Case Study PROGRAMME Bachelor of Commerce in Human Resource Management MODULE Human Resource Ethics in Business YEAR Two (2) INTAKE July 2021 Semester 2 TOTAL MARKS 30 CASE STUDY [30 Marks] Read the following case study and then answer the questions that follow. The Best Person for the Job After 25 years, Ismail is finally ready to retire and take it easy. Ismail teaches Accounting and General Business courses at Mzansi College. The Business Department at Mzansi College offers Business Administration classes transferable to Gauteng University (GU) as well as professional and technical programs that culminate in a certificate after one year of study. Mzansi College has a dual enrollment agreement with Gauteng University (GU), and as a result, many business students at Mzansi College are also enrolled at GU. Ismail teaches several of the business transfer classes at Mzansi College, but his real love is the non-transfer professional Accounting program. He was part of the faculty that created the program, and over the years he has taught hundreds of Accounting students and helped them obtain internships and find employment in the community. Ismail’s golfing buddy sometimes jokes that every bookkeeper in town has been through Ismail’s Accounting classes. Besides the regular Accounting classes and internships, Mzansi College maintains an Accounting lab where students can get tutoring help if needed. The current lab tutor is Mark, who was hired two years ago when Dianne retired after nearly 10 years as the Accounting tutor. Mark is a former student of Ismail’s and holds a BCom Accounting degree. The lab job is part-time, which works out perfectly for Mark, leaving him plenty of time to pursue his MBA in Accounting at Gauteng University. Mark wants to teach Accounting at Mzansi College when he completes his MBA. As a tutor, Mark has brought the Accounting Lab to life. He relates well with students, is an excellent tutor, and the faculty sees him as a valuable member of the department. In the two years he has worked in the lab, Mark has become good friends with Bongani, the Business Department Dean. They frequently have lunch together and even socialize with their wives outside of work. Last summer the families went camping together over Heritage Day, the 24th of September, and this year they expect to do the same. Bongani is Chair of the Recruitment Committee to find Ismail’s replacement. The committee consists of Bongani, two additional faculty members, an administrator from another department and Thandi, the Department Chair for Business and Accounting. On Monday morning, Thandi met with Bongani to plan out the recruitment process. “I know HR requires us to do a job search,” said Bongani, “but even so, there’s no reason why we can’t move Mark into Ismail’s position. He relates well with our students, knows all the ins and outs of the college, and is well liked by the faculty.” Thandi is surprised at Bongani’s suggestion. “Mark is a nice guy, and we all like him,” she said, “but he’s not qualified. This position requires a master’s degree, and he’s only got a bachelor’s.” “He doesn’t need a master’s degree to teach in the professional/technical program,” said Bongani. “He’s perfectly qualified for that, and we have plenty of other faculty that can teach the transfer program. Mark is in university anyway. He’ll get his MBA next year, and until then, we’ll just schedule him for the professional/technical program, and we’ll fit the other classes into other faculty members’ schedules.” “This is not how we normally replace faculty,” said Thandi. She was particularly disturbed that Bongani’s attitude indicated it was a done deal. “It’s no problem,” said Bongani. “And besides, this is how things actually work. The only reason why I got to advance in my career is due to a friend in a management position who recognised my potential and overrode HR processes to promote me. I would like to do that for Mark too. Recruitment is just a superficial, meaningless HR exercise anyway. I’ll have the paperwork ready for your signature by tomorrow.” The paperwork, marked “confidential”, was in Thandi’s mailbox the following morning. It contained all the documents necessary for HR to launch a full-scale recruiting plan, including a new job description written by Bongani. Instead of the customary broad-based job description for a faculty member qualified to teach university-transferable and non-transferable classes, Thandi found a job description that described Mark exactly. “This is a set-up,” Thandi mumbled to herself. She knows that even with five members on the Recruitment Committee and the required selection process, the actual hiring decision is left to the Dean. “It looks like Mark’s got the job no matter what. What good is Mzansi College’s Ethics Committee when the Deans have the power to do as they please anyway?” Answer ALL the questions in this section. Question 1 (10 Marks) Discuss the case study from the perspective of utilitarianism. Question 2 (10 Marks) "Individuals can affect the ethical culture of the organisation that they work for, but the opposite can also happen." Critically discuss this statement in relation to the information presented in the case study. Question 3 Discuss the extent to which ethical leadership is evident in the case study. (10 Marks) Bachelor of Commerce in Human Resource Management HUMAN RESOURCE ETHICS IN BUSINESS Module Guide Copyright © 2021 MANCOSA All rights reserved; no part of this book may be reproduced in any form or by any means, including photocopying machines, without the written permission of the publisher. Please report all errors and omissions to the following email address: modulefeedback@mancosa.co.za Bachelor of Commerce in Human Resource Management HUMAN RESOURCE ETHICS IN BUSINESS Preface.................................................................................................................................................................... 1 Unit 1: Ethical Theories ........................................................................................................................................... 8 Unit 2: Sources of Ethics ....................................................................................................................................... 17 Unit 3: Human Resources and Ethical Issues ....................................................................................................... 24 Unit 4: Ethics and Human potential ....................................................................................................................... 37 Unit 5: Role of HR in creating Ethical culture ........................................................................................................ 45 Unit 6: Accountability, Responsibility, Corporate Governance and CSR............................................................... 52 Unit 7: Code of Ethical guidelines ......................................................................................................................... 61 Answers to Revision Questions ............................................................................................................................ 70 Bibliography .......................................................................................................................................................... 93 i Human Resource Ethics in Business Preface A. Welcome Dear Student It is a great pleasure to welcome you to Human Resource Ethics in Business (HREB7) to make sure that you share our passion about this area of study; we encourage you to read this overview thoroughly. Refer to it as often as you need to, since it will certainly make studying this module a lot easier. The intention of this module is to develop both your confidence and proficiency in this module. The field of Human Resource Ethics in Business is extremely dynamic and challenging. The learning content, activities and self- study questions contained in this guide will therefore provide you with opportunities to explore the latest developments in this field and help you to discover the field of Human Resource Ethics in Business as it is practiced today. This is a distance-learning module. Since you do not have a tutor standing next to you while you study, you need to apply self-discipline. You will have the opportunity to collaborate with each other via social media tools. Your study skills will include self-direction and responsibility. However, you will gain a lot from the experience! These study skills will contribute to your life skills, which will help you to succeed in all areas of life. We hope you enjoy the module. MANCOSA does not own or purport to own, unless explicitly stated otherwise, any intellectual property rights in or to multimedia used or provided in this module guide. Such multimedia is copyrighted by the respective creators thereto and used by MANCOSA for educational purposes only. Should you wish to use copyrighted material from this guide for purposes of your own that extend beyond fair dealing/use, you must obtain permission from the copyright owner. 1 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business B. Module Overview  Globally, professionalization of business with a lot of regulatory demands from legislation and societal pressures requires businesses to conduct their operations in professional and ethical manner. Compliance to legislation and corporate governance are key in ensuring a good image and integrity for businesses. The purpose of this module is to teach core themes and issues of ethics in Human Resource Management. Students will be exposed to some of the ethical dilemmas facing Human Resource Practitioners in the 21st century business and organisations in general. It is expected that in completion of this module students will be able to understand ethical issues facing business in general and Human Resource in particular. Students will also be able to identify what solutions Human Resource must consider in solving Human Resource ethical dilemmas in the workplace.  The module is a 15 credit module at NQF level 7.  It is recommended that student should use this module guide in collaboration with the prescribed textbook for this module as well as recommended additional reading material. C. Exit Level Outcomes and Associated Assessment Criteria of the Programme Exit Level Outcomes (ELOs)  Demonstrate the ability to make decisions and Associated Assessment Criteria (AACs)  Scope and context of organisational structure, act appropriately through an understanding of systems and relevant policies human resource organisational structure, systems and relevant management practice understood policies in human resource management practice   Apply various methods and systems in the  Various methods and systems in the development of human resource strategies and development of human resource strategies plans and plans applied Evaluate, select and apply appropriate methods,  Various appropriate methods, procedures or procedures or techniques when effecting human techniques of evaluated, selected and applied resource management functions when effecting human resource management functions  Demonstrate an ability to develop and  Human resource management concepts, communicate ideas and opinions in well-formed ideas and opinions presented in well - formed arguments using appropriate academic and arguments using appropriate discourse professional discourse when engaged in human resources management contexts MANCOSA – Bachelor of Commerce in Human Resource Management 2 Human Resource Ethics in Business   Demonstrate the ability to manage processes Processes and accountability is demonstrated and take accountability in a variety of contexts to manage processes in various contexts relating to the management of human resources relating to the management of human resources  Demonstrate the ability to take decisions and  act ethically and professionally; and  Ethical and professional conduct regarding decision – making demonstrated Contribute to improving organisational culture and climate  Organisational culture and climate strategies of organisations are analysed and evaluated to contribute to continuous organisational development D. Learning Outcomes and Associated Assessment Criteria of the Module LEARNING OUTCOMES OF THE MODULE ASSOCIATED ASSESSMENT CRITERIA OF THE MODULE   Define ethics and its value for human resource management and business  Discuss various sources of Ethics Ethics is defined to explore its values for human resource management and business  Various sources of ethics are explained to determine its role in human resource management and business  Understand the implications of personal  Implications of personal values are identified to understand values and how these may be integrated how these are integrated in business and HRM decision- in business and HRM decision-making making roles roles  Explain the qualities required in ethical  decision making  Assess the suitability of ethical theories Personal qualities are identified to understand how one can make ethical decisions  and moral philosophies in resolving Ethical theories and moral philosophies are assessed to determine how ethical dilemmas can be resolved ethical dilemmas in the human resources and business context  Justify the use of particular mechanisms for developing and sustaining an ethical  Mechanisms are highlighted to achieve sustainable and ethical corporate culture corporate culture. 