This document discusses the concept of corporate morality and how organizations progress through different stages of moral development over time. It presents a conceptual model that outlines 5 stages of corporate moral development, from a "winning at any cost" attitude with no regard for ethics to internalizing ethical values as part of the organizational culture. The model is then illustrated with examples of companies that have demonstrated different stages of morality. The key lessons are that organizations can start at any stage and progress or regress depending on leadership and societal pressures, and that focusing on developing strong organizational values and ethics is important for encouraging moral behavior.

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Oh Yes! Oh Yes! Oh Yes!
Lets Focus on
What & How

3. WHAT IS MORALITY?
Morality (from the Latin moralitas "manner, character, proper
behavior") is the differentiation of intentions, decisions, and actions
between those that are good (or right) and those that are bad (or
wrong). A moral code is a system of morality (according to a particular
philosophy, religion, culture, etc.) and a moral is any one practice or
teaching within a moral code. The adjective moral is synonymous with
"good" or "right." Immorality is the active opposition to morality (i.e.
good or right), while amorality is variously defined as an unawareness
of, indifference toward, or disbelief in any set of moral standards or
principles. An example of a moral code is the Golden Rule which states
that, "One should treat others as one would like others to treat
oneself."
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4. WHAT IS MORALITY?
Aristotle argues that the correct approach in studying such
controversial subjects as Ethics or Politics, which involve discussing
what is true about what is beautiful or just, is to start with what
would be roughly agreed to be true by people of good up-bringing
and experience in life, and to work from there to a higher
understanding.
Ethics is about what makes a virtuous character (ethikē aretē)
possible, which is in turn necessary if happiness is to be possible.
He describes a sequence of necessary steps in order to achieve this:
righteous actions, often done under the influence of teachers, allow
the development of the right habits, which in turn can allow the
development of a good stable character in which the habits are
voluntary, and this in turn gives a chance of achieving eudaimonia
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5. IMMORAL HISTORY OF INDUSTRY
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6. IMMORAL HISTORY OF INDUSTRY
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7. IMMORAL HISTORY OF INDUSTRY
FORD PINTO:
11 MILLION DEFECTIVE CARS SOLD THAT
CAUSED MANY HUNDRED DEATHS AND
INJURIES DUE TO FIRE
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8. IMMORAL HISTORY OF INDUSTRY
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9. IMMORAL HISTORY OF INDUSTRY
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10. IMMORAL HISTORY OF INDUSTRY
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11. MORALITY IMPROVES OVER THE YEARS
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12. MORALITY IMPROVES OVER THE YEARS
• It became accepted that their views were no longer accurate
• They pushed “Profit Maximising at Any Cost” TOO FAR
• The World learnt lessons from History
• Business started to CARE
• Pressure from Civil Society and Self Regulation caused CHANGES
• SUSTAINABILITY - OUR COMMON FUTURE became MANTRA
• CSR was linked with Profitability
• Corporate Philanthropy
• Voluntary Codes of Conduct adopted
• Social Audits were done
• NGOs and LAW Applied Pressure
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13. MORALITY IMPROVES OVER THE YEARS
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14. MORALITY IMPROVES OVER THE YEARS
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15. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
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16. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• “WINNING AT ANY COST” ATTITUDE
• UNMANAGED ETHICAL CONCERNS
• PRODUCTIVITY AND PROFITABILITY ARE DOMINANT VALUES
• ACT WHEN CAUGHT PHILOSOPHY
• IRON FIST OF TOP MANAGEMENT AND “GO ALONG” TYPE OF BEHAVIOUR BY STAFF
• ELSE, EXPULSION
• “EVERYBODY DOES IT”
• “NO ONE WILL FIND OUT”
• “RULES ARE MEND TO BE BROKEN”
• EXAMPLES: ELECTRICITY THEFT IN STEEL INDUSTRIES, BAD HEALTH CONDITIONS,
HIRING ILLEGAL MIGRANTS WITH NO LEGAL RIGHTS, EXPLOITATION OF THE POOR
• CORPORATE MOVIE
• SIVAKASI FIRE KILLING MORE THAN 36 PEOPLE
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17. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• HIGHER STAGE OF MORAL DEVELOPMENT THAN STAGE 1
• CULTURE DICTATES OBEDIENCE TO LAW, CODES AND REGULATIONS
• WORRY ABOUT LEGALITY AND NOT WHAT IS JUST AND RIGHT.
• COMPLIANCE OF “LETTER” OF LAW AND NOT “SPIRIT” OF LAW
• “IF ITS LEGAL, ITS OK IF IT IS NOT, LET LAWYERS CHECK IT OUT”
• “DON’T DO ANYTHING UNLAWFUL OR IMPROPER THAT WILL HARM THE ORG.”
• FORD PINTO: REASONING THAT “IT MET ALL FEDERAL, STATE AND LOCAL GOVT.
STANDARDS CONCERNING AUTO FUEL SYSTEMS”- TRUE! BUT THEY KNEW THE
PROBLEM AND SHOULD HAVE MADE IT SAFER.
