A direct and interesting relationship exists between ethical standards and the specifics of a business or organization’s culture. Organizational cultures have norms, rules, and underlying ideas that are unique to every different business, and these can all affect the ethical decisions that managers and employees need to make. The more that management defines and understands their organization’s culture, the better they’re able to identify risks in some ethical rules or standards. These rules are most often unwritten, yet they have a definite impact on both employee and customer relations. The same rules of behavior also affect interactions with other organizations in the same industry. When employees on any level are faced with an ethical dilemma, the organizational culture they work in will guide them in the decisions they end up making.
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Here, UE.co shares more information about the relationship between ethics and organizational culture:
Definition of Ethics
The definition of ethics can be divided into two parts. The first sub-definition directly addresses how ethics relates to established standards of right and wrong. Any idea or decision can be described as ethical or unethical based on value to society, virtue, fulfilled obligations, and a number of other factors. Ethical standards are viewed as reasonable obligations to society, as contracts not to commit crimes or take actions that bring harm to others. A good number of ethical standards are directly based on the virtues of compassion, loyalty, and honesty. These essential standards of ethics are upheld due to society’s widespread support of them.
The second part of ethics’ definition is concerned with individuals’ development and refinement of their own personal ethical standards. In some situations, ethical standards can diverge from what the majority of society considers normal or acceptable. Depending on the specifics, these deviations can be harmless or can carry the potential for poor decision-making skills. This aspect of ethics involves the regular study and evaluation of one’s personal ethical standards. These include moral beliefs as well as moral conduct. Most laws of society are based on a set of widely-held agreements on the ethical standards that benefit society the most. Ethics is also defined as a subset of philosophy that can explain, defend, and refine the concepts of values and of what constitutes a virtuous life.
What Does Organizational Culture Mean?
An organization’s culture is its observable and consistent behavior patterns that ate common to its employees, management, and others who are otherwise involved in the organization on a regular basis. Culture is what dictates how these individuals behave, think, collaborate with one another, and respond to ethical challenges. When first hired, a good portion of employee training frequently involves the teaching of the organization’s culture.
The culture of any organization is powerfully shaped by the use of external incentives. Members of that organization who master the cultural norms and use them consistently are rewarded with praise, recognition, advancement, and increased status. Adherence to the organization’s culture is also frequently a deciding factor in promotions and pay advancement decisions. These incentives can evolve over time, and they become the norm as all organization members agree that following them carries the most benefits for everyone.
Organizational cultures serve as the carriers of meaning for the members of that organization. Established cultural norms and values explain both what the company does and why it fills this role. A specific organizational culture is vital for all levels of employees to believe their assigned work has value to society at large. Understanding the finer points of the organizational culture will also greatly facilitate members’ abilities to communicate with each other effectively and to make the right collaborative decisions.
How Ethics and an Organization’s Culture are Related
A strong set of ethics is imperative for an organization to continue to prosper. Defining the specifics of an organization’s ethics can be a challenge, and managers are the individuals who set the examples for the rest of an organization’s employees. Ethics are the core foundation for a business’s policies and codes of conduct. One of the most important tasks for managers is to understand the organization’s cultural ethics and communicate them to everyone else. Living and working with good business ethics is also important for maintaining morale and for building managers’ credibility.
From both new and seasoned employees’ points of view, management sets this tone, which in turn shapes their overall views of their daily work environment. These views can have a definite and serious impact on both productivity and profitability, in either a positive or a negative way. Ethical standards considered vital for a business environment include maintaining a safe work environment, creating reasonable work schedules, and keeping policies free from any violations of employees’ legal rights. Other common aspects of good business ethics include social responsibility, public transparency, and open lines of communication from the top down.