1. Defining Ethical Culture
within an Organization
Le Hoang Thach
Columbia Southern University
MBA 6301 Business Ethics
Dr. Clay Owens
Due Date: December 27th, 2020
2. Introduction
Learn about ethical culture in the business.
Building a ethical culture in the company.
Why must maintain a ethical culture in the business?
The role of ethical culture in the global economy.
The importance of ethical culture in the company.
Ethical guide for the beverage industry.
What should we do?
3. Learning about ethical culture
Cultural definition
Ethical culture definition
Five levels of an ethical culture
4. Creating an ethical culture
According to Lena Eisenstein, a corporate ethical culture will be built if the
company applies the following 5 methods:
The company's leadership team practices ethical behavior well.
Instruct employees on good ethical behavior.
Ethical standards training programs for employees.
Deal with ethical violations and reward ethical behavior.
Staff support and protection.
5. Maintain an ethical culture in the business
Code of conduct
Ethical committee
Professional assessment from Board of Directors
6. The benefit of maintaining ethical culture
Benefits for employees
Benefits for investors
Benefits for clients
Valuable achievement for Organization
7. The importance and rationale of maintaining
ethical culture
The importance and rationale for this are:
Benefits for companies, employees, partners and customers
The development of the organization will not be sustainable without an ethical culture
The success of the organization will be strengthened based on an ethical culture
8. Culture’s role in global business ethics
Culture is different among countries
Asian culture
Western culture
Culture’s role.
The role of ethical culture in global business.
9. Motivating the human resources towards
ethical practicles
Equal responsibility: Recognizing the role and importance of employees in building an ethical culture.
Equal rights: Respect for the rights, responsibilities and roles of employees in the company.
Equal rights: Protect and encourage employees to report unethical behaviors and to report violations.
10. Ethical guidelines for beverage industry
The beverage industry is a food business that is used directly by consumers.
Therefore, ensuring product quality is extremely important. In addition, the support
services for the system of distributors and agents play an important role in distributing
goods to consumers. Therefore, building an ethical culture plays an important role in
ensuring product quality for customers and building relationships with partners.
Analyzing an example of the beverage industry in Vietnam
11. What should we do?
Human Resource Department needs to perform its centered role
Guidelines for Leadership of Company
Guidelines for Staffs of Company
12. Conclusion
Building a culture of ethics and maintaining the standard of ethical culture is a necessary trend
for every company / business in shaping culture and branding. We, the management team, will
be a role model for our employees in the task of building ethical culture at the company. With
clear research and correct application of the method, combined with the right guidance for the
management team. I believe that building and maintaining a culture of ethics at ABC beverage
company will be successful. We will soon reach our goals in the medium to long term.
13. References
Bsr. org ( 2017). 5 Levels when develop ethical cultural in the enterprise
http://www.franklincovey.vn/kho-hoc-lieu/bai-viet/5-cap-do-khi-xay-dung-van-hoa-dao-
duc-doanh-nghiep
Eisenstein, L. (Oct 2019). 5 steps to Creating an Ethical Organizational Culture.
https://www.boardeffect.com/blog/5-steps-creating-ethical-organizational-culture/
Leigh, A. (Nov 2013). Ethical Leadership.
https://ericjacobsononmanagement.blogspot.com/2013/11/the-benefits-of-having-
ethical-culture.html
14. References
Olson, D. S. (2013). Shaping an Ethical Workplace Culture.
https://www.shrm.org/hr-today/trends-and-forecasting/special-reports-and-expert-
views/Documents/Ethical-Workplace-Culture.pdf
Recycling the bottle cap to build a bridge, Tiger inspires a beautiful life [Online] / auth.
VietnamNet // VietnamNet. - 2019. - https://vietnamnet.vn/vn/thi-truong-tieu-
dung/tai-che-nap-chai-xay-cau-tiger-truyen-cam-hung-song-dep-566351.html.
Quang Nam Network Press [Online] / auth. Quang Nam Network. - 2020. -
http://baoquangnam.vn/xa-hoi/cong-ty-tnhh-nha-may-bia-heineken-viet-nam-ung-
ho-1-ty-dong-phong-chong-dich-90936.html.
Editor's Notes
In this case, I act as the Vice President of ABC beverage company. I'm building a presentation on the ethical culture of the business. This presentation will be used during a company division leader's instruction on the importance of maintaining a culture of ethics in the business.
ABC beverage company is headquartered in Ho Chi Minh City, the business environment in Ho Chi Minh City is very competitive with many big competitors such as Sabeco, Heineken ... With the desire to build businesses towards sustainable development to create a competitive advantage. ABC Company will build a corporate culture with specific standards.
Culture in the organization is the contribution of each individual in the organization to build a culture of ethics in the business. Ethical culture is important, contributes to business success and builds ethical culture for every employee in the company. In the goal of building a company's ethical culture, the manager's role is extremely important. Therefore, guiding the management team to understand the importance and meaning of the company's ethical culture, as well as maintaining a culture of ethics at all departments of the company will determine success or the failure of the company's goals to build ethical culture. That is also the purpose of today's presentation.
