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Literature Review Shaping Cultures and Ethics of the Organization
Literature Review Shaping Cultures and Ethics of the Organization
Austin Rogers
Liberty University
BUSI 610-B08
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Literature Review Shaping Cultures and Ethics of the Organization
Abstract
This paper seeks to conduct a literature review on how businesses go about creating a culture and
a system of ethics that encompasses the overall organization. The collection of literature and
articles included within this review provide examples and evidence of not only how
organizations begin to build culture and ethical behaviors, but the importance that these aspects
hold within the organization as well. From broadly covering the creation of an organization’s
culture and ethics to detailing specific techniques and how these lead to positive results and
overall success, the research contained in this literature review strives to create a comprehensive
understanding of the influences that culture and ethics have in an organization.
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Organizational Culture and Ethics
In order for any organization found throughout the world to create a cohesive set of rules
to abide by and establish what is and is not accepted, the culture and ethics of the organization as
a whole must be set in place. The importance that culture and an ethical code have within an
organization cannot be understated, as these two integral pieces of an organization’s make up can
set the foundation for the future success of the organization and will determine the direction the
organization chooses to take. While the impact that the cultural and ethical values an
organization chooses to implement has on the organization overall is very important, ethics and
culture also plays a vital role in the minds of every employee, manager, and executive within the
organization individually.
Each individual can be influenced by the organizational culture and ethical and moral
standards that are put in place, and will be able to utilize these values in their work and
incorporate them into their daily lives as well. The cultural aspects of an organization along with
the moral and ethical principles that are established can present themselves as a guideline for
every individual within the organization to follow, and should be able to set a precedent that will
radiate throughout the organization as a whole.
Considering how important the cultural and ethical facets of an organization can be in
creating a foundation with which to use to base future organizational work and shaping each
individual’s frame of mind in regard to how to best go about their occupations, it is vital to bring
together all current literature on these subjects in order for researchers to further develop how
culture and ethics can affect an organization and those who work within it. This literature covers
a multitude of factors related to the ethics, morals, and culture of an organization from nearly
every aspect, and should be a very valuable asset in contributing to bringing to light new ways of
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thinking about ethics, morals, and culture, and more innovative methods of implementing them
into organizational structures.
For an organization, being able to implement an all encompassing culture and ensuring
that ethical codes and standards are being adhered to is not an easy task. Establishing culture and
ethics could serve as a focal point for researchers to study the most efficient ways to employ
these integral aspects of an organization to ensure that it resonates effectively with each
individual. By placing a focus on conducting research on the important aspects of organizational
culture and ethics, researchers may be able to better understand techniques that could be utilized
to promote positive culture and ethics.
Business Culture and Ethical Principles
Creating Culture and Ethics. According to research conducted by Ardichvili, Mitchell,
and Jondle, the environment that is formed from positive culture and ethical principles is “an
environment where employees are not only expected to discern right from wrong, a basic
minimum, but also more importantly are expected to go beyond the minimum to explore and
implement ethical decisions when all choices seem right” (2009). The key for any organization
that is seeking to develop an overall culture is to work to ensure that it is a positive one by
incorporating ethical procedures in all aspects of the organization. Just as a positive
organizational culture can bring about constructive changes and cohesiveness, a negative culture
that is plagued with immoral actions and questionable business practices can be the downfall of
an organization entirely.
In order to accomplish this difficult task, the organization must ensure that executives,
managers, and any individual who holds a top leadership position is consistently setting an
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example of how ethical business practices should be conducted. Ethical actions and decision
making begin with the model that an organization’s leadership team demonstrates, and can then
trickle down to mid-level managers and find its way to every employee in the organization.
Furthermore, making sure that all organizational structures and policies are consistent with the
ethical direction the organization is seeking to go is paramount as well. Effective leaders who
promote ethical business practices should not have to deal with policies and processes which do
not share the same ethical code.
Another important aspect of creating a strong business ethics system is moral
reciprocation between both the employee and the employer. Examples of this given in a study
contained in literature by Burcea and Croitoru states that after interviewing participants in both
employee and management roles, aspects considered to be most important by both respective
sides were honesty, respect, fairness, transparency, and dignity (2014). This research lends itself
to the notion that these aspects can set a common ground within an organization to foster a
positive business relationship, and can advocate for the creation and continuance of an ethical
and moral organizational culture.
Maintaining Culture and Ethics. While it is a very difficult task to implement a wide
reaching positive culture and ethical code within an entire organization, it may be an even more
complex problem to maintain them over long periods of time. Considering that there have been
a multitude of breakdowns in ethical conduct in the business world throughout the years which
have caused organizations to completely reconstruct their corporate structure, members of an
organization’s leadership to resign, and governments to step in and introduce new laws in regard
to this problem, researching the methods that allow for long term maintenance of ethical and
moral business culture would serve as a worthwhile endeavor.
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Some negative aspects found in the business world that could possibly persuade an
individual to abandon ethical and morally sound business practices is greed and competition.
Individuals who make the decision to pursue profit with no regard for whether how they go about
doing so is ethical or not, or in some cases what laws they may be breaking, can be very
dangerous to an ethical organization as a whole. Furthermore, while competition can mostly be a
positive factor in creating a drive for an individual to work toward a goal, it can be detrimental as
well if not accompanied by morality. According to research conducted by Feldman, this point is
touched on by stating that the “lack of cultural integration between competitive values and moral
values plagues many companies” (2007).
In order to be able to combat the unethical and immoral business practices that torment
organizations all too often, there needs to be moral and ethical values ingrained into how the
organization conducts business in general. If an organization can sustain moral and ethical
practices, it can eventually become a moral tradition which will continue to be passed down
throughout the life of the organization and can be adapted to changing needs. The author goes
on to speak about the important role that moral traditions can play in an organization’s ability to
maintain ethical business culture over long periods of time.
