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A Dialogue on Ethics in Organizations University of Wisconsin – Stout Julie A. Paleen Aronow Introduction Ethics – A Working Definition Multiple Ethical Lenses Business Ethics HRD’s Current Focus Ethical Dilemmas The HRD Call Ethically Led Organizations Ethics – A Working Definition Ethics is the study of individual and collective moral awareness, judgment, character, and conduct. Petrick & Quinn (1997) Multiple Ethical Lenses The Utilitarian Approach • The action resulting in greatest benefits and least harm. The Rights Approach • The action that respects the moral rights of everyone. The Fairness or Justice Approach • The action that treats everyone in the same way; does not show favoritism. Ethical Lenses The Common-Good Approach • Members of the same community in which social systems, policies, practices support shared goals. The Virtue Approach • There are ideals toward which we ought to strive which provide the full development of our humanity. Velasquez, Andre, Shanks, Meyer (2003), Applied Ethics, Santa Clara, University Business Ethics Business Ethics is the study of conflict between: • • • economics and values, competition, commerce, and capitalism, morality, integrity, and responsibility. Business ethics is the examination of values and the way values are carried out in the workrelated systems. Hatcher, (2002) Two Views of the Organization An Organization’s Primary Responsibility Is To: SHAREHOLDERS • The business of business is business. • Shareholder return is paramount. STAKEHOLDERS • The business of business is to meet the needs of a wide range of stakeholders. • Community return is paramount. Business Dilemma “The more stress we put on our organizations the more their tendency will be to revert to their most primitive behaviors.” Peter Senge (1997) The fact is, a company with a myopic goal of making as much money as possible, or responding solely to the capriciousness of Wall Street…is capable of harming more than itself. Winstanley, Woodall (2000) ROI Versus ROC Return on investments: do the benefits out weigh the costs? It’s a balancing act Profits Delighted Customers Return on Culture: do the business decisions support the espoused values of the organization? Interdependent Team Environment HRD’s Current Focus Contemporary HR has taken the focus away from ethics, towards issues such as strategy and effectiveness, while at the same time creating the conditions which make ethical exploration more urgent, as new ethical concerns and dilemmas emerge. Winstanely, Woodall (2000) 2003 SHRM/ERC Survey 24% - feel pressured to compromise ethics standards all the time, fairly often, or periodically. WHY? • • • • • need to follow bosses directives – 49% need to meet overly aggressive objectives – 48% need to help the organization survive – 40% need to meet schedule pressures – 35% want to be a team player – 27% Doing the Right Thing According to a 2000 study of workers’ attitudes toward workplace ethics, 90% of American workers say they “expect their employers to do what is right, not just what is profitable.” Ethics Resource Center (2000) Ethical Dilemmas True Stories It’s yearend and a manager’s sales figures are just short of making the larger bonus….he asks the finance director to fudge a bit on the numbers…just this time. (CFO, large retailer) A qualified candidate is interviewed for an open position, but it is suggested you hire a less qualified friend of the boss. (Recruiter, local financial services firm) Ethical Dilemmas An entry level accountant is having difficulty on the job, six months go by and she hasn’t received any feedback. She thinks things must be okay. The manager is so frustrated and tells you he’s “lost confidence in her. She needs to go.” (HR Manager, regional accounting firm) Ethical Dilemmas You’re meeting with a well-known consultant regarding an engagement with your organization. In the meeting, she shares sensitive information about someone at another firm. You’re uncomfortable but your boss wants to hire her. (HRD, regional knowledge management firm) Ethical Dilemmas Information Technology staff member is asked to monitor an employee’s internet and email usage to “see what’s going on.” (IT Director, law firm) A director delays annual performance evaluations and compensation reviews for his staff because he feels unfairly treated. (Finance Director, Professional Services firm) HRD’s Purpose is to… Enhance the organization’s strategic initiatives through: • • • • • • • • Employee Development Compensation designs Recruitment and Selection HRIS management reporting Employee relations consulting Diversity initiatives Executive Coaching Leadership Development The HRD Call The task is to “prove that HRD should be central to the creation of ethical and responsible organizations…to date, HRD’s contribution to ethics and the social responsibility of our organizations appears trivial.” Hatcher (2002) HRD Comparison View One “At the Table” A business partner Aligned to business goals Fingers on the pulse ROI Civic minded View Two “Respected Advisor” A leader & strategist Co-Architect of business goals Creator of the pulse ROI and ROC Social activist A Crisis In The Workplace Manufacturing Plant 450 Employees Average Pay: 22.00/hr. Decision to move to Mexico Average Pay: 3.00/hr. Rationale: Good business decision This is not a question of ethics! It’s a business decision. Ask Questions • What benefits/harms will result? • What are the moral rights of affected parties? • Which course of action limits favoritism? • Which course of action advances the common • good? Which course of action respects individual virtues? Ethically Led Organizations Open up the dialogue – inclusive Ask the employees for solutions Focus on the long term versus short term gain Reward “doing the right thing” behavior Share the pain – Share the gain Model ethical behavior Own results Promote people who exemplify integrity and have a social conscience Live stated values HRD Professionals Can Create Personal Values Statement Employ better than best practices Act like people are our business Model ethical behavior/decision-making Promote change management practices Create venues for open dialogue Create atmospheres of trust Refuse to buy into “If it’s not illegal, it’s okay” thinking Be honest when the organization’s DNA is skewed A Call to Action Are ethical organizations your responsibility? If so, Embrace the challenge!