Managing Ethic In Business
The concepts of business ethic contain the implication of a corporate ethic, a working ethic and a personal etiquette. They relate in a social network between the corporate, the employees and the business or the natural working environment. The corporate ethic is interconnected with the relationship between the corporate and the employee with the environment, with other companies or with the local society. Meanwhile, the working ethic is interconnected with the relationship between the company and its employees. Lastly, the personal etiquette organizes the relationship within the employees.
The corporate ethic creates a trusting condition between the company and the stakeholders. In a long run, the company is able to increase profits; because it prevents the opportunitic action between customer-worker-vendor. It enables the company to create a superior competitiveness, to reduce uncertainty in the budget estimate, to expedite the delegation process and to promote success in research and development.
BUSINESS ETHICS AND CORPORATE CULTURES
Strategy and cultural values (including business ethic) are two completely opposites. Both incorporate the working policy and the behavioral standard, including the issues of staffing, system, skill, style, and structure that need to be improved in the company.
A corporate policy to supervise ethics will endorse an image of a company who supports an ethical business behavior. If a company is unable to justify what is right or wrong, then problems may surface and consequently direct to an unethical behavior. The corporate policy is documented in the Code of Conduct. The Code of Conduct has an important role, because in a globalized era company it is becoming more influenced by a diversity of cultures due to the intensive interactions between a range of races, philosophies, knowledges and religions.
FORMING BUSINESS ETHICAL CLIMATE
There are three main factors that support the formation of corporate ethical climate; the formation of a sound corporate culture, the growth of the organization based on trusts (trust-based organization/TBO), and the establishment of a relationship within employees (employee relationship management/ERM). The formation of the TBO is signed by the CHIROAH (Caring, Honesty, Integrity, Respect, Ownerwhip, Accountability and Honor). The ERM holds the nature of VISIONARY (Vision, Information, Satisfaction, Involvement, Optimism, Nexus, Accountability, Retention and Yield).
Creating an unconditional ethical climate is encouraged although it takes time, money and hard work. Only a successful ethical climate allows a company to be prepared in executing business plans to achieve the goals effectively and efficiently. Due to this ethical climate, the interest of the stakeholders is accommodated well because it is based on trust.
TRANSFORMING KNOWLEDGE INTO ETHICAL BEHAVIOR
Understanding the corporate ethics as knowledge is not hard, however accepting it as a value and implementing it in everyday work is not easy. There must be an internalizing process in each individual and group, as well as a technical and an administrative process in the company.
The internalizing process is crucial because they will behave as both an object and a subject. The process comprises 5 stages; awareness, understanding, assessment, acceptance and implementation. These 5 stages must be in order, eventhough the intensity of depth and the timeframe in each stage do not have to be the same.
The technical and administrative processes involve several stages. The first stage is to provide and implement an extensive training on the analysis and the resolutions of the dilemmas encircled the business ethics. The second stage is to allow an ethic advisor to help ensuring the ethic messages are delivered properly. Third, communicating the importance of the business ethic periodically to ensure a good business decision. Fourth, it is important to form a committee or a supervisory board of ethics to monitor organizational activities and to recommend the next proactive activities and decisions. And fifth, cooperation with an ethic consultant or an auditor is essential to check and re-check the implementation of the business ethics in the company and to enhance perfection when necessary.
ESTABLISHING AN IMAGE AND A REPUTATION BY CONSTRUCTING AN ETHICAL CLIMATE
Creating an ethical climate is not easy because it requires special pre-requisites such as cultures of trust and employees relationship in the company.
The existence of the ethical climate will create the image and the reputation of the company, therefore the opportunity to coorperate with other party is opened.