Feldman states that moral traditions are such vital aspects of business culture “because
they permeate the organization to some extent and thus decentralize moral motivation, giving the
organization a moral stability and depth that moral leadership alone cannot provide (2007).
Moral traditions along with integrating the goal of financial gain with moral and ethical values
have been shown to help in discouraging those who may consider attempting to undertake
unethical business practices in the pursuit of wealth. Furthermore, organizations who have
established cultures with morality ingrained within them are able to quickly address any issue
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that may arise in the event that an individual chooses to carry out immoral ways of doing
business.
International Business
In the international business climate of today we are more connected and move at a faster
pace than ever before. With this increase in connectivity comes a blending of many different
ethnic and cultural backgrounds all with their own belief systems, business practices and
customs, and moral and ethical codes. Organizations who regularly conduct international
business may find that the ethics and morality of their business partners do not always match
their own.
According to research conducted by Saunders and Lockridge, unethical and immoral
behavior is a worldwide issue, not just simply a domestic problem. The authors state that when
tested with the Transparency International Corruption Perceptions Index, the “ranking for two of
the world's largest countries is far below most other industrialized countries and indicates a
widespread perception of extensive corruption(2010). The results of this test could raise a red
flag in the minds of executives and leadership teams who are a part of organizations that conduct
business in nations all over the world. The perception of what is and is not considered to be
ethical or morally sound can depend significantly on the cultural values and beliefs of the
individual or organization involved.
Though this may prove to be true in some cases, Saunders and Lockridge go on to
reference a study performed on students from India and the United States which sought to
compare and contrast the student’s ethical beliefs, that produced results to argue against this
notion. The authors explain the results of the study, stating that “students in a culture that is
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generally believed to be more corrupt than Western cultures exhibited ethical principles as
strong, or stronger, than did students in the U.S” (2010). Both of these points could be utilized to
bring to light just how complex the relationship between ethics and international business can be,
and can serve as an example of how continued research on this aspect of globalized business
could better benefit organizations around the world. Furthermore, this study could establish a
point of reference for future researchers to study what factors lead to both sets of students having
similar beliefs on ethics and morality, even with the vast differences in cultures between the
students.
Industry Specific Ethics and Culture
While the act of shaping and maintaining positive ethics and culture within any
organization is an extremely difficult task to take on, those who find themselves in leadership
positions must find a way to implement them for the good of the organization. The experience
and knowledge of these organizational leaders and executives within their own specific industry
could come into play here, as each industry comes with its own moral and ethical dilemmas and
cultural requirements. These individuals must be able to identify what their organization
requires from an ethical and cultural perspective, and how the particular industry they are in will
play into those requirements.
Financial Organizations
With the amount of fiscal responsibility that financial institutions hold, ethical and
morally sound judgement from these organizations is of paramount importance, especially to
those who trust them with their finances or are purchasing goods and services from them.
However, with the high number of employees that many top financial institutions have, it can be
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extremely difficult to police for unethical behavior and be able to enforce ethical policies
uniformly throughout the entire organization. Tactics which are put in place for employees to
promote competition and strive to meet sales and incentive goals should work well in an ethical
and morally sound environment, but when these sales strategies are corrupted it can lead to
employees seeking to meet sales goals with no regard for ethical behavior.
According to research conducted by Connell, individuals working within an organization
utilize six primary psychological systems when evaluating their decision making in regard to the
standards and behavior of the organization itself. The author goes on to state that these systems
can serve as an “informal rulebook that individuals learn through experience and which they
apply when choosing how to behave, and when predicting the behaviour of others” (2016). By
making an attempt to further study these methods of behavior defining decision making,
researchers could possibly uncover evidence that managers and executives can use to develop
more effective communication, organizational structures and conventions which will guide the
organization into establishing a more positive corporate culture.
Healthcare Organizations
The nature of work that is involved with choosing an occupation in the healthcare
industry is such that the need to have positive culture, ethical values, and morally sound decision
making set into place is imperative. Organizations who provide any type of healthcare service
are put in a very unique position when ethics, morals, and an overall positive organizational
culture is directly linked to the physical and mental health of the individual being treated. When
unethical decisions are allowed to be made the results are never ideal within any given industry,
but this type of unethical decision making and immoral judgment can result in catastrophic
consequences for both the organization and the patient.
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Organizations within the healthcare industry are bound by certain standards such as
ethical treatment and diagnostic practices, retaining the privacy of their patients, and all-
encompassing legislation put in place to ensure these standards are upheld. While many other
industries are also required to adhere to certain rules and regulations and are held to a higher
standard, those involved with the healthcare industry must also consider how the organization’s
ethical code and overall culture complements and intertwines with the ethics, morals, and culture
of those who are being treated.
According to research conducted by Hernandez and Roberts, in regard to the healthcare
industry, “To practice ethically requires awareness, sensitivity, and empathy for the patient as an
individual, including his or her cultural values and beliefs” (2008). In order for an organization
practicing in any division of the healthcare industry to fully provide adequate and all-inclusive
levels of treatment, each individual must first understand that the patient’s values of ethics and
morality must be addressed as well.
If organizations which provide healthcare services to the public are conscious of the
cultural and ethical values that each individual patient holds and are aware of how this may
affect the care being provided, it could allow for the organization to implement more efficient
healthcare services for every patient. In doing so, the healthcare organization would be more
effective in prescribing and managing healthcare services and would allow the organization itself
to service patients more ethically as well, in terms of both the law requiring it and the patient’s
confidence in the treatment being given.
Engineering Organizations
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Considering the broad spectrum of occupations and specializations that can fall under the
umbrella of the engineering industry, ethics and organizational culture can be instrumental in
ensuring that the engineers within the organization are exhibiting morally sound judgment on all
of the vast amount of jobs and projects in which engineers are involved. According to Clark’s
literature on the subject of ethical behavior in engineering, “Engineering teams have contact with
many different stakeholders such as owners, client in-house design staff, equipment vendors,
code authorities, and constructors” (2016).
