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ASSIGNMNET

On
BUSINESS ETHICS AND CORPORATE GOVERNANCE
TOPIC: ETHICAL ISSUES IN WORKPLACE

SUBMITTED TO,

SUBMITTED BY,

ASST. PROF. BETSY BABY GEORAGEEN

JENCY P.J

DiST, ANGAMALY

MBA 15
NO: 25
01/09/2016

INTRODUCTION

Ethics or moral philosophy is branch of philosophy that involves systematizing,


defending, and recommending concepts of right and wrong conduct. In the complex global

business environment of the 21st century, companies of every size face a multitude of ethical issues.
Businesses have the responsibility to develop codes of conduct and ethics that every member of the
organization must abide by and put into action. Fundamental ethical issues include concepts such and
integrity and trust, but more complex issues include accommodating diversity, decision-making,
compliance and governance. Though the ethical dilemmas faced by certain companies may be specific to
their industry or company, other types of ethical issues are common to all types of companies. Handling
ethical decisions with wisdom is especially important for small businesses, given the potentially
devastating effects these companies may face if such issues aren't handled correctly.

ETHICAL ISSUES IN THE WORKPLACE

In ethics, value denotes the degree of importance of some thing or action, with the aim of determining
what actions are best to do or what way is best to live (deontology), or to describe the significance of
different actions (axiology). It may be described as treating actions themselves as abstract objects, putting
value to them. It deals with right conduct and good life, in the sense that a highly, or at least relatively
highly, valuable action may be regarded as ethically "good" (adjective sense), and an action of low, or at
least relatively low, value may be regarded as "bad". What makes an action valuable may in turn depend
on the ethical values of the objects it increases, decreases or alters. An object with "ethic value" may be
termed an "ethic or philosophic good" (noun sense).
Values can be defined as broad preferences concerning appropriate courses of action or outcomes. As
such, values reflect a person's sense of right and wrong or what "ought" to be. "Equal rights for all",
"Excellence deserves admiration", and "People should be treated with respect and dignity" are
representative of values. Values tend to influence attitudes and behaviour. Types of values include
ethical/moral values, doctrinal/ideological (religious, political) values, social values, and aesthetic values.
It is debated whether some values that are not clearly physiologically determined, such as altruism, are
intrinsic, and whether some, such as acquisitiveness, should be classified as vices or virtues.
Technically speaking, ethics is a branch of philosophy, which deals with questions about a person's
morality and values. Ethical dilemmas occur when a person has to choose between the right and wrong or
the good and bad. In our personal lives, ethics such as honesty, loyalty, truth, and commitment doing the
right thing, and commitment are highly valued. The basic goal of any business is to make profits and the
people working in organizations today can go to any length to achieve that, even if it means
compromising on one's ethics. Also, the success of an individual in an organization depends on how much
he is contributing towards the business.
Essentials
Employees may overlook ethics in many situations for their personal benefits. At the same time, it has
been observed that businesses that follow a culture of ethics create a lot of goodwill for themselves in the
market as well as among their customers, thus making them highly successful in the long run. The
following

paragraphs

give

you

brief

idea

about

corporate

ethical

issues.

Every company is different but they all should take the following into consideration:
Trustworthiness
Respect
Responsibility
Fairness
Caring
Relationships and Ethics
Ethics applies to any relationship between the following individuals:
Management/Supervisors
Colleagues/Employees
Customers
Communication is key among management, employees, and customers in order for respect to be extended
to each person within the organization, and promote relationships that are based on honesty and integrity.
Be cautious to cross the line between personal friendships in the workplace and professionalism.
Good work place ethics

Staying productive
Be accountable for your actions
Take initiative
Think critically to be able to solve problems
Blowing the whistle
Be punctual
Stay positive
Stay professional
Take pride in your work
Immediately attempting to correct an issue

ETHICAL ISSUES

You and your colleagues provide a direct reflection of your company. Your combined Behaviours
represent the companys culture. An ethical corporate culture promotes a strong, positive brand image,
builds customer loyalty and can benefit the company financially. Employees working in an atmosphere
founded on ethics might also be more motivated and committed to the companys success. If your
companys culture needs some work, you could be a catalyst for change by serving as an example of good
ethical Behaviour in your workplace.

