Ethics in the Work Environment

Managers within organizations all posses a certain degree of ethical responsibility. These ethical standards are key for a manager to effectively run their part of the organization. This is because a managers ethics impact their entire decision making process, and (more often than not) unethical decisions often carry heavy consequences. The potential consequences can range anywhere from having a disgruntled employee to facing legal trouble. As a result, ethics play a vital role in the business world, and they largely impact the success rates of managers within organizations.

First and foremost, ethics are defined as the standards of right and wrong that influence behavior. This applies to all phases of life, and as it pertains to managers, they must weigh their ethical standards in cohesion with deciding what is best for their organization. As a result, managers will often face ethical dilemmas, where they must decide if a potential benefit to their organization is worth pursuing if it carries the risk of being unethical (or sometimes, illegal). There are four generally accepted approaches that managers use when facing these ethical dilemmas. The utilitarian approach suggests doing what will result in the greatest good for the greatest number of people. Secondly, with the moral rights approach, managers often base their decisions off of their morals (whether they be religiously based or in respect to the basic fundamental rights of human beings). Thirdly, the justice approach promotes respect for impartial standards and equity. More specifically, it refers to how fairly organizations apply their policies towards employees of different ethnicities, ages, and genders. It also implicates how evenly or unevenly the pay is distributed between employees and their higher-ups. Lastly, the individual approach prompts managers to make decisions in their own long-term self interest. This approach often leads to unethical decisions being made by managers.

An extreme example of an ethical dilemma would be the Enron scandal. Executives and higher-ups within Enron decided to use fraudulent accounting methods to hide billions in debt from failed deals and projects. Obviously, these executives were making decisions by using the individual approach method. They took these methods far enough that Enron ended up being recognized as the seventh largest company in the United States in the early 2000s, despite their massive debt and financial instabilities.

These executives made unethical decisions to better benefit their company, Enron Corporation (along with trying to further their self interest to become individually wealthy). They weren't just solely manipulating their accounting figures, however. They told their investors, many of which were their very own employees, that the company was in excellent shape, and that they should purchase a lot of Enron stock. Unfortunately, many followed this advice, and some families even put the majority of their life's savings into Enron stock. The executives, knowing full well that their company was about to implode, sold all of their stock right before the stock price crashed in order to remain individually wealthy. Investors, on the other hand, ended up loosing billions of combined dollars as a result of this corporate fraud, and because of this unethical behavior (along with other malpractices), the executives faced extensive jail time, and Enron went bankrupt.

Ethical dilemmas aren't just limited to major scandals like these, however. Most ethical dilemmas that managers have to deal with are much less serious in nature. One example is the implementation of the state and federally mandated overtime