The ethical climate in an organization refers to how employees examine and analyze what entails the rightful character traits within an organization. The ethical climate is a result of the organizational culture, internal elements such as the historical background of the organization, the structural design of the organization, the employers working inside the organization, and the external environment will influence the ethical climate in the organization.Ethical climate concentrates on the ethical aspects of making sound decisions and in the dimension of organizational staff.
Ethical Climate Issues
There are two dimensions applied in the determination of ethical climate. These are the ethical criterion which bases on the ethical theory such as egocentric character, benevolence principle in the organizational employers. The other dimension of describing ethical climate is the locus of analysis. The ethical climate in an organization is crucial in identifying ethical issues and providing a solution to the problem arising in the organization. The organization performs dismally in terms of ethical criterion. The type of analysis is the psychological climate. The antecedents for this concept were management exposure to organizational evolution, time in corporate operations, academic qualifications, classification of property, and gender issues in the organization.
The ethical issue of leadership is trying to enhance in the organization is trust — the ethical issues bases solely on the interpersonal and institutional dimension in the organizational environment. Under the interpersonal level, trust involves the person who trusts and the individual to be believed. Hence trust is considered a psychological condition as it depends on the possible outcomes of the expectations (Demirtas & Akdogan, 2015).Trust in the institutional extent refers to the lack of credibility to the way operations are carried out in the organization. Unethical issues of trust are evident according to the ethical climate index.
To solve the trust issues in the ethical climate index of the company, it is essential for a comprehensive and in-depth analysis of the ethical climate. The review must be in a position to identify all the arising issues due to trust to avoid plunging the organization into more severe problems (Hansen, Dunford & Jackson, 2016). The organization should come up with concepts useful to develop policies of enhancing trust in the organizational operations. These include an effective governance mechanism and proper coordination in businesses activities. Good governance should encourage such as integration of the organization operations. The employers should work together thus increasing integration levels while the degree of conflicts decreases. A useful tool to be incorporated is the attraction-selection-attrition framework which aims at encouraging homogeneity in business operations.The organizational management should motivate cultural dimensions policy which will increase the respect levels among employees thus increased innovation. The systems will result in adequate coordination n the organization essential for the building of trust into the ethical climate of the organization.
The perceptions of the ethical climate adversely affects the way organizations operate. Useful ethical climate results in higher productivity as every decision regarding productivity is eased with everything settled in the organization. The proposed policies should be incorporated into business operations to encourage the ethical climate in the organization. The solution to the ethical issues in the organization is critical towards employees in the organization discussing any ethical problems that may arise in the organization.
Demirtas, O., & Akdogan, A. A. (2015). The effect of ethical leadership behavior on ethical climate, turnover intention, and affective commitment. Journal of Business Ethics, 130(1), 59-67.
Hansen, S. D., Dunford, B. B., & Jackson, C. L. (2016). Corporate social responsibility, ethical leadership, and trust propensity: A multi-experience model of perceived ethical climate. Journal of Business Ethics, 137(4), 649-662.
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