Supplier/Customer Relations: In addition employees and business owners


must consider the ethical issues involved with their relationships between
suppliers and customers. Business owners in particular must consider whether
it is ethical to do business with suppliers who have unethical practices. When
dealing with customers or clients, business people must ensure that they use
their information correctly, do not falsely advertise a product or service, and
do not intentionally do sub-standard work.

Gossips: These gossips are typical of the things you'll face at work, and they spread because of a
lack of accurate information. So, the best way to fight gossips is with good communication. When
you communicate well, your team knows what's happening, and they trust that you'll keep them
informed. Good communication within your team also means that you will become aware of any

gossips that are starting, and you'll be able to address them quickly and effectively.
Conducting personal business on company time: Because employees tend to spend so much of
their weekday hours on the job, they often are tempted to conduct personal business on company
time. This can include setting up doctor's appointments on company phone lines, making vacation
reservations using their employer's computers and Internet connections or even making phone
calls for a freelance side business while on company time. At first glance, this ethical dilemma is
fairly clear: It is an abuse of your employer to conduct personal business on company time. But
there are shades of gray here. What if your spouse calls to tell you that your children are ill? Is it
OK for you to schedule a doctor's appointment? A good rule of thumb is for an employee to check
with his manager or human resources supervisors to clarify what counts as an actionable offense
in the company.

Ignoring problem: In most of my management workshops the discussion, at some point,


generally comes around to one of those workplace problems that few managers wish to confront.
For example:

A personal hygiene issue.

The frequent use of inappropriate language around co-workers.

A suspected alcohol or drug abuse issue.

A suspected violation of workplace time and attendance requirements.

Behaviour of any kind that demonstrably lies outside usual and expected organizational norms.

A subordinates anger management difficulties.

Excessive displays of negativity and an argumentative disposition.

Potential sexual harassment Behaviour.

The proselytizing of co-workers motivated by ones political or religious beliefs.

Blackmail: There are many ways that someone can blackmail you at the workplace. Maybe you
made a mistake at work that someone promised to help you cover up. Or it can be a secret of a
personal nature that is being used against you. Whatever error you made, you dont deserve to pay

for it over and over again.


Lying: In the workplace people fib, flatter, fabricate, prevaricate, equivocate, embellish, take
liberties with, bend, or stretch the truth. They boast, conceal, falsify, omit, spread gossip,
misinform, or cover-up embarrassing (perhaps even unethical) acts. They lie in order to avoid
accepting responsibility, to build status and power, to protect others from hearing a negative
truth, to preserve a sense of autonomy, to keep their jobs, to get out of unwanted work, to get on
the good side of the boss, to be perceived as team players when their main interest is selfinterest. Or they lie because theyre under pressure to perform and because (as one co-worker
observed about his teammates) they lack the guts to tell the boss that what is being asked isnt
doable.

Bribe: Corruption is one of the worst enemies of business because it can result in far-reaching
consequences, including total closure of the company. The vice can be perpetuated by an
individual or a clique of employees within a business organization. Corruption in business
involves misappropriation of funds, bribery, misuse of office by company officials and dishonesty
in financial matters. Its magnitude notwithstanding, corruption can hurt the image of the business
and jeopardize its profitability. Being offered a bribe is one of the most awkward situations any
professional can find himself or herself in. You may politely but firmly decline the offer. In some
cases, however, a firm No may not be sufficient or the safest move. ADB defines bribery as the
act of offering, giving, receiving, or soliciting, directly or indirectly, anything of value to influence

Improperly the actions of another party. A bribe can be disguised as a gift, money, property,
privilege, or even a personal favor.

