Quiz 3: Organizational Ethics and Corporate Governance


1. Ethical dissonance is the difference between the ethical level of the firm and the employee. There possible combinations are high - low, high - high, low - high, and low - low, firm to employee ethics. In this case, the "firm" is the group of hikers. The "employee" is S. S wishes to help the holy man, a high ethical value. But he had low support from the author and the group as a whole. While the group did help out in little ways, none of them were willing to bring the holy man to safety. 2. The Kohlberg's moral development stages are listed below. Preconventional: • Stage 1: Obedience and punishment - morals are followed to avoid punishment • Stage 2: Self-interest - morals are pursued if there's a benefit. Conventional: • Stage 3: Norms - one considers how others may perceive their actions. • Stage 4: Social order - morals need to be followed to maintain order in society Postconventional: • Stage 5: Social contract - considers the overall cost benefit to society. • Stage 6: Universal ethics - absolute notion of following ethics The author and the others possibly acted at stage 3. They did enough to help the holy man recover but did not see him through to safety. To them it would be an inconvenience to their goal of climbing the mountain. S acted at stage 6. He believed the right thing to do is to see the holy man to safety. But he was unable to act on his own due to lack of group support. A bystander effect would occur if the group had done nothing believing the holy man to be helped by others. The group did enough to warm up the man and made sure he was alert enough to walk. They exhibited some notion of bystander thinking, e.g. "a villager passing by may help him". 3. Ethical fading occurs when companies no longer consider ethical implications of their actions or inactions. People tend to rationalize their actions. In this case, the group believed the man was alert enough to get back to the village on his own. Utilitarian thinking may be used as a rationalization device. Utilitarianism views cost benefits of actions. The action is executed only if there's a net benefit. The group's cost was their lost opportunity in completing the hike, and potentially a dead person, the benefit is the knowledge that the man is safe. Given the man was alert, they believed that it wasn't worth the lost opportunity to do so. 4. Organizational support may refer to internal controls of the company and ethical management. When the company enforces its rules and management hold high ethical standards, individuals are more likely to point out misconducts. 5. Some important themes in the story is organizational support, ethic fading, and dissonance. These themes should be considered when deciding on the moral of the story.

The quote is related to a theme of ethical fading. Ethical fading occurs when companies no longer consider ethical implications of their actions. The quote goes further and states that these companies and their employees will "rationalize" and resort to "legalism" to replace the void in ethics. For example, an unethical company employee may rationalize their unethical action as one out of business necessity explaining that it's not illegal to do so, or even if they get caught it's not that big of a deal.

1. A values statement is used to list and identify the values the company holds. The question states the company values people. However, values statements are meaningless unless it can be enforced by the organization. The company in the case failed to upkeep the safety standards required of them. 2. The company failed to uphold the ethical standards required of them. They even made light of the FDA warning message in their convention. The whistleblowers have attempted to seek internal guidance before seeking action from the government. 3. Refer to exhibit 2.2. Step 8 requires a comparison of alternative. This is relevant to the question asked in the code of conduct which asks employees to consider the legal and ethical concerns. Step 10 requires a reflection of the action. The code of conduct include questions such as how the employee and his family would feel about it.