Ethics in Corporate America
Ethical v. Unethical, Compare & Contrast
The organizational performances of companies who deal with unethical business as opposed to companies who have leaders who consistently behave in an ethical manner have significant differences. One must, first, take into consideration how ethics are looked at as it pertains to the business community. Because terms dealing with the ideal behavior of leaders are used so loosely, it is helpful to define what these terms have generally come to mean in the business community. Ethics is the study of moral obligations, or of separating right from wrong. Ethics can also be a plural noun meaning the accepted guidelines of ...view middle of the document...
It is clear that the ethical behavior of the leader has a clear effect on the employees within the company. Therefore, it is of utmost importance that the leader is actually one who will consistently have a positive effect on the organization.
Consequences for Unethical Leaders
Modern organizations have been characterized as morally complex environments that impose significant ethical demands and challenges on organizational actors. Researchers have suggested that to meet these demands individuals require high levels of character in order to promote ethical behavior (Hunter, 2003). History shows, however, that many times leaders are unable to meet these high levels of character and often fail at behaving in an ethical manner. The book highlights extremely wealthy leaders, who were still willing to behave in an unethical manner, such as Steve Jobs and Martha Stewart amongst others.
When leaders behave in an ethical manner, communicate the importance of ethics, and use punishment and reward systems to encourage ethical behavior, group norms of acceptable behavior and employees in a work unit will be less likely to engage in unethical behavior (Mayer, Aquino, Greenbaum & Kuenzi, 2012). The same can be said for the opposite, when unethical behavior becomes a part of the group norm the unethical behavior can be ignored and create a vast amount of problems for the organization. If employees feel as if they will not be punished for any of their unethical actions, they will continue to pursue the unethical behavior until it is possible for it to go unnoticed. Importantly, employees might not be the only ones who benefit from engaging in unethical behavior. Rather, in organizations, the interests of leaders (i.e., managers) and followers are often aligned (Hoogervorst, Cremer & Dijke, 2010).
One of the main consequences that organizations have to deal with when an abundance of unethical behavior to occur is the disdain that they will receive from the public and how that has the possibility of effecting the brands that belong to the company. A public figure such as Martha Stewart is an example of how a whole company can find themselves in trouble when unethical conduct becomes a product. Stewart was convicted and had to serve time as well as be on house arrest for the unethical activities that she chose to engage in.
Social Responsibility and Organizational Performance
There are several methods for a leader to be ethical and to display that within their organization, one of the more effective ways would be to incorporate a corporate social responsibility program. Ethics and social responsibility relate to the goodness or morality of organizations, but social responsibility relates to an organization’s impact...