Taking Credit for Others' Work: Employees often work in teams to create
marketing campaigns, develop new products or fine-tune services, yet rarely
does everyone in a group contribute equally to the final product. If three
members of a five-person team did all the work, do those three members
demand to receive proper credit while pointing out that two members of the
team did not pull their weight? This is a thorny question. If employees single
out their co-workers in a negative light, it could foment resentment. The same
thing could happen, however, if all employees accept equal praise even
though only a select few did the real work. The best way to resolve this ethical
dilemma is to not let it happen. Team members should insist that all
employees perform specific tasks to help complete a project.

Unpunctuality: Bad attitudes in the workplace might include laziness, tardiness, rudeness, rumor
mongering or any other attitude or activity that lowers overall morale. Negative attitudes could be
due to personal problems. For example, an employee might be having trouble at home that
influences her Behaviour at work. Bad attitudes also can result from workplace events, such as a
firing, pay decreases or other small-business problems.

Illegal practices: Violations of the law in a workplace can occur in multiple ways. Employees
engaging in illegal activities at work, an employer violating labor laws or engaging in illegal
activity, or an employer dealing with third parties engaged in illegal activities all pose hazards to
employers and workers. Employees fearing the consequences of reporting illegal activity at work

may protect themselves by not reporting illegal activity or even denying knowledge of such
activities when questioned.

Stealing: Ethics violations can also involve stealing items, including office
supplies and computer equipment. Employees who have access to company
finances can steal cash, or use "creative accounting" as a means to embezzle
money.

Workers

may

also

steal

merchandise

from

business.

The

International Foundation for Protection Officers points out that product


displays are a frequent target of employee theft.

Abusing confidentiality agreements: Confidentiality, or non-disclosure, agreements, can be used


to protect sensitive information or trade secrets. But confidentiality agreements are often part of
settlements in contentious disputes between employers and employees, or former employees. Most
include both a mutual ban on speaking about the details of the settlement and a blanket nondisparagement clause, in which both parties agree not to make negative statements about the other.

In cases with large financial settlements, stiff financial penalties for speaking out are often worked
into the agreement these are called a liquidated damages clause.

Falsifying information: Falsifying documents is a type of white collar crime. It involves


altering, changing, or modifying a document for the purpose of deceiving another person. It can
also involve the passing along of copies of documents that are known to be false. In many states,

falsifying a document is a crime punishable as a felony.


Making decision for your own personal gain: Individuals are often required to make decisions
in the business environment every day. Working for a company often requires following an ethical
model or framework when making these decisions. Business ethics outlines the acceptable
Behaviour companies expect to see from their employees. Strong decision making and business

ethics can also help companies select the best business opportunities.
Lack of communication: Communication ethics is the notion that an individual's or group's
Behaviour are governed by their morals which in turn affects communication. Generally speaking
communication ethics deals with the moral good present in any form of human communication.
This includes interpersonal communication, mass mediated communication, and digital

communication.
Withholding information: The act of withholding information is a common tactic used by toxic
employees. Some workplaces flow work and information seamlessly from one work group to
another. This doesnt happen by accident. Optimum efficiency requires the identification of the
key information required by each work group as products or information flow from a point of
origin to the point of delivery.

Safety Violations: Ethical violations may occur regarding workplace safety. The 2005 National
Business Ethics Study indicated that 16 percent of the surveyed employees observed violations of
workplace safety regulations. Not following established safety procedures can jeopardize the
health, or even the lives of other employees. Even something as simple as not wearing a hard hat
or other safety gear can result in worker injury, which impacts the employer as far as lost
productivity and possible payment of a workers compensation claim.

Time Theft: Time theft can be a more subtle form of unethical Behaviour.
According to the International Foundation for Protection Officers, common
forms of time theft involve altering time cards or time sheets to cover up late
arrivals or early departures, or even standing around the water cooler instead
of working. Time theft also includes viewing non-work-related websites, or
spending time sending emails to friends.

Employer Intimidation: The 2005 National Business Ethics Study listed


employer intimidation as the most common form of ethical violation in the
workplace. According to the Canadian Centre for Occupational Health and
Safety, intimidation, also known as bullying, typically involves a pattern of
verbal abuse directed at any employee by an employer. The employers
attempts to assert his power by humiliating the employee.

