The Importance of Organizational Ethics

In today’s world, it is all too prevalent to see more and more people hungry to gain success at an ever-increasing rate. Modern culture can and indeed is labelled ‘greedy’ and ‘thoughtless’. Through my relatively short time spent in business, I have encountered many of these types of people. But who are they hungry for? Who benefits from their thoughtlessness, and why do they do what they do? More importantly, who is to blame when things don’t go according to plan? These are all questions asked constantly in the business domain, questions that often seem to include the word ‘ethics’ in their answer.

Whether we look to consequentialism and always consider the outcome of a particular action, or conform to a more deontological form of ethical thinking and focus on always acting in a manner that seems ‘right’, I believe that a person cannot always be ‘ethical’, all of the time. If it were that easy, ethics would be a very small area of study. So what does the word ‘ethical’ mean? To me, it is to take into account every aspect involved in any given situation, peoples’ feelings, thoughts and well-being, both now and in the future, and act as best one can to achieve the most satisfactory outcome for all concerned.

From my viewpoint, acting in an ethical manner comes from each and every individual, each having learned from the environment in which they have grown and developed. Should the judgement, therefore, always be left to the individual? This is certainly not the case, as more and more organisations in the business world develop codes of ethics that they expect each member to follow. This definition and management of ethics can be seen as a control-oriented position. This control paradigm for organisational ethics is largely concerned with extracting the best possible results for the organisation as a whole.

When acting within a certain environment, be it local, national or global, the organisation must be seen to be ‘socially acceptable’. I believe this idea of control of the organisation’s self-interest together with maintaining a good standing in the public eye to be the main factor for preparing these ethical codes. Both of these can only be achieved through clearly defined codes of ethics from which individuals’ roles can conform through a manner of standardisation. However, through the enforcement of ethical codes, people revoke to a basic level of thinking, judgement and acting as identified in Lawrence Kohlberg’s pre-conventional level.

When put simply, it allows little room for individual thought or expression, only rewarding good actions and punishing those that are bad. Can it be right to control tasks that involve ethical reasoning by individuals? This is certainly much different than, say, controlling how someone operates a particular machine. Conversely, the autonomy paradigm, present in some organisations’ ethical policies, is put in place to promote individual critique through their moral thought and judgement.

It emphasises a feeling of a ‘moral community’, seen before in Kant’s work, and from which Kohlberg developed his post-conventional level, that allows people to apply their own reasoning to daily situations. As Durkheim suggests and with which I agree, individuals submit to the environment in which they work and how others have previously cast out norms and values. This applies to general situations and therefore the majority. At other times, in more complex situations, an individual would then be left to choose their own actions.

McMahon identifies that the legitimacy of managerial authority lies within a contract or promise. An employee, therefore, willingly submits to the thoughts and ideals of the organisation when they sign the contract of employment. “That is, the exchange of labour for wages in which employment consists involves a promise on the part of employees to accept the directives of managers. To be sure, employees may be expected to use their own judgement in carrying out the tasks assigned to them. But if a managerial directive conflicts with an employee’s judgement, the directive must take precedence.

Otherwise the employee is attempting to renege on a morally binding agreement” (McMahon, 1989). Whilst this in law is true, I feel that it should be left wholly to the individual’s own moral judgement. What is to say that those who have prepared the code of ethics for a particular organisation are better ‘ethically equipped’ to make the decisions for others? That is to say, why is a senior manager more ethically right than a lower employee? I don’t believe that as a rule he/she is, more they and others responsible for making the decisions would like to think they are.

Yes they may have more experience in their particular industry or even technical and conceptual skills, but that does not make them better suited to exert their moral judgement over another individual’s. Once again, this control is clearly forcing employees back down to a Kohlbergian pre-conventional level. In such free-speaking times as we now live therefore, why do organisations attempt to dictate our thoughts and actions? As I earlier identified, the organisation does not want to be seen to be ‘socially unacceptable’ whilst simultaneously achieving the best possible results.

