CHAPTER 2

Ethics and
Human Resource
Management
By Amanda Rose

Chapter outline

Standards, values, morals and ethics have become increasingly complex in a postmodern

society where absolutes have given way to tolerance and ambiguity. This particularly

affects managers in HR, where decisions will affect people’s jobs and their future employ-

ment. This chapter explores some of the ethical dilemmas encountered in the workplace,

discussing ethical behaviour and values that relate to HR. It looks at relevant ethical tools,

such as utilitarianism and relativism in order to examine current practices in the work-

place and their links to corporate social responsibility.

Learning outcomes

By the end of this chapter, you should be able to:

u Critically explore and evaluate the ethical nature of human resource management;

u Identify and define current ethical and moral issues confronting HR managers;

u Compare, contrast and critically appraise a range of approaches to ethical analysis;

u Critically appraise the relevance and usefulness of philosophical analysis to HR practice.

Introduction

Human Resource Management is a business function that is concerned with managing rela-

tions between groups of people in their capacity as employees, employers and managers.

Inevitably, this process may raise questions about what the respective responsibilities and

rights of each party are in this relationship, and about what constitutes fair treatment. These

questions are ethical in nature, and this chapter will focus on debates about the ethical basis

of human resource management.

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The ethical nature of HRM

‘All HR practices have an ethical foundation. HR deals with the practical con-

sequences of human behaviour’.

(Johnson, 2003)

‘The entire concept of HRM is devoid of morality.’

(Hart, 1993: 29)

Despite these moral appreciations of human resource management (HRM), there is

a strong tradition in business that insists that business should not be concerned

with ethics. As Milton Friedman, a vociferous proponent of this position, has put

it:‘The social responsibility of business is to its shareholders. . . . The business of busi-

ness is business’ (1970).

The core concern of business – proponents of the market economy argue – is in

attempting to secure the best possible return on any investment. Any dilution of this

focus will lead to the corruption of what is a finely balanced system. Businesses that

seek to be ‘ethical’ as well as profitable will probably fail economically, following

which the whole community may suffer. Rather, let the invisible hand guide the mar-

ket and all will prosper. Like some evolutionary force, the best will always survive.

Wealth will trickle down from successful enterprises, and humanity will be best

served. Any constraint on the freedoms of the market – be they motivated by ethical

angst or vote-seeking government policy – will just mess everything up.

Notwithstanding the appeal of this position, a critique of business practice has

continued to accumulate and assert itself, and to challenge the notion that business

and morality have no meeting point. Concern has surfaced from a variety of sources:

from consumer groups, political groups, religious and charitable organisations.

Entrepreneurs (for example, Anita Roddick of The Body Shop (2000), academics and

researchers (Winstanley and Woodall, 2000; Greenwood, 2002) and management

professionals (Brown, 2003) have all expressed the view that standards of behaviour

within business need to be evaluated, and improved.

A case can be made that negative consequences flow from poor ethical standards:

u While short-term goals may be achieved through the cut-throat tactics of free

market principles, in the long run business will survive better if good standards

of conduct are maintained;

u Ethical business creates a positive environment in which to buy and sell, as cor-

ruption, poverty and lack of respect for the environment generate problems for

the business community in the long term;

u Finally, people neither hold moral values nor have religious beliefs to guide the

conduct of their lives. Why should the area of business be exempt?

C H A P T E R 2 E T H I C S A N D H U M A N R E S O U R C E M A N A G E M E N T

Do you think that ethical behaviour is relevant in today’s business world?

Why did you reach this conclusion?

pause for
thought

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2 9E T H I C S I N T H E B U S I N E S S E N V I R O N M E N T

Much of the recent focus on business ethics has been directed against financial cor-

ruption, especially a concern with accounting standards. The scandals involving

Enron Corp. and WorldCom are two recent examples. But concern has been raised

over a very broad range of issues, for example:

u Abuse of the world’s physical resources, and the global ecological balance (Esso);

u Abuse of human rights (Shell/Nigeria);

u Animal rights (KFC, McDonald’s);

u Aggressive treatment of competitors (Wal-Mart);

u Exploitative and unscrupulous marketing (Philip Morris) (Klein, 2000).