Safety Violations: Ethical violations may occur regarding workplace safety. The
2005 National Business Ethics Study indicated that 16 percent of the surveyed
employees observed violations of workplace safety regulations. Not following
established safety procedures can jeopardize the health, or even the lives of
other employees. Even something as simple as not wearing a hard hat or
other safety gear can result in worker injury, which impacts the employer as
far as lost productivity and possible payment of a workers compensation
claim.

Time Theft: Time theft can be a more subtle form of unethical Behaviour.
According to the International Foundation for Protection Officers, common
forms of time theft involve altering time cards or time sheets to cover up late
arrivals or early departures, or even standing around the water cooler instead
of working. Time theft also includes viewing non-work-related websites, or
spending time sending emails to friends.

Stealing: Ethics violations can also involve stealing items, including office
supplies and computer equipment. Employees who have access to company

finances can steal cash, or use "creative accounting" as a means to embezzle


money.

Workers

may

also

steal

merchandise

from

business.

The

International Foundation for Protection Officers points out that product


displays are a frequent target of employee theft.

Misconduct: Misconduct in the workplace can take on many forms. Common


varieties include sexual harassment, or discriminatory practices, such as age,
race or gender bias. The 2005 National Business Ethics Study indicated that
12 percent of employees reported occurrences of discrimination in the
workplace, while 9 percent reported occurrences of sexual harassment.

Technology: Advancements in technology and the growth of the Internet in the


early 21st century have produced a slew of ethical dilemmas for companies.
Company leaders have to balance the privacy and freedom of workers while
also maintaining standards that require that company technology use is for
legitimate business purposes. Certain companies go so far as to monitor all
online use and email communication from employee computers and work
accounts. A company may have this right, but its leaders need to understand
the potential concern about privacy and autonomy among employees.

Transparency: Prominent business and accounting scandals have made it


imperative that companies operate with openness and transparency. For
public corporations, this includes honest, accurate and complete reporting on
mandated financial accounting reports. For large and small businesses,
transparency

includes

communicating

messages,

including

marketing

messages, that aren't open to misinterpretation and that clearly represent the
intentions of the company and its messages. Being caught in a lie or avoiding
full disclosure may cause irreparable harm to small businesses.

Small Business Ethics: Although there are ethical issues like discrimination
that apply to all areas of business, each business area has its own ethical
concerns. For example, business people who act as consultants must ensure
they are giving sound advice. In the area of small business, some major
ethical issues result from hiring, firing and dealing with employees. For
example, conflicts of interest may cause ethical issues in small businesses,

especially if they are family run. When personal family issues interfere with
business decisions, this is a conflict of interest and an ethical concern.

Harassing Behaviour: Employees often don't know what to do if they see one
of their co-workers harassing another employee, either mentally, sexually or
physically. Employees may worry for their jobs if they attempt to report a
superior for harassment. They may fret that they'll be labelled a troublemaker
if they report co-workers who display inappropriate Behaviour toward other
employees. The best way to resolve this ethical dilemma rests with the staf
members who develop the company's employee handbook. It is their job to
include specific language that spells out that employees won't be punished for
reporting the harassing Behaviour or inappropriate actions of their co-workers.

In shortly we can say ethical issues in workplace as:


Ethical Issues of Employees

Making long phone calls at the companys cost. Some organizations provide a refund for the
phone bills of the employees, especially if the employee is dealing with a job which that involves
using the telephone. Taking advantage of the fact and making personal phone calls is unethical.

Taking home the companys assets. Some employees pocket tools and stationery such as staplers,
pins, papers etc. to use them at home. This would have probably gone undetected by the cameras,
but definitely doesnt say much about their behaviour.

Taking excessive leaves beyond the allowed number is a breach of ethical code. It not only leads
to losses for the company but also brings you a bad name. Sounds unethical, doesnt it?

Improper usage of machineries. Some employees make use of office computer and printers for
personal uses such as taking lengthy print outs, heavy downloading and even unnecessary net
surfing etc. Personal work needs to be kept personal!

