Business Ethics

Definition of Ethics

Ethics is defined as the moral responsibility of people that governs their behaviour or the way that they conduct of any activity. In other words, ethics is a system of moral principles that is concerned with what is considered good for the individual and the society. (The following image captures Ethics principles quite well)

Ethics vs. Morals

Many people use the terms ethics and morality interchangeably. As discussed above, ethics is the moral responsibility of people that governs their behaviour or the conducting of an activity. Morality is a system of rules that guide human conduct and principles for evaluating those rules.

To have an ethical viewpoint, you should have a reason for it.
Therefore, Ethics = Morality + Reasoning.

Determinants of Ethics

There are many sources from which ethical standards arise, for example:

• Law
• Time
• Society
• Religion
• Individual
• Knowledge

Positive consequences include:

• Feeling good
• Creating credibility
• Safeguarding the society
• Satisfying basic human needs, etc.

Negative consequences include:

• Crimes
• Corruption
• Loss of trust
• Nepotism/ favouritism

Ethics in Public & Private Relationships

Private relationships largely involve relations with friends and family; thus, the structure of the relationship is usually informal in nature. Private relationships are often driven by emotions and not by reason or logic. This can result in unethical practices. For example, helping your friend cheat in an exam.
Public relationships involve relations which are formal (legal) in nature. This can include: co-workers, government officials, or strangers. There can be legal or social obligations as well.

Ethics in Public Relations can come into play at:

• Political Ethics – constitutional ethics, national interest etc.
• Social Ethics – tolerance towards other sections, peace and harmony etc.
• Organisational Ethics – impartial, honesty, hard work, corporate governance, efficiency, etc.
• International Ethics – diplomacy ethics, respecting international treaties etc.

Why is Ethical Behaviour in the Workplace Important?

Ethical behaviour in the workplace can stimulate positive employee behaviours that lead to organizational growth. Unethical behaviour in the workplace can inspire damaging headlines that lead to organizational demise.
All organizational stakeholders enter into a relationship with a business for that business to protect their interests in a specific way. Therefore, there is a mutual expectation that stakeholders and business organizations act in an ethical manner and in each other’s best interest – ‘Scratch my back and I will scratch yours!”
A decision to act unethically, by the organization or a stakeholder, can strain the relationship and damage the reputation of the organization. The increased risk of reputational damage and harm from negative headlines is often the ‘kick-start’ for an organization to promote and encourage ethical behaviour and prevent and report unethical behaviour.
Also, many individuals are connected to social media with technology, therefore, the risk that unethical behaviour will cause reputational damage to an organization is arguably much greater than in the past. Any form of ethical or unethical behaviour is now easily recorded on video, captured in photos, shared online and propelled into headlines and it can be uploaded either LIVE or within a few minutes of it happening.
However, there are many positive benefits of ethical behaviour in the workplace apart from avoiding harm to a business’s reputation. An organization that is perceived to act ethically by employees can realize positive benefits and improved business outcomes.
The perception of ethical behaviour can increase employee performance, job satisfaction, organizational commitment, trust and citizenship behaviours. Organizational citizenship behaviours include altruism, conscientiousness, civic virtue, sportsmanship and courtesy.

What can organisations do to encourage ethical behaviour in the workplace?

Organizations can take positive steps to create a good narrative around their reputation by implementing measures that help ensure ethical conditions and perceptions of organizational support are present in the workplace.
Many organizations implement reactive systems to report unethical behaviour. However, the single most important thing organizations can do different to promote ethical behaviour is to implement a proactive employee voice system and use voice of the employee tools to proactively give employees the capacity to be heard.

Voice of the Employee Systems that effectively promote ethical behaviour and encourage reporting unethical behaviour meet five key criteria:

• Correctness: be well-administered and include follow-up to complaints
• No Punishment: be free of retaliation – all employees must be protected
• Accessibility: be easy to use, widely promoted, accessible to all employees
• Elegance: be easily understood, applicable to the entire organization and all employees and effectively diagnose issues
• Responsiveness: be timely, responsive, be used by management, show results

The challenge is that many organizations implement Voice of the Employee Systems with good intentions; however, the Voice of the Employee tools used are not effective. Voice of the Employee tools, like interviews and surveys, that proactively seek to uncover and stop unethical behaviour should be conducted:

• Using Open-Ended Questions: this will help to ensure that all possible issues are uncovered. Voice of the Employee efforts should focus on asking an openended question about awareness of compliance issues. Closed-ended questions do not provide the ability to uncover all possible issues or all details to understand issues.
• Externally: to ensure accuracy, the research should be conducted through an independent third-party to remove biases and remove barriers to employees feeling so they can express their true perceptions related to unethical conduct in the workplace. When conducted internally, it’s likely that true perceptions aren’t revealed because employees aren’t being honest with the organization. Employees may not want to risk burning a bridge or disappointing a manager. When conducted externally, data is systematically collected and thoroughly reported.
• Using Mixed Methodology – Asking “Why?”: to obtain detailed reasons for perceptions of unethical behaviour, it is critical to use a mixed methods research instrument that asks “why?” in an open-ended, qualitative manner to avoid limiting the scope of what can be learned from each individual employee. Third-party researchers can offer high-quality telephonic interviews and web interviews that capture in-depth qualitative responses in a systematic manner. In asking fewer open-ended questions, specifically following up to ask why the participant perceives unethical behaviour, you obtain in-depth data and reveal the root causes of perceptions.
• Systematically: to track trends and progress, data should be systematically captured for use in subsequent data collection and analysis. External research uses a consistent question set, data collection technology and a dependable methodology to capture responses in a reliable system to facilitate future reporting and analyses. This information can then be analysed to identify issues that might exist in specific employee segments, departments, job groups or even certain supervisors.

