Introduction

Morality - Morality is the differentiation of intentions, decisions and actions

between those that are distinguished as proper and those that are improper.

Ethics - Ethics or moral philosophy is a branch of philosophy that involves

systematizing, defending, and recommending concepts of right and wrong
conduct. The field of ethics, along with aesthetics, concern matters of value,
and thus comprise the branch of philosophy called axiology.

Business ethics - Business ethics (also known as corporate ethics) is a form

of applied ethics or professional ethics, that examines
ethical principles and moral or ethical problems that can arise in a business
environment. It applies to all aspects of business conduct and is relevant to
the conduct of individuals and entire organizations.

Importance of ethics in organisation

Positive corporate culture - An organization devoting resources to

developing policies and procedures that encourage ethical actions builds a
positive corporate culture. Team member morale improves when employees
feel protected against retaliation for personal beliefs. These policies include
anti-discriminatory rules, open door policies and equal opportunities for
growth. When employees feel good about being at work, the overall feeling in
the organization is more positive.

Consumer confidence - An organization can lose consumer confidence very

quickly with a few bad online reviews. Organizations have to retain consumer
loyalty through ethical practices that start with fair and honest advertising
methods and continue through the entire sales process

Reduced financial liabilities - Organizations that don't develop policies on

ethical standards risk financial liabilities. The first liability is a reduction in
sales. For example, a real estate development company can lose customer
interest and sales if its development reduces the size of an animal sanctuary.
This doesn't mean a company must abandon growth. Finding an ethically
responsible middle ground is imperative to sway public opinion away from
corporate greed and toward environmental responsibility.

Improving decision making - A man’s destiny is the sum total of all the
decisions that he/she takes in course of his life. The same holds true for
organizations. Decisions are driven by values.
Security and society - Often ethics succeeds law in safeguarding the society.
The law machinery is often found acting as a mute spectator, unable to save
the society and the environment.

Satisfying basic human needs - Being fair, honest and ethical is one the
basic human needs. Every employee desires to be such himself and to work
for an organization that is fair and ethical in its practices.

Uniting people and leadership - An organization driven by values is revered

by its employees also. They are the common thread that brings the employees
and the decision makers on a common platform. This goes a long way in
aligning behaviours within the organization towards achievement of one
common goal or mission.

Code of ethics
Definition – The code of ethics for an organisation would help to give clarity
to the organisation and the public to what it stands for. A code of ethics document
may outline the mission and values of the business or organization, how professionals are
supposed to approach problems, the ethical principles based on the organization's core
values and the standards to which the professional is held.

Five code of ethics-

Integrity - should be straightforward and honest in all professional and business

relationships

Objectivity- should not allow bias, conflict of interest or undue influence of

others.

Professional competence and due care - should act diligently and in

accordance with applicable technical and professional standards when
providing professional services.

Confidenciality - Confidential information acquired as a result of

professional and business relationships should not be used for the
personal advantage of the professional accountant or third parties.

Professional behaviour - should comply with the relevant laws and

regulations and should avoid any action that discredits the profession.

Five ethical principal –

Beneficence and nonmaleficencen - The beneficence and non
maleficence principle of the APA ( American Psychological Association) general
principles guides psychologists to perform work that is beneficial to others yet
does not hurt anyone in the process of carrying out that work.

Fidelity and responsibility - The fidelity and responsibility principle of the

APA general principles inspires psychologists to cultivate a professional and
scientific environment built upon trust, accountability, and ethical
considerations.

Integrity - The integrity principle of the APA general principles aims to

encourage psychologists to engage in honest, transparent practices within all
aspects of the field of psychology.

Justice - The justice principle of the APA general principles states that people
are entitled to the advances made within the field of psychology and to the
services offered by professionals within the field.

Respect for people's rights and dignity - The APA general principle
concerning respect for people's rights and dignity recognizes individuals' rights
to privacy and confidentiality.

Importance of code of ethics

There are several important reasons for a company to develop a code of

ethics. In the first place, there are some business related reasons. A
code of ethics can boost corporate reputation and brand image. It can
create a positive image about the company’s business practices. In
addition, corporations are sometimes even required to have a code of
ethics in order to conduct business. For example, if a company wishes to
get listed on the Bombay Stock Exchange, it must have one that
conforms to all the required compliance standards and procedures.
Furthermore, research indicates codes of conduct play an important role
in institutionalizing ethics in a company and creating an ethical culture in
a company . This is because they can help familiarize employees about
ethical issues. Some researchers have found statistically significant
levels of employee commitment to organizations with codes and have
found that it can, in conjunction with other ethics related factors,
positively affected job satisfaction. Researchers also indicates that they
can help create a sense of community within the organization and “rally
employees around a corporate culture”, as its values are expressed in
the code.
 The role of ethics in corporate culture

Corporate culture business ethics - Corporate culture refers to the beliefs

and behaviors that determine how acompany's employees and management
interact and handle outside businesstransactions.

Four types of corporate culture-

Clan culture - This working environment is a friendly one. People have a lot in
common, and it’s similar to a large family. The leaders or the executives are seen as
mentors or maybe even as father figures. The organization is held together by loyalty
and tradition. The organization emphasizes long-term Human Resource
development and bonds colleagues by morals

Adhocracy culture - This is a dynamic and creative working environment.