Cultural definition: In each country there will be different definitions of culture. Depending on the opinion of the leader, there will be different definitions of corporate culture. As a leader of a company operating in the beer, wine and beverage industry, I would like to define the following culture: Behaviors, perceptions, beliefs and acts of belief, The collective human interests are called culture. Culture is also the aggregation of all the behaviors that people behave on a daily basis and differ from country to country.
Ethical culture definition: Ethical culture is the standards that the leadership team of a business builds and uses as the center of company. A ethical culture was built on experience and shared ethical values, managers want their employees to apply a culture of ethics to their daily behavior and avoid ethical violations.
According to the latest report from a new BSR report in 2017. I find that when we build a culture of ethics for business, we need to focus on all levels of the ethical culture, in which there are 5 specific levels including:
- Individual: The appreciation and rewarding of employees is a key factor in maintaining or undermining the ethical culture of the business.
- Interpersonal: Companies need to consider how employees interact among hierarchies.
- Group: The main aspect of human culture is the relationship and communication between the members.
- Intergroup: The quality of the relationships between groups is crucial in any attempt to build a culture of morality.
- Inter-organizational: the company needs to focus on ethical behaviors with suppliers, customers, competitors and stakeholders.
The company's leadership team practices ethical behavior well: The leaders of a company need to be the first to practice ethical behavior to set an example for employees. Practical actions are the best commitment to building a culture of ethics for the business. Leaders are always noticed by employees and their ethical behaviors will be learned and followed by employees.
Instruct employees on good ethical behavior: The instruction between the leadership team with employees or the cooperation between employees of different departments is very important to building relationships in the work. Instruction needs to be accurate and complete, especially with the building of ethical culture in the business. The leadership team can not only speak with words, but need to provide specific regulations, standards and assessments through certain documents or regulations. Clear and serious instruction combined with ethical behaviors from the leadership team will motivate staff to adjust and practice behavior in accordance with cultural standards.
Ethical standards training programs for employees: Organizing ethical culture introduction programs for employees is extremely important. Through this activity, employees will understand the importance of cultural ethics in the business. In addition, the company will organize seminars and training programs for employees on ethical culture. These programs will help employees understand which behaviors are culturally appropriate and which are ethical violations. In addition, direct managers from departments need to regularly report and evaluate the ethical behavior of employees at that department so that leaders can come up with training solutions to enhance culture ethical in business.
Deal with ethical violations and reward ethical behavior: In a culture of ethics, there is no distinction between leaders and employees. All members of the company should strictly adhere to the standards set forth in the company's ethical culture. The management team needs to be a role model for employees in the process of building a culture of ethics in the business. Therefore, giving rewards to employees who perform well in ethical behavior is extremely important for staff to have more motivation to improve their behavior. In addition, sanctions for ethical violations should also be applied. However, the leadership team can give violators the opportunity to correct the wrongdoing, as the leader can be viewed as unethical if making a decision to punish the offending employee in a hurry.
Staff support and protection: As the leader of the company, I pledge to protect as much as the employees who boldly denounce the violations of corporate ethics culture. This is a necessary action to handle ethical violations, affecting the ethical culture of the company. In addition, I want the leaders in the departments to take measures to protect their employees from bad behavior from outside or from within the company such as forced overtime, discrimination, lack of respect for staff ...
Maintaining a culture of ethics in the business cannot be done only by words. Skills and personality from the leadership team are important factors in building a culture of ethics. At the same time, the management and transparent actions, complying with the ethical standards of the leadership team are the foundation to build the ethical culture of the company.
Based on Leigh's definition: "The foundation of ethical culture is built on values, attitudes, meanings, behaviors, goals and management practices". Thus, the building of a ethical culture will create trust, consensus, cohesion and build standards of behavior for employees with the company, helping the leadership team and staff. The same focus on the common goal is the sustainable development of the company.
Building a culture of ethics in a company is a time-consuming and difficult process. However, when a culture of ethics is maintained, a lot of benefits will be gained from the company.
Benefits for employees: Based on a culture of ethics in the company, employees will have a correct standard of conduct, avoiding unethical behaviors. Additionally, employees know that violations of morality will be punished. At the same time, employees will be protected from misconduct. From there, they will feel secure to work, relieve pressure and stress. Employees know that their contributions will be respected. From there, they will be loyal and contribute their capacity to the overall performance of the company.
Benefits for investors: When a company has a strong ethical culture, investors will gain more confidence when they collaborate on joint projects. In addition, a culture of ethics will help the company's environment become professional and enhance the company's brand value in the eyes of partners.
Benefits for clients: Through an ethical culture , the company's employees will learn and practice good behavior with customers. From there, customers will have a good experience working with the company's employees. The customer satisfaction with employees will enhance the company's value and brand.
Valuable achievement for Organization: The values that ethical culture brings to employees, partners and customers are the benefits that ethical culture brings to the company. When employees behave properly to each other, the company will have a friendly and professional working environment. Partners and customers will feel confident working with the company. From there, the company's brand value will be enhanced.
