Ethics of Wasta and the Use of Social Capital Report

Introduction

Reflectively, the concept of Wasta involves a contractual agreement between members of an ethnic group with each group having specific obligations on how to treat each other. This analytical treatise will attempt to explicitly review the concept of Wasta and its application in real life. Specially, Wasta’s key similarities and differences are going to be compared between other equivalent occurrences. The first point of interest is the literature review, which will describe wasta and take a look at its roots.

Then wasta will be matched to the related incidents in different cultures, Chinese (Guanxi) and American (Nepotism or Cronyism). Afterwards a case in which a workplace ethical dilemma is going be dissected and operated on. Finally recommendations are going to be offered in an attempt to diminish the harmful consequences of wasta in the business setting. The paper will then provide a comprehensive conclusion on the best approach of implement the wasta without having to harm the business operation environment.

Literature Review

This part of the paper will review various literatures on the concept of wasta and its application in the business environment. The literature review will dwell on the definition of wasta, the types of wasta, and how the business environment may benefit from wasta without having to compromise its sustainability or suitability. In addition, this part will dwell on empirical and comparative studies on the concept of wasta.

“Wasta is an Arabic term that refers to an implicit social contract, typically within a tribal group, which obliges those within the group to provide assistance (favorable treatment) to others within the group”^[1]. There are many ways to define wasta but they all come down to one, which is favoritism.

There are two types of wasta, mediation wasta and intercession wasta. Mediation wasta is to solve tribal issues without resorting to court. For example, if there were any problem between two families they would use mediation to resolve the issue without involving authorities. Intercession wasta is a way to exploit connections in order to get a job. The type of wasta that is most commonly used is the intercession.^[2]

To explain further, even though wasta is commonly used nowadays, there was a time when it was much simpler. “Wasta was used as a means of mediation between families to resolve conflict. The head of the family, tribe or clan acted as the waseet (middleman) to mediate and adjudicate within the tribal group and to negotiate points of conflict with other tribal groups”^[3].

Before the 12^th century, people in the Arab countries resorted to using wasta because it provided means for survival; “The desert climate was harsh, raiding occurred between tribal groups, and there were few formal avenues for conflict resolution”^[4]. Over time, wasta evolved from mediation to intervention. The waseet was no longer needed because people with close relationships could directly go to one another to get wasta.

Wasta is now used to gain an advantage to enter the workplace. According to an article on The National newspaper “wasta gives employers access to students and graduates who stand out, through the recommendations of professors who have spent a lot of time getting to know and teach the candidates”. There are also negative uses of wasta.

Sometimes, people that have been hired by the use of wasta may not perform up to certain standards. Middle East Online states that employees are promoted as a favor from their family even though they do not work properly. Wasta can be used in two ways. Some of the uses are morally or universally acceptable and others are contemptible. As an example, you can compare corruption to networking. In order to see if corruption is bad, we need to limit it to favoritism.

Favoritism is defined in “How Favoritism Affects the Business Climate: Empirical Evidence from Jordan”^[5] as “it is the use of personal connections to receive preferential treatment”. In addition, they also state that favoritism makes state-business relations unfair and unpredictable and thereby raises the risks of investors and the barriers to competition. To elaborate on it further, we can use Jordan as an example.

The success of an entrepreneur depends much more on his wasta than on his competitiveness, people tend to neglect investments in productive assets and new business ideas, which is detrimental for Jordan’s national competitiveness. In addition, they also stated that business people will spend more time and money on having a good relationship with customers which results in higher investment costs.

Wasta is making Jordan’s business relationship inefficient with regards to legislation. Members of Parliament are elected so that the people could get jobs rather than for their political ideas. In addition, they also stated that members of parliament “neglect their duty to design and decide on reforms that serve the country as a whole”.^[6] Thus, the above elements of wasta have direct impact on doing business and the workplace environment.

Comparative

In the comparative literature review, the paper will examine the types of guanxi within the context of wasta. Besides, the paper will discuss the phenomena of individuality and nepotism in workplace as contributed by practicing wasta. In addition, the comparative analysis will be applied on each of the above elements in terms of their application to the concept of wasta.

