Ethical Management Model

One should note that business activity is a very important social phenomenon. It supports individuals in their private and social lives and provides individuals with an opportunity for a career. It is a basis for more specific skills and knowledge possessed by individuals carrying out social or commercial undertakings .Throughout the business activity, there should be several guides set which are meant to mould the behaviour of an individual for better outcomes of the business at large. A formal ethics policy helps reinforce the organisation’s business values and philosophies that are communicated to both the internal and external stakeholders. An ethics policy will also serve as guidance to employees of the organisation (Cant, Wiid, & Kallier,

This is because, entrepreneurs form the managerial part of their businesses and, as such, who manage people / employees, finances, and relationships between the remaining stakeholders. In order to understand the relationship between ethics and venture failure prevention, it is important to understand the three key ethical management models that exist in the organisational world. These are moral, immoral and amoral. Moral management conforms to the highest standards of ethical behaviour and strives to operate within the confines of sound ethical standards predicated on such norms as fairness, justice, respect for rights and due process. It seeks out only those opportunities that the organisation can pursue within the confines of acceptable ethical behaviour. Immoral management, on the other hand, is focused on exploiting opportunities for corporate or personal gain. It is not only devoid of ethical principles, but also it implies a positive and active opposition to what is ethical (Kroneb,

. With respect to organizational employees, defined unethical conduct as "behaviour that has a harmful effect upon others and is either illegal or morally unacceptable to the larger community." Such behaviour can begin with seemingly minor infractions such as fudging time sheets in order to meet unrealistic billing budgets, to stealing credit for other's work, and putting self or departmental interests above the client's interests (Nair & Kamalanabhan, 2010). This leaves companies concerned about unethical behaviour for a number of reasons. Decreases in organizational performance, financial losses, reputational damage, safety concerns, and a loss of customers are all concerns that are connected with unethical behaviour (Askew, Baisler, & keel, 2015). According to (Katarina & Bogdan, 2010) an example of an unethical leader and ethical leader are resembled by the table below;

Table 1: Ethical and unethical leadership

The Ethical Leader The Unethical Leader

Is humble Is arrogant and self-serving

Is concerned for the greater good Excessively promotes self-interest

Is honest and straightforward Practices deception

Fulfils commitments Breaches agreements

Strives for fairness Deals unfairly

Takes responsibility Shifts blame to