By: Ido Saltarelli
Human Resource
management is an integral part of business today. Often it is the HR
departments’ job to keep employees in line with the mission of the company
through recruitment, policy, and the organization’s culture. In the recent past
there have been many high profile business scandals such as the Bernie Madoff
Ponzi scam, Enron, and WorldCom. This has brought ethical behavior to the
spotlight for discussion more than ever. (McDowell , 2006) HR departments have
been charged with the responsibility of keeping policy and management in line
with ethical standards put in place by the government and going beyond them to
raise employee morale, put the origination in good standing with the public,
and avoid legal complications.
The government has put
some standards in place to deal with unethical behavior. An example of this is
the Sarbanes–Oxley Act of 2002. This federal act outlines rules for companies
and penalties for non-compliance. (Sloan, Gavin,2010) Human Resources have the job of keeping the
organization in compliance with federal and state law. Every company has
different goals and functional areas of operations so the laws and required
policies differ from company to company. (To see the Sarbanes-Oxley act go to
http://www.sec.gov) It is important for HR leaders to stay in compliance with
laws and to offer additional training to avoid legal problems.
Ethical issues within
the workplace can come in all different shapes and sizes. Often time’s ethical
situations are thought of as the company’s policies regarding employees, such
as compensation and ethical recruiting practices. But ethical problems arise at the personal
level such as misconduct, bullying, sexual harassment, and discrimination.
(Giancola, 2008) HR being the professional liaison between corporate and
employee, it is their duty to develop a personal and corporate ethical code.
Sloan and Gavin (2010) describe a 3 stage process for HR to develop an ethical
policy.
· Develop core values
congruent with an ethical origination,
· Identify changes to be made and implement
them throughout the organization,
· Create an ethical
culture that promotes individual ethical conduct and creates ethical
organizational goals.
Using company goals and direction from top management HR can shape
culture within an organization over time to become more ethical.
As HR departments
develop strong ethical standards for their company many things will be
affected. Thilmany (2007) states that “working within a strong ethical culture
can have a positive effect on an employee's level of pride in an organization,
confidence in its future and overall satisfaction.” Also as the public
perception of an organization shifts there is a strengthening of the corporate
brand. For example the shoe company Toms is perceived as an ethical company
that donates a pair of shoes for every pair it sells. A strong brand will help
organizations grow and be more resilient to hard economic times through
customer loyalty.
Deloitte is an
accounting, and consulting firm headquartered in New York. Fortune magazine
ranked Deloitte 67 out of the top 100 companies to work for in 2012 and in 2013
they raised 20 spots to 47. I believe
what helped them attain this is solid ethical polices and training. Human
Resource professionals did this at Deloitte by identifying key people at the
top and aligning their goals for the company and integrating an ethical
program. (Mcdowell, 2006) They called this setting the “tone at the top”.
Mcdowell writes that the next step was for them to integrate a system of
leadership that would allow the “tone” to flow down from the top to the leaders
of daily operations. This system worked for Deloitte and the result was that
from the first day of employment the ethics policy is understood and
reinforced. (Mcdowell) An example of how Deloitte promotes an ethical culture
is Deloitte has implemented a program that allows for employees to work for
nonprofits for a few months and still get paid partial salary.
(http://money.cnn.com, 2013)
An ethical corporate culture is a
vital to a company in the 21st century. The government has put in place
regulations to help keep tabs on large organizations and keep them from acting
illegally. HR managers must keep their
companies within the bounds of the law. But it is also important for HR
managers to go above and beyond. It is a good idea for HR managers to start to
think about the mission statement and how they can develop, and research ways
for to implement policies that go above and beyond law. Present the findings to
upper management and if it is feasible, develop a plan to start implementing
the policies across the organization. Most companies have different needs and
are at various stages of development and growth, and no one person can change everything
overnight. But to be completive in today’s corporate environment it is
important to try and instill an ethical code. Deloitte did this and it created
a culture within their origination that allowed them to be named one of the top
50 companies to work for in 2013.
Giancola, F. (2008). A tool for developing ethical HR policies and
practices. Employee Benefit Plan Review, 63(3), 24-28. Retrieved from
http://search.proquest.com/docview/216888020?accountid=12924
McDowell, T. (2006). Deloitte's three ways to instill ethical
guidelines. Strategic HR Review, 5(5), 16-19. Retrieved from
http://search.proquest.com/docview/217175661?accountid=12924
Thilmany, J. (2007). Supporting ethical employees. HRMagazine, 52(9),
105-106,108,110,112. Retrieved from http://search.proquest.com/docview/205054151?accountid=12924
SLOAN, K. and GAVIN, J. H. (2010), Human Resource Management: Meeting
the Ethical Obligations of the Function. Business and Society Review, 115:
57–74. doi: 10.1111
Deloitte - Best Companies to Work For 2013 - Fortune. (n.d.). CNNMoney -
Business, financial and personal finance news. Retrieved April 16, 2013,
Retrieved from
http://money.cnn.com/magazines/fortune/best-companies/2013/snapshots/47.html?iid=bc_fl_list
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