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org/businessethics/

About Ethics, Principles and Moral Values

Simply put, ethics involves learning what is right or wrong, and then doing the right thing -- but "the
right thing" is not nearly as straightforward as conveyed in a great deal of business ethics literature.
Most ethical dilemmas in the workplace are not simply a matter of "Should Bob steal from Jack?" or
"Should Jack lie to his boss?"

(Many ethicists assert there's always a right thing to do based on moral principle, and others believe the
right thing to do depends on the situation -- ultimately it's up to the individual.) Many philosophers
consider ethics to be the "science of conduct." Twin Cities consultants Doug Wallace and John Pekel (of
the Twin Cities-based Fulcrum Group; 651-714-9033; e-mail at jonpekel@[Link]) explain that ethics
includes the fundamental ground rules by which we live our lives. Philosophers have been discussing
ethics for at least 2500 years, since the time of Socrates and Plato. Many ethicists consider emerging
ethical beliefs to be "state of the art" legal matters, i.e., what becomes an ethical guideline today is
often translated to a law, regulation or rule tomorrow. Values which guide how we ought to behave are
considered moral values, e.g., values such as respect, honesty, fairness, responsibility, etc. Statements
around how these values are applied are sometimes called moral or ethical principles.

What is Business Ethics?

The concept has come to mean various things to various people, but generally it's coming to know what
it right or wrong in the workplace and doing what's right -- this is in regard to effects of
products/services and in relationships with stakeholders. Wallace and Pekel explain that attention to
business ethics is critical during times of fundamental change -- times much like those faced now by
businesses, both nonprofit or for-profit. In times of fundamental change, values that were previously
taken for granted are now strongly questioned. Many of these values are no longer followed.
Consequently, there is no clear moral compass to guide leaders through complex dilemmas about what
is right or wrong. Attention to ethics in the workplace sensitizes leaders and staff to how they should
act. Perhaps most important, attention to ethics in the workplaces helps ensure that when leaders and
managers are struggling in times of crises and confusion, they retain a strong moral compass. However,
attention to business ethics provides numerous other benefits, as well (these benefits are listed later in
this document).

Note that many people react that business ethics, with its continuing attention to "doing the right
thing," only asserts the obvious ("be good," "don't lie," etc.), and so these people don't take business
ethics seriously. For many of us, these principles of the obvious can go right out the door during times of
stress. Consequently, business ethics can be strong preventative medicine. Anyway, there are many
other benefits of managing ethics in the workplace. These benefits are explained later in this document.

Managing Ethics Programs in the Workplace

"All organizations have ethics programs, but most do not know that they do," wrote business ethics
professor Stephen Brenner in the Journal of Business Ethics (1992, V11, pp. 391-399). "A corporate
ethics program is made up of values, policies and activities which impact the propriety of organization
behaviors."

Bob Dunn, President and CEO of San Francisco-based Business for Social Responsibility, adds: "Balancing
competing values and reconciling them is a basic purpose of an ethics management program. Business
people need more practical tools and information to understand their values and how to manage them."

Developing Codes of Ethics

According to Wallace, "A credo generally describes the highest values to which the company aspires to
operate. It contains the `thou shalts.' A code of ethics specifies the ethical rules of operation. It's the
`thou shalt nots." In the latter 1980s, The Conference Board, a leading business membership
organization, found that 76% of corporations surveyed had codes of ethics.

Some business ethicists disagree that codes have any value. Usually they explain that too much focus is
put on the codes themselves, and that codes themselves are not influential in managing ethics in the
workplace. Many ethicists note that it's the developing and continuing dialogue around the code's
values that is most important.

Developing Codes of Conduct

If your organization is quite large, e.g., includes several large programs or departments, you may want to
develop an overall corporate code of ethics and then a separate code to guide each of your programs or
departments. Codes should not be developed out of the Human Resource or Legal departments alone,
as is too often done. Codes are insufficient if intended only to ensure that policies are legal. All staff
must see the ethics program being driven by top management.

Note that codes of ethics and codes of conduct may be the same in some organizations, depending on
the organization's culture and operations and on the ultimate level of specificity in the code(s).

Resolving Ethical Dilemmas and Making Ethical Decisions

Perhaps too often, business ethics is portrayed as a matter of resolving conflicts in which one option
appears to be the clear choice. For example, case studies are often presented in which an employee is
faced with whether or not to lie, steal, cheat, abuse another, break terms of a contract, etc. However,
ethical dilemmas faced by managers are often more real-to-life and highly complex with no clear
guidelines, whether in law or often in religion.
As noted earlier in this document, Doug Wallace, Twin Cities-based consultant, explains that one knows
when they have a significant ethical conflict when there is presence of a) significant value conflicts
among differing interests, b) real alternatives that are equality justifiable, and c) significant
consequences on "stakeholders" in the situation. An ethical dilemma exists when one is faced with
having to make a choice among these alternatives.

Assessing and Cultivating Ethical Culture

Culture is comprised of the values, norms, folkways and behaviors of an organization. Ethics is about
moral values, or values regarding right and wrong. Therefore, cultural assessments can be extremely
valuable when assessing the moral values in an organization.

Ethics Training

The ethics program is essentially useless unless all staff members are trained about what it is, how it
works and their roles in it. The nature of the system may invite suspicion if not handled openly and
honestly. In addition, no matter how fair and up-to-date is a set of policies, the legal system will often
interpret employee behavior (rather than written policies) as de facto policy. Therefore, all staff must be
aware of and act in full accordance with policies and procedures (this is true, whether policies and
procedures are for ethics programs or personnel management). This full accordance requires training
about policies and procedures.

Social Responsibility

Social responsibility and business ethics are often regarding as the same concepts. However, the social
responsibility movement is but one aspect of the overall discipline of business ethics. The social
responsibility movement arose particularly during the 1960s with increased public consciousness about
the role of business in helping to cultivate and maintain highly ethical practices in society and
particularly in the natural environment.