Organizational ethics refer to the policies, procedures, and culture of doing the right thing in the face of difficult and often controversial issues. Ethical topics include discrimination, social responsibility, and fiduciary matters.
Ethical issues and how organizations practice ethics are more important than ever because social media readily exposes issues that might have been ignored in previous generations. Every organization aims to earn profits, but how it makes money is even more critical. One must understand that money is not the only important thing; pride and honor hold greater value.
There must be absolute fairness in monetary transactions and all forms of trade. Organizations must not discriminate against any employee on the grounds of sex, physical appearance, age, or family background.
The important trends related to ethics and corporate social responsibility are as follows:
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Strategic changes in corporate philanthropy
Today, the focus has shifted to strategic giving, which ties philanthropy and corporate social responsibility efforts closely to a company’s mission or goals. Companies now target donations to the communities where they conduct business.
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A new social contract between employers and employees
Another trend in social responsibility is the effort by organizations to redefine their relationship with employees. Companies now recognize that the social contract between employer and employee is a vital aspect of the workplace. Both groups must be committed to working together for the organization to prosper. The social contract can be defined in terms of four critical aspects: compensation, management, culture, and learning and development.
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The growth of global ethics and corporate social responsibility
When businesses expand into global markets, they must carry their codes of ethics and corporate social responsibility policies with them. Multinational corporations have several responsibilities, including respecting local practices and customs, ensuring harmony between the organization’s staff and the host population, providing management leadership, and developing a strong group of local managers who will positively contribute to their community. By fulfilling these responsibilities, companies foster respect for both local and international laws.
