Ethics: the global challenge: the demands of regulations are creating mounting ethical dilemmas for management teams and their communicators.
On a local, national, regional or global front, ethical standards are being seen as increasingly important, whether the situation involves bribery and corruption, executive pay, treatment of employees or suppliers, human rights, intellectual property, or misappropriation misappropriation n. the intentional, illegal use of the property or funds of another person for one's own use or other unauthorized purpose, particularly by a public official, a trustee of a trust, an executor or administrator of a dead person's estate, or by any of funds. Reputations of global corporations have been shredded by the scandal of unethical behavior. So, why is ethics--an understanding of moral principles applied to decision making--becoming such an important part of the global debate?
Doing business in today's global marketplace places new demands on companies, their employees, governments, the financial community, regulators assessing corporate performance and communicators. There is now greater pressure for regulators to act on corporate malpractice, hence the far-reaching Sarbanes-Oxley Act See SOX. of 2002 in the U.S. and similar corporate social responsibility initiatives in Europe.
Financial analysts and other market watchers have tuned in to the trend of investors still wanting profits but not without social responsibility from corporations. Terms such as engagement and social responsibility are becoming as common as dividends and earnings. Governments are also being pressured to act. Investigations of bribery and corruption can now involve transgovernmental information exchanges and even extradition.
In the face of widespread ethical malpractice, international business has moved to head off further reputation crises. Some observers feel that ethics may be the most important business leadership issue of this decade, calling for a dynamic relationship among the entire executive "C" suite. Some say that in the company of the future, the whole senior management team will have a direct reporting line to the new supremo su·pre·mo
n. pl. su·pre·mos Chiefly British
One who is highest in authority or command, as of an organization.
[Spanish and Italian, supreme, supremo, from Latin of the C suite, the chief ethics officer.
Trends indicate that there is greater pressure for European companies It may never be fully completed or, depending on its its nature, it may be that it can never be completed. However, new and revised entries in the list are always welcome.
This is a list of companies from the countries in the European Union. to improve their own codes of ethics to comply with Sarbanes-Oxley or equivalent pan-regional or national codes, according to Muel Kaptein, a professor of business ethics and integrity management at the Rotterdam School of Management “RSM Erasmus University” redirects here. For other uses, see RSM Erasmus University (disambiguation).
The Rotterdam School of Management Erasmus University (or RSM Erasmus University Erasmus University in the Netherlands.
In his recent book, The 6 Principles of Managing with Integrity (Spiro Press), Kaptein outlines the multitude of ethical dilemmas that confront business executives and their communicators: When does keeping silent constitute lying? When does an intimate relationship become intimidation? When does the private use of company property constitute theft? How does one achieve a balance between generating profits and jobs, between productivity and pleasure, between sales and safety, between self-interest and organizational interest, and between economics and ecology? In Kaptein's view, how managers and communicators resolve such dilemmas determines their personal integrity, as well as that of the organization.
While the demands of Sarbanes-Oxley also need to be addressed by European companies, particularly by those having operations in the U.S., within Europe there is a bigger variety of legal and cultural approaches to corporate governance Corporate Governance
The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. , according to Georges Enderle, a professor of international business ethics at the University of Notre Dame, in Indiana. As a result, corporate communication in a multilingual environment is much more demanding than in a monolingual mon·o·lin·gual
Using or knowing only one language.
"There are several European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the
European Community and national laws covering corporate behavior with which companies are expected to comply," Enderle says. "On the other hand, there are examples of how the consultative approach is producing and communicating impressive results. This is particularly true among small and medium-sized enterprises having to survive in a world of globalization globalization
Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation , where the tendency can be toward cutting ethical comers for maximum financial return."
Hoteliers on the Mediterranean island of Majorca, for example, cleaned up their environment and beaches by working as an industrywide group. In Switzerland, upholstery manufacturer Rohner Textil established partnerships with chemical transnational corporation Any corporation that is registered and operates in more than one country at a time; also called a multinational corporation.
A transnational, or multinational, corporation has its headquarters in one country and operates wholly or partially owned subsidiaries in one or more Ciba-Geigy and the independent environmental institute EPEA EPEA East Providence Education Association in Germany to meet its business commitment to "economics and ecology."
The role of communicators
Whether in transnational corporations or smaller companies, communicators face their own ethical dilemmas.
A recent IABC IABC International Association of Business Communicators
IABC Indo-Americans for Better Community Research Foundation survey conducted by professor Shannon Bowen of the University of Maryland University of Maryland can refer to:
The research also found respondents mixed in their views on whether communicators should be "the conscience" of the organization. One respondent commented: "I give it the sleep-at-night test: If I don't vocalize my opposition, can I sleep at night?"
But being ethical is not enough, according to Kaptein. "Companies should communicate their performance repeatedly. One of the greatest challenges is how internal and external stakeholders are convinced of the 'tone at the top.' The challenge for business communicators is to communicate this role modeling in a trustworthy and convincing way. They are, after all, in almost all cases, responsible for issuing corporate social responsibility reports."
The debate over ethical behavior is likely to grow and challenge communication (and other disciplines) in both theory and practice. The post-Enron era could, for example, lead to in-house lawyers' roles being fine-tuned to ensure corporate legal health and fairness for the markets and investors.
Communicators would therefore do well to reflect on the approach adopted by in-house lawyers working around the world in publicly traded companies publicly traded company
A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. .
Alan Lane is CEO of VASGAMA, a U.K.-based reputation management consultancy.