With engineers providing their services throughout the entire life of a project and
remaining in contact with a multitude of organizational departments and individuals, unethical
behavior or immoral actions could occur at any point during the project in any one of the many
departments involved. Furthermore, those involved in any of the many disciplines the
engineering industry offers can easily commit unethical business practices unknowingly as well
by not staying up to date with the vast number of current licensing requirements and continuing
education courses, some of which cover the importance of business ethics, that engineers must
undertake.
Ethics and Culture in Business Education
When speaking on the subject of business education, the primary topics that would come
to the minds of most individuals are more than likely subjects such as marketing or management
that seem to be seen as more tangible aspects of the business world. With that being said, the
aspects of business ethics, morality, and organizational culture are quickly making their way to
the forefront of most programs that educate their students in business and organizational related
courses.
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The rise of business ethics courses in the current business educational system can partly
be attributed to the highly publicized ethical and moral violations that have plagued
organizations such as Enron and Worldcom. These scandals were witnessed by the public and
were the cause of many cries for additional legislation and the initiation of ethical guidelines
within organizations to help curb the unethical practices that were so prevalent in the business
world. Those who are involved in providing business education to students can draw from these
ethical and moral setbacks as an example of the many negative effects that can occur when
unethical business practices are allowed to so deeply root themselves into the structure and
culture of an organization.
Furthermore, according to research conducted by Lopez, Rechner, and Olson-Buchanan,
some business education institutions do not place ethics education into one course, and rather
decide to promote ethical teaching in every business class. The authors go on to state that in this
example, “students who are completing their undergraduate degree in business are significantly
less approving of the unethical behavior in the scenarios concerning deceit, fraud, and coercion
than were students at the beginning of their undergraduate program” (2005). By including
ethical and moral decision making in with the teaching of every aspect of business education
these institutions are able to further integrate the notion that ethical and moral values matter in
the business world.
In doing so, these business educators are able to emphasize that there are more aspects
involved with running a business than just simply worrying about the bottom line. In any
industry, it would be extremely difficult to eradicate unethical business practices altogether, but
further research on this topic could provide assistance to decrease the number of instances where
ethical violations in business occur. Also, more business educators could utilize the study by
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Lopez, Rechner, and Olson-Buchanan as a guide to teach the next generation on the importance
of proper ethical and moral principles within a business element.
Business education can also have a great effect on how business students begin to shape
their thoughts on the subject of organizational culture as well. According to a study conducted
by Mintrom, the results showed that “specific teaching practices can create cultures of excellence
among students” (2014). This study could be used now by researchers, business executives, and
organizational leadership teams who are seeking to develop a cohesive organizational culture
that strives to promote excellence in their work by utilizing the teaching practices that proved to
be so useful in establishing excellence.
Though these organizations should always promote the pursuit of excellence in their
work, they must also strive to retain the importance of morality and ethical values throughout the
organization as well. Furthermore, this study also shows that future business leaders have been
educated on how to establish positive and successful culture among their fellow students, and
may be able to incorporate those same ideals into the organizational culture of their chosen
industry.
Certain educational institutions could take their curriculum on business ethics even
further than just simply providing education on these subjects in the classroom and set out to
involve their students first hand in projects that promote ethical and moral behavior and
awareness to how these aspects of an organization can affect society. According to literature
which presents the research conducted by Marques, this innovation in business education is
summed up by stating:
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In a concerted attempt to convert the unflattering reputation of business into a more
positive one, an increasing number of business schools have revamped their programs in
recent years to include courses that enhance the alignment of business students with the
circumstances and needs of society. (2016)
This method of civic engagement used to educate business students could allow them to
receive crucial hands on experience that they may not have been able to be subjected to
otherwise. Being able to implement this type of educational program would also allow the
students the chance to experience tangible applications for the techniques, business and
organizational terms, and management and leadership methodologies and how they can be
applied to obstacles found in the real world. These civic engagement projects could also serve as
an outstanding vehicle for these students to begin to build personal relationships with the
business partners in the community of the business school or of an organization. Fostering
positive relationships with these business entities can lead to future collaboration once the
student begins his or her career as a business professional, and may also result in these
organizations seeking to hire these students in the future.
Furthermore, the author of this specific study goes on to state that successfully employing
these social awareness and civic engagement projects in collaboration with the educational
institution’s main curriculum has shown to result in the participants being more engaged with
how an organization can make positive contributions to society and the local community, a
greater knowledge of how to implement business practices that are more socially responsible,
and even seemed to lead to an increased emotional intelligence in regard to these social issues
among the students.
The Effectiveness of Business Ethics
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The research, implementation, and influence of business ethics programs which advocate
for the addition of morally sound business practices and a positive all encompassing
organizational culture have become much more prevalent in recent years. Organizations all over
the world are placing a much greater emphasis on implementing and enforcing a moral and
ethical code throughout the entire organization, as the need to diminish acts of unethical behavior
throughout the business world becomes necessary in order to avoid any possible association with
negative headlines regarding their company.
While every leader of an organization throughout the world would prefer that every
individual employee in the company follow the organization’s code of ethics with no immoral
business practices or unethical behavior taking place, it is very difficult for an organization to get
rid of corruption in its entirety. In some cases, individuals within an organization can even
disguise unethical behavior, as it could possibly be thought of as compliant with the laws that are
set in place (Eammon, 2018). With this being the case, researchers have recently attempted to
focus their studies in an effort to discover exactly what aspects of an organization’s code of
ethics make it effective in keeping the instances of unethical and immoral business actions to a
minimum.
