Learner Guide OC Knowledge Module 4

SAQA 96368 Knowledge Module 4

A government Report says that Iceland, hit hard by both the global economic meltdown and
a pesky volcano, was “victimised by politicians, bankers, and regulators who engaged in acts
of extreme negligence.”30 When you hear about such behaviours—especially after the high-
profile financial misconduct at Enron, WorldCom, Lehman Brothers, and other
organisations—you might conclude that businesses are not ethical.

Although that is not the case, managers—at all levels, in all areas, in all sizes, and in all kinds
of organisations—do face ethical issues and dilemmas. For instance, is it ethical for a sales
representative to bribe a purchasing agent as an inducement to buy? Would it make a
difference if the bribe came out of the sales rep’s commission? Is it ethical for someone to
use a company car for private use? How about using company e-mail for personal
correspondence or using the company phone to make personal phone calls? What if you
managed an employee who worked all weekend on an emergency situation and you told
him to take off two days sometime later and mark it down as “sick days” because your
company had a clear policy that overtime would not be compensated for any reason?31
Would that be okay? How will you handle such situations? As managers plan, organise, lead,
and control, they must consider ethical dimensions (Robbins & Coulter, 2016).

Topic 3.6: Unethical Behaviour [KT0306]

Unethical behaviour and preventative measures to it

Whether someone behaves ethically or unethically when faced with an ethical dilemma is
influenced by several things: his or her stage of moral development and other moderating
variables, including individual characteristics, the organisation’s structural design, the
organisation’s culture, and the intensity of the ethical issue.

People who lack a strong moral sense are much less likely to do the wrong things if they are
constrained by rules, policies, job descriptions, or strong cultural norms that disapprove of
such behaviours. Conversely, intensely moral individuals can be corrupted by an
organisational structure and culture that permits or encourages unethical practices (Robbins
& Coulter, 2016).

30 C. Hausman, “Financial News Focuses on Questions of Ethics,” Ethics Newsline
[www.globalethics.org/newsline], April 20, 2010; C. Hausman, “Privacy Issues Prominent in Week’s Tech
News,” Ethics Newsline [www.globalethics.org/newsline], March 9, 2010; and H. Maurer and C. Lindblad,
“Madoff Gets the Max,” Bloomberg BusinessWeek, July 13 & 20, 2009, p. 6.

31 This last example is based on J. F. Viega, T. D. Golden, and K. Dechant, “Why Managers Bend Company
Rules,” Academy of Management Executive, May 2004, pp. 84–90

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SAQA 96368 Knowledge Module 4

Bibliography

Robbins, S. P., & Coulter, M. (2016). Management. Essex: Pearson.

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