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Is it Important for Companies and Managers - Dissertation Sample

06 Mar 2017Dissertation Samples

Is it important for companies and managers to be able to justify their actions ethically?

As a corporation is a legal ‘entity’, it does pay taxes and has certain other organisimal-type characteristics, it is easy to forget that the smallest common denominator of behavior is usually a single individual choice.  As a corollary, the phrase “the people make the organization, not the organization the people” warrants consideration.   In the corporate context, people may exhibit elements of crowd psychology as noted by Gustave LeBon’s seminal work indicating lowered inhibitions.  Alternatively, individuals may choose courses action based upon the assumption that they are not observed as the famous example in Plato’s Republic in which an invisible person would be thought to want to commit various crimes knowing that he would not be caught.  Thus, in consideration of corporate ethics, there is a recognition of both external and internal factors in the subsequent motivation and justification of a behavior.

Motivation!

Why do people do what they do?  The utilitarian version of the ultimate goal of human existence is it is the goal of an organism to simply “pursue pleasure and avoid pain”.   >From a behavioral perspective, this explanation makes great deal of sense in that studies have shown, with proper conditioning, people can be made (or, made to want) to do most any task.  A key part of this prior statement should be emphasized: that is, the behaviors that are of concern, though perhaps mightily influenced, are a choice and the discussion which follows is largely concerned with beliefs that originate within oneself and not externally imposed.   Admittedly, in many cases the proverbial carrot is dangled by someone else but, one must first want the carrot and persist in doing so to the extent that one makes plans and considers the consequences of attempting to get it. 

In seeking to understand why people act the way they do, one begins a discourse that is perhaps the very essence of psychology.  But, as in any review of such a potentially thorny issue, it is helpful to ‘step back’ to explicitly define what sort of behaviors are done prior to seeking the rationale for such action.  Though there are many notable examples of unethical and improper behavior, it is worth mentioning at least of few of them so as the give substance, style and a context to the matters at hand:

  • The Manville Case – Over 50 years prior to the case receiving widespread public attention in the 1980’s, the company’s medical department brought evidence of potential serious pulmonary health issues in the workers who handled the company’s primary product, asbestos.  Top management buried this evidence and did nothing, a feat which the medical department remarkably also did when later confronted with the issue (Gellerman 1986, pp. 85-86).
  • Exxon… at Grand Bois, Louisiana – In the 1990’s, seeking to dispose of what Alabama declared hazardous waste, Exxon choose to efficiently and cost effectively dispose of the same waste at a Louisiana waster treatment area.  In all, 81 trucks bearing men wearing ‘moon suits’ dumped waste into open pits against the protests of the already becoming ill townspeople.  In the end, a lawsuit was won by the plaintiffs against the waster company and Exxon was chastised for not revealing a key witness (Hamilton & Berken 2005, pp. 385, 388, 390-391).
  • Widespread ‘petty’ offences such as appropriating company property for personal use such as making personal phone calls, use of the copy machine or ‘appropriating’ office supplies.  Listed below are a host of ‘small’ cases from a California law firm that involve the same decision to cross the line (Stimmel, Stimmel & Smith 2004):
  • In a small doctor's office, right after the doctor finished with the patient, the bookkeeper would offer a 5% discount if the patient paid with cash. The patient's bill and the cash paid was never recorded.
  • In another doctor's office, the bookkeeper pocketed part of the cash payments and recorded a credit to the patient's account as a write off or insurance adjustment.
  • A person who worked solely in accounts payable created a fictitious office supply company and would submit a small invoice to the company.
  • A bookkeeper, who prepared the bank reconciliation for an importer obtained a company check. She made the checks payable to herself and found someone to forge the signature.
  • A bookkeeper, who printed the computer checks, would keep an unprinted check from the check runs. He made the checks out to himself and for personal expenses. The bookkeeper also did the bank reconciliation and kept the general ledger.
  • At an automobile service center, the manager would write up the service tickets. One of the questions he would ask was, "How are you going to pay?" If the customer said "cash," the manager would pull a service ticket from the bottom of his clipboard. Since all service tickets were pre-numbered and accounted for each day, the manager used a service ticket for the cash sales that had a number no one would look for. The cash from these sales were pocketed and the service invoices were destroyed.
  • A maintenance person submitted petty cash vouchers for hardware purchases for his own house.

In each of these cases, the motivation was for personal gain, even in the context of corporate settings.  From a behaviorist viewpoint, the idea of reinforcement contingencies come into play and we realize that, in addition to simply desiring a ‘positive’, it is also a “pleasure” to have the removal of a ‘negative’.  With this understanding, a richer context for motivation within the corporate setting is seen: people choose to act not simply in pursuit of a favorable outcome but also to avoid or stop a undesirable activity.  These desired outcomes are not just monetary gain but may come out of a desire for psychological comfort as might be evidenced by someone motivated to ‘try to fit in’ and ‘be like everyone else’.  

Justification for the Motivated

Consider the famous (infamous?) maxim of the English gentleman’s evening conversation with a famous but unnamed American ‘movie star’ on a crossing of the Atlantic:

  • Gentleman:    My lady, would you consider having sex with me for one million of your American dollars?
  • Lady:        I would think that something might be arranged….
  • Gentleman:    Would you do it in exchange for $1?
  • Lady:        Ahem…. You must think I am a whore…..
  • Gentleman:     That, ma’am has already been established, we are presently just haggling over the price….
  • Such an example clearly illustrates one of the key precepts for many justifications that a person will use, especially for such petty offenses as are listed in the previous section:   that the idea of degree is relevant.  This concept is likely to be especially prevalent in such petty violations as using the telephone for personal calls or taking pens (a few) home for personal use.  