Research which places the main focus on understanding which factors that executives and
the leadership team of an organization place a high importance on in regard to the organization’s
code of ethics has shown that there are a multitude of organizational characteristics that may
attribute to ethical effectiveness. According to a research study conducted by Singh, A code is
only one of a range of measures that corporations should have in place to inculcate an ethical
ethos into the heart and soul of the organization(2018). An organization who simply sets a
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code of ethics in place are not guaranteed to see any response to it, especially the desired ethical
response.
Organizations must treat business ethics just as they would any other aspect of business
and develop a strategic plan in order to best ensure that the ethical and moral policies of the
organization resonate with every employee. Furthermore, these organizations could also utilize
strategic planning to implement ethical guidelines that are all encompassing throughout the entire
organization. Committees that would oversee all ethical violations committed within the
organization, and also administer employee training on ethical behavior, could be put into action
as well. Organizations who are able to establish more tangible assets which are perceived by
executives and organizational leaders to be integral pieces of business ethics, and that will aid in
the distribution of their code of ethics itself could possibly see a more ethical and morally aware
workforce.
Profitable Business Ethics
When considering the aspect of ethics and morality in a business sense, the conversation
often times consists of organizational culture and facets of personality and behavior. While these
conversations may mention the aspect of profit and the organization’s bottom line, it is usually in
the sense that business ethics and profitability are at odds with each other and executives must
work to find a way to keep the balance. Research conducted by Eammon brings to light the
argument that these aspects are much more intertwined than most individuals may realize, and
that organizations can become more profitable if a strong positive culture and code of ethics are
in place.
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The author goes on to state that “unless a society has at its foundations ethical behaviour
and zero tolerance to corruption, you will have a breakdown of trust among certain segments of
society. This leads to lower confidence and lower economic growth” (2018). This literature
argues the point that the lack of ethical and moral behavior within an organization, and even
within state departments and governments, can lead to a breakdown in economic factors that
would eventually lead to a reduced level of profitability.
In order for organizations to avoid this stagnation of profitability, among the vast number
of other negative aspects that come with immoral and unethical behavior, it is necessary for the
organization to have strong ethical leadership and a culture that permeates throughout the
company. In doing so, organizations can attempt to avoid as many cases of corruption and
unethical business practices as possible while having systems in place to root out any of these
behaviors that inevitably can make their way into organizations.
Virtue Ethics in Business
In the international business climate of today, with so many differences in customs,
values, and ethical beliefs, organizations all over the world are making an attempt to curb the
problem of corruption that plagues every organization. One method that could aid organizational
leaders in establishing a system to combat corruptive behavior is that of virtue ethics. According
to research conducted by Bertland, virtue ethics along with a capabilities approach can be
beneficial to an organization by tasking organizations and managers to work toward ethically
building up each individual’s capabilities and promote growth from within. The author goes on
to state that “the role of an institution is to provide opportunities for individuals to develop
capabilities to function at a level worthy of human dignity” (2009).
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These methods could allow an organization to become more cohesive, as each individual
would be more willing to apply ethical and moral behavior and feel more dignified in their
occupation and with the work they put forth. The application of virtue ethics can be divided
even further into subgroups as well, as according to research conducted by Fernando and Moore
state that MacIntyrean virtue ethics specifically could work to diminish ethical breakdowns in
organizations. The authors state that the MacIntyrean system of virtue ethics take into account
that if individuals within an organization collectively work toward a goal of achieving the greater
good, assuming the goal is ethically and morally sound, the culture of the entire organization will
cement itself as being positive (2015).
Conclusion
Organizations, and those who find themselves leading them, all face a difficult task when
shaping ethical behavior and organizational culture. Being able to ensure that your organization
is practicing ethically, morally, and with a positive corporate culture is of paramount importance
when considering the long term success that the organization wishes to reach. While remaining
profitable is often times an organization’s main priority, business ethics and positive
organizational culture can provide a solid foundation for a company to grow as well. These
aspects allow for establishing relationships with the community, serve as guidelines for how
business practices should be performed, and can help in organizations avoiding unrecognized
costs that can accompany unethical behavior. While unethical behavior and corruption may
never be fully eradicated from the business world, further research on this prominent topic could
lead to more efficient methods and strategies organizations can utilize to work toward reducing
the number of instances immoral acts occur.
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org.ezproxy.liberty.edu/10.1108/EBR-05-2017-0101

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1 Literature Review – Shaping Cultures and Ethics of the Organization Literature Review – Shaping Cultures and Ethics of the Organization Austin Rogers Liberty University BUSI 610-B08 2 Literature Review – Shaping Cultures and Ethics of the Organization Abstract This paper seeks to conduct a literature review on how businesses go about creating a culture and a system of ethics that encompasses the overall organization. The collection of literature and articles included within this review provide examples and evidence of not only how organizations begin to build culture and ethical behaviors, but the importance that these aspects hold within the organization as well. From broadly covering the creation of an organization’s culture and ethics to detailing specific techniques and how these lead to positive results and overall success, the research contained in this literature review strives to create a comprehensive understanding of the influences that culture and ethics have in an organization. 