Ethics Is a Major Concern

There has been an increasing concern for corporations to define and act ethically since the early 2000’s. Companies began to come under review everywhere for fraud, embezzlement, falsifying documents and insider trading to name just a few. As O’Rourke points out it began in 2001 with the bursting of the dot-com bubble, the ensuing bear market and financial scandals involving Enron, WorldCom, Tyco, and others. (O’Rourke, p.71) In the past, when these breaches of trust happened the companies tended to be reactive by blaming and dismissing values. This time, in 2001, the responses were different. The companies were beginning to look inward for answers and find ways to eliminate the risk of unethical behavior. It was found that ethical behavior was a core component of company activities. In order to make sure that a corporation remained ethical they have to take steps to ensure ethical behavior.

As Persaud and Plender state in their study of the challenges which face managers in creating an ethical culture they state that. Within the company an ethical culture provides the glue that makes for a cohesive and effective organization. (Persaud & Plender, 2006) Part of creating an ethical culture is making sure that the following steps are taken. There needs to be a clear definition of what is ethical and what is unethical according to Carroll’s Global Corporate Social Responsibility Pyramid. (Kinecki & Kreitner p.24) Carroll’s pyramid advises corporations in the global economy, from the bottom up, to incorporate economic responsibility, legal responsibility, ethical responsibility and finally philanthropic responsibility. This model, if each level is not solid will not stand to provide the objectives of the company which would be to make sure that all stakeholders sense and feel that their business practices are ethical. As the Model of Individual Ethical Behavior is explained in Kinicki & Kreitner’s Organizational Behavior at the center is the...