3 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business  E. Analyse the relationship between human  Relationship between human resource practices and resource practices and business in business are analysed to explore its relation to the relation to the environment environment Learning Outcomes of the Units You will find the Unit Learning Outcomes on the introductory pages of each Unit in the Module Guide. The Unit Learning Outcomes lists an overview of the areas you must demonstrate knowledge in and the practical skills you must be able to achieve at the end of each Unit lesson in the Module Guide. F. Programme Notional Learning Hours This Notional Learning Hours Table is for the Bachelor of Commerce in Human Resource Management programme which is 360 credits. The South African Quality Authority (SAQA) equates one credit with ten notional hours of learning. Notional learning hours are defined in terms of the amount of time it takes for the average student to achieve the learning outcomes. Learning time Types of learning activities % Lectures/Workshops (face to face, limited or technologically mediated)s 10 Tutorials: individual groups of 30 or less 0 Syndicate groups 0 Practical workplace experience (experiential learning/work-based learning etc.) 0 Independent self-study of standard texts and references (study guides, books, journal articles) 60 Independent self-study of specially prepared materials (case studies, multi-media, etc.) 20 Other: Online 10 TOTAL G. How to Use this Module This Module Guide was compiled to help you work through your units and textbook for this module, by breaking your studies into manageable parts. The Module Guide gives you extra theory and explanations where necessary, and so enables you to get the most from your module. MANCOSA – Bachelor of Commerce in Human Resource Management 4 Human Resource Ethics in Business The purpose of the Module Guide is to allow you the opportunity to integrate the theoretical concepts from the prescribed textbook and recommended readings. We suggest that you briefly skim read through the entire guide to get an overview of its contents. At the beginning of each Unit, you will find a list of Learning Outcomes and Associated Assessment Criteria. This outlines the main points that you should understand when you have completed the Unit/s. Do not attempt to read and study everything at once. Each study session should be 90 minutes without a break This module should be studied using the prescribed and recommended textbooks/readings and the relevant sections of this Module Guide. You must read about the topic that you intend to study in the appropriate section before you start reading the textbook in detail. Ensure that you make your own notes as you work through both the textbook and this module. In the event that you do not have the prescribed and recommended textbooks/readings, you must make use of any other source that deals with the sections in this module. If you want to do further reading, and want to obtain publications that were used as source documents when we wrote this guide, you should look at the reference list and the bibliography at the end of the Module Guide. In addition, at the end of each Unit there may be link to the PowerPoint presentation and other useful reading. H. Study Material The study material for this module includes tutorial letters, programme handbook, this Module Guide, prescribed reading which is supplemented by recommended readings. I. Prescribed and Recommended Textbook/Readings There is at least one prescribed and recommended textbooks/readings allocated for the module. The prescribed and recommended readings/textbooks presents a tremendous amount of material in a simple, easyto-learn format. You should read ahead during your course. Make a point of it to re-read the learning content in your module textbook. This will increase your retention of important concepts and skills. You may wish to read more widely than just the Module Guide and the prescribed and recommended textbooks/readings, the Bibliography and Reference list provides you with additional reading. The prescribed and recommended textbooks/readings for this module are: Prescribed Reading/Textbook  Rossouw, D. and Van Vuuren, L., (2017). Business ethics. Oxford University Press.  Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers.  Bratton, J. and Gold, J., (2017). Human resource management: theory and practice. Palgrave.  Hunter, C., (2016). Managing people in South Africa: human resource management as competitive advantage. Sherwood Books. 5 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business  Jamali, D.R., El Dirani, A.M. and Harwood, I.A., (2015). Exploring human resource management roles in corporate social responsibility: the CSR‐HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143.  Nelson, W.A., Taylor, E. and Walsh, T., (2014). Building an ethical organisational culture. The health care manager, 33(2), pp.158-164.  Scott, E., (2016). Ethics and human resource management. In practicing professional ethics in economics and public policy (pp. 215-221). Springer, Dordrecht. J. Special Features In the Module Guide, you will find the following icons together with a description. These are designed to help you study. It is imperative that you work through them as they also provide guidelines for examination purposes. Special Feature Icon Explanation The Learning Outcomes indicate aspects of the particular Unit you have LEARNING to master. OUTCOMES ASSOCIATED ASSESSMENT CRITERIA The Associated Assessment Criteria is the evaluation of the students’ understanding which are aligned to the outcomes. The Associated Assessment Criteria sets the standard for the successful demonstration of the understanding of a concept or skill. A Think Point asks you to stop and think about an issue. Sometimes you THINK POINT are asked to apply a concept to your own experience or to think of an example. You may come across Activities that ask you to carry out specific tasks. ACTIVITY In most cases, there are no right or wrong answers to these activities. The purpose of the activities is to give you an opportunity to apply what you have learned. At this point, you should read the references supplied. If you are unable READINGS to acquire the suggested readings, then you are welcome to consult any current source that deals with the subject. PRACTICAL Practical Application or Examples will be discussed to enhance APPLICATION understanding of this module. OR EXAMPLES MANCOSA – Bachelor of Commerce in Human Resource Management 6 Human Resource Ethics in Business KNOWLEDGE You may come across Knowledge Check Questions at the end of each CHECK Unit in the form of Knowledge Check Questions (KCQ’s) that will test QUESTIONS your knowledge. You should refer to the Module Guide or your textbook(s) for the answers. You may come across Revision Questions that test your understanding REVISION QUESTIONS of what you have learned so far. These may be attempted with the aid of your textbooks, journal articles and Module Guide. Case Studies are included in different sections in this Module Guide. CASE STUDY This activity provides students with the opportunity to apply theory to practice. You may come across links to Videos Activities as well as instructions VIDEO ACTIVITY 7 on activities to attend to after watching the video. MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Unit 1: Ethical Theories MANCOSA – Bachelor of Commerce in Human Resource Management 8 Human Resource Ethics in Business Unit Learning Outcomes CONTENT LIST LEARNING OUTCOMES OF THIS UNIT: 1.1. Introduction  1.2. What is Ethics  Introduce topic areas for the unit Define ethics and its value for human resource management and business 1.3. Difference between ‘Ethics’ and ‘Morals’  Distinguish between ethics and morals 1.4. ‘Ethics’ and Human Resource  Understand the effects of ‘ethics’ in the HR Management profession 1.5. Ethics and Law  Discuss the difference between ethics and law 1.6. Ethics and Values  Identify the different kinds of values one can find in an organisation 1.7. Ethical Theories and Frameworks  Outline theories found in moral philosophy of ethics 1.8. Theories of modern Corporation  Describe the theories of modern corporation 1.9. Summary  Summarises the content areas of the unit Ethics - is the discipline dealing with what is good and bad or right and wrong or with moral duty and obligation. Ethics- refer to standards of conduct or codes of conduct for specialized groups. Deontology - This perspective of moral philosophy argued that being ethical means to exercise one duties and obligations over individuals or society. Justice - The justice ethical principle falls under the perspective of ‘egalitarianism’ which states that all people are equal, have equal rights and should be treated fairly and equitably. Stakeholder theory - this theory argues that corporations have responsibilities towards stakeholders other than shareholders (Armstrong and Taylor, 2014). 9 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Prescribed / Recommended Readings  Rossouw, D. and Van Vuuren, L., (2017). Business ethics. Oxford University Press, Chapter 1.  Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers.  Bratton, J. and Gold, J., (2017). Human resource management: theory and practice. Palgrave.  Hunter, C., (2016). Managing people in South Africa: human resource management as competitive advantage. Sherwood Books.  Jamali, D.R., El Dirani, A.M. and Harwood, I.A., (2015). Exploring human resource management roles in corporate social responsibility: the CSR‐HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143.  Nelson, W.A., Taylor, E. and Walsh, T., (2014). Building an ethical organisational culture. The health care manager, 33(2), pp.158-164.  • Scott, E., (2016). Ethics and human resource management. In practicing professional ethics in economics and public policy (pp. 215-221). Springer, Dordrecht. MANCOSA – Bachelor of Commerce in Human Resource Management 10 Human Resource Ethics in Business 1.1. Introduction Globally, professionalization of business with a lot of regulatory demands from legislation and societal pressures requires businesses to conduct their operations in professional and ethical manner. Compliance to legislation and corporate governance are key in ensuring a good image and integrity for businesses. Human Resource division as one of the most important functions within the organization is not immune to these demands of legislative compliance and societal demands that require HR to ‘act right’ and ‘do right’. Ethical requirements, legislative demands and policy compliance are issues that Human Resource Practitioners across the board should be aware of and be capacitated to effectively deal with them. This unit provides a comprehensive definition of what is ethics in the workplace and what are morals and it also explains how these concepts are relevant to the HR division in the organization. Ethics comes from the moral philosophy that distinguishes what is right from wrong, good from bad and ethics theories are believed to set the foundational guidelines for decision making when one is required to make a decision by distinguishing right from wrong and good from bad. 1.2. What is Ethics Ethics - is the discipline dealing with what is good and bad or right and wrong or with moral duty and obligation. Ethics- refer to standards of conduct or codes of conduct for specialized groups. Term ‘ethics’ is also used to denote the field of moral philosophy; moral philosophical theories of ethics are concerned with principles of conduct that govern behavior. Business ethics- focus on moral standards as they apply to organizations and behavior of organizational members. “Considering what is good and right, for the self and other, and can be expressed in terms of the golden rule, namely, to treat others as you would like to be treated yourself” “In the context of organizations; ethics refers to ethical values applied to decision making, conduct and the relationship between the organization, its stakeholders and broader society” (King IV report, 2016). Human Resource Ethics- “Human resources professionals are given a great deal of moral, ethical and legal responsibilities. In recruiting, training, reviewing, terminating and working with employees, there are a great deal of ethical ramifications. These positive or negative consequences can have a huge impact on the business at large. In a maze of complicated relationships, business associations, and personnel issues, many in the workplace look to a human resources team for guidance. That is why human resources professionals are encouraged to stick to ethical codes of conduct to guide their behaviors” (cornerstone, 2018). 1.3. Difference between ‘Ethics’ and ‘Morals’ The two terms are usually used interchangeably although only under particular fields such as legal field and academia where clarity of facts is important a distinction of the two will be made. The term ‘morals’ is usually used to refer to an individual’s moral beliefs, principles and values, morals can be subject and individualistically orientated. On the other hand, ethics are usually used to refer to the standard and accepted norms and levels of behavior by a certain community of group of people, e.g. HR ethics, legal ethics, business ethics, so ethics are more community orientated in perspective. Generally, the terms are related although one can draw a thin between their distinctiveness. 11 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business 1.4. ‘Ethics’ and Human Resource Management With professionalization of HR, the need arose for uniform code of ethics. There are many kinds of ethical codes and most professions have their own (business, HR, Medical, Law, Education etc.). Most decisions in business particularly those relating to HR have an ethical component. The ethical activities (selection, recruitment, compensation, training, promotions etc.) are not only a means to gain competitive advantage, they are also important vehicles for promulgating an ethical culture. To ensure fairness and integrity in recruitment, compensation, promotions and other key activities of the HR division within the organizations, ethical principles must be applied, policy and legal compliance need to be applied, this is why ethical behavior is a very important component in Human Resource Management. Most organizations have a ‘Code of Ethics’ or ‘Code of Conduct’ in place, which serves a guide on how the Human Resource division should behavior while exercising their duties within the organization. 1.5. Ethics and Law Both ethics and the law strive towards determining what is acceptable and responsible in human interaction and society. The law does so through a public and political process and employs the power of the state to ensure that all abide by the stipulations of the law. Ethics emanates from personal or societal values; the sense of ethical obligation to do what is right is based on internal convictions rather than on external coercion as in the case of the law (Rossouw & Van Vuuren, 2017). 1.6. Ethics and Values Values can be defined as relatively stable convictions about what is desirable. Three different kinds of values can be distinguished within business organizations: 1. Strategic values 2. Work values 3. Ethical value (Rossouw & Van Vuuren, 2017) 1.7. Ethical Theories and Frameworks The following are theories found in the moral philosophy of Ethics: Deontology Deontological philosophy originated from the moral philosophy work of Immanuel Kant, it is also referred to as the ‘Kantian Duty’ theory. This perspective of moral philosophy argued that being ethical means to exercise one duties and obligations over individuals or society. This means that it was not focused on consequences of those duties or obligations. What is important here is to religiously follow your official obligation, duties and policies in making decisions and in your actions. The strength of this theory is consistency as one will respond in a similar to all being consistent in their actions at all times. Weaknesses observed in this theory is that it does not care or consider the consequences what is important here is to do your obligations and duties (Rossouw & Van Vuuren, 2017) Justice MANCOSA – Bachelor of Commerce in Human Resource Management 12 Human Resource Ethics in Business The justice ethical principle falls under the perspective of ‘egalitarianism’ which states that all people are equal, have equal rights and should be treated fairly and equitably. Strength of this theory is that we are all equal irrespective of who you are in society and we should all be treated the same way. It also advocates for fair and equal distributions of resources and human needs. Weaknesses’ can be that, in circumstances where there is imbalance, it will need to prioritize the disadvantage over those who are in positions of privilege in order to achieve its vision of equity, this will not go well with others and especially those who will have to give way for others in employment opportunities, resources, testimony of this in South Africa was the introduction of laws such as BEE, ‘Employment equity act and its affirmative action policy’ etc. not everyone welcomed these pieces of legislation with warm hands. Utilitarianism Utilitarian ethical theories take the perspective that an ethical decision is the one that benefits the majority. It is a decision which is concerned with the greatest good to many. It is not individualist or egoistic in nature, actually individual feelings or needs take a better seat here if the majority will not benefit. Strength of this theory is that it respects the needs for the majority but the weakness here is that the minority can be disadvantaged. (Armstrong & Taylor, 2014) Rights This perspective is all about rights that are endorsed by the majority. It is also rights that are agreed upon between individuals. Decisions here are based on the rights, e.g. in South Africa, employees have a right to strike, this right needs to be respected by company’s even those that are against ‘strikes’ just because the right is endorsed by the majority through democratic processes. The weakness here is that in some instances when people exercise their rights they might ignore their responsibilities and thereby act on the right that infringe on other people as they abdicated the responsibility part. E.g. A work strikes that damages other people’s property e.g. other employee’s cars at work. Consequentialism This theory argues that a decision’s ethical nature can be judged by the consequences of that decision. It does not matter if the decision was based on a particular law or policy, particular duty or obligation or is someone’s right or not but its consequences is what matters the most. Therefore, what is important here is to determine the consequences before one can make a particular decision, will the consequences be good or bad is what should reign supreme according to consequentialism theory (Rossouw & Van Vuuren, 2017) 13 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Table 1Table 1.1. Summary of ethical frameworks (Armstrong & Taylor, 2014) Ethical Framework and Strengths Weaknesses Looks at all consequences on all Difficult to predict and quantify all affected, universalistic not consequences. Can result in unfair egoistic. distribution of common good. Protects individual from being Can be difficult in practice to make used a means to an end. distinction between means and end. Consistent with the golden rule Universality vs respect for autonomous ‘do unto others as would have beings’ test not sufficient. Principle Utilitarianism Consequentialism, greatest good for greatest number. Kantian Duty Non-consequentialism, universal respect for autonomous beings. Focus on moral duty than them unto you’. consequences. Justice Egalitarianism – all people are equal with equal rights. Fair distribution of benefits and burdens Moral Rights Individual entitlements which impose obligations on others Attempts to allocate resources Can encourage a sense of entitlement and costs fairly and objectively. that reduces innovation and Protects those who lack productivity. Can result in reducing representation and provides rights to some to accommodate rules of basic welfare. justice. Protects the individual from Can be misinterpreted and result in harm. Consistent with universal selfish behavior. Can promote personal human rights liberties that impede productivity efficiency. Difficult to balance conflicting rights. 1.8. Theories of modern Corporation Stakeholder Theory – this theory argues that corporations have responsibilities towards stakeholders other than shareholders. Legal argument: Employees, suppliers, customers and local communities have legally protected rights that have to be respected by corporations. Economic argument: In pursuing their goals, corporations often pollute the environment or disrupt communities. Corporations therefore have to be regulated to prevent their imposing extravagant costs on societies. Stakeholders: The following two principles provide the basis for stakeholder theory: Principle of Corporate Rights: The Corporation and its managers may not violate the legitimate rights of others to determine their own future. MANCOSA – Bachelor of Commerce in Human Resource Management 14 Human Resource Ethics in Business Principle of Corporate Effects: The Corporation and its managers are responsible for the effects of their actions on others. Questions for Reflection 1) . Briefly define the term ‘Ethics’? 2) What is the difference between Ethics and Morals? Explain. 3) Why are Ethics important in the management of Human Resources? 