3 Literature Review – Shaping Cultures and Ethics of the Organization Organizational Culture and Ethics In order for any organization found throughout the world to create a cohesive set of rules to abide by and establish what is and is not accepted, the culture and ethics of the organization as a whole must be set in place. The importance that culture and an ethical code have within an organization cannot be understated, as these two integral pieces of an organization’s make up can set the foundation for the future success of the organization and will determine the direction the organization chooses to take. While the impact that the cultural and ethical values an organization chooses to implement has on the organization overall is very important, ethics and culture also plays a vital role in the minds of every employee, manager, and executive within the organization individually. Each individual can be influenced by the organizational culture and ethical and moral standards that are put in place, and will be able to utilize these values in their work and incorporate them into their daily lives as well. The cultural aspects of an organization along with the moral and ethical principles that are established can present themselves as a guideline for every individual within the organization to follow, and should be able to set a precedent that will radiate throughout the organization as a whole. Considering how important the cultural and ethical facets of an organization can be in creating a foundation with which to use to base future organizational work and shaping each individual’s frame of mind in regard to how to best go about their occupations, it is vital to bring together all current literature on these subjects in order for researchers to further develop how culture and ethics can affect an organization and those who work within it. This literature covers a multitude of factors related to the ethics, morals, and culture of an organization from nearly every aspect, and should be a very valuable asset in contributing to bringing to light new ways of 4 Literature Review – Shaping Cultures and Ethics of the Organization thinking about ethics, morals, and culture, and more innovative methods of implementing them into organizational structures. For an organization, being able to implement an all encompassing culture and ensuring that ethical codes and standards are being adhered to is not an easy task. Establishing culture and ethics could serve as a focal point for researchers to study the most efficient ways to employ these integral aspects of an organization to ensure that it resonates effectively with each individual. By placing a focus on conducting research on the important aspects of organizational culture and ethics, researchers may be able to better understand techniques that could be utilized to promote positive culture and ethics. Business Culture and Ethical Principles Creating Culture and Ethics. According to research conducted by Ardichvili, Mitchell, and Jondle, the environment that is formed from positive culture and ethical principles is “an environment where employees are not only expected to discern right from wrong, a basic minimum, but also more importantly are expected to go beyond the minimum to explore and implement ethical decisions when all choices seem right” (2009). The key for any organization that is seeking to develop an overall culture is to work to ensure that it is a positive one by incorporating ethical procedures in all aspects of the organization. Just as a positive organizational culture can bring about constructive changes and cohesiveness, a negative culture that is plagued with immoral actions and questionable business practices can be the downfall of an organization entirely. In order to accomplish this difficult task, the organization must ensure that executives, managers, and any individual who holds a top leadership position is consistently setting an 5 Literature Review – Shaping Cultures and Ethics of the Organization example of how ethical business practices should be conducted. Ethical actions and decision making begin with the model that an organization’s leadership team demonstrates, and can then trickle down to mid-level managers and find its way to every employee in the organization. Furthermore, making sure that all organizational structures and policies are consistent with the ethical direction the organization is seeking to go is paramount as well. Effective leaders who promote ethical business practices should not have to deal with policies and processes which do not share the same ethical code. Another important aspect of creating a strong business ethics system is moral reciprocation between both the employee and the employer. Examples of this given in a study contained in literature by Burcea and Croitoru states that after interviewing participants in both employee and management roles, aspects considered to be most important by both respective sides were honesty, respect, fairness, transparency, and dignity (2014). This research lends itself to the notion that these aspects can set a common ground within an organization to foster a positive business relationship, and can advocate for the creation and continuance of an ethical and moral organizational culture. Maintaining Culture and Ethics. While it is a very difficult task to implement a wide reaching positive culture and ethical code within an entire organization, it may be an even more complex problem to maintain them over long periods of time. Considering that there have been a multitude of breakdowns in ethical conduct in the business world throughout the years which have caused organizations to completely reconstruct their corporate structure, members of an organization’s leadership to resign, and governments to step in and introduce new laws in regard to this problem, researching the methods that allow for long term maintenance of ethical and moral business culture would serve as a worthwhile endeavor. 6 Literature Review – Shaping Cultures and Ethics of the Organization Some negative aspects found in the business world that could possibly persuade an individual to abandon ethical and morally sound business practices is greed and competition. Individuals who make the decision to pursue profit with no regard for whether how they go about doing so is ethical or not, or in some cases what laws they may be breaking, can be very dangerous to an ethical organization as a whole. Furthermore, while competition can mostly be a positive factor in creating a drive for an individual to work toward a goal, it can be detrimental as well if not accompanied by morality. According to research conducted by Feldman, this point is touched on by stating that the “lack of cultural integration between competitive values and moral values plagues many companies” (2007). In order to be able to combat the unethical and immoral business practices that torment organizations all too often, there needs to be moral and ethical values ingrained into how the organization conducts business in general. If an organization can sustain moral and ethical practices, it can eventually become a moral tradition which will continue to be passed down throughout the life of the organization and can be adapted to changing needs. The author goes on to speak about the important role that moral traditions can play in an organization’s ability to maintain ethical business culture over long periods of time. Feldman states that moral traditions are such vital aspects of business culture “because they permeate the organization to some extent and thus decentralize moral motivation, giving the organization a moral stability and depth that moral leadership alone cannot provide” (2007). Moral traditions along with integrating the goal of financial gain with moral and ethical values have been shown to help in discouraging those who may consider attempting to undertake unethical business practices in the pursuit of wealth. Furthermore, organizations who have established cultures with morality ingrained within them are able to quickly address any issue 7 Literature Review – Shaping Cultures and Ethics of the Organization that may arise in the event that an individual chooses to carry out immoral ways of doing business. International Business In the international business climate of today we are more connected and move at a faster pace than ever before. With this increase in connectivity comes a blending of many different ethnic and cultural backgrounds all with their own belief systems, business practices and customs, and moral and ethical codes. Organizations who regularly conduct international business may find that the ethics and morality of their business partners do not always match their own. According to research conducted by Saunders and Lockridge, unethical and immoral behavior is a worldwide issue, not just simply a domestic problem. The authors state that when tested with the Transparency International Corruption Perceptions Index, the “ranking for two of the world's largest countries is far below most other industrialized countries and indicates a widespread perception of extensive