Wasta may seem just related to the Middle East region but there are other similar types of wasta practiced in other cultures like Chinese and American. The Chinese society operates as a circular network of relationships with family members in its core and other relatives and friends are arranged based on how trustworthy they are. Guanxi is “deeply embedded in China’s culture, with a history of more than 5000 years”. In the Chinese culture, people protect each other and companies protect the business interest of their members.

Guanxi is about having close relationships with people or companies in order to secure favors. Securing favors “include preferential treatment in dealings, preferential access to limited resources and increased accessibility to controlled information”. For example, when a person is seeking employment and if she is a friend with one of the managers then she is able to secure the job through that relationship, Guanxi.

However, Guanxi requires that the favor be reciprocal. For example, if that same person mentioned above got the job then she would have to do something to compensate the other party for the job. Guanxi is the social phenomena and Confucianism is the major life philosophy. Guanxi stems from Confucianism with “a primary purpose is to achieve harmony, the most important social value”. Guanxi follows Confucianism in the sense that family is the center of relationships.

There are four principles that distinguish Guanxi from other phenomena: transferability, utilitarianism, reciprocity, and intangibility. All four are discussed. The first principle is that “guanxi is transferable among parties (i.e., A and C) related through a common connection in the middle (i.e., B)”. For example, Ahmad and Mohammad are friends who work for company XYZ.

On the way home, Ahmad got a speeding ticket for 500 dirhams and would like to find a way to eliminate it. He remembers that Mohammad once told him that he has a friend in the police department so Mohammad asks his police friend to get help get rid of the ticket for Ahmad. The second principle is that Guanxi is more utilitarian than emotional because it is based on exchanging favors whether there is a relationship between people or not. However, other scholars prefer relationships or connections to be present for Guanxi.

A third principle would be that Guanxi is reciprocal. If a person does a favor for someone then that person has to pay for that favor. The fourth principle is that Guanxi is intangible. “Guanxi members are tied together through an invisible and unwritten code of reciprocity and equity. Failure to respect the commitment substantially hurts one’s reputation, leading to a humiliating loss of prestige or face”^[7].

As mentioned before wasta exists in other countries as well but with different titles. In United States there is nepotism, which is originated from Italy (16^th or 17^th century) and it means “grandson” or “nephew” according to Adam Bellow.^[8]

Social capital could be seen as simple networking or corruptive nepotism. Social capital by definition is the networks of relationships among people who live and work in a particular society, enabling that society to function effectively.

Networking is simply put just the relations that you have established with the people you know, for example if you received a job that you are qualified for because of a friend’s recommendation to the responsible authority then that is considered to be a result of networking. On the other hand nepotism is when people in high ranks favor people they know not just because of their merits but just because they know them, in some cases they would be favored over someone who is more qualified.

In an article by Margret Heffernan on the CBS website she attempts to show the good that nepotism brings, when in reality she is talking about social capital and networking^[9]. One of the examples she gives is when teenagers are trying to apply for college and university their parents try to use their contacts to make their children stand out. They also try to polish their contacts to make them better than they actually are.

The bad reputation that nepotism has is because if people in power favored their relatives the company they are running won’t reach its full potential. In an article the Work Study journal titled nepotism;^[10] the authors discuss the implications and the immoralities of nepotism, which occurs in American businesses. In the article the authors don’t just discuss the negatives they also talk about the positive outcomes of nepotism.

Starting the negative, in the article there is a discussion, which revolve around the family member not being as qualified as the other. Another argument against nepotism would be that married couples and family in general usually come with their quarrels and their history. A good way of using nepotism would be that if the family member was actually qualified and the person in control gave them the job so they wouldn’t have to waste time looking at other candidates.

Comparative aspects between wasta, guanxi, and nepotism

The elements of wasta, guanxi and nepotism are related to each other. In fact, their application is often confused. It is thus important to highlight their similarities and differences. Guanxi follows the method of Confucius and is based on the relationships that are interpreted in a hierarchy form^[11].

