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The purpose of this essay is to discuss whether an ethical manager is someone who identifies and effectively manages ethical dilemmas within an organization. To better understand the purpose of an ethical manager within an organization, the concept of ethics needs to de defined and understood. Ethics in organizations and businesses involves identifying what is right or wrong within an organization and then determining to do the right thing.
The concept of business ethics has began to be a common practice in most organizations as many managers try to ensure that their employees are doing the right thing in the workplace. Organizational ethics are important to every organization as they provide the necessary foundation for business operations and systems. The modern concept of business ethics is based on individual and collective judgement on what are proper business ethics when it comes to conducting business transactions and activities.
Business ethics encompasses social factors, environmental factors such as technology, economy and political issues, sustainability, the effects of globalization on the company, the society and the well being of employees.
The role of the ethical manager in an organization is to ensure that business ethics are observed within the organization especially during times of fundamental change such as economic downturns, mergers and acquisitions, bankruptcies or foreclosures. Such periods of fundamental change are usually marked with the questioning of the organization’s values and beliefs with some of these values being abandoned.
There is usually no moral compass that can be used by organizational leaders and managers during such times to ensure that complex dilemmas that are right or wrong have been identified and dealt with. Attention to business ethics in the workplace ensures that managers and employees have been sensitized on how they should act ethically during times of crisis or confusion. The role of the ethical manager therefore becomes to manage ethics within an organization or business setting (Samson & Daft, 2009).
The Role of an Ethical Manager
Most organizations and companies around the world do not recognise the need of having an office for an ethical manager as their job tasks are viewed to be similar to those of human resource managers. The role of ethical management is usually allocated to the human resource or personnel manager as they have the appropriate training and experience to manage ethical dilemmas within organizations. During times of fundamental change or ethical dilemmas, the human resource managers are also referred to as ethical managers.
Companies that practice ethical management will determine the role of an ethical manager depending on the size of the organization as well as the part time or full time functionality of the roles. Large organizations have the ability to make the role of an ethical manager to be permanent or long term in nature while small organizations lack the financial capacity to have a full time ethical manager (McNamara, 2010)
The general role and responsibility of an ethical manager is to effectively resolve ethical dilemmas that are faced by an organization. The ethical manager is trained on how to recognize and identify ethical dilemmas within an organization and how to differentiate between what is right or wrong.
There are various ethical dilemmas that are faced by an organization and examples of such dilemmas include excessive profits made by a company within one financial year, greed by corporate managers, exploitation of employees, manipulation of people’s feelings, coercion or inducement of employees by managers within an organization, unnecessary waste of company resources, invasion of privacy, nepotism where the employment of family members and friends is favoured, favouritism when it comes to financial deals or affiliations, reckless use of authority and negligence, betrayal of trust to gain a business deal, the marginalization of certain groups within the workplace and conflict of interest.
There are vary many ethical dilemmas that face organizations around the world and the above examples are but a few of these ethical dilemmas (Chapman, 2010).
The responsibility of the ethical manager therefore becomes to handle such dilemmas effectively reducing any negative impact on the organization. The ethical manager is charged with the responsibility of ensuring that preferred behaviours have been achieved within the workplace.
This is done by developing codes of ethics, policies and procedures that incorporate the ethical values of the organization that will be used in ensuring the desired behaviours have been incorporated within the organization. Apart from developing the code of ethics as well as the code of conduct, the ethical manager has the responsibility of ensuring that ethical dilemmas do not occur within the workplace (McNamara, 2010).
The major purpose of any ethics program is to ensure that ethical dilemmas do not occur in the work place at all. Codes of ethics and codes of conduct ensure that ethical dilemmas do not occur as they sensitize employees on how they can minimize cases of unethical behaviour within the organization. The role of the ethical manager also involves the integration of ethical management into the management practices of the organization.
This means that when developing ethical values for an organization, the ethical manager will have to incorporate the value statement during strategic planning activities as well as personnel policy development activities. Ethical managers are generally charged with the role of managing the ethical activities of an organization as it conducts its business operations.
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This will involve conducting ethical management activities such as formulating codes of ethics and conduct, identifying what is right or wrong within an organization and identifying the necessary behaviours that need to be achieved by employees to ensure there is successful ethical management within the organization (Gensse, 2006).
Ethical Managers and Ethical Dilemmas in Organizations
As stated earlier, various organizations face different types of ethical dilemmas during the course of their operations. Some of these dilemmas as stated earlier in the essay include nepotism and favouritism in the work place, dishonesty, negligence on the part of managers or people in positions of authority, invasion of privacy, marginalization of specific groups, coercion or inducement and the manipulation of employees do perform duties that are unethical.
The ethical manager receives training on how they can be able to identify and resolve such dilemmas effectively to reduce any negative impacts on the organization (Renz & Herman, 2010).
