Ethics - 3

Class COR3302

Type Seminar

Reviewed

Status Not started

Status Done

1. CORPORATE CULTURE AND ETHICS

Corporate culture:

The shared pattern of beliefs, expectations and meanings that

influence and guide the thinking and behaviors of the members of that
organization

Shapes the people who are members of the organization

Shaped by the people who comprise the organization

Is not static; but changing corporate culture analogous to moving an

iceberg

Can give a firm direction and stability during challenging times OR can
constrain an organization

“that’s how things have always been done here”

Ethical corporate culture

Employees empowered and expected to act ethically responsible even

when the law doesn’t require it

If law is ambiguous, corporate culture is driving factor

Is ethical culture a competitive advantage?

Depends on leader? Bigger company greater need for ethics to avoid

social lawsuits and gain favor of society’s and stakeholders. it isn’t a

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 competitive advantage but rather prevents a competitive disadvantage
in terms of social activities.

If it isn’t dynamic, risk of falling into a “that’s how it was done before”
trap

Costs associated with developing a culture

Investments in ethical training programs etc

Should a company be willing to sacrifice an ethical culture for profit

Even if it is a profit motive, ethics helps to improve sustainability by

avoiding issues with stakeholder

2. COMPLIANCE VS VALUES

Compliance based

Obedience to rules as primary responsibility of ethics

There is a limit to number of rules that can be set, can’t cover all
situations

Values based

Reinforces set of values rather than rules

Encourages a decision making process that refers to values of

underlying principles as guides

Recognizes that when a rule doesn’t apply, the firm must rely on the
personal integrity of their workforce

3. ETHICAL LEADERSHIPS

Responsibility of shaping corporate culture lies with its leaders

Leaders set the tone via

Personal behavior

Keeping promises, maintaining standards, and encouraging others

to do so

Allocation of resources

Investing in ethical training

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 An ethical leader engages in visible ethical actions, is people oriented
and has important personal traits

Does things with an ethical agenda

Gets noticed for making courages decisions in difficult situations

Effective leader

Gets the job done

May not be ethical

Ideally one would be effective+ethical

4. MISSION STATEMENTS

Articulation of values you inculcate

No decision should break the underlying values

5. CODE OF CONDUCT

Set of rules on what you should do

Enhances corporate reputation

In-built risk management system

Provides concrete guide for decision making

6. NKF example:

NKF culture-

From the example seen between durai and matilda, I believe that it had
a culture which could potentially encourage the misuse of NKF’s
assets and funds, ‘twas unethical. Promotes self interest

When Gerard was appointed as chairman, the culture changed to be

more ethical as he was someone who wanted to ensure funds were
rightfully used

If I was EE, create a code of ethics including the consequences of

breaking the ethics, create an ethics committee to ensure employees
are on track

7. EMPLOYER RESPONSIBILITIES AND EMPLOYEE RIGHTS

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 Treating employees well

Is utilitarian(means to get end greater productivity and profits)

Is a principle-based ethic in treating ppl well because it’s the right

thing to do

Employers have authority to control the employees who are dependent on

them. This authority must be used with just

Due process – the right to be protected against the unfair use of authority

Employers can fire or discipline employees at will, due process

recognizes this, but demands that this power be used justly

Should be extended to how employees are monitored and evaluated at

work

Singapore is more tilted to employment-at-will(EAW)

Employer can fire an employee at any time, for any reason

Employee can resign at any time, without giving notice

Gives businesses the freedom to make decisions to make an

environment conducive to business

SG WorkRight is a program in SG to ensure EAW is not taken advantage of

Employer must pay cpf and salaries and overtime on time

Must give appropriate leave

UBER AI

To what extent would uber pursue automation

Currently drivers use their own cars, auto car implies need for
company to buy the cars, increasing capital costs.

Need to maintain provision for potential legal issues as in case of

accidents, the primary fault will lie with uber and car software
provider

How would you manage the existing/displaced workers?

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 Fire them or provide them alternate jobs perhaps in ensuring the
cars are driving optimally, resolving customer issues that require a
human touch etc. maintain some human driven cars- give
customers the choice

Ethical concern

Taking away the livelihood of the drivers

Not sure if robots have the ethics to take care of stakeholders

Who addresses ethical issues?

tech companies in allowing robots to have jobs

Companies in choosing profits vs ethics

Humans in having the necessary skills to retain jobs

Downsizing occurs when a company lets many employees go at the

same time

Not necessarily unethical

Companies should ensure decisions are made and executed

ethically

Let those who are going to be affected be aware as soon as

possible

Managers need to visible to their staff

The above points are best practices but doesn’t always happen
because of some considerations

Lowers morale

Employees may negatively react to sabo the company

Downsizing in SG

Retrenchment should be based on objective criteria, and no

particular group should be discriminated against

Should communicate intentions early

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 The text/official guideline recognizes the practical
limitations discussed above

HEALTH AND SAFETY

Wide consensus in developed economy that workers have

a right to a safe workplace

When is a workplace safe? And How can an employer

ensure employees are safe

As an acceptable risk:

workplace is considered safe if level of risk is

acceptable, recognizes all risks cannot be mitigated

treats employees disrespectfully by ignoring their input

assumes an equivalent between workplace risk and

other types of risks

H&S being market controlled

Bargaining between employer and employee as the

approach to workplace health and safety

Employees free to choose their level of acceptable risk

Would result in optimal distribution of income

Cons,

labor markets may not be c ompletely competitive and

free

employees seldom possess perfect information

considers social justice and public p olicy problem

eg: first generation problem( it needs to be experienced

first to be protected against it)

Government regulation

Government sets the relevant H&S rules to ensure the

welfare of all stakeholders

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 8. CASE STUDY -TOLLYJOY

Summary:

A company asked their senior employees to accept lesser pay during

an economic crises(dot.com burst) to ensure the company could
continue operations without reducing the junior employee’s pay

What is the ethical issue

They want to cut costs

Was cutting the pay of senior employees the right choice?

Stakeholders involved and point of view

Senior employees- would not appreciate the pay cut in terms of

economic trouble

Junior employees- appreciate that they did not get a pay cut

Shareholders- maybe worried that they did not let ppl go like other
companies

Customers – if company pushes costs onto customers

Probably worried about their profit in the trying economic times

Available alternatives

Downsize operations & retrenching redundant employees– must

deal with concerns of employee firing

Encourage wfh to rent lesser office space for admin staff

How will alternatives affect stakeholders

Downsizing is negative for junior employees, beneficial for the pay

of seniors, assuming they have enough people to get work done.
Perhaps more income available for shareholders. Downsizing
should be done ethically to ensure the junior employees are treated
with respect

Challenging for retrenched employees to find another job

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