The unethical practice of HRM itself has also hit public attention:

u Off-shoring and exploiting ‘cheap’ labour markets;

u Using child labour;

u Reneging on company pension agreements;

u Longer working hours;

u Increasing work stress;

u The use of disputed and dubious practices in hiring and firing of personnel.

It has been shown that just as consumers’ perception of the ethics of a company

can affect sales, so the views of its investors will affect its share price. Similarly,

it has been suggested that poor standards of conduct emanating from the top

management affect employee motivation and commitment to organisational goals

(Schramm, 2004).

Ethics in the business environment

Concern with standards must be seen in the current context of business processes.

We live in a complex society, which is both morally and culturally diverse.

Key drivers and features of this complexity can be identified:

u Globalisation of markets and labour forces (‘McDonalidisation’);

u Intensification of both competition and monopolies (‘Coca Colonisation’);

u Paradigmatic changes in technology and the application of ICT, creating new

opportunities, but also new dilemmas over communication, surveillance and

privacy;

u Rapidly increasing rates of product innovation, obsolescence and demand;

u Aggressive marketing and the use of celebrities by the media;

u An escalation of materialist values and the commodification of everything, even

education;

exercises
What other examples of unethical business practice have you heard about?

What have you experienced in your own organisation?

What is the difference between being fair and acting appropriately?

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3 0

u Increased isolationism, individuality and world-weariness, often demonstrated by

cynicism, sarcasm and mockery, with a disregard for traditional values and any

form of authority;

u A rise in secular concerns – but also a concern with a loss of spirituality.

Against this background, management style and management ideology has under-

gone great change. New organisational forms and new ways of managing, including

the emergence of more flexible working patterns, have come into force. During this

era, HRM has become more strategically focused and more concerned with facilitat-

ing the achievement of organisational goals.

Winstanley and Woodall (1996) highlight a number of ethical concerns about

standards of HR practice, arising from this strategic focus. These include:

u Increased job insecurity – arising from ‘flexible’ work practices; short-term and

temporary conditions of employment; fear of job loss due to outsourcing and

off-shoring; increased stress; and a widening imbalance of power between

management and workforce;

u Increase in surveillance and control – this ranges from the use of psychometric

tests to electronic surveillance of work patterns through the application of ICT;

u Deregulation – freedom of the market place has been imposed by global regula-

tors such as the WTO, and has led to what Storey (1993) has termed: ‘impatience

with rule’ and ‘can-do outlook’ amongst line managers, which in practice may be

seen to push HR into compromising ‘good’ practice, for business needs. In pro-

fessional services organisations, for example, fee-earners may be challenged to

decide between ‘doing good’ and ‘doing well’;

u Aligned to this is a decline in management integrity, leading to accusations of

recourse to rhetoric and deceit among HR professionals. For example, the current

emphasis on managing organisational culture and commitment of employees

can be contrasted with a highly instrumental approach to the supervision of the

employment contract.

In this current context, it becomes most relevant to examine the ethical dimension

of HRM practice. In what ways can HRM be ethical and/or unethical? Are there guide-

lines and principles that all HR professionals ought to follow and adhere to? How

can we judge what a good course of action might consist of in a specific situation?

However, it is simplistic to consider HRM as a coherent and unitary set of prin-

ciples and practices. It varies from organisation to organisation, from culture to

culture, and can be diverse both within and between industries and sectors. It has

evolved in complex historical, economic and social contexts.

The current global operation of business creates extraordinary interactions of

values and practice. HRM is a feature of both the public, private and voluntary sectors,

and management practice differs accordingly. It is argued (Winstanley and Woodall,

2000) that HRM holds the moral ‘stewardship’ of organisations. It is interesting

therefore to consider the special role of HRM in the generation of an ethical and

moral climate in organisations in general.

