Seminar in Business Ethics and
Social Responsibility
SMT 940
Abeer Youssef
1
Overview
- Corruption
- Corruption Perceptions Index
- Corruption Perceptions Index - Scores and ranking
- The benefits of a strong ethical reputation
- Values
- Global ethical culture
- Organizational culture
- Unethical behaviour in the workplace
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Corruption
What is corruption?
- We define corruption as the abuse of entrusted power for
private gain.
- Corruption erodes trust, weakens democracy, hampers
economic development and further exacerbates
inequality, poverty, social division and the environmental
crisis.
3
Corruption Perceptions Index
- The Corruption Perceptions Index (CPI) is an index published
annually by Transparency International, since 1995, which
ranks countries “by their perceived levels of public sector
corruption, as determined by expert assessments and opinion
surveys”.
- The CPI generally defines corruption as “the misuse of public
power for private benefit”. The CPI currently ranks 180
countries “on a scale from 100 (very clean) to 0 (highly
corrupt)”.
https://www.transparency.org/en/
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Corruption Perceptions Index - Scores and Ranking
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6
Egypt Score 33/100- Rank 117/180
The least corrupted countries: Denmark, Finland, and New
Zealand
Please bear in mind:
- Score refers to a numeric value calculated out of 100, and
each country’s result determines its global ranking.
- Ranking refers to the position held by each country in the
global chart
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Discuss
- How do you think score and ranking reflects on the
ethical reputation of countries?
- What do you think are the benefits of a strong ethical
reputation and ranking high in the corruption
perceptions index for doing business?
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The benefits of a strong ethical reputation
The benefits of a strong ethical reputation for a country
could include:
1- Positive reputation and brand
2- Greater customer loyalty
3- Committed and engaged staff
4- Easier market access
5- Lower costs of business
6- Increased returns on investments
7- Improved access to capital
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Values
- All individuals have values; but not all values are
ethical. We value different things, but many of these do
not have an ethical component –like, say, appreciating
the arts or spending time with family and friends.
- The society, we live in, values different things –hard
work, ambition, wealth, compassion, and so on.
- Different societies will take a different view on what is
of value and our own personal values will be formed by
a mixture of the influences of family, friends,
institutions such as school, and society in general.
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- Virtues may also take different forms; the courage of an
employee to stand up to a bullying supervisor is
different to the courage that a front-line officer in the
emergency services may show.
- And yet it can be argued that some virtues are needed
for any kind of human flourishing –courage, sympathy,
empathy, etc.
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Global ethical culture
- The extent to which a universal ethics, agreed to by all,
exists is; however, problematic.
- We need to consider two aspects to the issue around a
universal ethics:
➢ First: Subjectivism
▪ It is the view that individuals decide what is ethically
wrong or right according to their chosen ethical
principles, such that ethics are a purely personal matter.
▪ There is no guarantee that the chosen principles will be
agreed to, by anybody else.
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▪ Moral autonomy is important, but should ethics be a
matter of personal preference? From this perspective
there is no objective right or wrong, no standards by
which we can judge the actions of others.
▪ Many factors are affecting cross-culture variability:
❖ Religious beliefs,
❖ Historic traditions,
❖ Social customs,
❖ Prevailing political and economic doctrines.
▪ However, certain universal basics are a mutually agreed
upon, among communities, such as, honesty, fairness,
avoiding unnecessary harm, etc. 13
➢ Second: Moral relativism
▪ It asserts that it is for each society or group to
determine what is ethically right or wrong. There are
no universal ethics, and we cannot, therefore, judge
the ethics of another society or group for we have
nothing to judge them by.
▪ Any attempt to impose our ethics on another society
might be judged to be ethical imperialism. Who we
are to criticise the ethical practices of others.
▪ This argument is at the heart of discussions in
business ethics concerning when does a gift, a
traditional way of doing business in some countries,
become a bribe? This is a problem in a world of
international cooperation and agreements.
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Organisational culture
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• Culture is needed for any human organization (family,
village, nation, or international companies).
• Culture is a unique identity and a group of core values
(such as communication, respect, integrity, excellence,
etc.).
• Stating core values does not mean that we are living them.
• Employees should walk the talk (putting your words into
action) because culture is not a slogan.
• Culture is the way we do things in the organization.
• It is difficult to be explained to others and it too difficult to
imitate others culture.
• Culture reflects the lessons that learned from our past
experience (legacy/wisdom).
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Peter Drucker, “Culture eats strategy for
breakfast, eats action plans for lunch and
eats everything else for dinner “
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Unethical behaviour in the workplace
- Unethical behaviour can be easier to identify than ethical
behaviour, as sometimes it is easier to say what is wrong with
something instead of what is right.
- In order to understand what goes wrong in an organisation, it
is therefore important to recognize all kinds of unethical
behaviour, from the seemingly minor offences, to the more
serious ones.
- Professor Leo Huberts and the research group Quality of
Governance at the VU University Amsterdam have developed
a typology of ten common integrity violations.
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This typology is useful to identify unethical behaviour in almost
all organisational contexts worldwide. Let’s take a closer look at
these ten types of unethical behaviours:
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Corruption in business/organizations
- When someone misuses his or her power or authority
position for private gain, it is called corruption.
- Corruption can take the form of bribery or favouritism.
1. Bribery
- Bribery could be when an employee is acting in the
interest of a third party because they are promised or
given personal advantages.
