How to Become an Ethical Organization

Doing the right thing may not always be the easiest path, but it is the path that keeps you looking forward instead of over your shoulder. There are several ways to go about making an ethical decision. You can consider how the general public would react to your decision if they heard about it on the evening news. You can consider whether your mom, dad, or someone you deeply respect would consider your decision ethical or not. The need to follow the law is of utmost importance to the stability and long term success of any company. (Martin, 2009) So it is important to pick the causes that are important to you, and then do your best (Goldsmith, 2003).

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When decisions are made, values, principles and ethics come into play. Equal Opportunity for all employees is covered by law and should be a policy for all companies. This prohibits against prejudice in regard to race, color, religion, handicap, national origin, sex, age or veteran status. All personnel decisions such as selection, hiring, training, transfers, promotions, demotions, layoff, disciplines and termination must be based only on job-relation factors (Budd & Scoville, 2005).

In accordance with Kaptein, (2008) it can be stated that many of today’s top organizations are faced with the challenge of creating an ethical organization. But before an organization can begin its transformation into an ethical organization, there are some basic elements that an organization must establish first. These include the ethical orientation of the leader, support of top management, and finally an established corporate ethics policy. The ethical orientation of the leader is considered to be the key factor in promoting ethical behavior among employees. Nowadays leadership skills are not enough, these skills needs to be paired with integrity and ethical behaviors. These traits of honesty and integrity have been identified as essential for a leader to be successful in building a trusting relationship with his/her followers (Kaptein, 2008).

Global Ethics & Integrity Benchmarks is a tool for helping multinational organizations assess and measure their progress in making a formal and transparent commitment to ethics and integrity in the workplace. It should be understood in the initial stages of the essay that this issue is a bilateral phenomenon and each point of view can be seen from two distinctive perspectives. One is the perspective of the employer and the other is the perspective of the employees. However the term ‘employment at will’ indicates the perception of the employer more than that of the employee.

The property rights of the business owner are a dominant feature of business or monetary transaction proceedings under the parameters of a capitalistic form of government. Under the influence of market economy, it is absurd to think of an environment that is unable to provide the employer a sense of confidence in its fiscal proceedings and the property rights of the business owner provides exactly that assurance to develop and operate a commercial organization. On the other hand it is also true that the boundary of clean and ethical business stands at a marginality when a certain amount of impositions are not regulated by the government. This is to make an indication that the government is watching every step and thus everything that is operative is basically government property and this is beneficial for the employees’ interests.

The freedom of contract is another aspect of business and it is applicable both ways. From the point of view of the employer it is evident that management would look for the best skills at the lowest price thus a contract is set forward to assure the end product. Similarly enough the employee would be looking for a job that yields the maximum harvest. Here also a contract would assure a fixed or fluctuating pricing, as the case may be, and negotiate into an understanding with the management. It may not be very ethical but it is clear for both parties in this way along with the ability to maximize income margins at any point. But the freedom of contact hardly provides and fiscal stability for a huge margin of timeframe. The environment of insecurity prevails at all point of time. For example a government employment or service can provide that assurance what the multinational company is incapable to provide.

The issue of need for an efficient business is the major important topic. It is essential to develop efficiency under the perspective of a market induced economy and the result of this efficiency directly translates into plough back of profit for both the employer and the employee, though not in the same ratio. Inequality of economy thus rises with this measure. It was found in a research that between 1991 and 2000 the average salary of the lower level employees has raised to 11% but at the same time the top level was earning a breathtaking 611% profit. This means the top level was curving away the possible income of the lower level of employees. However, it is certain that only with an efficient business operation would it be possible to sustain the proceedings of a business and without the success of the business neither the management nor the employees would survive. Thus it is extremely obvious to create an environment where the success and efficiency of the business is ensured.

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The major aspect of building an ethical organization is its ethical codes. It is expected from every members of the organization to show commitment towards these codes with the conduct of a professional. This is the fundamental issue for any machinery to perform properly with an ethical perception. These codes can be viewed as a formulation of personal responsibility where the most identifiable significance being the mode of commitment that an individual possesses. In general sense the code possesses all aspects of professional situation both as a human and a proficient member of the organization. It is obvious that an organization is formed with human aspects and for an organization to become ethical it is important the human aspects are indulged into following the code. It is imperative that these codes of ethics would be subjective and open to individual interpretations but it should also be noted that in such incidents these codes or phrases or word of the codes would be judged upon individual approach of humane solution.

In this respect of ethical organization it would be relevant to mention the emergence of Professional Care Organization (PCO, a newly established health care organization) may be definitely seen as a paradigm shift. This is a commercial association that provides all types of hospital and clinic care treatment to its patients, including mental health and rehabilitation services. The clientele is the general public in need of medical treatment. The organization employs 120 employees (doctors, paramedics, assistants, nurses, health-care assistants, and maintenance staff). PCO intends to become the leading health-care services provider in its region. It also plans to alter the general conception for high medical care costs by implementing a society benefit program that will significantly reduce the patients’ expenditures.

PCO reflects the growing understanding that American medicine had exceeded society’s ability to pay for all of the health care that individuals could use to actually better their health. Modern American health industry goes through a difficult period, one characterized by new concerns about rising health costs. The major concern that had directed medicine until that time was that Americans required more medical care—more than the marketplace would offer by itself. At the moment, however, worries about high expenditures are replacing concerns about expanding access. The country’s focus turns to the matter of redundant procedures, excessive rates of surgery and hospitalization, and repetition of facilities and equipment. The appearance of PCO indicates the growing appeal of scientific and rational approaches to social concerns, including health related questions. PCO symbolizes a way to smooth the playing field and to bring arrangement and order as well as scientific reasoning to the, at times, inefficient health care system. Its decision-analytical foundation gives society a structure for posing a range of questions related to priority-establishment. It lets the general public evaluate existing alternatives, explore hypothetical techniques, and test the strength of primary assumptions, all in an explicit, quantitative, and systematic manner.

