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    You are here Home » ethics

    Ethical Leaders And Workplace Culture: The Foundation Of Ethical Decision Making

    Last updated on Sep 19, 2019 by Dan McCarthy · This post may contain affiliate links

    Guest post by Dr. Steven Mintz:

    Ethical leaders
    create a culture in the workplace that promotes moral values and establishes an
    ethical tone at the top. Creating an ethical culture means setting a standard
    that decisions are made and actions are taken that are right, not wrong; good,
    not bad; and they benefit the stakeholders of the organization. Ethical leaders
    are role models for others in the organization to follow. They “walk the talk”
    of ethics in everything they say and do. Ethical leaders empower others to
    achieve success through right actions. They make decisions that contribute to
    the common good.

    Employees want to
    work for ethical organizations. Ethical organizations treat employees with
    respect and promote fairness in the performance evaluation process. Employees
    are compensated based on results and not biased choices where one employee is
    favored over another and compensated higher for the same quality of work. The
    gender pay gap is one such example.

    An ethical
    workplace culture is one where moral values define relationships between
    employees, the organization and other stakeholders. The congruence of
    employee-employer values facilitates ethical decision making while gaps in
    those values can promote conflict and create an ethical dilemma. For example, a
    superior who pressures a subordinate to overlook financial wrongdoing creates a
    dilemma for the employee that can best be expressed as: Should I do what my
    superior demands or what I know to be the right thing? 

    Turning Moral Values into Virtues

    The moral values
    of an ethical leader include honesty, integrity, respect for others, fair
    treatment, being responsible for decisions and accountable for one’s actions.
    Moral values encourage positive relationships built on respect, trust and
    transparency.

    One way to
    understand the role of moral values in an ethical workplace is through the
    concept of virtue. Virtues are characteristic traits of behavior that ethical
    leaders should aspire to adopt. They are often thought of as excellences of
    character and categorized as either moral or intellectual. Moral virtues govern
    our behavior (e.g., courage, justice, self-control and truthfulness) while
    intellectual virtues deal with our thought process and are acquired through
    understanding, good judgment, reasoning abilities and practical wisdom. Intellectual
    virtues are gained by deliberating about what should and should not be done.

    Turning virtue
    into ethical action requires a commitment to do the right thing regardless of
    the costs to oneself and the organization. Sometimes this is easier said than
    done because internal pressures create barriers to ethical decision making as
    in the case of financial wrongdoing.

    Ethical Decision Making

    The ethical
    decision-making process begins by identifying the moral values in play. The
    following example illustrates how ethical judgments are made.

    It is 5 p.m. on
    Dec. 29 and the chief operating officer (COO) meets with the production manager
    about a major shipment of product to a customer. The COO tells the production
    manager to ship the product within the next two days to ensure it is counted as
    revenue in the current year. The motivation is to pay larger bonuses based on
    the higher level of revenue and profit. The production manager reminds the COO
    that an agreement exists with the customer to inspect 100 percent of the
    product prior to shipment and it cannot be done by December 31. What should the
    production manager do?

    The production
    manager knows that what is being asked is wrong. After all, why should the
    customer be burdened by possible defects in the product that went undetected
    because inspections were not made? The COO is motivated by short-term
    considerations – higher profits and greater bonuses – rather than long-term
    ethical behavior.

    An ethical
    production manager should be guided by the following virtues:

    Honesty.
    Shipping the product without
    inspecting it violates the agreement and potentially compromises the trust of
    the customer.

    Responsibility.
    The ethical question for the
    production manager is: How would I feel if the customer identifies a defect in
    the product and I failed to insist on 100 percent inspection? What if the
    product defect caused harm to the customer? Can I ethically defend my decision
    to go along with the COO?

    Courage.
    Integrity is the key meaning to have
    the courage of one’s convictions to do the right thing precisely because it is
    the right thing to do. The production manager should be willing to stand up to
    the COO and not give in to the pressure, even if threatened with retaliation.

    Good judgment.
    An ethical leader relies on reasoning
    methods such as teleology, or consequence-based ethics, and deontology, or duty
    ethics. The reasoning process for the production manager follows.

    Ethical Reasoning Process

    Teleology. Teleological ethics relies on an ethical analysis of the
    outcomes or consequences of each action. The best choice is that which
    maximizes the benefits to the stakeholders while minimizing the costs. The
    benefits are higher revenue, greater profits, and bonuses. The costs are
    largely unknown because it is unclear whether any defects exist and, if so, how
    they might affect the customer. This uncertainty is why cost-benefit analysis
    is problematic. 

    Deontology. Deontological ethics, or duty
    ethics, bases moral decision-making on foundational principles of obligation. A
    major approach is rights theory under which each individual has certain rights
    that should be respected and decision-makers have an obligation to satisfy
    those rights. Simply stated, the customer has a right to use a product and
    expect it to operate as intended. The company has an ethical duty to meet the
    legitimate rights of the customers for a fully functioning product.

    Ethical Decision

    Knowing what the
    right thing to do is and doing it are not the same. The fear of retaliation can
    negatively influence ethical decision-making. However, an ethical production
    manager should understand that going along with the COO can create an ethical
    slippery slope problem where decisions in the future are tainted by unethical
    behavior in the present that has to be covered up. This is no way to promote
    ethical leadership and create an ethical organization environment.
    Dr. Steven
    Mintz
    (www.stevenmintzethics.com), author of Beyond
    Happiness and Meaning: Transforming Your Life Through Ethical Behavior
    ,
    has frequently commented on ethical issues in society and business ethics. His
    Workplace Ethics Advice blog has been recognized as one of the top 30 in
    corporate social responsibility. He also has served as an expert witness on
    ethics matters. Dr. Mintz spent almost 40 years of his life in academia. He has
    held positions as a chair in Accounting at San Francisco State University and
    Texas State University. He was the Dean of the College of Business and Public
    Administration at Cal State University, San Bernardino. He recently retired as
    a Professor Emeritus from Cal Poly State University in San Luis Obispo.
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