Employees take risks. Leaders are seen as innovators and risk takers. Experiments
and innovation are the bonding materials within the organization. Prominence is
emphasized. The long-term goal is to grow and create new resources.

Market culture - This is a results-based organization that emphasizes finishing

work and getting things done. People are competitive and focused on goals. Leaders
are hard drivers, producers, and rivals at the same time. Long-term focus is on rival
activities and reaching goals.

Hierarchy culture- This is a formalized and structured work environment.

Procedures decide what people do. Leaders are proud of their efficiency-based
coordination and organization. The long-term goals are stability and results, paired
with efficient and smooth execution of tasks.

The role of management in building an ethical culture

Be a role model and be visible.Your employees look to the behavior of top

management as a model of what’s acceptable behavior in the workplace.
When senior management is observed (by subordinates) to take the ethical
high road, it sends a positive message for all employees.

ethical expectations.Ethical ambiguities can be reduced by creating and

disseminating an organizational code of ethics. It should state the
organization’s primary values and the ethical rules that employees
are expected to follow. Remember, however, that a code of ethics is worthless
if top management fails to model ethical behaviors.

Offer ethics training.Set up seminars, workshops, and similar ethical training

programs. Use these training sessions to reinforce the organization’s
standards of conduct, to clarify what practices are and are not permissible,
and to address possible ethical dilemmas.

Provide protective mechanisms.The organization needs to provide

formal mechanisms so that employees can discuss ethical dilemmas and
report unethical behavior without fear of reprimand. This might include
creation of ethical counselors, ombudsmen, or ethical officers

Judge ethical acts. Performance appraisals of managers should include a

point-by-point evaluation of how his or her decisions measure up against the
organization’s code of ethics. Appraisals must include the means taken to
achieve goals as well as the ends themselves. People who act ethically
should be visibly rewarded for their behavior. Just as importantly, unethical
acts should be punished.

Management and ethical culture

One of the tasks that management has is to make sure that employees are
engaging in behaviours that meet the organization’s goals. In other words,
they need to control the activities of the employees. This can be achieved in a
couple of ways. They are as follows :

The Unitary Corporate Culture : Sinclair (1993) evaluated two approaches

to managing organizational culture to improve ethics in organizations. These
kinds of organizations fit the description of the culture of character, with
organizational values and norms being shared by all members of the
organization (not just the leaders), believing in the norms and following them,
regardless of the geographical or departmental divisions. This approach
argues that management can and should manage the organizational culture
actively. The end result is the corporate strategy, philosophy, mission and,
most importantly for this article, the code of ethics. The code of ethics should
be posted in prominent places to serve as a constant reminder about the
values the organization has adopted. The last, yet extremely important factor,
in creating a unitary ethical culture is “empowering the guardians of integrity”.
A credible, ethical and transformational leader leads employees to accept the
organization’s values as their own. Thus, the combination of the
transformational leader behaviors with the previously mentioned elements
influence the organizational character, making it self-sustaining and transcend
the leader’s influence, thus firmly establishing a culture of character.

The Subculture Approach: The subcultural approach recognizes and

encourages diversity within the organization. It attempts to understand the
value differences of the subcultures. Research indicates that the repository of
organizational values and norms is more likely to come from the subcultures
of an organization than the corporate culture. The values gained from the
subcultures may be longer lasting and more significantly influence employee
behavior. Therefore, the role of management should not be to try and create
or control one single culture, but instead should try to understand and unleash
the subculture’s ethical commitment towards the goals which are consistent to
those of the organization. It prevents groupthink and simply maintaining the
status quo, and also serves as a watchdog over members of the organization
who have privileged positions. this approach does not impose a single
corporate culture. It attempts to use the values of the subcultures to stimulate
more ethically-aware behavior. It sees management’s role as sponsoring the
coexistence of subcultures, determining, accepting and consolidating the
value difference and the porousness of the organization to changing external
values. The subcultural approach avoids imposing standards; instead, it
encourages the individual processes of self-inspection, critique and debate.

Conclusion

1. Ethical issues have posed major challenges to companies in recent years and
there will undoubtedly be more in the future. Good ethical practices may not
be easy to maintain. However, with a well-designed ethics policy, ethical
leadership and implementing ethics into organizational strategies and
processes, it will make it easier
2. It is the responsibility of particular individuals within the organization, i.e. it
leadership . Strong leaders model and pass on ethical aspects of the culture
 and use techniques like structure, decision-making processes, rewards,
norms, heroes, stories, rituals and other artifacts to create a strong culture
3. this article has defined organizational culture and demonstrated the role it
plays in ethics within the organization. Benefits of ethical behavior have been
established. Furthermore, methods for managing organizational culture to
enhance ethics have been explored and suggestions for creating an ethical
organizational culture have been briefly presented. In all cases, management
must be committed to ethical conduct.
4. To conclude, despite the economic crisis, there are clear and long-lasting
advantages of establishing an ethical culture. With a more open and ethical
organizational culture, the more positively employees tend to commit to
corporate social responsibility and this will generate more honest
environments