Organizational Culture and Ethical Decision Making

“Organizational Culture and Ethical Decision Making”  Please respond to the following:

Examine the major influences that organizational culture can have on organizational ethical decision making. From your personal experience in your current or past organization, provide one (1) example of how organizational culture influenced the outcome of an ethical decision. Note: Please do not identify workplaces or leaders by name.

Ferrell, Fraedrich & Ferrell (2015) believe that the ethical dimension is dependent on how the company’s leaders influence the culture (p. 316). There are influences that organizational culture can have on ethical decision making. I have found that some leaders in my organization are tolerant toward misconduct. I have witnessed misconduct in my organization with employees meeting sales goals.

Ethical conflicts can arise when employees feel uncomfortable about their own or their co-workers’ decisions (Ferrell, Fraedrich & Ferrell, 2015). Recently, my organization was exposed for some very serious unethical conduct. The conduct resulted in a fine with a very expensive price tag. I’m sure that the employees that were involved did not agree with the pressure that was placed on them to meet sales goals. But, they were doing what they were told or had to do at the time. I’m sure that they knew deep down that the conduct was ethically wrong. After the company’s unethical conduct reached the media, more than 5,000 employees were terminated, including senior management and executives. I don’t work in the immediate area, but I still deal with disgrace daily. The employees that blew the whistle on the scam recognized that this behavior was wrong and refused to ignore it any longer. The ethical decision to terminate those employees was the right thing to do.

Use the Internet to research a business leader that you believe to be an ethical leader. Next, examine the key traits and actions that the selected leader demonstrates in order to influence a positive ethical culture in the organization. Suggest two (2) actions that a company could take in order to achieve a positive ethical culture.

Effective leadership is essential for a company and successful companies develop based on the leadership (Ferrell, Fraedrich & Ferrell, 2015). Howard Schultz, Starbucks CEO, gets my vote for being an ethical leader. In 2011, he stepped out and advised other CEOs to stop making contributions to politicians until they start running the government like a successful business. Schultz decided on this action to put a stop to politicians living beyond their means. When Schultz called on corporations join him in a moratorium on political contributions until Washington politicians came up with a bipartisan plan to address long-term fiscal issues, more than 100 signed on, including the CEOs at Pepsi, Disney, Intuit, Whole Foods, J. Crew, AOL, the New York Stock Exchange and Nasdaq (Hedges, 2012).

Schultz reached his level of success by taking stances because he felt they were moral. He strikes a delicate balance of being decisive, assertive, and approachably real (Hedges, 2012). In 2011, Schultz landed the No. 1 spot on Fortune’s Businessperson of the Year as a result of his activism.

Ethical leaders need to possess knowledge and experience. Schultz demonstrates the transformational leader trait. Offering healthcare to part-time workers is a way to raise employees’ level of commitment and foster trust and motivation, and it also shows that he considers employees’ needs. In order to achieve a positive ethical culture, the most important action to take is to offer training. This training can be web-based or classroom setting, as long as it is offered annually. Another action that could achieve a positive ethical culture is to visibly reward ethical acts and punish unethical ones (Nguyen, 2011).

Hedges, K. (2012, April 10). Forbes Welcome. Retrieved from http://www.forbes.com/sites/work-in-progress/2012/04/10/why-im-stalking-starbucks-ceo-howard-schultz/2/#6ef9c9256748

1. Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2015). Business ethics: Ethical decision making and cases
   (10th ed.). Stamford, CT: Cengage Learning.

Nguyen, S. (2011, February 14). Creating an Ethical Organizational Culture | Workplace Psychology. Retrieved from https://workplacepsychology.net/2011/02/14/creating-an-ethical-organizational-culture/