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Management Ethics


Accordingto Grojean(pp 224), ethicaldecision making involves makings decision that will elicit moralimplication to the parties involved. It is the duty of the managementof an organization to ensure that ethics is upheld because they areaccountable for every operation of the organization. Managers canpromote ethical practices in the organization by establishing rulesand guidelines to prevent employees from violating ethical conduct.The managers should train employees on ethical conduct in addition tomonitoring them to ensure they are meeting the expectations of theemployees. Promoting ethical practices requires a holistic approachfrom the managers of every department and involving the employees.

ThisResearch paper examines management ethics and its impact on theorganization.


Ethicalbehavior can be used as a tool for boosting the competitive advantageof an organization. One of the major benefits of ethical practices isthat it enhances the corporate image which is a form of intangibleassets. A positive corporate image is important for increasing thebrand equity which helps to increase customers’ loyalty and attractmore customers to the company. Organizations with good reputationexperiences low employees’ turnover, which is important formaintaining a high level of productivity (Cummingspar 3). Generally, focusing on ethical practices promotes a goodrelationship between the organization and various stakeholders thatare pertinent to the success of the organization. For instance, acompany with positive corporate image attracts more investors andthus puts the share price constantly high in addition to being in asound financial position.

Onthe other hand, engaging in unethical decisions can significantlydamage the reputation of the organization. Apart from the reputation,some unethical practices can lead to lawsuits which can lead tounnecessary expenses and can make the company incur huge losses.

Therole of management in promoting ethics in an organization

Managementplays a major role in promoting ethics in the company. The managementshould lead by example in order to influence other employees also tobe ethical in their working with the company. It is the duty of themanagement to uphold the rules that are set to guide every process ofthe organization so that other staffs can follow the same. Themanagement should ensure that all the employees adhere to the setrules and regulations in the organization. This can be achieved byhaving measures to monitor the performance of the employees in theorganization. Managerial ethics is the setting of principles andrules to be used in an organization in order to ensure that theemployees are always doing what is right. According to Cummingset al (par 2),it is the responsibility of the management to ensure that all thedecisions made by the organization have moral implication to thestakeholders. Although decision making is based on individuals’judgment, an organization should have a structure that promotes moraljudgments about right and wrong.


Communicationis important for inculcating ethics in the organization. Organizationshould have effective organizational communication channels that willhelp to promote open and honest communication for good relationshipsbetween the employees. Promoting transparency helps promoteinclusiveness which is important for effective decision making.Managers of the different department should come together and workwith their respective employees to uphold the required ethicalstandards. However, the human resource department should ensure thatthe right people are joining the organization and also providetraining to new employees on ethics. Communication is also importantfor passing the right information to the external stakeholders of theorganization such as customers, suppliers, government andcommunities` representative. When interacting with the externalstakeholders, the managers should take the opportunity to explainsome of the decisions that have been made by the organizationespecially based on the ethical angle (Michaelet al pp233).The managers are also mandated, in collaboration with other leaders,to restructure and implement new ethical codes. In case the decisionmade by the organization has been misinterpreted, the managers shouldtake responsibility for communicating the right information to thestakeholders using different media such as radio, television andsocial media.


Organizationalculture also influences the decisions and the general operation ofthe organization. Organization should promote a culture that isfocused on promoting effective communication and engaging in ethicalpractices. According to Weaver and Linda (pp 127), organizations withpowerful organizational culture enjoy good relationships and ensurethat the employees are focused on achieving the objectives of theorganization. A good example of how weak culture can push anorganization to engage in unethical practices is the emission scandalthat faced Volkswagen in 2015 (Lee Spectrum Organization, par 2). Because of the weak culture that did not promote openness and goodrelations, when the mistake occurs on the engine designs, theengineers were forced to improvise an unscrupulous way of coveringthe mistake. The engineers decided to install a software system onthe engines that will help the engines to pass the test during theCO2 testing. According to Lee Spectrum Organization (par 5),Volkswagen had a weak organizational culture that did not give roomfor errors, and the engineers had no powers to challenge the decisionmade by the management.

Communicationis important for promoting the values that are set by theorganization. The employees should also be involved in thedecision-making process in order to make them feel part of theorganization and rally behind the decisions and projects laid by theorganization. Effective communication helps to provide a goodplatform for sharing and finding the solution for any problem thatmay face the organization. Employees form an important part of everyorganization thus, it is important for the management to engage theemployees in every decision made.


Engagingin ethical practices is important for promoting the image of anorganization and can be used as a competitive tool. Upholding ethicalpractices requires a holistic approach from both the management andemployees. The human resource management has a significant rolebecause it bears the responsibility to hire the right people to workin the organization in addition to the formulation of rule andregulation for guiding employees. Top members of the organization whoinclude the Chief Executive and the board member and all theemployees should be undertaken through ethical training. Ethicalpractices should be upheld in every department of the organizationincluding marketing, finance, and human resource department. Failureof one department to observe ethical behavior can dent the image ofthe whole company thus ethics is a subject that requires a combinedeffort from all the leaders in the organization.


Cummings,Thomas G., and Christopher G. Worley. Organization development andchange. Cengage learning, 2014.

Grojean,Michael W., et al. &quotLeaders, values, and organizational climate:Examining leadership strategies for establishing an organizationalclimate regarding ethics.&quot Journal of business ethics 55.3(2004): 223-241.

Weaver,Gary R., and Linda Klebe Trevino. &quotThe role of human resourcesin ethics/compliance management: A fairness perspective.&quot HumanResource Management Review 11.1 (2001): 113-134.

LeeSpectrum Organization. Engineers, Ethics, and the VW Scandal. (2015) http://spectrum.ieee.org/cars-that-think/at-work/education/vw-scandal-shocking-but-not-surprising-ethicists-say.Accessed November 23, 2016.