- Bribes can be money, goods or gifts.
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- Common business practices such as travel and
accommodation payments, or expensive lunches and
dinners are in a grey area in this regard - they always
raise the question WHY they are paid for: is something
expected in return?
- Note that in cases of bribery both parties – giver and
taker - are corrupt.
2. Favouritism
• It is when unfair advantages are given to family, friends,
a political party, or a firm or business.
• Other terms for this type of corruption are nepotism,
cronyism or patronage.
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• Favouritism may seem less serious than bribery,
because it doesn’t involve a direct exchange of
money and it is therefore harder to identify. But it
may be widespread within organisations and
become ingrained in their culture.
• This can be a problem, for example, when
employees get promoted because they are the
boss’s favourite and not because they are doing
good work.
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Fraud and theft
- Fraud and theft of organisational resources are
common integrity violations.
- A wide range of behaviours falls under this category:
stealing from colleagues, the fiddling of expenses,
taking home pens and pencils. Or more sophisticated
behaviour such as white-collar crime.
- Unlike in cases of corruption, fraud and theft are
usually the actions of individuals acting on their own,
and no third party is involved.
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Conflict of interest
- Employees can also get in trouble because they are
accused of a conflict of interest: a situation in which a
person or organisation is involved in multiple interests,
and serving one interest could involve working against
another.
- Conflict of interest could be through gifts or side line
activities (a business or activity pursued in addition to
one's regular occupation).
- For example, a consultant of a large firm, who also
does executive work on the side. 25
Improper use of authority & misuse and
manipulation of information
- Another type of unethical behaviour in the workplace is
the improper use of authority, which can go hand in hand
with the misuse and manipulation of information.
- A good example is when managers artificially increase
the profits in the books to make the financial situation of
an organisation look better than it actually is.
- As you can see from this example, sometimes these
integrity violations can happen with the best interests of
the organisation in mind.
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Indecent treatment, discrimination and sexual
harassment
- Another type of unethical behaviours concern the way
people treat each other and their relationships.
- Interpersonal deviance can take the form of indecent
treatment, such as discrimination, sexual harassment,
bullying and intimidation.
- The victims might be colleagues and subordinates, or
customers and clients of the organisation.
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Waste and abuse of organisational
resources
- Waste and abuse of organisational resources are a
failure to comply with organisational standards and
expectations.
- For example, using organisational properties in a
careless manner, calling in sick just to have a day off,
or deliberately not performing and being lazy.
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Private time misconduct
- Another listed violation is misconduct in private time.
- Offences committed in private time can include the
excessive use of alcohol and drugs; domestic violence;
vandalism, or other forms of criminal behaviour.
- The inclusion of private time misconduct in a typology of
workplace integrity violations is disputed: on the one
hand, what professionals do outside of their work hours is
up to them and not their employers’ business. But on the
other hand, and especially from an ethical leadership
point of view, they are expected to behave ethically all the
time, and not just between 9 and 5. 29
In general:
- A toxic workplace culture can be a breeding ground for
serious corruption cases, which often occur in organisations
that lack clear guidelines for ethical behaviour. It is
therefore important for integrity management to address the
whole range of unethical behaviours. “Slippery slope”
theory assumes that serious corruption cases have started
with minor offences.
- There is a huge opportunity for ethical leaders to create and
maintain an ethical and healthy workplace culture with a
clear code of conduct; in which people feel safe to ‘speak
up’ to management - and if necessary, against their
superiors.
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Activity
This is the first question of the UK Institute of Business
Ethics. Ethics at Work Survey 2021: https://www.ibe.org.uk/
Answer this first question of the survey as truthfully as you
can. Then discuss your thoughts and the reasons behind
them with your group.
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32
The answers were as follows:
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Recap
- Corruption: It is the abuse of entrusted power for private
gain.
- Corruption Perceptions Index: CPI is an index published
annually by Transparency International, which ranks
countries “by their perceived levels of public sector
corruption, as determined by expert assessments and
opinion surveys” on a scale from 100 (very clean) to 0
(highly corrupt).
- Corruption Perceptions Index - Scores and Ranking:
Egypt Score 33/100- Rank 117/180. The least corrupted
countries are Denmark, Finland, and New Zealand 34
The benefits of a strong ethical reputation:
1- Positive reputation and brand
2- Greater customer loyalty
3- Committed and engaged staff
4- Easier market access
5- Lower costs of business
6- Increased returns on investments
7- Improved access to capital
Values:
- All individuals have values; but not all values are ethical.
- Different societies will take a different view on what is of value
and our own personal values will be formed by a mixture of the
influences of family, friends, institutions such as school, and
society in general. 35
Global ethical culture:
The extent to which a universal ethics, agreed to by all,
exists is; however, problematic because of two things:
- Things are subjective. It is the view that individuals
decide what is ethically wrong or right according to
their chosen ethical principles, such that ethics are a
purely personal matter.
- It is also relative. Every society believes in something
different, what could be right for one society could be
wrong for another.
36
Organizational culture:
• The values and behaviours that contribute to the unique
social and psychological environment of an organisation.
• Culture is a unique identity and a group of core values
(such as communication, respect, integrity, excellence,
etc.). It is the way we do things in the organisation.
Unethical Behaviour in the Workplace: A typology of ten
common integrity violations were developed to identify unethical
behaviour in almost all organisational contexts worldwide, which
are:
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38
Thank you
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