Organizational Behavior

Organizational Behavior Module 3: Ethics in Business

Module Learning Outcomes Describe the methods of encouraging ethical behavior and the laws encouraging good corporate practices 3.1: Describe the history of business ethics as a topic in organizational behavior 3.2: Describe the methods to encourage ethical behavior in contemporary organizations

Business Ethics

Learning Outcomes: Business Ethics 3.1: Describe the history of business ethics as a topic in organizational behavior 3.1.1: Discuss the history of business ethics 3.1.2: Describe business ethics and why they play an important role in the workplace 3.1.3: Examine recent ethical investigation cases in the workplace

History of Business Ethics • Early code of ethics include The Ten Commandments, Aristotle economic relations philosophies • Social responsibility becomes a focus in the 1960s • Business ethics becomes a topic in business in the early 1970s

Business Ethics in the Workplace • Personal ethics • Professional ethics • Organizational ethics

Types of Ethical Issues • Fraud • Sustainability • Diversity • Exploitation

Ethical Investigations • Enron • Bernie Madoff • Yahoo!/Scott Thompson • Bill O’Reilly/20th Century Fox • Equifax • Elon Musk

Class Discussion: Ethical Investigations • Have you heard any stories in the news about ethical dilemmas or investigations in the workplace? • How were these incidents resolved? Or are they still ongoing?

Practice Question 1 Which of the following is the best description of business ethics? • Legal matters concerning business decisions and transactions • The morals of each employee within a company • Religious teachings and beliefs of right versus wrong • Identifying right and wrong and consciously choosing right

Practice Question 2 The Equifax data breach in 2017 was a huge ethical scandal. There were multiple components to the scandal, all of which have big implications. Which of the following was not a part of the scandal? • Equifax was oblivious to the breach, finding out at the same time as the public. • Approximately 145 million people’s information was compromised. • Equifax knew about the breach months before it was public knowledge. • Executives sold $1.8 billion in shares right before the breach went public.

Behaving Ethically

Learning Outcomes: Behaving Ethically 3.2: Describe the methods to encourage ethical behavior in contemporary organizations 3.2.1: Examine smart hiring methods 3.2.2: Discuss the importance of a company's code of ethics 3.2.3: Examine how training can impact ethical behavior 3.2.4: Describe how upper management impacts ethical culture

Hiring Employers can hire ethically by conducting • Behavioral interviews • Personality tests • Background checks • Reference checks

Class Activity: What’s a behavioral interview? • Pair up into groups of two • You’re interviewing for a position as a caretaker for the elderly. • Using the verbiage in the module as your guide, what kind of questions would you ask? • What kind of responses are good? Which are bad? (Take 5 minutes each) Examples in the module: • Describe a stressful work situation and howyou handled it. • Tell me about a time you used logic to solve a problem. • Tell me about a time you did not meet your goal.How did you handle that?

Present: What’s a behavioral interview?

An Organization’s Code of Ethics How should it be implemented? • Delivered to all employees • Training on ethics and values • Signed documentation indicating receipt and understanding What should it include? • Company values • Company mission • Company principles

Training for Ethical Behavior • Group sessions or one-on-one training • Offer refresher courses every six months Without training, ethics and behaviors will be left up to employee interpretation

Creating an Ethical Culture • Upper management sets the example • Middle management reinforces • All employees at every level responsible for representing company’s ethical code and upholding the organization’s reputation

Practice Question 3 What is the first step in implementing smart hiring practices? • Conduct a behavioral-based interview • Create a list of qualifications and behavioral needs for the position • Run a candidate background check and check references • Request all applicants complete a personality test prior to scheduling interviews

Practice Question 4 Which of the following lists the most important components needed in every organization’s code of ethics? • A company’s mission, values and principles • A company’s beliefs, preferences and mission • A company’s vision, past successes and future goals • A company’s beliefs, mission, and vision

Practice Question 5 Without proper training, ethical behavior is _______________________. • forgotten • only demonstrated by management • overwhelming • left open to interpretation

Quick Review • Historical codes of ethics, like the Ten Commandments, were early guides for ethical behavior • Business ethics became a topic of importance in the early 1970s • Ethics operate on a personal, professional and organizational level • Types of ethical issues include • Fraud • Sustainability • Diversity • Exploitation • A company’s values, mission and vision are a part of its code of ethics • Hiring and training are among the means by which organizations develop and maintain strong ethical cultures

Organizational Behavior