Kohlberg’s model for cognitive moral development can be classified as a reliable framework that can interpret the formation of moral values that could significantly impinge on the ethical concerns of employees in an organization. The three levels of ethical concerns refer to premoral, conventional, and post-conventional stages as stated in Kohlberg’s model (Baladacchino, 2013). The conventional or premortal implications in the formation of moral values could lead to the imposition of physical power by senior management and hence the ambiguities about obedience and punishment orientation as well as naively egoistic orientation.
As per Ballantyne & Packer, ethical concerns are observed in the evaluation of responsiveness according to the presence of unfavorable acts and objective responsibility as well as the relation of personal values with personal expectations. The second stage of the ethical concerns is noted in the conventional or role conformity level in which the validation of ethical compliance is ensured through the appropriate role (Ballantyne & Packer, 2013). The predisposition to adhere to specific stereotypes of images of the majority as well as the behavior of natural roles is a notable influence on ethical concerns of cognitive moral development. The inclination of an individual towards completion of duty or to meet the expectations of other individuals also accounts for ethical concerns of moral development (Wongthong & Harvey, 2014).
According to Birdir, et al, the development of morality is associated with another level of ethical concern known as the post-conventional or self-accepted moral principles. The formal illustration of the presence of ethical concerns can be observed in the contractual or legal standardization of rules and regulations depicting conflict between individual needs as well as contract or legal documentation (Birdir, et al., 2013). The concerns for the resolution of conflict between law and contract could also be subject to confusion over the functional rationality accessible by society can be observed profoundly in the case of the model of cognitive moral development.
The formulation of action based on social rules as well as the moderation of control through the internal ideals of an individual is also related to prolific ethical concerns. Since the development of morality is a subjective outcome and varies from individual to individual, the references to ethical concerns can be helpful in the realization of effective corporate governance in organizations (Cabiddu, Lui & Piccoli, 2013).
Organizational culture in the corporate sector is accounted as corporate culture and the references to the immaculate effect of leaders on the promotion of strategic performance of an organization. The scope of power has to be recognized distinctly from management since it involves the contrast between a leader’s capabilities to manage as compared to the incompetence of some managers to lead (Chen, 2013). Leadership styles are associated with distinct approaches to shaping the corporate culture and could be implicative of the formation of culture through the interaction between leaders and managers with the employees (Witt, Brooke & Buckley, 2013).
Corporate culture denotes the shared values and beliefs that can be considered as a unique competence for an enterprise. Power anointed to leaders can be reflective of the distinct responses of leaders to particular situations which subsequently lead to the formation of an indelible impression of the leader’s competence on subordinates (Srinivasan & Karmarkar, 2014). Furthermore, the behavioral patterns depicted by leaders could also be assumed as major implications of power in shaping corporate culture since the distinct application of power to promote healthy or unhealthy organizational culture (Chen, 2013). The inclination of leaders towards becoming role models and facilitating information on ethical frameworks could also be viable inputs for the determination of corporate culture.
The use of power to establish role models for employees could be reflective of the induction of positive values and skills of leaders among the workforce as well as the communication of ethical frameworks leads to the establishment of a healthy corporate culture in which the workforce is conscious of the integrity of the other involved entities in the organization (FitzPatrick, et al., 2013). Models of motivation for the workforce of an organization could be classified on the grounds of distinct management styles.
Authoritarian leaders perceiving incompetence in the workforce could implement higher supervision alongside the adoption of a transactional leadership style alongside the explicit dependence on punishment in the corporate culture. On the other hand, participative leaders induce corporate culture based on trust with formal trust in employees and flexible communication (FitzPatrick, et al., 2013).
The requirement for an Ethics and Compliance Program could be reflected in the characteristics of international and local regulations that impinge on organizations and their management. The lack of obligation to the different regulations could lead to damage to the organization’s reputation alongside the prospects for long-term damage. The requirement of the program can be validated on its application for ensuring the operations of an organization within legal limits alongside ensuring the compliance of the organization with its assortment of ethical principles (Gunter & Önder, 2015).
This application could lead to the sustenance of the organization’s business operations alongside the identity of the brand. The formulation of an Ethics and Compliance program would be the indicator of the commitment of the organization to business management on justified terms especially communicated to the stakeholders, communities, and employees.
On the contrary, the compliance aspect is often perceived by organizations as a burden on the costs of back office management which is a short-sighted opinion. The prominent setbacks that could be encountered in the long run without the presence of an Ethics and Compliance Program could be observed in the capability of a breach in compliance and ethics could lead to formidable damage and in certain cases the destruction of a brand image is imperative (Hsiao, et al., 2014).
An example of the Enron Corporation can be assumed as a formal example of destroying a company. The recovery from such instances would require formidable investments in terms of time and money which are far higher than the costs of a functional ethics and compliance program (Srinivasan & Karmarkar, 2014).
The observation of distinct limitations faced by managers as well as errors committed by them in the fabrication and implementation of ethics programs could be reflective of plausible solutions to improve compliance of organizations to the profound ethical implications of the industry and market (Ibrahim, 2013). First of all, managers do not emphasize the communication of standards and procedures to the employees and immediate communities which could lead to ambiguities among employees and stakeholders without a specific code of conduct (Peng, et al., 2015).
This leads to irrational goals for employees in terms of ethical obligations as well as inappropriate perception of the organization by the community due to improper communication (Lockyer, 2013). The training of the organizational workforce for estimating plausible outcomes from the ethics program is also a notable mistake incurred by leaders and managers while designing and implementing compliance programs. Supervision and audit are ignored by the organizational management for the ethics programs citing it as a superfluous cost and with minimal emphasis on the audit leads to potential issues about abuse, bribes, and frauds alongside conflicts with accounting and financial entities alongside the third-party vendors (Lockyer, 2013).
The managers also refer to mistakes in ethical program design due to the reporting and information discrepancies which are reflected in faulty systems for reporting and complaint resolution. Therefore these mistakes could lead to profound pitfalls in the management of the organization in line with the standards of ethics and compliance required for industry (Ibrahim, 2013). The major implications that can be drawn from the mistakes could be promising contributions for the acquisition of sophisticated ethical program designs with the integrated involvement of employees, managers, and stakeholders in the design process so that the unique ethical identity of the organization can be preserved (Ibrahim, 2013).
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