Lecture 6 - Ethics

Question 1

Ethics

Answer 1

The code of moral principles and values that governs the behaviors of a person or group with respect to what is right or wrong.

Question 2

Ethical Climate

Answer 2

the shared perceptions of what constitutes ethical behavior and how ethical issues should be handled within the organization.

Question 3

Types of Ethical Climates:

Answer 3

1. Caring: Concern for others’ well-being
2. Law and Code: Following rules and standards
3. Rules: Adhering to company policies
4. Instrumental: Self-interest and company profit
5. Independence: Personal moral beliefs

Question 4

Ethical climate affects whether employees:

Answer 4

• Speak up about problems
• Report misconduct
• Cut corners under pressure
• Treat stakeholders fairly

Question 5

Sources of Individual Ethics and Actions

Answer 5

History
Society
Local Environment

Question 6

Forces That Shape Managerial Ethics

Answer 6

Personal Ethics
Organizational Culture
Organizational Systems
External Stakeholders

Question 7

Tensions can arise when these levels conflict:

Answer 7

• Personal values vs. organizational pressure
• Professional standards vs. company practices
• Organizational culture vs. societal expectations

Question 8

Organizations can build ethics into their structure:

Answer 8

Organizations can build ethics into their structure:
1. Ethics Committees - board ethics committees
2. Chief Ethics Officer / Compliance Officer
3. Ethics Ombudsperson
4. Whistleblowing Mechanisms
5. Ethics Training Programs

Question 9

Codes of Ethics

Answer 9

Formal statement of organizational values and ethical expectations

Question 10

Effective codes of ethics:

Answer 10

 Clear and specific (not vague platitudes)
 Relevant to actual dilemmas employees face
 Consistently enforced (no exceptions for top performers)
 Regularly communicated and updated
 Integrated into performance evaluation

Question 11

Role of Leadership in Ethical Culture

Answer 11

1. Role Modeling
2. Communication
3. Decision-Making
4. Accountability

Question 12

Assessing Culture–Structure Fit

Answer 12

1. Does the structure support or hinder the culture?
2. Does the culture support or resist the structure?
3. Do both fit the strategy and environment?

Question 13

Signs of misalignment Culture–Structure Fit:

Answer 13

• High frustration and workarounds
• Formal structure ignored
• Culture resists strategic change
• Structure can’t accommodate cultural norms