Ethics and values

Organisations are bound by law to treat the people they employ fairly and not to dis-

criminate against identified groups. Legislation is a codification of accepted moral

C H A P T E R 2 E T H I C S A N D H U M A N R E S O U R C E M A N A G E M E N T

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3 1

principles, and acts to moderate standards within a community – ‘the greatest good

of the greatest number’.

But, conformity to all legal requirements does not necessarily ensure the best

treatment of employees. The law itself may not be fair; it may not cover all even-

tualities; and it may not always offer a clear guide to action.

E T H I C S I N T H E B U S I N E S S E N V I R O N M E N T

Ethics is a key branch of philosophy, concerned with analysing what is right or wrong

in people’s behaviour or conduct. Ethics and morality are terms that are often used

interchangeably in discussions of good and evil. The term ‘ethics’ is usually applied

to persons (ethics comes from the Greek ethos, meaning character) – and ‘morality’

to acts and behaviour (moral comes from the Latin moralis, meaning customs or

manners).

Philosophy presents us with suggestions about the nature of morality and ethics.

It also offers us a set of tools for analysing and exploring morality. Some main

issues and approaches will now be discussed:

u Relativism and absolutism;

u Consequentialist approaches (e.g. utilitarianism);

u Non-consequentialist approaches (deontological or ‘duty’ ethics);

u The ethics of human rights;

u Virtue ethics;

u The stakeholder approach.

Cultural relativism

One core distinction when analysing morality is the issue of relativism – the idea that

morality varies with culture, time and circumstances. The opposite position is that

of absolutism, the notion that there are universal truths in morality that apply at

all times and in all circumstances. In a global business world, this aspect becomes

significant. When businesses operate globally, how far should they adapt company

rules to local circumstances? Situational ethics can become problematical for

organisations wishing to expand into new international markets.

exercises
How far do you agree with the following list of HR objectives?

u In recruitment and selection: ensure that all assessment measures are fair and just.

u In reward management: ensure fairness in allocation of pay and benefits.

u In promotion and development: ensure equal opportunities and equal access.

u Ensure a safe working environment in both for all employees.

u Ensure that procedures are not unduly stressful, and that the needs of employees’

work–life balance are not compromised.

u When redundancies occur, to be fair and just in handling job losses.

u Deal effectively with all forms of bullying and harassment.

u In outsourcing and offshoring: ensure that contractors, consultants and franchisees

are fair and honest in their dealings with employees, clients and customers.

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Consequentialist approaches (utilitarianism)

This approach was developed by Jeremy Bentham (1748–1832) and John Stuart Mill

(1806–1873). Its main premise suggests that the morality of an act is determined by

its consequences: people should do that which will bring the greatest utility (which

is generally understood to mean whatever the group sees as good) to the greatest

number affected by a given situation.

C H A P T E R 2 E T H I C S A N D H U M A N R E S O U R C E M A N A G E M E N T

The ethical concerns of personnel managers

A survey of over 1,000 US personnel managers (Danley et al., 1991) found that the most

common areas causing ethical concern were: favouritism in hiring, training and promo-

tion; sexual harassment; inconsistent disciplinary measures; not maintaining confiden-

tiality; sex discrimination in promotion, and pay; and non-performance factors used in

appraisals.

u How far do you feel these are culturally specific?

u Why did you reach this conclusion?

u Would personnel managers in different cultures agree with this list? Give reasons for

your answer.

exercises

A company needs to make savings to survive a recession. They have a number of plants

in the Yorkshire area, some of them in areas of above-average unemployment. All plants

are equally profitable.

u Which plant should they close?

u Should they make their decision on purely economic grounds? Why?

u What if financial analysis doesn’t produce an obvious choice?

u What should they then decide to do?

exercises

For example, military contractors may be faced with ransom demands for kidnapped

employees. The UK government was embroiled in such a situation in 2004 in the

case of a UK citizen who was taken hostage in Iraq. His captors demanded economic

and political concessions to win his release. His family pleaded with the prime min-

ister to meet these demands. The government argued that to do so would jeopardise

the lives of many more UK subjects in Iraq and globally. In doing so, the government

was appealing to utilitarian arguments.