corruption” (2010). The results of this test could raise a red flag in the minds of executives and leadership teams who are a part of organizations that conduct business in nations all over the world. The perception of what is and is not considered to be ethical or morally sound can depend significantly on the cultural values and beliefs of the individual or organization involved. Though this may prove to be true in some cases, Saunders and Lockridge go on to reference a study performed on students from India and the United States which sought to compare and contrast the student’s ethical beliefs, that produced results to argue against this notion. The authors explain the results of the study, stating that “students in a culture that is 8 Literature Review – Shaping Cultures and Ethics of the Organization generally believed to be more corrupt than Western cultures exhibited ethical principles as strong, or stronger, than did students in the U.S” (2010). Both of these points could be utilized to bring to light just how complex the relationship between ethics and international business can be, and can serve as an example of how continued research on this aspect of globalized business could better benefit organizations around the world. Furthermore, this study could establish a point of reference for future researchers to study what factors lead to both sets of students having similar beliefs on ethics and morality, even with the vast differences in cultures between the students. Industry Specific Ethics and Culture While the act of shaping and maintaining positive ethics and culture within any organization is an extremely difficult task to take on, those who find themselves in leadership positions must find a way to implement them for the good of the organization. The experience and knowledge of these organizational leaders and executives within their own specific industry could come into play here, as each industry comes with its own moral and ethical dilemmas and cultural requirements. These individuals must be able to identify what their organization requires from an ethical and cultural perspective, and how the particular industry they are in will play into those requirements. Financial Organizations With the amount of fiscal responsibility that financial institutions hold, ethical and morally sound judgement from these organizations is of paramount importance, especially to those who trust them with their finances or are purchasing goods and services from them. However, with the high number of employees that many top financial institutions have, it can be 9 Literature Review – Shaping Cultures and Ethics of the Organization extremely difficult to police for unethical behavior and be able to enforce ethical policies uniformly throughout the entire organization. Tactics which are put in place for employees to promote competition and strive to meet sales and incentive goals should work well in an ethical and morally sound environment, but when these sales strategies are corrupted it can lead to employees seeking to meet sales goals with no regard for ethical behavior. According to research conducted by Connell, individuals working within an organization utilize six primary psychological systems when evaluating their decision making in regard to the standards and behavior of the organization itself. The author goes on to state that these systems can serve as an “informal rulebook that individuals learn through experience and which they apply when choosing how to behave, and when predicting the behaviour of others” (2016). By making an attempt to further study these methods of behavior defining decision making, researchers could possibly uncover evidence that managers and executives can use to develop more effective communication, organizational structures and conventions which will guide the organization into establishing a more positive corporate culture. Healthcare Organizations The nature of work that is involved with choosing an occupation in the healthcare industry is such that the need to have positive culture, ethical values, and morally sound decision making set into place is imperative. Organizations who provide any type of healthcare service are put in a very unique position when ethics, morals, and an overall positive organizational culture is directly linked to the physical and mental health of the individual being treated. When unethical decisions are allowed to be made the results are never ideal within any given industry, but this type of unethical decision making and immoral judgment can result in catastrophic consequences for both the organization and the patient. 10 Literature Review – Shaping Cultures and Ethics of the Organization Organizations within the healthcare industry are bound by certain standards such as ethical treatment and diagnostic practices, retaining the privacy of their patients, and allencompassing legislation put in place to ensure these standards are upheld. While many other industries are also required to adhere to certain rules and regulations and are held to a higher standard, those involved with the healthcare industry must also consider how the organization’s ethical code and overall culture complements and intertwines with the ethics, morals, and culture of those who are being treated. According to research conducted by Hernandez and Roberts, in regard to the healthcare industry, “To practice ethically requires awareness, sensitivity, and empathy for the patient as an individual, including his or her cultural values and beliefs” (2008). In order for an organization practicing in any division of the healthcare industry to fully provide adequate and all-inclusive levels of treatment, each individual must first understand that the patient’s values of ethics and morality must be addressed as well. If organizations which provide healthcare services to the public are conscious of the cultural and ethical values that each individual patient holds and are aware of how this may affect the care being provided, it could allow for the organization to implement more efficient healthcare services for every patient. In doing so, the healthcare organization would be more effective in prescribing and managing healthcare services and would allow the organization itself to service patients more ethically as well, in terms of both the law requiring it and the patient’s confidence in the treatment being given. Engineering Organizations 11 Literature Review – Shaping Cultures and Ethics of the Organization Considering the broad spectrum of occupations and specializations that can fall under the umbrella of the engineering industry, ethics and organizational culture can be instrumental in ensuring that the engineers within the organization are exhibiting morally sound judgment on all of the vast amount of jobs and projects in which engineers are involved. According to Clark’s literature on the subject of ethical behavior in engineering, “Engineering teams have contact with many different stakeholders such as owners, client in-house design staff, equipment vendors, code authorities, and constructors” (2016). With engineers providing their services throughout the entire life of a project and remaining in contact with a multitude of organizational departments and individuals, unethical behavior or immoral actions could occur at any point during the project in any one of the many departments involved. Furthermore, those involved in any of the many disciplines the engineering industry offers can easily commit unethical business practices unknowingly as well by not staying up to date with the vast number of current licensing requirements and continuing education courses, some of which cover the importance of business ethics, that engineers must undertake. Ethics and Culture in Business Education When speaking on the subject of business education, the primary topics that would come to the minds of most individuals are more than likely subjects such as marketing or management that seem to be seen as more tangible aspects of the business world. With that being said, the aspects of business ethics, morality, and organizational culture are quickly making their way to the forefront of most programs that educate their students in business and organizational related courses. 