Managing for Organizational Integrity

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  • Managers think that ethical violations are about a rouge employee doing something bad. In fact, managers do play a large role.
  • Law favors company who's managers make efforts to comply - but companies need to go beyond what the law requires.
  • Sears Example - Management can create a set of incentives that leads to unethical behavior even if that is not the purpose (incentives to increase sales leads to misrepresentations by salesmen)
  • Management and sound organization can lead to a ethical response (Tylenol recall)
  • Although it is important to have a framework in place to comply with the law, this is not enough. Just because something is legal doesn't mean that it is ethical
    • Sweatshops
  • There might be some bad consequences to have a ethics system that stresses punishment and a strict adherence to a given law because the law isn't a perfect guide to moral behavior
  • "An integrity strategy is broader, deeper, and more demanding than a legal compliance initiative."
    • Focus on values (such as honesty, fair dealing) or aspirations (such as good service to customers) or appropriate behavior
  • Focus on ethics can have many advantages:
    • A focus on ethics and values can lead to keeping employees happy and decreasing turnover.
    • A focus on ethics can better relationships with suppliers