by Kishore

Created on: March 06, 2011

       Ethical behavior is important and is good for business. Ethical behavior includes social responsibility, integration to the local community, a long-term stakeholder approach, treating suppliers and employees as partners and respect for the environment. Ethical behavior and competitiveness are not complementary. Ethical behavior helps businesses to grow and to be more competitive. Milton Friedman and Alfred Carton argued that businesses are responsible for stockholders and employees need to set aside personal ethics to meet the needs of the corporation. Virtue ethicists such as Morse opposed the ideas of Milton Friedman and Alfred Cart. Virtue ethicists argue that businesses are responsible for stakeholders and not just stockholders. Stakeholders include customers, employees, communities, management and stockholders. Day-to-day and moment-to-moment decisions made by employees and managers affect the lives of various stakeholders and ethical behavior needs to be an integral part of the decision making. Ethics, values, integrity and responsibility are no longer optional. Ethics are not just the responsibility of corporate officers or human resource professionals. Ethical behavior is the responsibility of everyone. There are no uniform ethical standards. Some are explicitly written and published and some are implicit and understood. Some are followed and some are ignored. Sometimes ethics come down to own personal values and beliefs. 

     Information revolution including world wide web has significantly changed the world that we live in. Information availability and public awareness is one of the driving forces behind the buzz about ethics. As information technology plays central role in business management, opportunities and innovation, technology managers and IT professionals play an important role in setting up and implementing ethical standards.

         Management commitment and clear involvement from the top are very important. Management needs to walk the walk, abide by solid ethics, provide resources to establish ethical culture, provide appropriate training and encourage employees to do the same. Management can establish a framework which defines the principles and code of ethics to manage the business and take account of economic, environmental and social factors in day-day decisions. Framework needs to include business related responsibilities such as providing value add to customers, creating new wealth, creating new jobs, rewarding hard work and results, promoting invention and ingenuity and providing reasonable returns on investment. Framework also needs to include outside business responsibilities such as sense of community, respect for the dignity of individuals, respect for the law, social justice, liberty, freedom, open communication and contribution to the society. The key to implementing the framework is to get the buy in from the stakeholders especially employees. After the framework is established using written rules and appropriate training is provided, these rules need to be applied consistently. Periodic reviews, independent audits along with programs such as anonymous speak up programs to review the implementation, publishing periodic news bulletins to provide guidelines related to the implementation can help in addressing the areas of non-compliance, controlling and improving the framework.

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