Ethics and Advocacy for HR Professionals

HRM 522 Organizational Factors: The Role of Ethical Culture and Relationships
Ferrell, O.C., Fradedrich, J., & Ferrell, L. (2010). Business ethics: Ethical decision making and cases. Mason, OH: South-Western Cengage Learning.

Objectives
Upon completion of this lesson, you will be able to:
Identify the role of corporate governance, corporate culture and work group influence in ethical decision making. Analyze scenarios to determine the ethical character of decisions made and the related impact on the organization.

Role of Corporate Culture

Components of corporate culture
Values Beliefs Customs Rules Ceremonies

Ethical Framework for Corporate Culture

Four organizational cultures
Apathetic Caring Exacting Integrative

Check Your Understanding

Ethics as a Component of Corporate Culture

Ethical issues may arise due to conflicts between
Cultural values perceived by management and Values actually at work

Differential Association

Kavin who believes stealing is wrong but lacks cash to buy a soda and steals

Sally who also believes stealing is wrong but borrows money instead

Whistle-Blowing
Whistle-Blowing
Is exposing an employers wrongdoing to outsiders

Federal False Claims Act

Enables whistle-blower to receive 15-25% of recovered funds

Sarbanes-Oxley Act
Makes it illegal to discriminate against whistleblower

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Leaders Influence Culture

Reward power Coercive power Legitimate power Expert power Referent power

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Motivating Ethical Behavior

Priority of needs is affected by
Career stage Age Organization size Geographic location

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Organization Structure
Centralized organization
Decision-making concentrated at the top Blame shifting or scapegoating may be an issue

Decentralized organization
Decision-making authority is far down chain of command Difficulty in responding quickly to changes

Group Dimensions of Corporate Structure and Culture

Types of groups
Formal groups (committees, work groups and teams) Informal groups

 Group norms

Group Dimensions of Corporate Structure and Culture

Are standards of behavior Have power to enforce conformity Define different roles for various positions May conflict with organizations values and rules

Variation in Employee Conduct

10% 40% 40% 10%

Follow their own Take advantage of values and beliefs; situations if the believe that their Go along penalty is less values are Always try to with than the benefit superior to those follow the and the risk of of other s in the company work being caught is company. policies. group. low.

Check Your Understanding

Summary
Role of corporate culture Motivating ethical behavior Organizational structure Group dimensions of structure and culture