4) Discuss five ethical theoretical frameworks of moral reasoning Activity Discuss few more examples of work values, in distinction from ethical values, other than the usual ones of punctuality and innovation? Write down your answer. Case Study : Company values, beliefs and ethical principles In recent years, Google has been under major scrutiny for gender discrimination, and the Department of Labour is investigating Google for a potential gender pay gap. As a result, Google has made a major push to create a more diverse and inclusive work culture. In August of 2017, Google fired a male software engineer, James Damore, after he internally posted a memo that relied on inaccurate gender stereotypes to criticize Google’s implementation of its diversity and inclusion initiative. The memo was leaked to the press, which lead to a public outcry and exacerbated an already tense time for gender diversity in Silicon Valley. Damore says he was trying to point out that sometimes conservative viewpoints aren’t welcome at Google because of its liberal “echo chamber.” The memo also says that Google discriminates against certain employees and offers development opportunities “only for people with a certain gender or race,” and that Google has lowered the bar by hiring diverse candidates. Damore believes that in order to have a truly diverse culture, Google needs to create a safe space for more conservative views. Damore’s memo also states that one of the central reasons there are fewer women than men in tech is women are biologically different from men. Damore then references scientifically unfounded gender stereotypes to support this line of reasoning. Some of the stereotypes he uses include: women are more neurotic than men; women are less capable of handling stress; and women are better at relationships than men because men are better at “things.” The day after the memo was leaked, Google’s VP of Diversity and Inclusion, Danielle Brown, issued a statement criticizing the discriminatory content of the memo, saying it did not align with Google’s dedication to creating a truly diverse workforce. Three days after the public release of the memo, Damore confirmed Google had fired him. 15 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Sundar Pichai, Google’s CEO, released a statement explaining the decision to fire Damore. Pichai’s statement points out that some of Damore’s criticisms of Google’s attempts at creating a truly diverse culture are valid, but the memo violated parts of the company’s code of conduct “by advancing harmful gender stereotypes in our workplace.” Pichai also writes, “To suggest a group of our colleagues have traits that make them less biologically suited to that work is offensive and not OK.” Those who disagree with the firing say it confirms Damore’s main argument: that Google does have a liberal echo chamber; Google is intolerant to conservative views; and that its diversity efforts have actually backfired and stifled diversity. Others who disagree point to Damore’s right to free speech. However, there is some legal ambiguity in this case because companies have the legal right to fire an employee who makes statements that could create a hostile working environment for other employees in a protected class (gender, age, sexual orientation, etc.). (Source: www.scu.edu/ethics/focus-areas/business-ethics) Case Study Questions 1. Legally, Google’s firing of Damore may or may not be problematic, but is it ethical? 2. Would you have made the same decision if you were Pichai? 3. Is it ethical for an organisation to fire someone who expresses beliefs that don’t align with the overall culture? 4. Do efforts towards a more diverse work culture stifle employee from speaking out? What can leaders do to avert this potential outcome? 1.9 Summary Human Resource Professionals need to be familiar with these theoretical foundations of moral reasoning as they are vital in guiding one to make better decisions when faced with ethical dilemmas in the workplace. They are the foundation upon which ethical policies and ethical code of behavior should be built upon. MANCOSA – Bachelor of Commerce in Human Resource Management 16 Human Resource Ethics in Business Unit 2: Sources of Ethics 17 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Unit Learning Outcomes CONTENT LIST LEARNING OUTCOMES OF THIS UNIT: 2.1 Introduction  Introduce topic areas for the unit 2.2 Sources of Ethics  Discuss various sources of Ethics 2.3 Personal and Organisational Ethics  Understand the implications of personal values and how these may be integrated in business and HRM decision-making roles 2.4 Summary  Summarises content areas of the unit Sources of Ethics - “Primarily ethics in business is affected by three sources - culture, religion and laws of the state. Personal and organization ethics - Individuals can affect the ethical culture of the organization they work for. But the opposite can also happen. The organization can have either a constructive or a corruptive influence on the moral character of the people that work there. MANCOSA – Bachelor of Commerce in Human Resource Management 18 Human Resource Ethics in Business Prescribed / Recommended Readings • Rossouw, D. and Van Vuuren, L., (2017). Business ethics. Oxford University Press, Chapter 1. • Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers. • Bratton, J. and Gold, J., (2017). Human resource management: theory and practice. Palgrave. • Hunter, C., (2016). Managing people in South Africa: human resource management as competitive advantage. Sherwood Books. • Jamali, D.R., El Dirani, A.M. and Harwood, I.A., (2015). Exploring human resource management roles in corporate social responsibility: the CSR‐ HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143. • Nelson, W.A., Taylor, E. and Walsh, T., (2014). Building an ethical organisational culture. The health care manager, 33(2), pp.158-164. • Scott, E., (2016). Ethics and human resource management. In practicing professional ethics in economics and public policy (pp. 215-221). Springer, Dordrecht. 19 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business 2.1. Introduction Ethics come from various sources such as the way one was brought up, socialized in society, their background, personal values, philosophies and morals as well as religion, culture and the laws that exist in their environments in the organization they work for and the country where they live. This mixed bucket of ethical sources are what makes an individual’s ethical tapestry. This chapter will mainly focus on the three sources of ethics found in scholarly work of business ethics and management in general which are culture, religion and law. 2.2. Sources of Ethics “Primarily ethics in business is affected by three sources - culture, religion and laws of the state. It is for this reason we do not have uniform or completely similar standards across the globe. These three factors exert influences to varying degrees on humans which ultimately get reflected in the ethics of the organization” (management study guide, 2018). Three sources of ethics found in scholarly work of business ethics and management in general are culture, religion and law as depicted in figure 2.1, below. “Religion - It is one of the oldest foundations of ethical standards. Religion wields varying influences across various sects of people. It is believed that ethics is a manifestation of the divine and so it draws a line between the good and the bad in the society. Depending upon the degree of religious influence we have different sects of people; we have sects, those who are referred to as orthodox or fundamentalists and those who are called as moderates. Needless to mention, religion exerts itself to a greater degree among the orthodox and to lesser extent in case of moderates. Fundamentally however all the religions operate on the principle of reciprocity towards one’s fellow beings?” (Management study guide, 2018). “Culture - Culture is a pattern of behaviors and values that are transferred from one generation to another, those that are considered as ideal or within the acceptable limits. No wonder therefore that it is the culture that predominantly determines what is wrong and what is right. It is the culture that defines certain behavior as acceptable and others as unacceptable. Human civilization in fact has passed through various cultures, wherein the moral code was redrafted depending upon the epoch that was. What was immoral or unacceptable in certain culture became acceptable later on and vice versa. During the early years of human development where ones who were the strongest were the ones who survived! Violence, hostility and ferocity were thus the acceptable. Approximately 10,000 year ago when human civilization entered the settlement phase, hard work, patience and peace were seen as virtues and the earlier ones were considered otherwise. These values are still in practice by the managers of today! Still further, when human civilization witnessed the industrial revolution, the ethics of agrarian economy was replaced by the law pertaining to technology, property rights etc. Ever since a tussle has ensued between the values of the agrarian and the industrial economy” (Management study guide, 2018). “Law - Laws are procedures and code of conduct that are laid down by the legal system of the state. They are meant to guide human behavior within the social fabric. The major problem with the law is that all the ethical MANCOSA – Bachelor of Commerce in Human Resource Management 20 Human Resource Ethics in Business expectations cannot be covered by the law and specially with ever changing outer environment the law keeps on changing” (Management study guide, 2018). Figure 1Figure 2.1. Sources of Ethics (image: businessjargons.com) Childhood Upbringing and Life Experiences According to Head (2006) the way we were brought up and socialized and also life experiences we had later in life also play a key role in shaping our ethical standards. “Without really thinking or even being able to avoid it, each person learns ethics from his or her parents—what they teach in words and perhaps more importantly through their actions. These teachings shape our most fundamental attitudes about what is "right" and what is "wrong." As a very brief insurance-related example, the child of an insurance agent, upon reaching adulthood, is much more likely to be honest and truthful in settling claims under his or her insurance policies than is the grown child of another insurance agent if the other agent was terminated by the insurer under disputed circumstances. The child may not have understood the intricacies of those circumstances at the time, but as an adult, he or she is likely to believe in their heart that insurers are not to be to be trusted and do not deserve to be treated honestly” (Head, 2006). Similarly, a life-shaping event later in life may more directly and consciously shape a person's ethics. Thus, someone severely injured in an automobile accident may have a much higher opinion of the entire automobileinjury reparations system—including the police who investigated, the hospital that provided care, the lawyers and courts that resolved any legal issues, and the insurers that helped finance so much of the injured person's recovery if that person is satisfied with the ultimate medical and financial result months and years after the accident. If, however, this victim feels the result was medically inferior or legally unfair, the victim may well treat everyone in the system unfairly—even years later in circumstances unrelated to the original accident—just to seek some measure of personal "justice." (Head, 2006) 2.3. Personal and Organizational Ethics Individuals can affect the ethical culture of the organization they work for. But the opposite can also happen. The organization can have either a constructive or a corruptive influence on the moral character of the people that work there. Organizations are not isolated from the broader society and social norms within which they operate. Society 21 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business can corrupt or conserve business organizations, but business can also contribute towards corrupting or improving the moral fiber of society. (Rossouw & Van Vuuren, 2017) Case Study : McDonald’s in India McDonald's, home of the Big Mac, has been threatened with protests over plans to open restaurants in two of India's most revered religious centers and pilgrimage sites. Meat is off the menu at two McDonald's catering for pilgrims in India. Meat is off the menu at two McDonald's catering for pilgrims in IndiIn a nod to religious and dietary sensitivities, the restaurants will be vegetarian. But the fast food giants' chosen locations are proving controversial regardless. The first site, Katra in Jammu and Kashmir, is home to Shri Mata Vaishno Devi, one of Hinduism's four holiest shrines and an unlikely haven for the chain that slaughters millions of cows, which are sacred to