By also weeding out and also only choosing men of character and integrity, we also manage to root out an eventual problem should the employee rise from his ranks and serve in a larger capacity, which can in turn pollute the whole organization by unethical practices. Following the Leader While we improve our ranks by ensuring that the employees have a good structure of integrity, we as the management must also do what is needed to support this. As established earlier in this paper, we are the setters of the standards and we bear the responsibility of implementing or allowing whatever practices that we want. It is therefore also an imperative that we shall be examples worth emulating by our employees. We can guarantee this by implementing legal practices of the ethics code and strictly following it and not allows any compromises in our operation when it comes to matters of integrity and ethics. On our expansion developments, upon acquisition of new companies or organizations, we must also make certain that our working conditions and standards of employees are also applied and other ethical standards must always be followed. In order for integrity and ethics to be successfully inculcated in our organization, it is vital that our employees also share our vision and goals (Dubinsky & Richter, 2009). In this manner, they are aligned with the proper mentality in carrying out their work and by sharing the same goals we achieve unison and cohesion in the organization. We must also be swift in punishment and generous in reward for the transgressors and the compliers of our ethical standards. Summary Ethics and integrity are vital to a business organization, for who would want to deal with a company who is known to have an unprincipled and tarnished reputation. Therefore an organization should guard its reputation, since that is also a commodity. In order to promote a healthy ethics and integrity in an organization, it must start with hiring the right and proper people to fill the roles in the organization, and it is then up to the leaders to nourish the culture of sharing a goal living and operating under the ethical code and professional integrity. References Blazovich, J. L. & Smith, L. M. (2009) Ethical Corporate Citizaneship: Does it Pay? Texas A&M University and Mississippi State University Czimbal, B. & Brooks, M. (2007, August 1). Ethics & Integrity [Web log post]. Retrieved from http://abundancecompany.com/ethics_integrity.htm Doty, E. (2007, February 28). Winning the Devil’s Bargain [Web log post]. Retrieved from http://www.strategy-business.com/article/07101?pg=all Dubinsky, J. E. & Richter, A. (2009, March 11). The Global Ethics & Integrity Benchmarks [Web log post]. Retrieved from http://www.policyinnovations.org/ideas/innovations/data/000088 Heathfield, S. M. (n.d). All You Have is Your Integrity: Why Leave Your Integrity to Chance? [Web log post]. Retrieved from http://humanresources.about.com/od/businessethics/a/integrity.htm Kotler, P. & Keller, K. (2009). Marketing Management (13th ed). Upper Saddle River, NJ: Prentice-Hall. Appendix A Company on Business Ethics list of most ethical companies 3COM CORP 3M CO ADAPTEC INC. ADOBE SYSTEMS INC ADVANCED MICRO DEVICES ADVENT SOFTWARE INC AETNA INC AFLAC INC AGILENT TECHNOLOGIES INC AGL RESOURCES INC AIR PRODUCTS & CHEM ALASKA AIR GROUP AMBAC FINANCIAL GP AMERICAN EXPRESS AMERICAN TOWER CORP AMGEN INC ANALOG DEVICES APACHE CORP APOGEE ENTERPRISES APPLE COMPUTER APPLIED MATERIALS ARROW ELECTRONIC AT&T CORP AUTODESK INC AVERY DENNISON AVON PRODUCTS BALDOR ELECTRIC CO BANK OF AMERICA BANK OF HAWAII CORP BANK OF NEW YORK BAXTER INTERNATIONAL BB&T CORP BEA SYSTEMS INC BECTON DICKINSON BELLSOUTH CORP BEST BUY CO INC BIOMET INC BRADY CORP BRIGHT HORIZONS FAMILY BRISTON-MYERS SQUIBB CA INC CAMPBELL SOUP CO CASCADE NATURAL GAS CATHAY GENERAL BANCORP CELERA CORP CHAMPION ENTERPRISES CHURCH & DWIGHT CIGNA CORP CIMAREX ENERGY CINCINNATI FINANCIAL CISCO SYSTEMS CITIGROUP INC CLOROX CME GROUP INC COCA-COLA CO COGNIZANT TECH SOLUTIONS COHERENT INC COLDWATER CREEK INC COLGATE-PALMOLIVE COMERICA INC CONSTELLATION ENERGY CORNING INC CROWN CASTLE INTL CROWN HOLDINGS CUMMINS INC