Health policy researchers traditionally employed cost-benefit to measure the value of health programs. Under this technique, analysts assess the net social benefit of an agenda or intervention as the incremental advantage of a program minus the incremental expenditures. All expenditures and advantages are measured in monetary terms (e.g., dollars). The technique is useful because it leads to a straightforward decision rule: if a program’s net benefits surpass its net costs, then it should be chosen and used. Cost-benefit analysis, yet, also presents measurement troubles in that it needs to include the monetary valuation of health benefits. It remains unclear, how should we value, in dollar terms, an instance of cancer avoided or a life saved.

In the past, cost-benefit researchers counted health benefits using a human capital approach. The worth of reduced health was measured as the lost earnings of affected persons. The benefit of the human capital technique was that it assessed value as the productive capability of society lost through morbidity and death. It also allowed a relatively simple calculation. The disadvantage is that the technique has no foundation in economic theory—because it ignores underlying individual preferences and entails that unproductive periods such as leisure time and retirement are without worth.

Recently, cost-effectiveness technique, adopted by PCO, has appeared as a favored analytical tool for economic evaluation in health care. The key appeal of cost-effectiveness over cost-benefit technique is that it permits analysts to measure health benefits in health rather than in monetary units. Consensus teams have emphasized the practical and political benefits of using cost-effectiveness technique because estimating outcomes in dollars as cost-benefit approach demands, presents calculation difficulties and ethical dilemmas.

Is PCO one of the few organizations who will actually adopt a cost-effective approach? The answer depends on the number of factors. PCO states that the organization’s success will greatly depend on the tool’s acceptance in the broader medical commune. Practicing doctors will need to be converted, or at least counterbalanced as an opposing force. This would entail a shift in their reasoning. Physicians have to begin contemplating boundaries, whereas their previous training stresses the need to offer beneficial treatment or service without regard to the marginal expenditures.

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Some of the trials could involve persuading doctors to acknowledge that they already thought routinely, not openly but by compromising in varied and masked ways—by not dispatching all post-operative patients to the intensive-care unit (ICU), by adhering to health plan policies to offer the most expensive drug only after others have failed, and by following standards of care, which suggested screening for cancer every, for example, three years, rather than every two or one. Beyond convincing physicians to admit the point, PCO managers will have to persuade them to accept the organizational approaches as the preferred rationing technique. Yet, PCO has all reasons to succeed as it truly cares about the community and designs effective tools that would allow the patients to significantly cut on their medical expense.

It is important to uphold the code and the future of the organization and profession depends on this therefore it is important that employees would motivate others too to follow the code. Any violation of the code would be recognized as possible termination of employment is the employee is found to misconduct grossly.

The code inspires a tangible outcome from employees by different manners and from various aspects. Firstly, the code serves as a guideline for the general approach towards the organization. Secondly it acts as a parameter that would enable an employee to understand what exactly is to be done and what is not to be done or encouraged. Thirdly, it enumerates a homogenous guideline to all the employees across the organization and thus implication to all makes the employees feel more as a part of a large family maintained by the same laws from the top management to the lower employees. Fourthly, this code acts as a benchmark for the employees and thus enables the employee to understand the organization better. Fifthly, and more importantly, this code is the statement that helps the company achieve its higher production rate and goals as following this code would certainly smooth the production or service infrastructure and thus efficiency would be achieved without much deliberations.

Thus the values of the organization are quite not any different from an organization that wants to be judged as an ethical organization especially as a health related sector. In this manner the codes already imply the basic services required by the health organization and being a sensitive and responsive statement the code of ethics already provides the needed perspective that is required. This alignment makes the ethical code more obvious and induces the real values of the organization that was already implied. With the code in action the details proved a written documentation that should be followed, valued and honored under every circumstance. Thus the ethical codes are perfectly aligned with PCO and the value is well placed with the healthcare proposition.


  1. Budd, J. W. & Scoville, J. G. (2005). The ethics of human resources and industrial relations. London: Cornell University Press.
  2. Frederickson, H.G. & Ghere, R. K. (2005). Ethics in public management. NY: M.E. Sharpe, 2005
  3. Goldsmith, M. (2003). Global leadership: the next generation. LA: FT Press.
  4. Gully, A., Stainer, L., & Stainer, A. (2006). Responsible business decisions: an over-arching framework. Journal of Public Affairs, 6(3-4), 185-196.
  5. Kaptein, M. (2008). Developing and testing a measure for the ethical culture of organizations: the corporate ethical virtues model. Journal of Organizational Behavior, 29(7), 923-947.
  6. Lawry, R. P. (2005). Accountability and nonprofit organizations: An ethical perspective. Nonprofit Management and Leadership, 6(2), 171-180.
  7. Martin, G. S. (2009). Ethical leadership across cultures: a comparative analysis of German and US perspectives. Business Ethics: A European Review, 18(2), 127-144.
  8. Moore, S. L. (2009). Social responsibility of a profession: An analysis of faculty perception of social responsibility factors and integration into graduate programs of educational technology. Performance Improvement Quarterly, 22(2), 79-96.
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