12 Literature Review – Shaping Cultures and Ethics of the Organization The rise of business ethics courses in the current business educational system can partly be attributed to the highly publicized ethical and moral violations that have plagued organizations such as Enron and Worldcom. These scandals were witnessed by the public and were the cause of many cries for additional legislation and the initiation of ethical guidelines within organizations to help curb the unethical practices that were so prevalent in the business world. Those who are involved in providing business education to students can draw from these ethical and moral setbacks as an example of the many negative effects that can occur when unethical business practices are allowed to so deeply root themselves into the structure and culture of an organization. Furthermore, according to research conducted by Lopez, Rechner, and Olson-Buchanan, some business education institutions do not place ethics education into one course, and rather decide to promote ethical teaching in every business class. The authors go on to state that in this example, “students who are completing their undergraduate degree in business are significantly less approving of the unethical behavior in the scenarios concerning deceit, fraud, and coercion than were students at the beginning of their undergraduate program” (2005). By including ethical and moral decision making in with the teaching of every aspect of business education these institutions are able to further integrate the notion that ethical and moral values matter in the business world. In doing so, these business educators are able to emphasize that there are more aspects involved with running a business than just simply worrying about the bottom line. In any industry, it would be extremely difficult to eradicate unethical business practices altogether, but further research on this topic could provide assistance to decrease the number of instances where ethical violations in business occur. Also, more business educators could utilize the study by 13 Literature Review – Shaping Cultures and Ethics of the Organization Lopez, Rechner, and Olson-Buchanan as a guide to teach the next generation on the importance of proper ethical and moral principles within a business element. Business education can also have a great effect on how business students begin to shape their thoughts on the subject of organizational culture as well. According to a study conducted by Mintrom, the results showed that “specific teaching practices can create cultures of excellence among students” (2014). This study could be used now by researchers, business executives, and organizational leadership teams who are seeking to develop a cohesive organizational culture that strives to promote excellence in their work by utilizing the teaching practices that proved to be so useful in establishing excellence. Though these organizations should always promote the pursuit of excellence in their work, they must also strive to retain the importance of morality and ethical values throughout the organization as well. Furthermore, this study also shows that future business leaders have been educated on how to establish positive and successful culture among their fellow students, and may be able to incorporate those same ideals into the organizational culture of their chosen industry. Certain educational institutions could take their curriculum on business ethics even further than just simply providing education on these subjects in the classroom and set out to involve their students first hand in projects that promote ethical and moral behavior and awareness to how these aspects of an organization can affect society. According to literature which presents the research conducted by Marques, this innovation in business education is summed up by stating: 14 Literature Review – Shaping Cultures and Ethics of the Organization In a concerted attempt to convert the unflattering reputation of business into a more positive one, an increasing number of business schools have revamped their programs in recent years to include courses that enhance the alignment of business students with the circumstances and needs of society. (2016) This method of civic engagement used to educate business students could allow them to receive crucial hands on experience that they may not have been able to be subjected to otherwise. Being able to implement this type of educational program would also allow the students the chance to experience tangible applications for the techniques, business and organizational terms, and management and leadership methodologies and how they can be applied to obstacles found in the real world. These civic engagement projects could also serve as an outstanding vehicle for these students to begin to build personal relationships with the business partners in the community of the business school or of an organization. Fostering positive relationships with these business entities can lead to future collaboration once the student begins his or her career as a business professional, and may also result in these organizations seeking to hire these students in the future. Furthermore, the author of this specific study goes on to state that successfully employing these social awareness and civic engagement projects in collaboration with the educational institution’s main curriculum has shown to result in the participants being more engaged with how an organization can make positive contributions to society and the local community, a greater knowledge of how to implement business practices that are more socially responsible, and even seemed to lead to an increased emotional intelligence in regard to these social issues among the students. The Effectiveness of Business Ethics 15 Literature Review – Shaping Cultures and Ethics of the Organization The research, implementation, and influence of business ethics programs which advocate for the addition of morally sound business practices and a positive all encompassing organizational culture have become much more prevalent in recent years. Organizations all over the world are placing a much greater emphasis on implementing and enforcing a moral and ethical code throughout the entire organization, as the need to diminish acts of unethical behavior throughout the business world becomes necessary in order to avoid any possible association with negative headlines regarding their company. While every leader of an organization throughout the world would prefer that every individual employee in the company follow the organization’s code of ethics with no immoral business practices or unethical behavior taking place, it is very difficult for an organization to get rid of corruption in its entirety. In some cases, individuals within an organization can even disguise unethical behavior, as it could possibly be thought of as compliant with the laws that are set in place (Eammon, 2018). With this being the case, researchers have recently attempted to focus their studies in an effort to discover exactly what aspects of an organization’s code of ethics make it effective in keeping the instances of unethical and immoral business actions to a minimum. Research which places the main focus on understanding which factors that executives and the leadership team of an organization place a high importance on in regard to the organization’s code of ethics has shown that there are a multitude of organizational characteristics that may attribute to ethical effectiveness. According to a research study conducted by Singh, “A code is only one of a range of measures that corporations should have in place to inculcate an ethical ethos into the heart and soul of the organization” (2018). An organization who simply sets a 16 Literature Review – Shaping Cultures and Ethics of the Organization code of ethics in place are not guaranteed to see any response to it, especially the desired ethical response. Organizations must treat business ethics just as they would any other aspect of business and develop a strategic plan in order to best ensure that the ethical and moral policies of the organization resonate with every