Indians, every year for its burgers, quarter-pounders and Big Macs. The second vegetarian restaurant is planned for Amritsar, home of the Golden Temple, the center of the Sikh religion in Punjab. Both form part of the fast food giant's aim to double its size in one of the world's fastest growing economies. Although Sikhs are not forbidden from eating meat, their temples serve only free vegetarian food to pilgrims and visitors. The opening of vegetarian-only outlets is the latest attempt by the global giant to win over an initially resistant people wedded to their own distinct spicy cuisine. Beef has never been on the menu since McDonald's first opened its first Indian store in Delhi in 1996. How McDonald's 'golden arches' will be welcomed by pilgrims returning from the Golden Temple or the arduous climb to worship the golden shrine to Shri Mata Vaishno Devi – an act of purification for Hindus – remains to be seen. The shrine is a steep ascent of 3,000 feet from Katra, high in the Himalayan foothills and a ten-mile hike through difficult terrain. Eighteen thousand pilgrims make the climb to the cave where the shrine is housed and many of them wait up to 20 hours for their darshan or viewing of the 'Mother Goddess'. McDonald's is hoping her eight million devotees, having emerged pure from their mountain pilgrimage will be hungry to carb-load on fries and burgers. "We see a huge potential (for veg outlets) as, by nature, Indians are religious," Vikram Bakshi, who manages McDonald's restaurants in east and north India, told the Economic Times. But the Hindu nationalist group Swadeshi Jagran Manch, a branch of the influential Rashtriya Swayamsevak Sangh (RSS) said it would oppose McDonald's plans and described them as an attempt to "humiliate Hindus". "It's an attempt not only to make money but also to deliberately humiliate Hindus. It is an organization associated with cow slaughter. If we make an announcement that they're slaughtering cows, people won't eat there. We are definitely going to fight it," its national co-convener S. Gurumurthy told The Daily Telegraph. A McDonald’s spokesman said: “The new restaurants in pilgrimage areas will be vegetarian-only because of the specific area and customer base. This further speaks to McDonald’s efforts to cater to local tastes.” (Source: https://www.telegraph.co.uk) MANCOSA – Bachelor of Commerce in Human Resource Management 22 Human Resource Ethics in Business Case study questions 1. Should companies consider local religious and cultural beliefs in the societies where they conduct business? 2. In your own view, is the decision by McDonald’s to open their restaurants close to the most revered hindu religious centers and pilgrimage sites ethically justified? Motivate your answer? Questions for Reflection 1) List and briefly explain the three sources of ethics? 2) Briefly explain the concepts of personal and organisational ethics? Activity Does an individual’s background determines their ethical standards in the workplace, Discuss? 2.4 Summary People might behave differently at work because of their differences in their backgrounds, culture, religion, country of origin and other differences. As there are various sources of ethics, it is important for organizations to have a standard code of ethics and organizational policies to ensure uniformity in how people behave and conduct themselves within the organization. 23 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Unit 3: Human Resources and Ethical Issues MANCOSA – Bachelor of Commerce in Human Resource Management 24 Human Resource Ethics in Business Unit Learning Outcomes CONTENT LIST LEARNING OUTCOMES OF THIS UNIT: 3.1. Introduction  3.2. List of Ethical issues and challenges  facing Business and HR division Introduce topic areas for the unit Identify the ethical issues facing business and HR division Fairness in employment Fairness in employment 3.3. Ethical issues and challenges: The  South African Context Discuss ethical issues and challenges faced in South Africa 3.4 Ethical Decision-Making  Explain the qualities required in ethical decision making 3.5 Moral Dissensus  Define Moral dissensus 3.6 Assumptions Behind the Rims Theory  Understand the assumptions behind the rims theory 3.7 The Rims Strategy  Discuss the purpose of the rims strategy 3.8 Summary  Summarises content areas of the unit Ethical decision making - are decisions that are fair, legal, meet company requirements and take into consideration the needs and welfare of all those involved and affected by the decision. Rims Strategy – rational interaction and moral sensitivity approach is designed as a decision-making strategy that can be used for both social and personal ethical dilemmas in the workplace. Moral dissensus - Moral dissensus occurs when there is a widespread unhappiness, disagreement and dissent with a particular issue, e.g. policy, law, practice (Rossouw & Van Vuuren, 2017). 25 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Prescribed / Recommended Readings • Rossouw, D. and Van Vuuren, L., (2017). Business ethics. Oxford University Press, Chapter 1. • Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers. • Bratton, J. and Gold, J., (2017). Human resource management: theory and practice. Palgrave. • Hunter, C., (2016). Managing people in South Africa: human resource management as competitive advantage. Sherwood Books. • Jamali, D.R., El Dirani, A.M. and Harwood, I.A., (2015). Exploring human resource management roles in corporate social responsibility: the CSR‐HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143. • Nelson, W.A., Taylor, E. and Walsh, T., (2014). Building an ethical organisational culture. The health care manager, 33(2), pp.158-164. • • Scott, E., (2016). Ethics and human resource management. In practicing professional ethics in economics and public policy (pp. 215-221). Springer, Dordrecht. MANCOSA – Bachelor of Commerce in Human Resource Management 26 Human Resource Ethics in Business 3.1. Introduction The 21st century role of an HR Professional is not an easy one because of the challenges HR Practitioners face on a regular basis. Conflict of interests HR Professionals find themselves in, HR Professionals find themselves in the middle between employees and employers. They find themselves in the middle of a ‘cross fire’ having to be mediators in situations of conflict between employers and employees, in some instances they become accused of taking sides. Making ethical decisions become difficult at times, but with HR understanding their role and mandate in the organization such issues and challenges can be dealt with effectively. 3.2 List of Ethical issues and challenges facing Business and HR division Fairness in employment In South Africa, the Employment Equity Act, 55 of 1998 is a piece of legislation whose purpose is to ensure that there is fairness in employment, the act promotes equal opportunity and fair treatment in employment through elimination of unfair discrimination and recommending the implementation of affirmative action to redress the imbalances of the past where certain groups of people (blacks, women and disabled) were being discriminated against in employment. The first section of the act clearly state that no employee may be discriminated against in employment on the grounds of race, gender, sexual orientation, religious beliefs, marital status, pregnancy, family responsibility, age, ethnic or social origin, disability and conscience belief. This then calls for HR Practitioners to be transparent, fair and ethical in their recruitment processes. (EEA, 1998) Fairness in pay/rewards Prior to 1994 and in some companies even today or currently, there are some employees who are still discriminated against when it comes to compensation and rewards. Discrimination is still observed in some companies where Men are paid better than women, where certain race groups are paid better salaries than others. These is unethical behavior as pay is not supposed to be determined by one’s gender or race. The type of job one does, qualifications and experience should be some of the key criteria used in determining pay levels not one’s skin color, race, gender or ethnic background. This is one of the ethical issues and challenges that are still a pandemic that needs to be remedied in the HR discipline. Bribery Bribery is an illegal act of giving out something of value in the form of money or any valuable thing or offer or to someone who is in a position of influence in return to them giving you what you need or have agreed upon with them, it is transactional in nature i.e. I give you ‘this’ and you must give me ‘that’ in return. In South Africa with the high unemployment rate competition to get jobs is tough. Some people are willing to do anything to get into employment. This has even opened opportunity for people to pay bribes to those with the mandate and powers to place people into available jobs, HR being the main division responsible for recruitment tends to face these incidents of people wanting to pay and some even paying bribes to get jobs. This then calls for HR Practitioners who are professional and ethical in the way they conduct themselves in their jobs. HR Professionals who are honest and 27 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business people of integrity with the ability to say ‘NO’ to bribes and employ people according to the official and legal recruitment processes. (Rossouw & Van Vuuren, 2017). Fraud Fraud refers to ‘theft by trickery’, for someone to be guilty of fraud, the following five elements of fraud have to be proven in court:  Unlawfulness  Intent  Misrepresentation/deception  Causality  Prejudice or potential prejudice (Rossouw & Van Vuuren, 2017). Drivers of Fraud Opportunity: There is a chance to commit fraud without being detected. Motivation: A person must have a reason sufficiently urgent to ignore the potential consequences of getting caught, including dismissal or even imprisonment. Three categories:  Self-centered motives (e.g. personal material gain)  Other-centered motives (e.g. to pay university fees for a child)  Situational motives (e.g. to pay family medical expenses) (Rossouw & Van Vuuren, 2017). Ethics management and fraud prevention Moral capacity: Moral capacity is a self-regulatory system developed over time that allows people to live in accordance with acquired social standards. Ethics management in organizations could be viewed as a way of activating the already existing moral capacity of individuals by creating an environment that triggers it. (Rossouw &Van Vuuren, 2017). Good people do bad things: Well-intentioned, good people can get involved in unethical behavior like fraud by systematically and unknowingly engaging in unethical behavior which allows them to believe in certain ethical standards while acting contrary to them. Ethical decision making is a matter of context as well as character. (Rossouw & Van Vuuren, 2017). Cultivating moral sensitivity and developing moral reasoning: Many companies respond to the risk of fraud through a variety of ethics training and awareness campaigns. Creating environments that promote ethical behavior: This can be done by  embedding moral reminders  eliminating conflicts of interest MANCOSA – Bachelor of Commerce in Human Resource Management 28 Human Resource Ethics in Business  rewarding the right behavior, and  being alert to trivial infractions. (Rossouw & Van Vuuren, 2017). Nepotism In employment, nepotism is when one employs or promotes people on the basis that they are friends, family or relatives not on the basis that they have the skills, knowledge, experience and qualifications for the job. In a country like South Africa where jobs are scarce this is also a challenge for HR Practitioners as they need to really have an ethical backbone to be able to resist falling into this practice that hits close to home as it deals with a person’s loved ones. Ethical principles need to be upheld by HR Professionals to ensure that the right people for the jobs available are employed without favor but on the