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18. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• UNLIKE 2 ND STAGE: CORPORATIONS EVOLVE CULTURES THAT CONTAIN VALUES
• STRIKE A BALANCE BETWEEN “PROFITS AND DOING RIGHT”
• CODES OF CONDUCT ARE INTRODUCED
• MANAGEMENT STILL HAS A “REACTIVE MENTALITY”
• BELIEVE THAT “ETHICS PAYS”
• RESPONSES TO EXTERNAL SOCIETAL PRESSURES ARE GIVEN
• FOCUS ON PEOPLE OUTSIDE BEGINS.
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19. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• GREATER BALANCE BETWEEN PROFITS AND ETHICS
• OVERT EFFORT TO MANAGE AND PRODUCE ETHICAL CLIMATE
• RECOGNITION OF SOCIAL CONTRACT BETWEEN BUSINESS AND SOCIETY
• CODES OF CONDUCT BECOME “LIVING DOCUMENTS”
• TYPICAL EMERGING ETHICAL ORG. FOLLOW THE CODE OF CONDUCT LIKE THE
UNDISPUTED LAW. ONE THAT WILL NOT BE BROKEN.
• WE WANT TO DO THE RIGHT THING
• ETHICAL VALUES BECOMES PART OF CULTURE
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20. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• EMPLOYEES ARE REWARDED FOR WALKING AWAY FROM ACTIONS IN WHICH ETHICAL
POSITION OF THE ORG. WILL BE COMPROMISED
• Eg. SIR ADRIAN CADBURY’S GRANDFATHER WITH A PROFITABLE PRO-POSITION THAT
HE FOUND MORALLY REPUGNANT.
• Christmas Tin of Chocolates to English Soldiers
• He opposed War-Could not Leave Order
• Took order-Did not Profit from it-Only covered remuneration to employees
• HIRING, TRAINING, FIRING AND REWARDING ALL REFLECT THE ETHICAL PROFILE
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21. CONCEPTUAL MODEL
CORPORATE MORAL DEVELOPMENT
• Now Lets Discuss Certain Examples:
• CORPORATE MOVIE
• VIC-MOVIE HALLS
• BTC-SUBWAY
• BTC-GDB
• ALA-SALT
• MC-SELLING HOUSE TO MAKE PAYMENTS
• TATA-DO NOT GIVE BRIBES, BUT RADIA TAPES HAPPENED
• GAP – SRI LANKA
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22. SO CHILDREN,
WHAT DID WE LEARN?
• ORGANISATIONS CAN BE AT OR START AT ANY STAGE OF THE MORALITY PYRAMID
• MAY RISE, STAY STATIC OR PROGRESS/REGRESS TO A DIFFERENT LEVEL
• BOSS, SOCIETY, FOUNDERS OF ORGANISATION, HISTORY ALL PLAY AN
IMPORTANT ROLE
• MOST ORGANISATIONS IN AMORAL STAGE DO NOT LEAVE IT WITHOUT CHANGE
OF MANAGEMENT
• Past ethical anecdotes and stories that circulate satisfy the “epistemic” hunger for
employees. The form the culture and the reference point for Morality. It is a
continuous process that shapes and moulds the Morality standards of an
organisation.
• To make both companies and government organizations behave morally, we need to
focus on organizational values and leadership. Some people will argue that
organizations can’t be moral; only people can be moral.
• BUT WHILE SOME ORGANIZATIONS ENCOURAGE AND REINFORCE MORAL REASONING
AND BEHAVIOR, OTHERS DO NOT.
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23. MORALITY IS A WINNER!
• SOME ORGANIZATIONS ENCOURAGE AND REINFORCE MORAL REASONING AND BEHAVIOR, OTHERS
DO NOT.
• LET US STRIVE AND HONOUR ETHICAL BEHAVIOUR IN EVERY ACTION WE DO.
• ASK: IS THIS THE WAY I WANT TO BE TREATED?
• IS THIS THE PRODUCT/SERVICE FOR USE OF MY CHILDREN
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NO, ORGANISATIONS ARE NOT ETHICAL!!-VERY FEW STRIVE TO BECOME ETHICAL
• BUT ETHICS ARE REWARDING TO THE ORGANISATION AND ARE PERHAPS THE
BIGGEST GOODWILL FOR A COMPANY.
• MANAGEMENT SHOULD INSTILL “GOOD THOUGHTS” AS MARKETING STRATEGIES
• STRONG MORAL CODE OF CONDUCTS SHOULD BE IMPLEMENTED, AND FOLLOWED IN
TOTO.
• ORGANISATIONS, SOCIETY AND HUMANITY WILL DO BETTER IF YOU AND ME WILL
MAKE THIS WORLD A “JUST AND RIGHTEOUS” PLACE TO LIVE.
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24. Jatin Aggarwal
PGDBM 96-98 JIMS
Past President JIMS Elite
Partner | Bansal Trading Company |
Director | ALA Exim Private Limited |
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