Introduction and meaning of Ethics Management 

Moral science Vs Culture and Religion 

Ethics is the science of morals dealing with the human morality revealed in the human character and conduct.  In every act, our human character is manifested.  If we do well, our moral character is characterized as ethical. If we do something bad, then our moral character is revealed as bad or unethical.  There is a system of morals prevalent in every society.  It differs from society to society, culture to culture.  In India, we greet elders, friends, relatives and  strangers  with folded hands, whereas in the west, people greet one another saying “hello”.  In India, if a young boy greets an elder person with “hello”, such an act is viewed as unethical.  In Indian culture, if a young executive talks to his boss sitting on his seat without standing up as a mark of respect, this posture is viewed seriously.  The author while working for a tea garden owned by a British company (subsequently taken over by Tata Tea) during early 70s in South India handed over a document to his Manager through his left hand and the latter considered this act unethical.  But the same act of using left hand for handing over files/documents to a boss in North India is not considered unethical. Even some morality issue in India may not be a morality issue in America.  

What is considered immoral in India may be considered moral in England.  Similarly, what is moral in one religion may not be moral in another religion.  The culture of India is diverse as its people follow different traditions. The culture of India was formed by its age old history, distinctive geography, diverse demographics and the amalgamation of customs, traditions and ideas from its ancient heritages. A company that functions in India has, as far as possible, to adapt to the Indian culture.  Similarly, an Indian company that functions in America has to adapt to the American culture to the extent possible as far its employees of American origin are concerned.  The cultural environment in which a company functions needs to be taken care of while framing the code of conduct for its employees, subject to the public policy of the government.  As such, we have to judge on moral issues depending on the peculiar cultural and religious background of the people in the society or in the work place.  A company situated in America or any western nation should not discriminate their employees on cultural matters or on religious faiths.  To quote an example, it should allow its employees belonging to “Sikh” religion to wear turbans. In USA, after the terror attack in 9/11, immigrant Muslim employees are looked down upon by their non-Muslim colleagues.  There have been increases in religious discrimination cases against them.  Employers have since undertaken ethical programs in training non-Muslim employees and supervisors in terms of accommodating the needs of Muslim employees. 

In a land mark judgment during April 2013 concerning an industrial mining global company Vedanta group’s $1.7 million bauxite mining project in Odhisha, India,  the Supreme Court of India observed that religious, cultural rights of tribal people must be protected when government considers taking over their land for business purpose. 

Application of ethics and values 

The rules of behavior are set by the government and the society in the public place whereas the rules of behavior are set by employers in the work place.  This is called the code of conduct.  Values and ethics in a society help the government concerned frame the code of conduct for its citizens through legislation.  Similarly values and ethics that influence government policy and public opinion should form the basis for companies to formulate the code of conduct for employees. 

Some years ago, Raymond Baumhart, a sociologist in America who was considered the first to teach and study “ethics in business”  asked business people, "What does ethics mean to you?" Among their replies were the following: 

"Ethics has to do with what my feelings tell me is right or wrong."
"Ethics has to do with my religious beliefs."
"Being ethical is doing what the law requires."
"Ethics consists of the standards of behavior our society accepts."
"I don't know what the word means." 

Markkula Centre for Applied Ethics of Santa Clara University situated in California’s Silicon Valley has studied the above replies and defined ethics as follows: 

“But being ethical is clearly not a matter of following one's feelings. A person following his or her feelings may recoil from doing what is right. In fact, feelings frequently deviate from what is ethical….. If ethics were confined to religion, then ethics would apply only to religious people. But ethics applies as much to the behavior of the atheist as to that of the devout religious person. ……Being ethical is also not the same as following the law. The law often incorporates ethical standards to which most citizens subscribe. But laws, like feelings, can deviate from what is ethical. Our own pre-Civil War slavery laws and the old apartheid laws of present-day South Africa are grotesquely obvious examples of laws that deviate from what is ethical….Finally, being ethical is not the same as doing "whatever society accepts." In any society, most people accept standards that are, in fact, ethical. But standards of behavior in society can deviate from what is ethical. An entire society can become ethically corrupt. Nazi Germany is a good example of a morally corrupt society. 

