1. Strategic Approaches to Improving Ethical Behavior
CHAPTER 6
Strategic Approaches to Improving Ethical Behavior

2. Chapter Objectives
To provide an overview of the need for an organizational ethics program
To consider crucial keys to development of an effective ethics program
To examine effective implementation of an ethics program

3. The Need for Organizational Ethics Programs
Organizations are held accountable for the conduct of their employees.
Organizations can create unethical corporate cultures.
Stakeholders demand greater ethical and social responsibility.

4. Codes of Conduct
Formal statements that describe what an organization expects of its employees

5. Developing and Implementing a Code of Ethics
Consider areas of risk and state values as well as necessary conduct.
Identify values that specifically address current ethical issues.
Consider values that link the organization to a stakeholder orientation.
Make the code understandable by providing examples that reflect values.
Communicate the code frequently in language employees can understand.
Revise the code each year.

6. Ethics Officers Assess organizational needs and risks
Develop and distribute the code of ethics
Conduct ethics training programs
Establish and maintain a confidential system to respond to ethics questions
Make certain the company is in compliance with government regulation
Monitor and audit ethics conduct
Take action when there is a code violation
Review and update the code

7. Ethics Training and Communication
Educates employees about the firm’s policies, expectations, relevant laws and regulations, and general social standards
Makes employees aware of available resources, support systems, and personnel who can assist with ethics and legal advice
Can empower employees

8. Training and Communication Initiatives
Should reflect the unique characteristics of an organization
Must operate with a strong foundation
Are more effective if employees engage in exercises that involve solving ethical dilemmas that relate to their job

9. Establishing Systems to Monitor and Enforce Ethical Standards
Help or assistance lines
Observation and feedback
Whistle-blowing

10. Questions to Ask Before Engaging in External Whistle-blowing
Have I exhausted internal anonymous reporting opportunities within the organization?
Have I examined company policies and codes that outline acceptable behavior and violations of standards?
Is this a personal issue that should be resolved through other means?
Can I manage the stress that may evolve from exposing potential wrongdoing in the organization?
Can I deal with the consequences of resolving an ethical or legal conflict within the organization?

11. Continuous Improvement of the Ethics Program
Putting strategies into action
Translating a plan of action into operational terms and monitoring, controlling, and improving organizational performance

12. Implementing Organizational Ethics Programs
Role of leadership
Transformational leaders
Transactional leaders

13. Leaders influence Corporate Culture
Organizational leaders use their power and influence to shape corporate culture. Power refers to the influence that leaders have over the behavior and decisions of subordinates.

14. Five Power Bases Reward power Coercive power Legitimate power
Expert power
Referent power

15. Variation in Employee Conduct
Because people are culturally diverse and have different values, they interpret situations differently and will vary in the ethical decisions they make on the same ethical issue.