It is the responsibility of leadership to decide what culture is ethically acceptable and what is not. Good culture is promoted by shared ethical values. Ethical leadership recognizes the behavior which is inconsistent with the desired organization cultural values. The management of ethical behavior in corporate culture is also a practice of ethical leadership. A company’s leadership is also involved training to handle the unethical dilemmas.
Figure 1: Ethical decision making. Source: (Vucaj, 2014) Introduction Ethics in general is about how we behave, encounter and treat one another. Without ethical principles applied in our world, injustice might take place. Ethics is not about the law or the common practice of society. According to Kirk O.Hanson, ethics is the study of standard of behavior that promotes what called good, and business ethics is the study of business behavior that promotes goods (Kirk O. Hanson, 2010).
In other words, Ethics are more moral guideline which governs good behavior. Ethics is the means the branch of philosophy that focus on morality and the way in which moral principles are applied in everyday life. It involves an active process of applying values, which may range from religious principles to customs and traditions. In the ethics part, it has some basic questions such as what is fair, what is the right things need to do in the situation? Business ethics is the study and examination of moral and social responsibility in relation to business practices and decision- making in the business.
Ethics Èthics is the discipline that deals with moral duty and responsibility. Ethics can also be regarded as moral principles or values. Morality is a guideline or system of moral conduct. Moral behaviour refers to that which relates to principles of right, wrong and fairness in behaviour. Business Ethics From the book, definition of business ethics is business policies and practices potentially controversial issues such as bribery, discrimination and corporate social responsibility.
It is a particular ethical standard that formulated and then applied. In the action of business ethic, it can makes specific judgments about what is right or what is wrong. Thus, we can said that it makes claims about what ought to be done or what ought not to be done. On the other hand, business ethics is concerned with the study of what is good and bad, right and wrong, and just and unjust in business. Islam places the highest emphasize on the ethical values in all aspects of human life.
As the practices of the company and a career specialization, the field is primarily normative. The scope and quantity of business ethics reflects the degree to which its business is considered contrary to the social values of non-economic. , For example, today most major corporate sites put pressure on the commitment to promote social values of non-economic under various posts (eg code of ethics, social responsibility). In some cases, companies have to reformulate their core values in the light of considerations of business ethics.
It is the commitment of a company to account for the impact of its operation in social, economic, and environmental dimensions (Achda, 2006). As one factor that frames CSR, culture becomes one of the triggering points that influence the institutional environment of the corporation. Institutions are interlinked with culture as they both help in practicing norms and increasing values of corporation. For CSR, this could be transmitted as an obligation for
The protection that CDS, subprime loans and model of the computer were not non ethical procedures ignored the truth that the decision makers mishandled the financial instruments to destroy others. It is very clear that business ethics in an organization need value related leadership from the top management, determined action which comprise managing and usage of the standards of the sufficient conduct and continuous and openness effort to enhance ethical performance of the organization. Thus the importance of ethical behavior associates to value and traditions of organizations, not only to the individual who creates the action and takes
Siegel (2014:221 ) highlights the importance of the interdisciplinary aspect of responsible leadership given a debate about how responsibility should be defined, especially since any definition is heavily impacted by the context within which it takes place. While he supports the view that leaders are responsible only to shareholders to maximize profit, Waldman (2008:121 ) defines responsibility with a much larger scope that includes other stakeholders. The latter’s approach ties responsible leadership to disciplines rooted in stakeholder theory and indeed makes of the leader a champion of movements like corporate social responsibility, corporate social performance, and the likes (Maak & Pless,