One common factor between guanxi and wasta, is that the Chinese build guanxi or relationship over a very long time and using this phenomenon is legal, as well as with wasta is legal in the Arab countries.^[12] Another common trait is that both focuses on blood connection, so exercising such phenomenon and giving favoritism applies to family member most of the times.^[13]

In guanxi the managerial tie with other companies or public sectors has a progressive effect on the corporation’s performance 3, however with wasta it’s the opposite of guanxi, because it creates inefficiency in workplace and lose of productivity due to hiring incompetent workers since they used wasta to get the job and causing decrease economy. ^[14]

One of the common factors between nepotism and wasta is that both are viewed as creating unproductively in the workplace as mentioned before in the paper. Both nepotism and wasta are viewed in a positive way, when it comes to getting a job or getting in to university for the adolescents and teenagers.

Nepotism is viewed in a negative way most of the time; but wasta has mixed views as mentioned earlier about it in the Jordan case. Nepotism is viewed in a positive way only when it creates productivity in the sense that when hiring a family member and that person is qualified then nepotism is not an issue, but according to the views mentioned from Jordan wasta is only viewed positively when the a person does have that connection and relation which makes it possible for that person to get a job.

From the above reflection, it is apparent that nepotism, individuality, and guanxi often occur in the field of business, communication and workplace environment. Irrespective of the form, these elements promote workplace ethical dilemmas.

Empirical studies

Basically, empirical studies on wasta are those studies that involve direct participation of the target subject in order to shade light on its application, merits, and demerits. The main studies discussed were conducted in Egypt, Lebanon, Syria, Kuwait, Emirates and Saudi Arabia.

A study was conducted in a university in Egypt that was directed towards wasta and its influence on competency. People who participated in the study were given a summary job description and qualifications necessary for a bank teller position. In addition, they received an employment record that included a hypothetical employee’s name, education and his demographic data who was working as a bank teller.

The employee was always a male and 24 years old. Participants in the study were asked to read the data and answer questions related to his competency. The data was manipulated. Instead of writing the words “presented wasta”, it was titled as “other remarks”^[15]. Moreover, his qualifications were manipulated by indicating that he was either qualified or unqualified. 70% percent of the questionnaires were returned complete.

The employee’s competency ratings ranged from 2.8 (low) to 4.81 (high). After the questionnaires were completed, the participants were asked to show the extent to which they believed that the employee used wasta and the extent to which they thought he was qualified. The results were that employees who used wasta were less competent than those that did not which resulted in a decrease in his competency level. Also, they viewed wasta as less moral.

Another study was conducted in organizations in Lebanon, Syria, Kuwait, Emirates and Saudi Arabia concerning the importance of networking on women and wasta on career development. The survey asked nearly 200 managers and used several people to get the most consistent data.

With regards to networking, the results showed that over 90% of respondents confirmed that there was no networking in their organizations.

It is probably due to the fact that 66% of the respondents found it difficult to form networks and that it is an issue for woman managers because they are unrepresented in an environment that constitutes males. With regards to wasta, 86% of respondents had used it to advance in their career but some want it to be reduced. In addition, they also stated that it could be helpful for recruitment and promotion.

Some of the respondents say that it is beneficial and some say that it should be reduced. They say that it should be reduced because some people do not have proper connections and can be unfair to them. 93% of them said that you should have influential family members in order to get a good job. Also most of them stated that wasta is more important than gender for recruitment.

To show the effects of wasta on the business environment in Jordan, a German research team conducted a study. They asked main stakeholders, local businesspeople and citizens about the difficulties of doing business in Jordan and the reasons why it is difficult.

It results in a greater investment risk because people use most of their time and money on social relationships, which increases the investment costs and they neglect investment because an entrepreneur’s success depends more on wasta. For some, wasta is beneficial. People say that it increases the chance of getting a job and it gives them access to proper healthcare.

In addition, 86% of the businesspeople said that wasta can help them to communicate with the bureaucracy and 56% use it regularly. 64% of the interviewed public sector employees stated that administrative procedures can be completed more quickly or more easily with wasta. In addition, the interviewed people say that it is an essential part of the Jordanian culture. Jordanians perceive wasta in different ways. Many do not approve of it because it is unfair and some consider it as corruption.^[16]

A study was conducted in a university in United States to show the view of 197 students on nepotism and merit. The students were given a case study that described three candidates for a banking position. One of the candidates was based on merit and the candidate was more qualified than the other two.

