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Managing ethics - Coggle Diagram
Managing ethics
Codifying ethical standards
The
code of ethics
identifies the
standards of ethical behaviour
that all e
mployees need to adhere
to in their decisions, actions and interactions with the stakeholders of the company
All ethical performance will be measured against the company's code of ethics
Two types of Code of Ethics
Directional Codes
(Compliance strategy)
Negative and prohibiting tone
Sanctions/permits/allows
Rule based
Strengths
Easy to enforce
Identify consequences for contraventions
Specific clear guidance
Specific guidelines of what is expected: Very clear and prescriptive
Weaknesses
Tends to be long and difficult to remember
No discretion
Aspirational Codes
(Integrity strategy)
Identify ethical values to live up to
Apply discretion
Strengths
Not, confusing, less detail
Respect for maturity and discretion of people
Concise, easy to recall
Value based
Weaknesses
Vague; no specific guidelines
Hard to enforce: no consequences for contraventions
Broad guidelines to guide behaviour: Less directive
Limitations to Code of Ethics
2) One needs skills to use the code of ethics
Training necessary
3) May silence other views
Debate on ethical matters
1) Hinder development of Moral Autonomy
Do not develop moral sensitivity
Need regular debate and case studies
Ability to think independently
4) Counter Productive
Manipulation by management
Implementation of the code:
Launch:
Undersigning by all staff members
Signed in contract by new appointees
Training:
Introduce with case studies
Positive behaviour rewarded, negative behaviour punished
Commitment by top officials in organisation
Communication:
Regular communication after implementation
Consequences for contraventions spelled out
With development - consultation, negotiation and participation
Institutionalising ethics
Institutionalising ethics
means that the code of ethics is translated into organisational practise
This occurs on two levels in the business:
The strategic level
This must be communicated to all stakeholders
The
BOD
must also decide on a strategy for managing ethical performance
Compliance Strategy
How?
Monitor ethical performance of employees
Discipline transgressors
Reward Compliance
Why?
(Motivation)
Prevent unethical behaviour
About
Emphasis on prohibiting unethical behaviour
Code:
Standard of measuring ethical performance
Directional code
Disadvantages:
Breed mentality of 'what is not forbidden is allowed'
Dis-empower employees from using own discretion
Too many rules to be remembered
Integrity Strategy
About
Ethical behaviour= competitive advantage
Realise ethical behaviour is of strategic importance
Value based- Aspirational code
How?
All members jointly responsible
Not imposing; rely on employee discretion
Why?
(Motivation)
Promote ethical behaviour
Disadvantages:
Greater discretion granted can be abused and lead to increased unethical conduct
Fuel moral disputes
Depend on management for tone
Example
Assume Ethical values= corporate identity and priorities
The
BOD
must commit the company to the code of ethics
The systems level