Question 4: (25 marks)

Ethical crisis can occur in virtually any organization. Critically discuss some of the key elements systems and procedures that organizations must have to become a highly ethical and that can help to prevent such crisis.

i will give you some hints but please you have to paraphrase and summarize in one paragraph and don't use bullet points.

-A firm must have several interrelated key elements to become a highly ethical organization. They include:

1.Ethical role models:

-The values as well as the character of leaders become transparent to an organizations employees through their behaviors. As ethical role models, leaders:-

Must be consistent in their words & deeds

Values & character must become transparent to an organizations employees

Courageous behavior helps to strengthen an organizations ethical environment.

2.Corporate credos(principles) & codes of conduct

-Corporate credo = a statement of the beliefs typically held by managers in a corporation.

-Corporate credos & codes of conduct:-

Provide a statement & guidelines for norms, beliefs & decision making

Provide employees with clear understanding of the organizations position regarding behavior

Provide the basis for employees to refuse to commit unethical acts and help them aware of issues before that are faced with the situation

Contents of credos & codes of conduct must be known to employees

3.Ethically-based reward & evaluation systems

-A flaw in the organizations reward system may cause individuals to act in an inappropriate manner if rewards are seen as being distributed on the basis of outcomes rather than the means by which goals and objectives are achieved.

-Reward & evaluation systems can either support or undermine an ethical orientation as follows:-

A. Support by creating an evaluation system that rewards ethical thinking. Actions consistent with words; follows through on commitments; readily admits mistakes

B. Undermine by rewarding results regardless of how they were achieved.

4. Consistently enforced ethical policies & procedures

Many situations that a firm faces have regular, identifiable patterns. Leaders tend to handle such routine by establishing a policy or procedure to be followed that can be applied uniformly to each occurrence.

-Carefully developed policies & procedures can help guide ethical behavior. They can be useful:-

1. By specifying the proper relationships with the firms customers and suppliers.

2. By encouraging employees to behave ethically through effective communication, enforcement, & monitoring and through sound corporate governance practices.