The second candidate was based on nepotism had equal qualifications as the first candidate, but had family relationship to one of the top managers. The last candidate had the least qualifications was only incorporated as a form to prevent “the possibility of demand characteristics influencing the results.” The outcome of the study showed that even though the students believed that nepotism is not just, but believed that the kinship connection could help getting the job were less favorable than getting the job based on merit.

From the above literature review, it is important to note that the concept of wasta cannot be ignored in a work or business environment. Apparently, the empirical and comparative studies indicate that wasta should be regulated due to its numerous demerits such as its cost on efficiency and profitability of a business and increased nepotism. However, regulated wasta is still instrumental in business management within the Arabic business environment since it encourages commitment and social pillar of doing business.

Workplace ethical dilemma

Workplace ethical dilemma often occurs when the underlying moral values of a work environment are compromised. Irrespective of a work environment, the main determinants of ethical dilemma remain the same since the underlying causes of these dilemmas are related to moral, behavioral, and interpersonal discrepancies.

This part of the paper will review the background, framework, decision making, and monitoring the outcome of the strategies designed to minimize workplace ethical dilemmas. Specifically, the focus will be on measurable and quantifiable decision making parameters that justify the identified workplace ethical dilemmas framework.

The Background

In order to understand the significance of the research, it is necessary to review the background of a typical workplace environment. Getting a job is stressful and there are always other applicants who are more qualified for the job that one may desire. A representative of the Human Resources office told an applicant for a position in the bank that there are two other qualified applicants.

Those applicants have had more experience from the internship that they did with highly respectable companies as well as they have higher grade point average. Also the other two applicants have scored higher grade in the applicant screening that was conducted earlier. Now the applicant who was told about the other two applicants is in a dilemma to whether use his uncle’s wasta to get the job or not.

Framework

The main elements of a framework include moral imaginations, ethical issue, and relativism as dependent on the dynamics of human resources and communication in a workplace.

The ethical issue would be whether the applicant should contact his uncle and secure of a bank management trainee job and neglecting the other applicants who are more qualified for the position or to personally secure the job. Stakeholder is any individual or group who affects or is affected by the decision made within the firm. The stakeholders in this dilemma would be the uncle, the firm, the other applicants, the costumers, the existing and potential employees, and the applicant himself.

Moral imaginations are element that distinguishes good people who make ethically responsible decisions from good people who do not. The alternatives for the applicant are to either to contact his uncle to get the bank management trainee job or utilizing his full potential to get the job despite the other more qualified applicants.

Ethical relativism states that there is no rational way of determining whether an action is right or wrong other than by asking whether people of particular society believe that it is so, in other words there is no absolute moral standard and it should consider the culture, time, and place.

With respect to the Middle East region where wasta is acceptable and commonly used, contacting the applicant’s uncle to get the job is permissible under the theory of ethical relativism, because the society’s perception of wasta is a normal phenomenon. It would be unfair to neglect those that are more qualified and experienced because of former opportunities, thus they more suitable for the job. However, under ethical relativism, it would be acceptable to ask the uncle to secure the job for the applicant.

If the uncle decides to helps the applicant, his nephew, then he would get the job even though he might not be qualified enough to fulfill the needs of the company. As a result, the company and the uncle’s reputation would be compromised due to my poor performance. Also, it would be unfair for the other applicants to be rejected despite their higher qualifications and experience.

Moreover, it would also affect the current employees because they will be discouraged from working hard because the applicant is less qualified than they are and he will be working among them even though there are better employees. If he does not work there, the current employs morale will increase because they will see that the employees are being chosen based on their merits.

On the other hand, if he does not ask for his uncle’s help, then he might end up not getting the job because he will not be as qualified as the other applicants. The applicant’s family will frown upon the uncle because they will see that he gave the job to a stranger when his relative needed the job. As a result, one of the other applicants will most probably get it because of their merits.