employee. Furthermore, these organizations could also utilize strategic planning to implement ethical guidelines that are all encompassing throughout the entire organization. Committees that would oversee all ethical violations committed within the organization, and also administer employee training on ethical behavior, could be put into action as well. Organizations who are able to establish more tangible assets which are perceived by executives and organizational leaders to be integral pieces of business ethics, and that will aid in the distribution of their code of ethics itself could possibly see a more ethical and morally aware workforce. Profitable Business Ethics When considering the aspect of ethics and morality in a business sense, the conversation often times consists of organizational culture and facets of personality and behavior. While these conversations may mention the aspect of profit and the organization’s bottom line, it is usually in the sense that business ethics and profitability are at odds with each other and executives must work to find a way to keep the balance. Research conducted by Eammon brings to light the argument that these aspects are much more intertwined than most individuals may realize, and that organizations can become more profitable if a strong positive culture and code of ethics are in place. 17 Literature Review – Shaping Cultures and Ethics of the Organization The author goes on to state that “unless a society has at its foundations ethical behaviour and zero tolerance to corruption, you will have a breakdown of trust among certain segments of society. This leads to lower confidence and lower economic growth” (2018). This literature argues the point that the lack of ethical and moral behavior within an organization, and even within state departments and governments, can lead to a breakdown in economic factors that would eventually lead to a reduced level of profitability. In order for organizations to avoid this stagnation of profitability, among the vast number of other negative aspects that come with immoral and unethical behavior, it is necessary for the organization to have strong ethical leadership and a culture that permeates throughout the company. In doing so, organizations can attempt to avoid as many cases of corruption and unethical business practices as possible while having systems in place to root out any of these behaviors that inevitably can make their way into organizations. Virtue Ethics in Business In the international business climate of today, with so many differences in customs, values, and ethical beliefs, organizations all over the world are making an attempt to curb the problem of corruption that plagues every organization. One method that could aid organizational leaders in establishing a system to combat corruptive behavior is that of virtue ethics. According to research conducted by Bertland, virtue ethics along with a capabilities approach can be beneficial to an organization by tasking organizations and managers to work toward ethically building up each individual’s capabilities and promote growth from within. The author goes on to state that “the role of an institution is to provide opportunities for individuals to develop capabilities to function at a level worthy of human dignity” (2009). 18 Literature Review – Shaping Cultures and Ethics of the Organization These methods could allow an organization to become more cohesive, as each individual would be more willing to apply ethical and moral behavior and feel more dignified in their occupation and with the work they put forth. The application of virtue ethics can be divided even further into subgroups as well, as according to research conducted by Fernando and Moore state that MacIntyrean virtue ethics specifically could work to diminish ethical breakdowns in organizations. The authors state that the MacIntyrean system of virtue ethics take into account that if individuals within an organization collectively work toward a goal of achieving the greater good, assuming the goal is ethically and morally sound, the culture of the entire organization will cement itself as being positive (2015). Conclusion Organizations, and those who find themselves leading them, all face a difficult task when shaping ethical behavior and organizational culture. Being able to ensure that your organization is practicing ethically, morally, and with a positive corporate culture is of paramount importance when considering the long term success that the organization wishes to reach. While remaining profitable is often times an organization’s main priority, business ethics and positive organizational culture can provide a solid foundation for a company to grow as well. These aspects allow for establishing relationships with the community, serve as guidelines for how business practices should be performed, and can help in organizations avoiding unrecognized costs that can accompany unethical behavior. While unethical behavior and corruption may never be fully eradicated from the business world, further research on this prominent topic could lead to more efficient methods and strategies organizations can utilize to work toward reducing the number of instances immoral acts occur. 19 Literature Review – Shaping Cultures and Ethics of the Organization References Ardichvili, A., Mitchell, J., & Jondle, D. (2009). Characteristics of ethical business cultures. Journal of Business Ethics. 85, 445-451. Retrieved from https://www-jstororg.ezproxy.liberty.edu/stable/40294807?pqorigsite=summon&seq=1#page_scan_tab_contents Bertland, A. (2009). Virtue ethics in business and the capabilities approach. Journal of Business Ethics. 84, 25-32. Retrieved from https://doiorg.ezproxy.liberty.edu/10.1007/s10551-008-9686-3 Burcea, N., & Croitoru, I. (2014). Business ethics. Journal of Public Administration, Finance and Law. 3, 139-143. Retrieved from http://www.jopafl.com/uploads/issue6/BUSINESS_ETHICS.pdf Clark, J. (2016). Engineering business ethics. ASHRAE Journal. 58, 74-76. Retrieved from https://search-proquest-com.ezproxy.liberty.edu/docview/1764136689?pqorigsite=summon&accountid=12085 Clegg, S., Kornberger, M., & Rhodes, C. (2006). Business ethics as practice. British Journal of Management. 18, https://doi-org.ezproxy.liberty.edu/10.1111/j.1467-8551.2006.00493.x Connell, M. (2016). The challenge of assessing and shaping bank conduct, ethics and culture: Insights from the social sciences. Journal of Risk Management in Financial Institutions. 10, 89-98. 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Ethics & Behavior. 18, 353-372. Retrieved from http://rx9vh3hy4r.search.serialssolutions.com/?ctx_ver=Z39.882004&ctx_enc=info%3Aofi%2Fenc%3AUTF8&rfr_id=info%3Asid%2Fsummon.serialssolutions.com&rft_val_fmt=info%3Aofi%2Ff mt%3Akev%3Amtx%3Ajournal&rft.genre=article&rft.atitle=Ethics+and+Culture+in+M Lopez, Y., Rechner, P., & Olson-Buchanan, J. (2005). Shaping ethical perceptions: An empirical assessment of the influence of business education, culture, and demographic factors. Journal of Business Ethics. 60, 341-358. DOI 10.1007/s10551-005-1834-4 Marques, J. (2016). Shaping morally responsible leaders: Infusing civic engagement into business ethics courses. Journal of Business Ethics. 135, 279-291. Retrieved from 21 Literature Review – Shaping Cultures and Ethics of the Organization https://search-proquest-com.ezproxy.liberty.edu/docview/1790884914?pqorigsite=summon&accountid=12085 Mintrom, M. (2014). Creating cultures of excellence: Strategies and outcomes. Professional Education & Training. 1, 1. https://doi.org/10.1080/2331186X.2014.934084 Saunders, G., & Lockridge, M. (2010). Ethics and culture: Is there a relationship? The International Business & Economics Research Journal. 9, 111-116. Retrieved from https://search-proquest-com.ezproxy.liberty.edu/docview/195152675?pqorigsite=summon&accountid=12085 Singh, J., Wood, G., Callaghan, M., Svensson, G., & Andersson, S. (2018). Operationalizing business ethics in organizations: The views of executives in Australia, Canada and Sweden. European Business Review. 30, 494-510. https://doiorg.ezproxy.liberty.edu/10.1108/EBR-05-2017-0101 Name: Description: ...
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