What, then, is ethics? Ethics is two things. First, ethics refers to well-founded standards of right and wrong that prescribe what humans ought to do, usually in terms of rights, obligations, benefits to society, fairness, or specific virtues. Ethics, for example, refers to those standards that impose the reasonable obligations to refrain from rape, stealing, murder, assault, slander, and fraud. Ethical standards also include those that enjoin virtues of honesty, compassion, and loyalty. And, ethical standards include standards relating to rights, such as the right to life, the right to freedom from injury, and the right to privacy. Such standards are adequate standards of ethics because they are supported by consistent and well-founded reasons. 

Secondly, ethics refers to the study and development of one's ethical standards. As mentioned above, feelings, laws, and social norms can deviate from what is ethical. So it is necessary to constantly examine one's standards to ensure that they are reasonable and well-founded. Ethics also means, then, the continuous effort of studying our own moral beliefs and our moral conduct, and striving to ensure that we, and the institutions we help to shape, live up to standards that are reasonable and solidly-based….” 

From  the above, it is seen that the institutions we help to shape are the corporate houses or the Govt. institutions.  The students of Ethics Management should study their own moral beliefs and their moral conduct so they can help build their companies or the institutions they serve on the ethical foundations that are reasonable and solidly-based. 

Ethics Management Vs law of nature and morality 

Keeping in mind the two cardinal definitions given by the said University, let us understand the concept of Ethics Management as a managerial function to regulate the conduct or behavior of the employees from top to bottom through written code or unwritten code.  Ethics Management is a managerial tool to enforce integrity of employees through a set of codified rules and regulations and in the grey areas where such codified rules and regulations are absent, the company or the government has to follow “reasonable” ethical standards or well-founded standards of right and wrong that prescribe what humans ought to do.   

When we apply ethics to professions like lawyer, doctor, architect, scientist, journalist, etc. it is called Professional Ethics. Professionals are supposed to exhibit the highest degree of ethics in their professions.  Many  professional bodies like Bar Associations, Medical Associations, etc. have their own codes of conduct and the professionals who are members of these professional associations are bound to follow the code of ethics prescribed by these professional bodies. Apart from the code of ethics, they have to subject themselves to certain self regulations wherever there are grey areas in the code of ethics of these professional bodies.  Such self-regulations come under the purview of Ethics Profession. I will discuss Professional Ethics under separate topics. 

First, an organization has to function within the boundary of morality that is set by the national “lawful” government that protects human rights and that does not violate the law of nature. Secondly, it has to function within the boundary of “well-founded standards of right and wrong that prescribe what humans ought to do”, as defined above.  In other words, an international organization has to adapt to the moral standards that are set by the national government through its law which is not against human rights and against the law of nature and also by the society through “reasonable” ethical practices which are supposed to be followed by humans.   

A company cannot function ethically in an anarchic country where its law permits human rights violations.  Similarly, a company cannot function ethically in a society that does not have “reasonable” ethical standards or well-founded standards of right and wrong that prescribe what humans ought to do. For instance in Somalia, pirates are ruling the roost in the absence of an effective central government since 1991. A company cannot function in the lawless society of Somalia ethically. No investor would dare to invest in Somalia. 

The law of nature overrides the law of morals. Gay and lesbian marriages are sought to be legalized by law and such marriages get legalized through law with the result that such legal marriages get the coating of morality. What is lawful becomes moral but not ethical. A national government or a company extends social benefits to the spouses of their employees or the dependent members of their families. Values and ethics in a society flow from the law of nature. In the event of an employee getting social benefits for his or her spouse after contracting gay or lesbian marriage as the case may be, the employer has to accept such an unnatural relationship which will erode the ethical foundation of the human race that includes “reasonable” ethical standards or well-founded standards of right and wrong that prescribe what humans ought to do. 

What is lawful is not ethical.  Ethics functions in a realm higher than law. For instance, you are occupying the seat meant for you in the Metro Rail and not sitting on a seat reserved for ladies or elders. Suppose, an elder or a lady stands near your seat.  Legally speaking, you are not supposed to give your seat to the standing elder or the lady. But ethically speaking, you should offer your seat to the elder or the lady.  This simple instance defines the term “ethics”. 

In Ireland, Savita Halappanvar,  a pregnant woman of Indian origin died after her repeated requests for abortion were refused when she was suffering a miscarriage and when she developed back pain and tests revealed that she would lose her baby on the ground that abortion was considered illegal and criminal by the Irish Government which professed the Catholic faith against abortions.  The surgeons who refused to perform the abortion to save the precious life of Savita had obeyed the law of the land. The law of nature which overrides the law demands that surgeons had performed the abortion to save the life of the mother. 