basis of merit and their capabilities for the job (oxford dictionary, 2018) Child labour Child labour is employing children below the age of 15 to do work supposed to be done by adults and in the process depriving them of their childhood and the opportunity to attend school and grow up like any other normal child. This practice is physically, mentally, emotionally and socially harmful to the child’s life and is chastised by legislation in most countries and legislation from global organizations such as the International Labour Organization (ILO) (Convention No. 182) and the United Nations (UN) (Convention of the rights of the child, 1989). Human Resource Professionals need to act ethically by making sure that no children are employed and exploited in the workplaces (UN,1989) 3.3 Ethical issues and challenges: The South African Context South Africa is one of the countries that is in the fight against unethical practices, fraud and corruption in various sectors and industries in the country. The Ethics institute is an institution that conducts research studies in the area of ethics. The South African Business Ethics Survey (SABES) 2016 is the fourth national business ethics survey that the Ethics Institute has conducted in the private sector in South Africa. Interviews were conducted with 4 795 staff members of various JSE (Johannesburg Stock Exchange) listed and large South African companies to identify the state of ethics in corporate South Africa. The instrument used in the survey is the Ethical Culture Assessment – a standardized instrument developed by the Ethics Institute. Earlier versions of the same instrument were also used in the 2009 and 2013 surveys. Results from the South African Business Ethics Survey (SABES) 2016 are as follows: Observing and reporting misconduct – “In 2016, the percentage of employees who have personally observed misconduct has increased by 11% since 2013 and by 7% compared to 2009. This is disconcerting as it could mean that unethical conduct has increased. However, it could also be because of a higher awareness level of what constitutes unethical behavior brought about through effective training and having a good understanding of the ethical standards of organizations, amongst other interventions. The significant increase in the observation of misconduct, coupled with findings related to the application of policies and how reports of misconduct are dealt 29 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business with, could, if not addressed, result in the acceptance of unethical conduct as 'the way we do business” (South African Business Ethics Survey, 2016.) “There has been a significant decrease in the percentage of employees who reported observed misconduct since 2009. Willingness to report misconduct is closely related to employees' perception that, and experience of their reports being not taken seriously. Furthermore, it is influenced by their perception that, where the findings of investigations result in disciplinary measures, such measures are not applied consistently. Findings about organizational culture suggest that reports are generally not dealt with openly, ethics policies are not consistently applied, and things are not made difficult for unethical people. This is troublesome as we would have expected a greater appreciation among organizations that unethical behavior should not be tolerated” (South African Business Ethics Survey, 2016.) Ethics institute also conducts a bribery survey in the country, Citizens' Bribery Survey is conducted annually with the aim of better understanding the bribery challenges that ordinary South Africans face on a daily basis, their beliefs about bribery, and the socio-economic factors that influence bribery. In Citizens' Bribery Survey of 2017, the results indicated that on the top five things South Africans pay a bribe for, ‘getting a job’ was number three. The report stated that “Bribes for jobs makes up a significant 14% of all bribes asked in South Africa” (Citizens' Bribery Survey, 2017). This is very concerning and worrying for the Human Resource profession as they are the ones who are responsible for recruitment in companies, if 14% of the bribes paid out in the country are for ‘getting jobs’ this means that there are Human Resource Practitioners who conduct their professional duties in an unethical and corrupt manner. This should not be allowed to happen in HR. The above statistics is of high concern and very worrying for organizations in the country and for the human resource discipline. The trend shows an increase in the levels of misconduct/ unethical behavior observed in the workplaces with a decrease in reporting of these incidences as employees fear, intimidation and victimization and the fact that little to no follow up is made when such incidences are reported to management (Citizens' Bribery Survey, 2017). Human Resource Practitioners should be concerned about these trends, pay attention and find ways to solve the problem of misconduct, fraud and corruption in the workplace. The Human resource division should also play a significant role in the attempts to combat unethical, fraudulent and corrupt behavior in the organization. 3.4 Ethical Decision-Making Most decisions in business particularly those relating to HR have an ethical component. The ethical activities (selection, recruitment, compensation, training, promotions etc.) are not only a means to gain competitive advantage, they are also important vehicles for promulgating an ethical culture. Human Resource Practitioners should apply ethical principles at all times in their decision making. MANCOSA – Bachelor of Commerce in Human Resource Management 30 Human Resource Ethics in Business 3.4.1 Qualities required in Ethical Decision making Human Resource Practitioners should possess the following abilities in order for them to be able to determine what is wrong or right when faced with ethical dilemmas and in making decisions on a daily basis:  Emotional Intelligence – the ability to be aware of one’s emotions, be able to control them accordingly while being able to handle other people’s emotions properly.  Social Intelligence – refers to self-awareness and social awareness, being able to relate to other people well and to get them to co-operate well with you.  Mental intelligence – having a mental ability to reason well, perceive situations properly and being able to solve difficult challenges. (Josephson, 1988) Three Qualities Required in Ethical Decision Making (Josephson, 1988) Ethical Consciousness The ability to perceive ethical issues in a situation Ethical competency The ability to engage principled reasoning and problem solving strategies Ethical Commitment A personal resolve to act ethically Questions to be asked in ethical decision making The following questions should be asked to judge the moral soundness of a decision:  Is it legal? - Since businesses are corporate citizens of the societies within which they operate, they have an obligation to ensure that they abide by the laws of their societies. Legal criteria cannot be the only aspect considered when determining the moral soundness of business decisions because the law is not always clear (e.g. in fast-developing fields such as information technology). The law can also be morally flawed and unfair (e.g. apartheid).  Does it meet company standards? – The ethical standards of a company are usually formulated as a set of company values, in a code of ethics, or in policy statements dealing with specific issues, like procurement, expense accounts, or the giving and receiving of gifts. Applying the company standards test to business decisions can be a fairly simple and straightforward process when a company’s ethical standards are formulated very clearly and precisely  Is it fair to all stakeholders? - The two most important ways of discerning the possible impact of decisions on the interests of others are through moral imagination, i.e. the ability to think beyond your own perspective, and stakeholder engagement, i.e. interacting with persona and parties who are likely to be affected by the decision. 31 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business  Can it be disclosed? - The public disclosure test: would you, or the company, be willing and able to provide in public, good and socially acceptable reasons for taking a specific decision? The private disclosure test: would you feel morally comfortable disclosing your decision to the most significant persons in your life? (Rossouw & Van Vuuren, 2017) 3.5 Moral Dissensus Moral dissensus occurs when there is a widespread unhappiness, disagreement and dissent with a particular issue, e.g. policy, law, practice etc. In coping with moral dissensus: instead of the empirical verifiability that modern rationality demands, Habermas (1984) proposes consensus within an ‘ideal speech situation’ as the criterion for ethical knowledge. According to his alternative conception of rationality, knowledge is made in conversational agreement through the interaction of rational participants. While other theories focus on content, his theory focuses on the process by which ethical decisions are made (Rossouw & Van Vuuren, 2017) 3.6 Assumptions Behind the Rims Theory Habermas’ moral theory (1984) forms the backbone of the Rational Interaction for Moral Sensitivity (RIMS) strategy. Assumption 1: Moral dissensus is a given: Modernity, in its attempt to find secular and rational grounding for morality, has produced any number of varying moral theories. All of these are rationally justifiable and defensible, and all need to be taken equally seriously or all need to be rejected. Assumption 2: Moral dissensus does not equal ethical relativism: Interaction between rival moral viewpoints is not only necessary, but is also an important source of creativity that can help to find morally sensitive answers. Assumption 3: Dialogue can produce solutions: Through dialogue, conflicting moral views can be creatively harnessed to produce morally sensitive solutions to moral dilemmas. Assumption 4: Focusing on motives is futile: A focus on underlying motives can at best illuminate the various moral viewpoints, it cannot overcome the rivalry between them. Assumption 5: Only moral arguments are allowed: To qualify, an argument should display a concern and respect for others and not be merely selfish. (Rossouw & Van Vuuren, 2017) 3.7  The Rims Strategy The RIMS approach is designed as a decision-making strategy that can be used for both social and personal ethical dilemmas in the workplace. Social dilemmas arise when different people make conflicting judgments on what is considered to be morally right with regard to a specific situation. Personal dilemmas occur when a person becomes uncertain about what the most appropriate moral decision should be in a specific situation. The purpose of RIMS strategy is to structure a process of rational interaction between the rival points of view in a moral dispute that will result in morally sensitive decisions (coursehero.com) The RIMS strategy begins MANCOSA – Bachelor of Commerce in Human Resource Management 32 Human Resource Ethics in Business with ‘rational interaction’, which is a rational debate between two or more rival views. In such a debate, the opposing views should be presented, analysed and discussed in a reasonable and tolerant way. (Rossouw & Van Vuuren, 2017) Steps in the RIMS strategy:  Generate and evaluate all points of view.  Identify implications.  Find solutions (Rossouw & Van Vuuren, 2017) Objections to the RIMS Strategy  Objection 1: It is too time consuming.  Defence: Change always takes time to achieve, and experience has shown that the quality and durability of change is enhanced when people actively participate in such processes of change.  Objection 2: No-one can be forced to use it. Defence: On the one hand it could simply be dismissed as unimportant, because it is true of most processes of change. On the other, this objection sets up the challenge of how to motivate people to engage in the RIMS process. (Rossouw & Van Vuuren, 2017 Questions for Reflection 1. Discuss five ethical issues and challenges that HR departments face ? 