Therefore, from where do the key decisions originate? Should it be left to the managers to ensure that employees follow an ethical code or should it be left to the individual’s judgement? In my view, autonomy is the generally the best approach as I am a firm believer in individual expression. We have moved from such times as to rule with an iron fist, we should go on from here and not regress. Do many organisations simply issue a code of ethics because it is the ‘done thing’, a reactive gesture rather than a proactive exercise? Is it the case that they are only acting merely not to appear unethical?

This certainly is the case in many organisations in my opinion. What is left to examine is which organisation subscribes to which approach and for what reasons? I consider the major factor in this to be the issue of responsibility. The term responsible is “firstly, sometimes used to mean ‘trustworthy’ or ‘dependable’… second, the term is used to mean ‘obligation’. Third, responsibility is sometimes used to indicate that an action or its consequences are attributable to a certain agent” (Velasquez, 1983). It is this third explanation that I shall focus on. Can corporations have moral responsibility?

This is a question that certainly needs addressing here, and one that has been previously considered by Richard De George. He focused on collective responsibility as it related to organisations, and identified two views, the organisational view and the moralistic view. “The organisational view maintains that moral responsibility cannot properly be assigned either to a corporation, nor to the agents of a corporation when they act as corporate agents. As legal entities corporations can be legally restrained and can have legal responsibility. But they cannot logically be held morally responsible or have moral responsibility.

For they are not moral agents or entities” (De George, 1981). His moralistic view, as he claims, is extremely outrageous. In essence, it states that organisations have moral immunity, whereby an individual could be morally condemned for their actions, they could not if they were pursuing the goals of their organisation. De George lists the example of morally condemning a murderer for their actions, but how “Murders Inc. cannot be faulted from a moral point of view for pursuing its goal, nor can its agents for doing what is necessary to achieve the organisation’s ends.

Whilst this addresses the issue of whether organisations can be morally responsible, it does not answer the question. Therefore, we have to determine whether it is the organisation that acts, the management or the people. “Whenever organisations act, people act, and for every act of an organisation there are at least some acts of individuals such that if these individuals had not performed their acts, and no one else had, then the organisation would not have performed the act attributed to it” (Haworth, 1959).

This quote, in my opinion begins to attribute responsibility wholly to individuals, and thus removes any need for a control-oriented approach. Since the organisation as an entity cannot be held responsible, why then should any body of people seek to control the moral judgement and actions of others? If I am likely to be held accountable for my actions, then I know I want to exert my own moral judgement before acting. Therefore, as it appears to me, it is the actions of the people (be it a manager or a cleaner) that are accountable, and consequently the people who are responsible!

So why do some organisations take this control-oriented approach? I’m sure that with some it is simply to keep the power in their own hands; these people think they need to have power in order to be successful. However, I think a more pertinent reason as to why some organisations take this approach is to hide behind the organisation themselves. Many individuals within organisations are scared of the book stopping with them so they create a ‘code of ethics’ which, in terms of blame, is large enough to hide behind.

Surely then, with the control-oriented approach the organisation should be responsible? On the contrary, with an organisation that employs the autonomous approach, each individual must be responsible for their own actions since they are solely attributable for every part of every move they make. In listing these two types of approaches and the degree of control that they attempt to possess, can it be said of any one organisation that it has successfully adopted a control-oriented or autonomous approach, and that there is no middle ground?

I believe there to be a large scope for contention with any organisation that states outright it has employed one of the two approaches in its entirety. Perhaps the two approaches are simply styles of operating, maybe even ideal? Having looked into the two different styles, therefore, I think that to control someone’s moral and ethical thinking with the ultimate aim to enforce them to acting in a particular way is wrong. Each individual, unless impaired by disability, has the power to determine what is right for them in a certain situation and therefore should have the opportunity to act accordingly.

A person should not be told what to think simply for the corporate ‘good’. “If we are to deter corporate wrongdoing and be assured that corporate members will comply with our moral and legal norms, our blame and punishment must travel beyond the corporate veil to lodge with those who knowingly bring about the corporation’s acts” (Velasquez, 1983). In conclusion, if we as individuals want the power to think and judge for ourselves then we must accept the consequences of our own actions. Organisations should give us this choice.

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