Large companies and organizations have begun to invest in ethical management to ensure that their corporate images have been promoted and kept clean. The increasing rate of globalization has increased the risk of some of these organizations acting against government regulations and their own codes of ethics. As more companies seek to increase their profits and company portfolios, business ethics at times takes a back seat as companies increase their profit earning activities.
Most managers rarely consider business ethics when they are presented with an opportunity to make excessive profits in way that is deemed to be unethical. For example a manager might sacrifice some employees to make a profit or they might betray confidential secrets of the business to gain a competitive edge over their rivals. The dilemma for an ethical manager in such a situation arises when they are faced with the task of identifying whether such behaviour is right or wrong (Renz & Herman, 2010).
While ethical management describes the role of a manager as that of identifying and resolving ethical dilemmas in an effective and efficient way, such activities become difficult when the financial survival of the business is dependent on unethical behaviour. The role of the ethical manager in such a situation becomes difficult as the future survival of the organization is tied to how many unethical activities the organization is involved in.
Organizations might have well developed structures and functions that support business ethics but external factors such as economic situations, political issues and technological innovations influence these structures and functions forcing managers to engage in unethical practices to ensure for the survival of the business in such environments (Garsten & Hernes, 2009).
Ethical management therefore becomes a difficult activity to perform in such circumstances and the role of the ethical manager becomes difficult when it comes to identifying the right and wrong ethical practices of an organization.
Managers of large organizations are charged with the duty of viewing ethical management activities as important because they provide approaches that can be used in dealing with dilemmas so as to reduce ethical complexities within the organization and reduce ay damage to the organization’s corporate image (Garsten & Hernes, 2009).
Business Examples of Ethical Management
A well known example of a company that engaged in unethical behaviour and misconduct was Enron. The managers at Enron engaged in fraudulent activities and unethical behaviour in the pursuit of higher profits and revenues. Enron promoted a culture of competitiveness to its employees which saw it achieving considerable success and recognition from business analyst.
The company was however experience negative earnings during this time which forced the chief executives at Enron to be unethical to their shareholders and investors by lying about the financial performance of the company. The managers developed questionable accounting methods and engaged in deceptive partnerships that were meant to maintain the investment grade status of the company (Sims, 2003).
The executives were convinced that they were doing nothing wrong by arguing that their underhand dealings were for the good of the company which was evidenced by their conflicts of interests with business ethics, their various limited partnerships with organizations such as Blockbuster and the hiding of debt from the company’s balance sheet (Sims, 2003).
While many business analysts viewed what the Enron executives did to be wrong, the question of ethics emerged when they performed premature bookings of the company’s earnings to save the image of the company which was that of success and competition.
The managers and employees of Enron were used to being the best in the industry and having business dealings that failed would be a poor image for the company. The managers therefore resulted to making early book earnings to show that the company was making successful deals. Such a culture eroded the ethical behaviour of the organization (Sims, 2003).
The case of Enron is a perfect example of unethical behaviour and ethical dilemmas that face managers and organizations in general. For an ethical manager working in Enron during that period, the ethical dilemma in such a situation would be whether to inform the shareholders and investors of the underhand dealings of the managers or to keep quiet and pretend all was well in the company.
While many might argue that the best alternative would have been to disclose the ethical malpractices of the company, the task of the ethical manager would have become difficult when faced with the Enron executives and managers who were determined to keep the financial state of the company quiet.
The essay has assessed the aspect of whether an ethical manager is someone who can identify and effectively manage an ethical dilemma. While many organizational theorists might agree with this statement, the different aspects and issues of organizations might muddy this view given the changing business environment that continues to pose major threats on the operations of a business.
The role of an ethical manager becomes difficult under certain circumstances especially where senior executives and managers participate in unethical behavior, making it difficult or next to impossible for the ethics manager to perform ethical management. It therefore falls on company regulations and carefully formulated codes of ethics to ensure that the ethical manager can be able to restore proper business conduct in the organization.
Chapman, A. (2010). Ethical leadership, decision-making and organizations. Retrieved from: https://www.businessballs.com/leadership/corporate-responsibility-and-ethics/
Garsten, C., & Hernes, T. (2009). Ethical dilemmas in management. New York: Taylor and Francis.
Gensse, C. (2006). Ethical management: efficient management, time to change paradigm. New York: Lulu Inc.
McNamara, C. (2010). Complete guide to ethics management: an ethics toolkit for manager. Retrieved from: https://managementhelp.org/businessethics/ethics-guide.htm
Renz, D., & Herman, R.D. (2010). The jossey-bass handbook for nonprofit leadership and management. San Francisco: John Wiley and Sons.
Samson, D. & Daft, R. (2009). Fundamentals of Management, 3rd edition. Australia: Cengage Learning.
Sims, R.R. (2003). Ethics and corporate social responsibility: why giants fall. Westport, Cincinnati: Greenwood Publishing Group.