2. Describe and explain which personal qualities one requires to be able to make ethical decisions? 3. List and explain the questions one needs to ask in order to determine the ethical nature of a decision? 4. Discuss the RIMS strategy and its steps in the decision making process? 33 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Think Point 1. Is there a relationship between nepotism, bribery and the level of unemployment in South Africa, or nepotism and bribery are just the actions of inherently immoral people, your thoughts 2. According to the Ethics Institute’s South African Citizens Bribery survey of 2017, in the top five reasons why South African pay bribe ‘getting a job’ was the number three reason in the country and statistics report that 14% of South African paid bribes in 2017 to get jobs? What do you think are the reasons for people to pay bribes to get job? What can be done to avoid this from happening in the country? Activity 1. List the five assumptions behind the RIMS strategy and discuss whether they are valid? 2. Discuss the moral dilemmas to which the RIMS strategy can be applied? Case Study 1 : To bribe or not to bribe? Thandi, a single parent with 2 kids in a private school is a Human Resource Manager at a government department. In the last 10 years working in Human Resources Thandi has always done everything according to the correct legal and official processes.Her department is in the process of employing five Regional Directors. One of the candidates who have applied for these Director posts knows Thandi and has contacted Thandi on her private cellphone offering her a bribe of R40,000 in exchange that Thandi should make sure he gets the Director job. Thandi has financial problems, she is debt, is 3 months behind with monthly payments for her kids school fees. The school has written a final demand letter to her threatening to expel her kids from school and put her through legal action if she does not pay in the next 7 days, she needs the money. She knows that taking a bribe is wrong and if the department can find out she did, she can be suspended or even loose here Job. (Source:Study guide author) Case Study Question  Briefly expolain the meaning of the concept ‘Bribery’?  What should Thandi do? Discuss. MANCOSA – Bachelor of Commerce in Human Resource Management 34 Human Resource Ethics in Business Case Study 2 : Ethical culture change at Siemens: In mid 2007 Peter Löscher was brought in from Merck to take over as CEO. He was charged with establishing a culture of integrity at a time when some of the Board had quit and a number of key executives were facing prosecution. Major restructuring took place in the months to come. Löscher himself stated that “about 80% of the top level of executives, 70% of the next level down, and 40% of the level below that” were replaced in the months that followed his appointment.Importantly Löscher, the first outsider to be a CEO at Siemens, spent considerable time getting to understand the company, its people and activities. A key finding was the level of disappointment in the failure of leadership, contrasting with a history of great staff pride in Siemens. This has a resultant impact on engagement and productivity. This type of outcome reflects recent findings by Harvard’s George Serafeim that “bribery’s most significant impact is its negative effect on employee morale. In order to root out corrupt practices across the business an “amnesty” was offered to staff, excluding former directors. Those who came forward and admitted any involvement in bribery and offered related information could keep their job. Those who did not and who later might be found to be implicated would be fired. It was estimated that around 130 staff came forward. Critically, fundamental changes were made to the overall corporate governance with amendments to the make-up and structure of the Boards. The new Board was composed of the CEO, the CFO and the head of HR, together with representatives from three key operational units of energy, industry and healthcare. There were two new Board positions of supply chain management and sustainability, and legal counsel and compliance. Prior to 2007, operations in 190 countries had been grouped into 70 clusters. This was minimised to increase accountability and oversight. Initially regrouped into 20 clusters, by 2012 there were just 14 clusters overseen by a steering group that met every quarter, including the global CEOs of the divisions, the CEOs of the clusters and the managing board members. Solmssen argues for a view of sustainability that underlines every aspect of global business culture, and part of this is a culture of responsibility that actively fights corruption and bribery. He highlights that anticorruption efforts can come with minimal costs, and “the company’s bottom line has only grown.” Siemens’ anti-corruption policy is based on three principles: prevent, detect and respond. Interviewed by CIMA’s FM magazine in 2011 John Garred, Siemens’ UK regional compliance officer said “Prevention is about training in the anti-corruption policies, detection is about monitoring and controlling how the policies are working and responding is about taking action on violations. If somebody crosses the line and nothing happens, then your programme is not worth the paper it’s printed on.” Garred also recognised the role management accountants play in ensuring a company upholds compliance rules: “They work in the background helping with reconciliations and making specific control checks on payments. If they see a payment that looks untoward they’ll scrutinise it more closely. They are the eyes and ears of the compliance organisation.” A key tenet of Siemens’ change programme 35 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business has been in this area. Open communication and transparency remains a strong focus and there are global programmes underway which bridge the communication gap between top management and the lower level employees through the middle management. Siemens have implemented “integrity dialogues” which are built into every sales meeting, to bring about an open discussion on ethical issues from the floor and ways of handling these issues. Such transparency includes the external reporting of compliance related developments. This publically states the number of enquiries to the “Ask us” help desk, which encourages staff to clarify their compliance related queries, as well as the “Tell us”, portal where staff can report compliance cases, and also lists the overall number of disciplinary sanctions including dismissals.Such reporting of ethical information is now increasingly part of good corporate reporting giving both management and external stakeholders’ insight into leadership activity and impact. (source: CGMA, 2014). Case Study Questions  Siemens’ anti-corruption policy is based on three principles, List and discuss the three principles?  A key tenet of Siemens’ change programme has been ‘transparency’, explain the different strategies Siemens used to ensure that there is open communicatio and transparancy in the process of building and ethical organisational culture?  In order to root out corrupt practices across the business an “amnesty” was offered to staff, excluding former directors, discuss how Siemens implemented this strategy successfully? 3.8 Summary Carrying out vital activities such as recruitment, training, compensation and succession planning come with loads of ethical challenges involving issues of transparency, fairness, bribery, nepotism just to mention the few. If these activities are not done ethically and professionally, the image and brand or name of the organisation can be damaged. The company can also face legal claims and legal costs and survival of the company can be compromised. This is why Human Resource division should be well educated on such ethical issues and challenges, be equipped to deal with ethical challenges professionally and effectively. This unit will therefore look and some of these ethically challenges HR division and outline the strategies that the HR division can employ to overcome such challenges. MANCOSA – Bachelor of Commerce in Human Resource Management 36 Human Resource Ethics in Business Unit 4: Ethics and Human potential 37 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business Unit Learning Outcomes CONTENT LIST LEARNING OUTCOMES OF THIS UNIT: 4.1 Introduction  Introduce topic areas for the unit 4.2 Ethics as the key to unlock human potential  Outline the ethical mind sets that unlock human potential 4.3 Ethical leadership in Practice  Understand the importance of ethics in leadership 4.4 Ethical Principles for HR and Business Executives  Evaluate the relevance of ethics to business life and human involvement 4.5 Summary  Summarises content areas of the unit KEY CONCEPT Ethical mind-sets - An organisation with an ethical mind-set is characterised by a seamless integration of ethics into the purpose, mission and goals of the organisation. Psychological contract - The psychological contract that exists between organisations and their employees is the match between the expectations organisations have of their people, the expectations people have of their organisations, and what the organisations are prepared to offer in return for employee loyalty and hard work. Ethical values - Ethical values such as integrity, responsibility, fairness, transparency and respect have to be prioritised by organisations that wish to bring the best out Ethical leadership - When leaders are authentic and values based, they become guides to helping employees find meaning. They set formal rules, but also lead by example. (Rossouw & Van Vuuren, 2017) MANCOSA – Bachelor of Commerce in Human Resource Management 38 Human Resource Ethics in Business Prescribed / Recommended Readings • Rossouw, D. and Van Vuuren, L., (2017). Business ethics. Oxford University Press, Chapter 1. • Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers. • Bratton, J. and Gold, J., (2017). Human resource management: theory and practice. Palgrave. • Hunter, C., (2016). Managing people in South Africa: human resource management as competitive advantage. Sherwood Books. • Jamali, D.R., El Dirani, A.M. and Harwood, I.A. (2015). Exploring human resource management roles in corporate social responsibility: the CSR‐ HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143. • Nelson, W.A., Taylor, E. and Walsh, T., (2014). Building an ethical organisational culture. The health care manager, 33(2), pp.158-164. • Scott, E., (2016). Ethics and human resource management. In practicing professional ethics in economics and public policy (pp. 215-221). Springer, Dordrecht. 39 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business 4.1. Introduction It is increasingly recognised that it is the people, or human resources, of the organisation that are most likely to supply the core competencies, which will be the primary source of sustained competitive advantage and successful long-term financial performance. Many senior managers fail to appreciate the impact that the thinking, attitudes and actions of people at all levels can have on profits, growth, efficiency and relationships. Organisations that invest in their human capital, develop it and reward people for performance, make more money than those who do not (Rossouw & Van Vuuren, 2017). 