    To go further as to how a specific behavior could be justified, there are a number of factors of ‘factor groups’ that give insight to the ways in which unethical behavior is justified.

Culture as a Context for Decisions

According to Bird, there are four cultural factors that are useful to understand the beliefs that people hold that, if not providing justification, at least influences the course of their choices.

  • Prevailing economic philosophy – Simply put, it is quite common that the rationality of a decision is based on its economic outcome and any choices aside from maximization of self-interest is viewed as irrational (Bird 1996, p. 145). 
  • Assumptions about the possibility for effective change – This feature expresses itself in the idea that many people become accustomed to a given situation because they feel that they cannot change it and, in many cases, if they were to attempt it, their personal situation would likely be worse, i.e., out of a job, ostracized, etc. (Bird 1996 p. 148). 
  • Beliefs regarding the role of legal action – This factor might also be labeled the “not my job” factor and many feel that certain people are supposed to speak up either for or against certain things and that it is not “my job” to say what is legal or not (Bird 1996 pp. 149-150).
  • Cultural systems that support tolerance and expressive individualism – Following World War II, it was noted that people, in general, were more pre-occupied with themselves and that, similar to the cliché, “two consenting adults”, if it did not directly affect your rights, tolerance of other belief and value systems was outright encouraged ((Bird 1996 pp. 151-152). 

Distributive Justice

There are perhaps two schools of thought on what constitutes ethical behavior.  The first, which could be described by adherents as being the a priori sense of right and wrong that we have within us… the gut feeling, the nagging doubt and the essential intuition that is either hard-wire or wired so early that most of us do not remember the work being done.  The second is based more on a situational or contextual definition which, interestingly enough, plays upon an built-in sense of fairness (if not outright right and wrong).  Referred to as being the essence of a distributive system of justice, this key to this system is understanding that it is valid only from the perception of the stakeholders.  That people seek to establish a sense of equity in any exchange type relationship gives ample justification, again from the perspective of the stakeholder, to what might seem to an outsider as construing unethical conduct (Trevino & Weaver 2003, pp.268-269).

Institutional Anomie Theory

This theory integrates both cultural and institutional factors in the consideration of why people choose to perform or choose to perpetuate unethical behaviors.  In short, it is posited the cultural and institutional systems work together to emphasize the outcome over the process.  Further, this emphasis on egotistical reasoning enables a “cognitive separation from traditional social rules and norms… [increasing] the willingness of people to ‘have no moral qualms’ about choosing any means necessary to achieve their goals”  (Cullen, Parboteeah, & Hoegl 2004, pp. 411-412).  Anomie theory, echoing Bird’s previous points, posits the cultural factors of achievement, individualism and materialism as influencing people to want to make unethical decisions.  

Rationalizations that lead to unethical behavior

Certain, there are a host of factors whose cumulative affect is likely driving motivation.  One cannot justify unethical behavior by these mean yet, by providing insight into motive, one can begin to see the context of how a decision is made and a behavior is exhibited.  If it is true that there is no single behavior that did not first begin with a thought, then it would follow that there would be thoughts which precede actual cases of unethical behavior.  By reviewing cases of misconduct as well as the available insights into motivation,  these thoughts can be categorized according to one of the following four criteria (Gellerman 1986, p. 88):

  • A belief that the activity is within reasonable ethical and legal limits 
  • A belief that the activity is in the person’s, group’s or organization’s best interest
  • A belief that the activity is “safe” because no one will ever know
  • A belief that because the activity will help the company, the company will condone it and offer protection to the individual.

In summary, though it seems too simple to be the case, motivation is a complex matter but once born, the afterbirth of the behavior must be psychologically dealt with so as to minimize ‘guilt’ or the possibility thereof.  As Gellerman proposes, these anxiety-reducing beliefs allow one to at least somewhat happily co-exist with one’s self and the continued pursuit of ‘what seems best for me’.   

Works Consulted

  • Bird, F. (1996).  The Muted Conscious:  Moral Silence and the Practice of Ethics in Business.  Quorum Books:  Westport, Connecticuit.
  • Cullen, J., Parboteeth, K., & Hoegl, M.  (2004).  “Cross-National Differences in Manager’s Willingness to Justify Ethically Suspect Behaviors:  A Test of Institutional Anomie Theory”.  Academy of Management Journal, (47), 3, pp. 411-421.
  • Gellerman, S.  (1986, July-August).  “Why ‘Good’ Managers Make Bad Ethical Choices”.  Harvard Business Review, (64), pp. 85-90.
  • Hamilton, J. & Berken, E.  (2005).  “Exxon at Grand Bois, Louisiana:  A Three-Level Analysis of Management Decision Making and Corporate Conduct”.  Business Ethics Quarterly, (15), 3, pp. 385-408.
  • Stimmel, N., L. Stimmel, and A. Smith. (2004).  “Employee Theft: Some Guidelines on Spotting It and Preventing It”. http://www.stimmel-law.com/articles/employee_theft.html.  Accessed on November 28, 2005.
  • Trevino, L. & Weaver, G. (2003).  Managing Ethics in Business Organizations:  Social Science Perspectives.  Stanford University Press:  Stanford, California.

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