Utilitarianism states that the right action is the one that would produce the greatest net benefits or the lowest net cost on those affected by a decision. The stakeholders affected by the applicant’s decision whether to contact his uncle to secure the job or not would be then the people affected would be his uncle, the firm, the other applicants, potential employees and the customers.

Under the theory of utilitarianism, it would not be appropriate to get the job because it is not the greatest good for the greatest number of people. It would be beneficial for him but it would impose more costs on the other stakeholders.

If the applicant gets the job with his uncle’s help and if it shows that he is qualified for the job through his performance then the uncle’s reputation would be stained and he will not be as capable of handling the demands of the job as the other applicants would. As a result, the firm’s reputation would be damaged.

If the other applicants find out that he got the job because of his uncle’s help then they might not apply for other jobs offered by the company. Hence, the company will be losing the talent offered by these applicants that would have otherwise been employed. The customers experience with the company would be compromised and will not be as satisfactory as if someone more qualified was interacting with them. Therefore, the customers may feel the need to find another company that will meet their demands more effectively.

On the other hand, if the uncle does not help then his reputation would remain intact because the applicant’s performance would not be shown. Instead of him getting the job, the other applicants would because they seem to have the potential to succeed in the trainee position. If the other applicants get the job then it would increase the firm’s productivity because their contribution to the company’s performance will be higher.

Ethics of care states that we have moral obligation to the people we have close relationship with, such as family and friends. This rule is different from other ethical rule, because it is not impartial compared to the others.

Ethics of care emphasizes that we exist in a web of relationships that should be preserved, and we should apply ethics of care only to those we have special relationship with and attending their needs, values, and well-being. Since the uncle is family and the applicant is related to him, he has a moral obligation toward this nephew. This means that under ethics of care, it is his obligation to attend the nephew’s needs and value, and use his wasta and influence so I would get the job.

Since the applicant is related to the uncle, he has moral obligation to use his wasta to help his nephew get the job that he wants. The applicant would expect that his uncle would help him get the job because it is a benefit and a must under ethics of care, one day the applicant will also return the favor and when the uncle needs his nephew there is an obligation to care and attend his needs as well.

The ethics of care neglects the ethic of justice and rights towards the other applicants. If wasta is used and the applicant gets the job the rights and justice to the other competitors are being violated, since they might be better candidates and not even getting the chance to be considered for the job by the company.

As well as violating the rights and justice of the company, which has the right to hire whoever it wants, because the uncle might be pressuring the company in to hiring his nephew and the uncle might be using ethics of care in the sense that he and the companies high mangers have a connection and relation, thus the they seem to have the obligation to attend for the uncles demands.

Rights are split into two parts, a positive right and a negative right; a right is a prerogative to claim something. The difference between a positive and negative right is that a positive right is a duty of others to deliver and meet the required necessities, for example food is a positive right because it is a necessity.

On the other hand a negative right is a duty of others to not interfere in specific acts, for example contracts are a negative right. Under positive rights the uncle should not give his nephew the job because he should be looking out for what is best for the company and what will help it succeed. Also the other applicants have the right to be given the job because they are more qualified.

The categorical imperative, developed by Immanuel Kant, consists of two formulations. The first formulation has two criteria the first is ‘universalizability’, the reason to do something must be ones that that everyone could act on, and the second is reversibility, the reason why someone is doing something is because they don’t mind it being done to them. The second formulation is that people shouldn’t use others as means to succeed.

Under the first formulation of the categorical imperative the applicant shouldn’t ask his uncle to help him get the job under the ‘universalizability’ criteria because if every person in power gave jobs to their family and friends even if they weren’t qualified companies will not be as successful as they are because their productivity won’t be optimal.

Customer satisfaction will be low which is going to decrease the company’s profitability. Also under reversibility the applicant shouldn’t ask for his uncle’s help because he wouldn’t want someone to take the job that he is more qualified for just because they were related to the person in charge.

Under the second formulation the applicant also shouldn’t because he would be asking his uncle to ignore his principals and just help his nephew progress instead of just letting him get the job with his own merits. The above formulations kill the spirit of competition and undermine the technical requirements in doing specific tasks.

