Ethical Behavior: A solid ethical culture, the key for a solid company

Do you think that strong ethical cultures in a company doesn't do any good? Well, KRI (Kenexa Research Institute) can prove you wrong. But before we go on to that topic, let us talk a bit about Ethics and its implementation on companies. Ethics are, in the most basic sense, the implicit norms or rules followed by a society because of their values. Ethics are the way you should behave in society to be accepted. Done with that, for a corporation to implement a strong ethical base it requires, more than rules, a culture which normally needs high amounts of time and money to be implemented.

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KRI handed up some statistical data where it showed which specific ethical behaviors where being followed in the United States, and which were the implications of these ethical behaviors in the employees of those organizations. We can see then, that some items like serving stake holders, the administration support for ethics, and corporate values where highly scored by workers. So, the percentage of favorability represented the commitment of an employee with its enterprise when it followed one of these components. This also inspired them to work with the company.  As mentioned in the last entry, the company cannot serve only for stockholder capital accumulation, it also has to deal with further goals, not only because of the customer satisfaction, but also because of overall efficiency.

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But, what makes the real difference when an organization has a strong ethical culture instead of a weak one? Well, the data on the right shows us an answer to this question. Pride, confidence and satisfaction grow deeply in a strong ethical culture, while they do not grow so much in a weak platform. These values are very intagible, but they can be linked with more tangible aspects as the intention of an employee to stay within the organization, his commitment, and his performance. Also happiness can be related to these values. Ethics, then, are making the difference and for instance a solid company, as Jack W. Wiley (the executive director of KRI) observes: "Employee’s feelings about ethics are closely related to their beliefs or perceptions about how an organization is performing, their overall satisfaction and their intent to stay or leave". Ethics are very related to beliefs or perceptions, and for every person, these two key aspects, determine everything. If a person believes in something it will be more willing to do it.

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But, lets not stay only in people, lets see how can a company be influenced by having a strong ethical culture. The image above shows three key items for an enterprise: performance, reputation, investment. In constast with a weak ethical culture company, a strong one can raise all of these items over 35% more. So, is not only about employees, is about the company as a whole. Ethics are now a reality needed in corporations if they want to succed in the market. Ethics are no longer something that companies can ignore without repercussions. The era where unethical organizations held a place on the market is ending, so are you willing to take the risk?

Bibliography

Meyer, Jennifer (2010). Creating an Ethical Culture... Looking Beyond Sarbanes-Oxley Compliance. Kenexa Webpage. Access 06/03/2011 Retrieved from http://www.kenexa.com/getattachment/0fd92403-cc61-4934-9bb3-17d3a31a8373/Creating-an-Ethical-Culture-Looking-Beyond-Sarba.aspx

Thorne Linda, Bartholomew Susan (2003). The Socio-Cultural Embeddednessof Individuals' Ethical Reasoning in Organizations. Journal of business ethics 35:1-14

D'Amato, Gina (2011). Decision Making & Ethical Behavior in IB Lecture. EAFIT University, Medellín Colombia.