Ethical Workplace Behaviours

• Obey the Company’s Rules & Regulation: At the start of an employee contract, companies may need the employee to sign various documents, including the company rules and regulation agreement form. Also, the employee may be given a handbook that may serve as a guide. Examples are, tardiness, inappropriate dressing, and language, etc.
• Communicate Effectively: Effective communication is very important to avoid misunderstandings when dealing with issues in the workplace. Communicating effectively may mean different things to people at different points in time.
• Develop Professional Relationships: Good professional relationships are not only a thing that fosters teamwork among employees, but also help with individual career development for employees. Developing professional relationships with co-workers or other professionals outside the workplace will also directly or indirectly improve productivity. Professional relationships between low-level and high-level employees will make it easier for ideas to be shared and knowledge to be passed to junior employees.
• Take Responsibility: It is important for employees to always take responsibility for decisions made both individually and in a team. This is, in fact, a leadership trait that every employee who is looking to take up a managerial position in the future should exhibit.
• Professionalism/Standards: There are professional standards that everything an employee does in the workplace. The use of informal words in a formal workplace is highly unprofessional. These standards should be held high and applied to every part of an employee’s activity in the workplace. This should include the way they speak, kind of work they deliver and their relationship with co-workers and customers.
• Be Accountable: Accountability is also a very good trait of an employee. One of the things that may short-change a talented and responsible is the lack of accountability. Lack of accountability may result in your boss thinking you have an “I don’t care attitude” to the company’s project or worst take you as a liar and may lead to job loss in the long run.
• Uphold Trust: An employee should not do anything that may make his or her employee withdraw trust. As an employee of a company, your employee trusts you to get work done perfectly on time. Things like missing deadlines regularly or delivering work that needs to be revised repeatedly will deny you a promotion. It may even leave the employer not giving you tasks to complete in the future—a nightmare for freelancers.
• Respect your Colleagues: It doesn’t matter whether you are dealing with the intern, a junior, janitor, etc. they should all be treated with respect. As a manager, treating your team members with respect will help improve their productivity. Giving constructive criticism and saying kind words to them even when they are not able to deliver perfectly will help them strive to do better in the future.
• Work Smarter: Don’t just work hard, work smarter. The reason why you see an employee promoted to the post of manager after just a short time and a hardworking employee who has been with the company for many years failed to get a promotion is that one of them is probably ‘working smarter’.

Unethical Workplace Behaviours

• Lies: Lying is a trait that is detested in and outside the workplace. It kills trust, affects relationships, and may even put people in trouble. There are different situations where employees lie in the workplace—with just one lie opening the floor for many others.
• Taking Credit for Others Hard Work: It is very common for managers to take credit for their team member’s hard work when reporting to the management. By taking credit for another person’s work, you will be denying the person a promotion, bonus or commendation for a job well done. This will discourage the person from sharing ideas that will benefit the company in the future.
• Verbal Harassment/ Abuse: Employees need to stay away from using foul language on coworkers in and out of the workplace. This is very important when dealing with customers.
• Violence: Like verbal harassment, employees should not be violent when dealing with coworkers and customers. Customers may likely provoke you, but it is better to keep shut and walk away rather than turn violent.
• Non-Office Related Work: A lot of employees have side hustles which they use to supplement salaries. This is very good and only very few companies are against employees working to make money outside work hours. However, some employees still do non-office related work during office hours. Employees who have side hustles should try doing them on weekends or employing other people to handle some of the business logistics to avoid eating into office hours to get the work done.
• Extended Breaks: Companies give lunch breaks to employees and people take advantage of these breaks to do other things outside office work like, go for interviews, meet with friends, or even work on their side hustles. They are free to do whatever they want these lunch breaks. Employees, however, take advantage of these lunch breaks and extend them beyond time.
• Theft/ Embezzlement: Some employees are known for diverting company funds into their bank accounts—padding project quotations, invoices, etc. to deceive the company on how much was spent on projects. This act is detrimental to the company because employees who steal sometimes replace quality products with counterfeits which are cheaper but causes damage in the future.
• Sexual Harassment: Sexual harassment is an offense that is not limited to the workplace alone. An employee accused of sexual harassment will not only face consequences in the workplace but also tried at a court of law. Many companies have a zero-tolerance rate for sexual harassment in and outside the workplace. This may tarnish the company’s reputation and the only way to curb is to make an example of defaulters.
• Corrupt Practices: Some common causes of corruption can be seen during the employment process of an organization. They invite so many people to send their CVs and come for interviews but only people with the same political affiliation with them get the job. This is also common with companies that ask for contractors to bid for a project, but the employees will only give them to their friends who may not even bid at all.

How to solve unethical issues in the workplace?

• Have Rules/Policies in place
• Accept feedback and compliant
• List consequences for unethical behaviours
• Swift justice determinatiokam
• Impose immediate disciplinary action

What is Professional ethics?

Professional ethics are a set of standards that are used for making decisions in the workplace. They are sometimes referred to as the Code of Conduct. Managers use these standards, or Codes, to clarify decision-making when there are gray areas relating to the topic on hand. The use of ethics prevents professionals from taking advantage of other employees or the company. Employees who are ethical build trust and respect amongst others at the company which can lead to more opportunities within the organization.