Making the decision

Decision making involves selective and non selective approach in order to match the decision to the prevailing rationale framework. Specifically, it is necessary for the relevant personnel to design a systematic system for monitoring the outcome against the expectations.

After discussing and viewing the ethical standards, my decision would be to not use my uncle’s wasta to get me the job. The reason why this decision has been made is because of the violation of some of the ethical rules, such as under utilitarianism it violates the wellbeing and greatest good of the majority of people and it also violates the rights and categorical imperative.

Monitoring the outcome

Reflectively, the process of making the decision should not operate independently. Rather, it should be dependent on the framework identified for the result to be easy to verify and align to the expected behavior and actions. After the decision has been made and implemented, it should be monitored and evaluated to confirm if the choices made are right or not.

Thus, if it was not the right choice then it needs to go through the ethical framework again. For instance, application of the first and the second categorical imperative proposed by Kant would weigh the merits and demerits against a standard system of tracking the outcome.

Conclusion

The concept of wasta involves a contractual agreement between members of an ethnic group with each group having specific obligations on how to treat each other. There are two types of wasta; mediation wasta and intercession wasta. Mediation wasta is to solve tribal issues without resorting to court.

Intercession wasta is a way to exploit connections in order to get a job. Apparently, the phenomena of wasta such as guanxi and nepotism and individually known to promote workplace ethical dilemma since they are characterized by nepotism and greediness especially when they are not regulated. The evidence from the comparative and empirical research indicates that wasta is a major contributor to workplace ethical dilemma. Reflectively, using an uncle’s wasta to get a job is not moral rights.

Bibliography

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Footnotes

1. Andy Barnett, Bruce Yandle, George Naufal. 2013. “Regulation, trust, and cronyism in Middle Eastern societies: The simple economics of “wasta”.” The Journal of Socio-Economics 41–46.
2. Cunningham, Robert, and Yasin K. Sarayrah. 1993. Wasta: the (Andy Barnett 2013) hidden force in Middle Eastern society. Westport, Conn.: Praeger.
3. Andy Barnett, Bruce Yandle, George Naufal. 2013. “Regulation, trust, and cronyism in Middle Eastern societies: The simple economics of “wasta”.” The Journal of Socio-Economics 41–46.
4. Andy Barnett, Bruce Yandle, George Naufal. 2013. “Regulation, trust, and cronyism in Middle Eastern societies: The simple economics of “wasta”.” The Journal of Socio-Economics 41–46.
5. Markus Loewe, Jonas Blume, Johanna Speer. 2008. “How Favoritism Affects the Business Climate: Empirical Evidence from Jordan.” Middle East Journal 259-276.
6. Markus Loewe, Jonas Blume, Johanna Speer. 2008. “How Favoritism Affects the Business Climate: Empirical Evidence from Jordan.” Middle East Journal 259-276.
7. Bellow, Adam. 2003 . “In Praise of Nepotism: A Natural History.” August 24.
8. Bellow, Adam. 2003 . “In Praise of Nepotism: A Natural History.” August 24.
9. Hefernen, Margaret. What’s Wrong With Neptosim? August 21, 2013.
10. Linda C. Wong, Brian H. Kleiner. Work Study. 1994.
11. E. Alan Buttery, Y.H. Wong. 1999. “The development of a Guanxi framework.” Marketing Intelligence & Planning 147 – 155.
12. Peng, Mike W, and Yadong Luo. 2000. “Managerial ties and firm performance in a transition economy: The nature of a micro-macro link.” Academy of Management Journal 486-501.
13. Kate Hutchings, David Weir. 2006. “Understanding networking in China and the Arab World.” Lessons for international managers 272-290.
14. Makhoul, Jihad, and Lindsey Harrison. 2004. “INTERCESSORY WASTA AND VILLAGE DEVELOPMENT IN LEBANON.” Arab Studies Quarterly 25-41.
15. Tlaiss, Hayfaa, and Saleema Kauser. 2011. “The importance of wasta in the career success of Middle Eastern managers.” Journal of European Industrial Training 467-486.
16. Markus Loewe, Jonas Blume, Johanna Speer. 2008. “How Favoritism Affects the Business Climate: Empirical Evidence from Jordan.” Middle East Journal 259-276.