What is the meaning of ‘‘Corporate Ethics’’?
The word ethics comes from the Greek word ethos, which indicates a person’s underlying outlook on life. It can be defined as a moral philosophy that tries to organize moral judgments. Ethics is a code of conduct that applies to everyone in the company, regardless of their position, amount of authority, and scope of authority. Ethical behavior and endeavors refer to behaviors that are marked by honesty, righteousness, integrity, morality, and excellent management practices while generating profit for the company. A written code of ethics describing the norms, laws, and expectations for all stakeholders should be formed by every firm. This code of ethics must be thoroughly communicated throughout the business in both formal and informal means while also ensuring that guidance and assistance are available in the event of ethical challenges or insecurities.
Implementation of ethics
The corporate world’s most significant business obligation is to build, install, and nurture business cultures based on values and principles. This may be accomplished by paying attention to four key factors.
Leadership must establish common and shared core values, such as honesty, respect, sense of responsibility, justice, empathy, and compassion, which must be the driving force behind organizational decision-making.
The company should have a clear and shared vocabulary that all employees can comprehend and use to communicate even the most sensitive or difficult matters. This is the language of ethics, which must be thoroughly embedded in the infrastructure of the business.
As the ethical culture gets deeply embedded, leadership commitment to the efficient, effective, and purposeful administration of the ethical program, as well as rewarding personnel who follow the ethical policies, strengthens the program.
Overcoming the challenges that may arise with confidence that procedures and policies are followed to the advantage of all stakeholders and the company, while neither leadership nor employees are frightened or stressed by the issue or decision-making options available.
Theories of Ethics
Four theories of ethics are widely applied in the corporate world :
The Utilitarian Approach: The utilitarian perspective mandates that the primary decision should be the one that will be most beneficial and least damaging to the greatest number of people concerned.
The Rights Approach: The rights method assesses the level and scope of rights that each party has over a choice, as well as who has the most sway over the others.
The Common Good Approach: The common good method proposes that the community’s resources and benefits be directed toward the entire community.
The Virtue Approach: The virtue method focuses on the virtues and desirable attributes of the person acting, as well as how he or she might achieve their full potential.
When reviewing and considering various approaches, scholars, researchers, and professionals must keep in mind that each has its own set of strengths and weaknesses. In the review process, one must keep in mind that not everyone will agree on what is damaging and what is useful; people from various places and backgrounds have different ideas, rights, and values; and everyone does not have to agree on the same set of shared goods and benefits.
Factors such as increased competition, profit and return on investment pressures, political corruption, values and morals not valued by younger generations, the expectation of quick money and profits, and a disregard for social responsibility, honesty, and integrity are all factors that inhibit ethical intentions and behavior.
Sources and references : The role of ethics in 21st century organizations by Brimmer, S. E. (Leadership advance online, issue XI)