CVS CORP CYPRESS SEMICONDUCTOR D R HORTON DARDEN RESTAURANTS DEERE & CO DELL INC DELPHI CORP DELUXE CORP DEVRY INC DIME BANCORP DIONEX CORP DISNEY (WALT) DORAL FINANCIAL DOW JONES EAST WEST BANCORP EASTMAN CHEMICAL EASTMAN KODAK CO ECOLAB INC EDWARDS (A G) ELECTRONIC ARTS INC EMC CORP EMERSON ELECTRIC ENDO PHARMACEUTICALS ENERGEN CORP ENERGY CONVERSION EXPEDIA INC FANNIE MAE FEDRL HOME LOAN MTGE FEDEX FIFTH THIRD BANK FIRST HORIZON NATIONAL FIRSTFED FINANCIAL FLEETBOSTON FINANCIAL FOUNDRY NETWORKS FULLER (H. B.) GAIAM INC GAP INC GEN-PROBE INC GENENTECH GENERAL MILLS GOLDEN WEST FINANCIAL GOOGLE INC GRACO INC GRAINER (W W) INC GRANITE CONSTRUCTION GREAT ATL & PAC TEA GREEN MOUNTAIN COFFEE GUIDANT CORP HANSEN NATURAL CORP HARMAN INTERNATIONAL HARTFORD FINANCIAL HASBRO INC HEARTLAND FINANCIAL HEINZ (H J) CO HEWLETT-PACKARD HNI CORP HOME DEPOT INC HONEYWELL INTL IDEXX LABS INC IKON OFFICE SOLUTIONS IMATION CORP INTEL CORP INTERFACE INC IBM ITRON INC ITT CORP JOHNSON & JOHNSON JOHNSON CONTROLS INC JONES LANG LASALLE J P MORGAN CHASE JUNIPER NETWORKS KELLOGG KEYCORP KIMBERLY-CLARK GROUP KINDER MORGAN KNIGHT-RIDDER KROGER CO LAM RESEARCH LENNAR CORP LEXMARK INTL LILLIAN VERNON LILLY (ELI) & CO LINCOLN NATIONAL LSI CORP LUCENT TECHNOLOGIES MARRIOTT INTL MATTEL INC MBIA INC MBNA CORP MCDONALDS CORP MCGRAW-HILL COMPANIES MEDTRONIC INC MENS WEARHOUSE INC MERCK & CO MERCURY GENERAL CORP MERIX CORP MGE ENERGY INC MICRON TECHNOLOGY MICROSOFT CORP MILLER (HERMAN) MILLIPORE CORP MINERALS TECHNOLOGIES MODINE MFG CO MOLINA HEALTHCARE MOLSON COORS BREWING MOTOROLA INC NATIONAL CITY NATIONWIDE FINL SVCS NATURES SUNSHINE PROD NETAPP INC NEW YORK TIMES CO NIKE NORDSON CORP NORDSTROM INC NORTHERN TRUST NORTHWEST NATURAL GAS NOVELL INC NUCOR CORP NUTRISYSTEM INC NUVEEN INVESTMENTS NVIDIA CORP OFFICE DEPOT INC ONEOK INC ORACLE CORP ORMAT TECHNOLOGY OXFORD HEALTH PLANS PEP BOYS PEPSI BOTTLING GROUP PEPSICO INC PITNEY BOWES INC PIXAR PLANTRONICS INC PNC FINANCIAL PPG INDUSTRIES PRINCIPAL FINANCIAL GRP PROCTER & GAMBLE PROGRESSIVE CORP PRUDENTIAL FINANCIAL QRS CORP QUALCOMM INC RAMBUS INC RESOLUTE ENERGY ROCKWELL COLLINS ROHM AND HAAS SALESFORCE.COM INC SAPIENT CORP SARA LEE CORP SCHOLASTIC CORP SCHWAB (CHARLES) SIERRA HEALTH SERVICES SIRIUS XM RADIO SLM CORP SMUCKER (JM) CO SOLECTRON CORP SONOCO PRODUCTS SOUTHWEST AIRLINES SPARTAN MOTORS SPX CORP STAPLES INC STARBUCKS CORP STATE STREET CORP STEELCASE INC STUDENT LOAN CORP SUN MICROSYSTEMS SUPERVALU INC SYMANTEC CORP SYNOVIS LIFE TECH SYNOVUS FINANCIAL TARGET CORP TD BANKNORTH TECHNE CORP TELLABS INC TENNANT C TEXAS INSTRUMENTS THERMO FISHER SCIENTIFIC TIMBERLAND TIME WARNER INC TIMKEN CO TJX COMPANIES TOOTSIE ROLL TOTAL SYSTEM SERVICES TRADESTATION GROUP TRAVELERS COS INC TREX CO INC TRIBUNE CO UNIONBANCAL CORP UNITED NATURAL FOODS INC UNITED PARCEL SERVICE UNUM GROUP VALASSIS COMMUNICATIONS VIASYS HEALTHCARE WACHOVIA WAINWRIGHT BANK & TRUST WAL-MART STORES WASHINGTON POST WASTE MANAGEMENT WEIGHT WATCHERS WELLS FARGO WENDY’S WGL HOLDINGS INC WHIRLPOOL WHOLE FOODS MARKETS WILD OATS MARKETS WORTHINGTON INDUSTRIES WRIGLEY (WM) JR CO XEROX XILINX XM SATELLITE RADIO XTO ENERGY INC ZIMMER HOLDINGS Source: (Blazovich & Smith, 2009) Appendix B List firms compared to industry benchmarks one and two years after inclusion on Business Ethics list One year after appearing on Business Ethics list Two years after appearing on Business Ethics list Median industry-adjusted variables Median industry-adjusted variables N Mean Median N Mean Median Profitability variables Sales to total assets 601 0.146* 0.093* 606 0.171* 0.063* Cost of sales margin 737 -0.114* -0.067* 731 -0.038 -0.056* Return on assets 737 0.173* 0.056* 731 0.155* 0.039* Return on equity 737 -0.240 0.085* 731 -0.439 0.060* Growth variables Sales growth 737 0.036* 0.001* 663 0.069* 0.000 Cost of sales margin growth 737 0.011 0.000 663 0.014* 0.001* Net income growth 737 -0.910 0.060* 685 1.579 0.046* Efficiency variables Inventory turnover 632 47.562* 0.619* 630 57.055* 0.449* Acc. receivable turnover 715 2.249* 0.072* 714 2.314* 0.118* Acc. payable turnover 731 1.576* 0.007* 722 2.959* 0.013* Source: (Blazovich & Smith, 2009) Read More