Behavior of employer 

Ethics Management, apart from the employee behavior, also studies the behavior of the employer in given circumstances.  Recently, 71 % of the respondents in a  survey undertaken by KPMG for 2012 have accepted the unacceptable behavior of giving bribes to win contracts or fraud as the inevitable but acceptable cost of doing in business.  According to KPMG, this includes 80 % of the respondents who stated they had experienced fraud in the last two years and Indian companies outnumbered multinational firms in this regard.  

Ethics Management Vs Business Ethics

Business Ethics is a set of rules and procedures for conducting business in an ethical manner.  It is a part of Ethics Management. However, the scope of Ethics Management as a managerial function is unlimited. It embraces all the other managerial functions like HR, Finance, Operations, Marketing, etc. , whereas Business Ethics is mostly confined to Marketing Department or those Departments that come in contact with the public, the clients or the other stakeholders with whom the company has to have business dealings.  Ethics Management is a study of human behavior in business transactions behavior whereas business ethics revolves on the code of conduct in business environment. 

Ethics Management, not a branch of HR

Though Ethics Management in the Corporate world appears to be a branch of Human Resources Management as it deals with employee behavior, it is a specialized managerial function distinct and separate from HR Management. This subject is becoming all the more important in view of the scams breaking out in the systems of public administration and corporate governance.  What is ethical in HR Management through its selection procedures becomes unethical in Ethics Management.  For example, in its HR policy, there may be a provision for employing the wards of employees against some quota after following a competitive selection procedure also open for the public candidates from the open market.  When the HR Manager appoints the wards of employees after rejecting meritorious candidates who have excelled the wards of employees in the open selection process, taking recourse to the HR policy, it would be unethical.  If the HR policy gives weightage to the wards of employees, say 5% of the total marks, it would be ethical.  But if the HR policy gives weightage to them to the extent of 25%, it will become unethical if we apply the definition of ethical standards as elucidated by Santa Clara University which also include those that enjoin virtues of honesty, compassion, and loyalty.

Ethics Management, a higher managerial function

When HR Management in the Corporate world or the public administration in government functions within the framework of the code of conduct, Ethics Management functions in a higher realm of ethical standards that include standards relating to rights, such as the right to life, the right to freedom from injury, and the right to privacy. When HR Management or Public Administration does not give importance to the cultural issues of the society, Ethics Management  guides the top management or the top government functionaries to work in a cultural or multicultural environment. 

When the mission of the top management or the government does not give due importance to global greenery policy, Ethics Management guides the top functionaries to frame policies so as to avoid pollution of the air and water and environmental abuse because “right to life of the society” has to be protected by the company that produces goods and services for the public. When the owners of lands/houses are dislodged for the establishment of industries or real estate business, grant of adequate compensation and rehabilitation of the owners displaced need to be given due priority by the industries or the realtors concerned.

Moral character

A person’s moral character will be the same at home or in the public place or in the place of work.  Of course, his moral character may be disguised in the public place due to fear of the rule of law.  An employee addicted to vices like gambling or drugs will manifest his immoral character at the work place wherein he spends more of his life time, whereas in the public place wherein he spends less of his life time, he may not manifest his real character, being afraid of the policeman.  Ethics Management has to deal with the inner character of the employee and to reform him.  While the top functionaries may attempt to get rid of the prodigal son who is either immoral or inefficient, Ethics Management may attempt to transform the prodigal son into a loyal and efficient employee through its ethical programs.  When the company management or the government encourages only the efficient employees through various incentives, Ethics Management becomes a tool to encourage the inefficient employees for higher performance and productivity and brings them into the mainstream of the organization, integrating them with the other efficient employees. 

Definition of Ethics Management

Ethics Management  studies the behavior of employees and of the employers in  business transactions of the Corporate world and in public administration of Government and lays down the requisite guidelines for corporate governance or governance in public administration, as the case may be.  Ethics Management is a managerial tool or function to bring about corporate governance or governance in public administration. Professional Ethics studies the behavior of professionals and lays down the requisite guidelines for regulating their conduct. The behavioral study covers acts both in the real world and in the cyber world.  An employee living in the real world behaves indifferently in the cyber world.  While sending emails to his superior, he uses unethical language whereas in the real world he is quite polite to his superior.  Many company employees disguise themselves in the social net working sites of the cyber world and criticize their company policies or their company bosses.  But in the real world, they have different faces. 

(The author may be contacted on his email: jobanbalagan@gmail.com)