Ethics in Organisations Not Only Right, but Profitable

Jan 7 , 2022
By Halima Abate (MD)

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Numerous factors exert intense pressure on a competitive environment to embrace social responsibility, restructuring the views on employment and how jobs are undertaken within the organisation. The pressure leads to an increase in recognition for social responsibility and a focus on the importance of the public good, contributing to society's harmony, stability, and strength with a focus on “doing good.” The impact of organisational decisions on society skews the attention towards the need for ethics within businesses. To secure smooth internal interactions, minimise internal and external frictions, and assist ethical challenges, organisational ethics has become a crucial tool and a subject of research.

An organisation's ethical culture is the synergy of explicit and implicit values that underlie and are expressed by the interactions and actions of the employees. With this, they formalise respectful, transparent, fair, and equal treatment of all employees and prevent wrongdoing, favouritism, and abuse of power. A well-defined ethical culture is characterised by proper feedback and guidance mechanisms, helping employees reflect on personal potential and allowing for optimal work life balance.

Ethics are increasingly crucial in organisational contexts for several reasons. There are more significant consequences on society as businesses have become increasingly multinational, and as organisations have consequently grown in scale and scope. These same factors result in greater competition with other organisations and wider communication networks.

Work has also become a more integral part of people’s lives. Employees define themselves in terms of traits and characteristics, but an important part of the way they see themselves is related to the way they interact with others and, more importantly, to the groups they belong to in the organisations. Thus, when belongingness is salient, individuals define themselves according to the attributes of the group and working in an organisation then becomes a part of individuals’ self-concept. Individuals are motivated for the self-concept to be positive. The moral component of behaviours in organisations is particularly important as companies are increasingly sensitive to ethical and unethical issues and, consequently, more sensitive to ethical and unethical conduct.

Designing and managing an organisational environment that is supportive of ethical conduct is nowadays obligatory. Different interventions have been suggested to improve ethicality in organisations, which can generically be classified into two groups: focused on the unethical employee itself in reducing unethical behavior, and on acting on the organisation’s overall climate.

We can think of reducing unethical behavior through the provision of ethical role models, monitor employees, and rewarding ethical behaviour. Besides, to improve the ethical climate, organisations should focus on the improvement of communication, provision of training on ethics, and empowering employees. The latter, especially, will help the company attract more employees, retain workers and improve initiative taking.

Promoting ethical behaviour while dealing with and reducing unethical behavior, from both leaders and employees, is one of the biggest challenges of organisations nowadays.

However, resolving ethical problems must be done across the organisational structure and culture and due diligence must be carried out to measure how well it is going and how much it is contributing to the social good. It could be practical within certain constrains of time to pursue multiple solutions at once. Examining the organisational hierarchy whether it has chain of command that impinges ethicality from growing is also necessary.

Can employees voice their concerns without destroying their career? Is there an environment that cultivates professional, ethical values, or are there formally established dissent channels and frameworks to express concerns or any perceived misconduct?

Implementation of organisational ethics through the establishment of shared values and norms, respect and integrity and responsible professional actions, are crucial to the success of organisations.

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PUBLISHED ON Jan 07,2022 [ VOL 22 , NO 1132]

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