The sustainable development of an organization depends a lot on a company's ethical culture. We can see that, if the company maintains a good ethical culture, the company will not commit bad practices in production such as: Using poor quality materials, not complying with waste treatment regulations to Reduce costs .... From there, customers will feel confident and continue to buy the company's products because they know the company always brings to the market quality products. The partners will trust the company's products and appreciate the company's contributions to the development of society. In addition, the ethical culture also helps the company build its own identity, attracting more talented people through social support programs, staff training programs, health care ...
A culture of ethics helps the company to reap many great benefits. Ethical culture not only contributes to the sustainable development of the company, but also helps the company improve brand value and thrive in scale and profitability ...
Culture is intangible or tangible values created by human behavior in everyday living environment.
Therefore, in different countries, the cultural, ethical values, beliefs will have different points, especially unethical behaviors.
Citizens of different countries will have different perspectives on: Lifestyle, historical views, cultural values, behavioral attitudes, social ethics ...
Asian culture: Self-control, collective standards, continuity and circles ...
European culture: Cultural diversity, individual liberty, extremism ...
The role of culture: Cultural differences create the identity of each nation in the world. Those are the values they uphold and they will feel better if they live in their culture. Therefore, culture is a very important factor for inclusion.
The role of ethical culture in global business: The global economy is the development trend of all economies around the world. Not learning about a country's culture will bring many disadvantages to a company when it comes to participating in the global economy. On the contrary, the study of culture will create many advantages. Therefore, building a global business culture based on the following factors: Responsibility, fairness, integrity, citizenship ... is extremely important. Besides, the global business environment is constantly changing and becoming more diverse. That is, companies need an understanding of a global ethical culture if we want to establish business relationships around the world.
Understanding the differences in cultures in the countries where the company is operating is extremely important. Respect for the culture of the host country will bring enormous benefits. However, we need to pay attention to the development of individual cultural identity with the conflict of ethics, beliefs and culture in the host country. The inclusion and respect for the local culture is an important factor in building a long-term relationship, bringing about sustainable development for the company.
Respect for equal rights and the roles of employees and employers plays a very important role in shaping a culture of ethics in the company. In this way, members of each level of the company will realize their role in maintaining and promoting ethical culture.
Responsibilities of the human resources department play a very important role. The HR department should provide tools and approaches to ethical culture for all members of the company. According to Steven D. Olson (2013), “Too much moral courage will turn into self-righteousness. Too little moral courage turns into cowardice ”.
Policy and procedure: Short, simple, easy to understand.
Training course: Regularly updated, quality, full content
Evaluation system: Fair, specific, strict.
In the Vietnamese market, the beverage industry is a potential business for many large companies. Therefore, building a culture of business is extremely important to branding for the company. A typical example for a company with a culture of ethics in the beverage industry in Vietnam is Heineken Vietnam. Heineken Vietnam has a very strong ethical culture that has been formed and maintained throughout the years. The ethical culture of Heineken Vietnam contributes to the sustainable development of the company. Heineken's ethical culture is respecting people and protecting the environment, through recycling bottle caps into a source of steel materials for bridge construction (Vietnam Net, 2019), or donating VND 2 billion to Quang Nam province in the campaign against Covid-19 virus (Quang Nam Network, 2020) is one of the activities that clearly shows the spirit of ethical culture in Heineken Vietnam.
Based on a culture of ethics in the business, Heineken Vietnam has built up its own identity and culture, making a difference. Since then, Heineken Vietnam has become a leading company in the beverage sector in Vietnam. This is really a role model that we need to learn to build an ethical culture to reinforce the brand for the company.
1. Human Resource Department:
The HR department plays an important role in providing fair, accurate and objective policies, regulations and assessment for the company's team members.
The HR department is the assessment department for behaviors that are viewed as unethical or consistent with the company's ethical culture.
Therefore, the human resources department needs to be transparent in recruitment, salary, bonus, performance assessment, labor policy, training ...
Human resources department should ensure that activities and policies are in place that conform to the standards of ethical culture. At the same time, policies need to be approved by other departments and widely disseminated to members of the company. In addition, the human resources department has a responsibility to help the employees in the company understand their roles and responsibilities in maintaining and developing an ethical culture at the company.
2. Guidelines for Leadership of company:
The company president, sales manager, finance director, production manager, human resources manager and all salesman supervisors play a key role in implementing ethical culture. . The basic tasks that the management team needs to perform:
The leadership team should be the role model for employees to apply an ethical culture to everyday behaviors such as decision making, hiring, performance assessment, layoffs, staff training and primary responsibility. for mistakes to appear in the departments they manage.
Protect employees when they report violations.
Build a system to evaluate employees' competencies based on the activities of the department they manage.
3. Guidelines for Staffs of company:
Comply with the regulations on ethical culture that the company has issued.
Recognize employees' rights and responsibilities to the company.
Respect personal honor in the face of tempting acts.
Trust the leadership team, respect employees who denounce unethical behaviors, forgive employees who violate ethics but take corrective action.
Take responsibility for your own mistakes.
Denounce unethical practices in the company.
Participate in ethical culture training and coaching sessions at the company.
Contribute ideas to management about company policy if it is not reasonable.
