Corporate culture is a set of beliefs, values, norms, goals and ways of finding solutions, shared by the employees (members) of any organization(Schein, 2010). An organization culture provides the employees the meaning and the internal rules of behavior. When these beliefs, rules, customs and norms have been accepted, shared and circulated within the organization they represent the culture of the organization. The culture of an organization greatly influences ethical decision making process within the organization. That is, if the organization culture encourages unethical behavior, then the employees may as well act in an unethical manner alongside making decisions. On the other hand if an organization values ethical behaviors and rewards them, then the employees will conduct their work ethically (Loe, Ferrell, & Mansfield, 2000). Therefore it is important for the management to determine the organization’s culture and to observe its traditions, values and beliefs in order to ensure that they are a true representation of the desired culture.
An example of best case scenario for promoting ethical behavior is in the case of an organization which rewards ethical behaviors (Sims, 1994). For example, Jack joins a company and he gets concerned of the working conditions, security and pay. After some time, he satisfies his needs but kept on giving his best. As a reward, the organization promoted him to a higher level job and sent him overseas. For the worst case scenario, an example is the case of employees trying to fix a problem by bending the rules. Mike who is employed by NASA, as a flight attendant has learnt to fix repairs of the space shuttle by the influence of the engineers. However, since the engineers are not for the documentation of repairs though it is a rule, mike made repairs to the leaking fuel tank. However, the space shuttle crushed, killing all people on board.
Leaders can utilize their power and influence to shape the organization culture and promote ethical behaviors. There are five bases of powers which may be used to influence individuals. First, reward power which is the ability of an individual to influence other people’s behavior by giving something they desire. Coercive power is an exact opposite of reward power, instead of reward, it punishes behaviors or actions. Legitimate power emerges as a result of the belief that an individual has the right to wield influence and that other people have an obligation to admit it. Expert power is derived from a person’s knowledge; it is as a result of the credibility of a superior with subordinates. Other people who view a person to be adept on some topic can also converse expert power on her or him. Lastly, referent power exists when an individual believes that his or her objectives are the same as another’s. The second individual may try to induce the first to take actions which will lead to attainment of the objectives by both persons. Since they have similar objectives, the person influenced would see the influence from the other person as beneficial (Fraedrich & Ferrell, 2011).
Fraedrich, J., & Ferrell, L. (2011). Business ethics: Ethical decision making and cases. Mason, OH: South-Western Cengage Learning.
Loe, T. W., Ferrell, L., & Mansfield, P. (2000). A review of empirical studies assessing ethical decision making in business. Journal of Business Ethics, 25(3), 185-204.
Schein, E. H. (2010). Organizational culture and leadership. San Francisco: Jossey-BassFerrell, O. C.
Sims, R. R. (1994). Ethics and organizational decision making: A call for renewal. Westport, Conn., u.a: Quorum Books