Taking advantage of the travel benefit. These are applicable to employees who have to constantly
be on the move such as the marketing personnel. More than ethical codes, common sense can tell
you not to use this for personal benefits!

Breach of rules and regulations of the company. Accepting terms and conditions are usually done
as a part of joining procedure. Violating any of these rules may leads to undesirable issues
between the company and you. Failing to maintain the privacy policy of the company is another

sort of breaking of rules. Each company has its own privacy policy. An employee is entitled not to
give out the companys data and other particulars to another company/competitor.

Offensive communications. Employees are not allowed to use offensive language in the office.
But anything that goes on beyond company walls cannot be taken into consideration.

Working for multiple organizations. An employee cannot work in more than one place
simultaneously literally and ethically! If ever caught doing so, the person can be prosecuted and
debarred from being a part of either organization in the future.

Ethical Issue of Employers

Favouritism. This means that the employer may favour a particular person with regard to
promotions and bonuses and evidently neglect other eligible employees. This conduct is
considered highly unethical on the part of the employer.

Sexual harassment is not legal/ethical/moral whether in the workplace or out of it. Harassing an
employee sexually, or refraining from taking action against those who are involved in such
offences, is strictly forbidden.

Terminating an employee without any notice. In some cases, for reasons like budget management,
companies opt for mass firing to reduce the number of employees. Such terminations should be
done after prior indications and notice of at least a month or two, so that the person can find
another job. Notice periods must be served to avoid confusion.

Unnecessary delay in paying employees provident fund and gratuity after leaving the
organization is a breach of professional ethics.

CONCLUSION

Ethics are the building block of our society and thus should be the building block of our corporations.

Henry Kravis states, If you build that foundation, the moral and the ethical foundation, as well as the
business foundationthen the building won't crumble. It is essential not to let greed cloud judgment.
The colossal missteps taken by Enron and Arthur Andersen shall serve as a lesson for those that consider
straying from the path of morality. Ethics are important not only in business but in all aspects of life
because it is an essential part of the foundation on which of a civilized society is build. A business or
society that lacks ethical principles is bound to fail sooner or later. Workplace ethics are an extension of
the personal standards or lack of them that is inherent in the people who make up the workplace. With all
of the news and attention upon those who have proven that they were devoid of moral ethics in the way
that they conducted their business, it behoves us to look at the basis for ethics that will stand the test and
the trial of temptation in a world that seems to reward the "shady deal." It seems that the current
worldview deems that the only wrong thing about shady business dealings and immoral workplace ethics
is in getting "caught."

REFERENCE
[1] http://www.forbes.com/sites/carolkinseygoman/2013/10/17/10-of-the-biggest-workplacelies/#537589cd3a21
[2] http://smallbusiness.chron.com/common-workplace-ethics-violations-2736.html
[3] http://smallbusiness.chron.com/adverse-efects-bad-attitude-workplace-18249.html
[4] http://www.forbes.com/sites/carolkinseygoman/2013/10/17/10-of-the-biggest-workplacelies/#537589cd3a21
[5] http://smallbusiness.chron.com/top-reasons-ethical-problems-business-61968.html
[6] http://smallbusiness.chron.com/common-types-ethical-issues-within-organizations15238.html
[7] http://www.speedupcareer.com/articles/ethical-dilemmas-in-workplace.html
[8] http://www.workplaceethicsadvice.com/2011/12/a-code-of-ethics-in-the-workplace.html
[9] http://www.buzzle.com/articles/ethical-issues-in-the-workplace.html
[10] http://www.bizjournals.com/philadelphia/blog/guest-comment/2015/01/most-commonunethical-behaviors-in-the.html
[11] http://smallbusiness.chron.com/major-ethical-issues-business-people-face-20900.html
[12] http://smallbusiness.chron.com/common-ethical-workplace-dilemmas-748.html

[13] http://www.epcc.edu/CareerServices/Presentations/Ethics%20in%20the%20Workplace.pdf

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