4.2. Ethics as the key to unlock human potential 4.2.1. Ethical organisational mind-sets: An organisation with an ethical mind-set is characterised by a seamless integration of ethics into the purpose, mission and goals of the organisation. It has a well-developed and espoused ethical identity. In an organisation with an ethical identity, the ethical culture is an integral and natural part of the organisational culture. Culture evokes notions of rules, codes, rewards, leadership rituals and stories. If organisational culture is described as ‘the way we do things around here’, ethical culture may be described as ‘the way we do things around here even when no one is watching’. Ethical organisations are characterised by the respect that they show to all their stakeholders. Their commitment to their people arises out of respect for the worth and dignity of individuals who devote their energies to the business and depend on the business for their economic well-being. The knowledge that they are trusted, that their creativity is appreciated and that they will be treated fairly, and the certainty that the organisation will care for their physical (e.g. safe working conditions) and psychological (e.g. recognition) needs culminates in ‘quality of work life’ (QWL) for employees. QWL facilitates the unlocking of human potential. If organisations succeed in unlocking human potential, they not only build ethical organisations, but also create a competitive advantage (Rossouw & Van Vuuren, 2017). 4.2.2 People related organisational mind-sets a) Human wellness: The wellness of individual workers is contingent upon the fulfilment of personal needs, collaborative relationships, and supportive and effective environments. Optimal unlocking of human potential, or reaching true wellness, can only occur if people are treated ethically and are given the trust and support to develop their ethical capacity. b) Finding Meaning - As human beings, we are constantly searching for meaning in our lives. A central aspect of this is finding meaning in our work. People find meaning in the workplace when they are given the freedom to apply their ethical capacity in a positive ethical climate, and when they realise that they are making a real difference in terms of striving towards the common, sustainable good. c) Self-Actualization - According to Maslow, self-actualisation is a higher-order need that requires fulfilment. Self-actualised people are mentally healthy and have optimised their potential. MANCOSA – Bachelor of Commerce in Human Resource Management 40 Human Resource Ethics in Business Organisations characterised by ethical neglect will frustrate self-actualisation, while ethical organisations will foster it (Rossouw & Van Vuuren, 2017). 4.2.2 Ethical Values Management: Organisations build contexts of meaning for their employees when they align organisational goals, values and behaviour with those of their employees. Ethical values such as integrity, responsibility, fairness, transparency and respect have to be prioritised by organisations that wish to bring the best out of their people (Rossouw & Van Vuuren, 2017). 4.2.3 Ethical leadership: When leaders are authentic and values based, they become guides to helping employees find meaning. They set formal rules, but also lead by example. Good ethical leaders establish cultures marked by trust. Employees that are unencumbered by fear, suspicion or ethical ambiguity have the freedom to pursue growth and development actions that will allow them to discover their true potential (Rossouw & Van Vuuren, 2017). 4.2.4 Psychological contract: The psychological contract that exists between organisations and their employees is the match between the expectations organisations have of their people, the expectations people have of their organisations, and what the organisations are prepared to offer in return for employee loyalty and hard work. If organisations want to place a sense of ownership on their employees, they must pay attention to employees’ personal growth and development. Nurturing work environments must be established, where employees feel trusted, valued and secure (Rossouw & Van Vuuren, 2017). 4.2.5 Empowerment and Enablement: If organisations believe that employees can really make a difference, be sources of creativity, behave in selfmanaging ways, and accept the values and culture of the organisation, they will allow employees relative freedom of participation, contribution, innovation and opinion. Enablement is facilitated through training and development opportunities, mentoring, coaching and guidance. (Rossouw & Van Vuuren, 2017). 4.2.6 Ethical HR Management Practices HR practitioners have to be in partnership with the operating managers in order to optimize financial success, while at the same time being advocates for the employees. HR’s contribution in unlocking human potential is based on its understanding of human behavior as well as its stewardship for fulfilling the organization’s ethical obligation to its workforce (Rossouw & Van Vuuren, 2017). 4.3 Ethical leadership in Practice Ethics and ethical leadership is not an option but a national imperative because when you are a leader you have the authority to influence those that you lead, and it is what you do that largely determines what those who follow you are likely to do” (Chief Justice Mogoeng. 2017) Being in a management position does not necessarily mean 41 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business that a person performs a leadership role. Leaders require the ability to envision a desired future state of affairs and the capacity to gain the commitment and cooperation of others to work towards it, leaders are regularly confronted with explicit or tacit challenges that require ethical action (Rossouw & Van Vuuren, 2017). 4.3.2 Leadership Commitment to Ethics There are nine dimensions of obligation to organisational ethics.  Care: A commitment to ethics requires one to engage with stakeholders, comprehend their legitimate ethics expectations and rights, have empathy for these and respond accordingly.  Consciousness: Leaders require a wilful and firm consciousness of organisational ethics should they wish to contribute to the establishment of ethical organisations. Consciousness also requires an ethical sensitivity, or an awareness of the ubiquitous nature of ethics, in business planning and decision making.  Competence: To meaningfully engage with the often complex nature of organisational ethics, leaders need to acquire ‘a way of thinking’ about business and organisational ethics, that is, they need to be cognitively ethically competent.  Conversation: Besides having to ‘walk the ethics talk’, leaders gain more credibility and support if they also ‘talk the ethics talk’, and encourage and coach others to do so as well. Ethics talk, or conversation on ethics, reflects the ethical convictions of the organisation.  Courage: Leaders and employees may be reluctant to stand up for what they believe in. Certain situations may be extremely intimidating, or they may be unsure as to whether they are in the right. Leaders should set the tone for displaying ethical courage when required.  Choice: Irrespective of different backgrounds, cultures and levels of education, when people are employed in an organisation they have an obligation to meet the organisation’s ethical standards. The majority of employees will usually agree on what is good (right) or bad (wrong). The topics on which people differ are referred to as ethical dilemmas, or grey areas. Leadership commitment to ethics is demonstrated by making choices that are good for both self and others.  Creativity: Ethical (or moral) imagination is required when multi-dimensional ethical dilemmas of which the consequences could be dire, present themselves in organisational life.  Consistency: A particular challenge of ethical leadership is to act in the same, predictable and ethical manner over time.  Congruence: A balance must be created between espousing ethics and acting ethically. (Rossouw & Van Vuuren, 2017). 4.4 Ethical Principles for HR and Business Executives  Honesty - honest and truthful in all their dealings  Integrity - demonstrate personal integrity are principled, honourable and upright; they will fight for their beliefs.  Promise-keeping & trustworthiness - worthy of trust. MANCOSA – Bachelor of Commerce in Human Resource Management 42 Human Resource Ethics in Business  Loyalty - demonstrate fidelity and loyalty to persons and institutions by friendship in adversity, support and devotion to duty  Fairness - are fair and just in all dealings.  Compassion - are caring, compassionate, benevolent and kind.  Respect for others - demonstrate respect for the human dignity, autonomy, privacy, rights, and interests of all those who have a stake in their decisions; they are courteous and treat all people with equal respect.  Law abiding – they abide by laws, rules and regulations relating to their business activities.  Commitment to excellence - pursue excellence in performing their duties.  Leadership - are conscious of the responsibilities and opportunities of their position of leadership.  Reputation and morale - seek to protect and build the company’s good reputation and the morale of its employees.  Accountability - acknowledge and accept personal accountability for the ethical quality of their decisions and omissions to themselves, their colleagues, their companies, and their communities. (Josephson on business ethics, 2018). Questions for Reflection 1. Discuss the ethical principles required by HR Practitioners and Executives for effective HRM 2. List and explain the 9 dimensions of obligation to organisational ethics that leaders should possess. 3. Discuss the ethical organisational minsdet. Activity Organisations build contexts of meaning for their employees when they align organisational goals, values and behaviour with those of their employees List and briefly discuss some of these values? Case Study : Unethical leadership “Ethical leadership is not an option but a national imperative, Chief Justice Mogoeng Mogoeng said "[It] really isn't an option but a national imperative because when you are a leader you have the authority to influence those that you lead, and it is what you do that largely determines what those who follow you are likely to do." Mogoeng said it was important for leaders, both in the public and the private sector, to espouse the characteristics of ethical leadership to ensure that the country moved forward in a direction which sought to undo the wrongs of the past."We are where we are as a result of what unethical leadership did to us as a nation," Mogoeng said. 'We the people of 43 MANCOSA – Bachelor of Commerce in Human Resource Management Human Resource Ethics in Business South Africa recognise the injustices of the past'. To make that statement as a nation assumes that there will be ethical leadership in the government and the corporate sector to make sure that something is done about the injustices of the past," Mogoeng said.Mogoeng warned against the influence of business in the political realm, saying elected leaders needed to be honest and act for the common good rather than for those who were funding their campaigns. This was the kind of leadership the country needed, he said."Ethical leadership leaves no room for corruption, ethical leadership leaves no room for the manipulation of politicians by the corporate world."Allowing those who funded political campaigns to influence how one governed his or her people, was pure corruption, Mogoeng said."What you do... largely determines what those who follow you are likely to do. When the leader is unethical in his or her approach, check what those closer to him or her do." (Source: news24.co.za) Case Study Questions: 1. Why is it important for leaders to be ethical? 2. List and discuss the principles and characteristics of ethical leadership? 4.5. Summary “Ethics must begin at the top of the organisation, it is the leadership issue, and the chief executive must set the example” Edward Hennessy. When leaders are authentic and values based, they become guides to helping employees find meaning. They set formal rules, but also lead by example. Good ethical leaders establish cultures marked by trust. Employees that are unencumbered by fear, suspicion or ethical ambiguity have the freedom to pursue growth and development actions that will allow them to discover their true potential. (Rossouw & Van Vuuren, 2017). MANCOSA – Bachelor of Commerce in Human Resource Management 44 Huma...
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