Critics suggest that in practice it is very difficult to accurately determine what

the maximal utility would be for all affected by a situation. People may not have the

necessary information. The notion of utility is very vague. Are we thinking of the short

or long term? These perspectives may lead to different conclusions. People may vary

in their perceptions and requirements. What is the ‘majority’? Can we accept a situ-

ation where the benefits of the majority might mean the exploitation, and suffering,

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of the minority? In this system, vast income disparity, or even slavery, might be

condoned on the grounds that it maximised the benefits of the majority. Some very

morally repugnant acts might be condoned on the grounds of utilitarianism.

Non-consequentialist or deontological approaches

This approach, associated with Immanuel Kant (1724–1804), is sometimes referred

to as ‘duty ethics’. Kant’s aim was to establish a set of absolute moral rules, devel-

oped through the application of reason. He also put forward an acid test for evaluat-

ing the quality of moral rules and this is termed: the categorical imperative. This

states that: ‘I ought never to act except in such a way that I can also will that my

maxim should become a universal law.’ In other words, moral rules should follow

the principle of reciprocity: do as you would be done by. This premise can be found

in the moral principles of many religious systems, including Islam, Christianity,

Judaism and Buddhism. See, for example, the Ten Commandments.

Kant further stated: ‘Act in such a way that you always treat humanity . . . never

simply as a means, but always at the same time as an end.’ The defining character-

istics of this approach are the universal applicability of principles to all humanity, and

basic respect for humans.

A key notion for Kant was that of intentionality. It might well be that the outcome

of an act leads to very bad consequences for people – for example, the closure of a

site and subsequent job losses – but if one’s aims and intentions are good, then the

act is a moral one. It’s all about motivation and meaning.

Goodpaster (1984) has attempted to develop a set of rules along Kantian lines for

business practice:

1. Avoid and prevent harming others.

2. Help those in need.

3. Do not lie or cheat.

4. Respect the rights of others.

5. Keep promises or contracts.

6. Obey the law.

7. Be fair.

8. Encourage others to follow these principles.

E T H I C S I N T H E B U S I N E S S E N V I R O N M E N T

exercises
Examine the rules of business practice developed by Goodpaster and the CIPD code

of professional conduct, which can be found at the following site: www.cipd.co.uk/

about /profco.htm.

u Which of these rules would you find:

– easiest to do?

– hardest to do?

Outline the reasons for your answer.

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The development of codes of good or ethical practice within organisations and pro-

fessional associations stems from the deontological approach. However, the approach

has been seen to present problems in its implementation, as follows:

u How do you judge that a rule is a good one?

u What, in the final analysis, is fair?

u Can we all agree?

u How should we proceed in cases where principles compete?

u And what about situations when avoiding harm to one person means harming

another or where keeping a contract with one person or group leads to breaking

it with another?

Hart (1993) has suggested that current HR practice falls short of Kant’s categorical

imperative. In tough business contexts, policies seem to support the premise that:

‘We should behave towards our fellow human beings with the over riding objective

of extracting added value’ (p. 29).

Human rights

Another very influential view stems from seeing people as having basic human

rights. In this view, there is recognition of a core set of human rights. Where a human

C H A P T E R 2 E T H I C S A N D H U M A N R E S O U R C E M A N A G E M E N T

The shrm code of ethical and professional standards in human
resource management

Core principles

As HR professionals we are responsible for adding value to the organisations we serve

and contributing to the ethical success of those organisations. We accept professional

responsibility for our individual decisions and actions. We are also advocates for the pro-

fession by engaging in activities that enhance its credibility and value.

u As professionals we must strive to meet the highest standards of competence and

commit to strengthen our competencies on a continuous basis.

u HR professionals are expected to exhibit individual leadership as a role model for

maintaining the highest standards of ethical conduct.

u As human resource professionals we are ethically responsible for promoting and fos-

tering fairness and justice for all employees and their organisations.

u As HR professionals we must maintain a high level of trust with our stakeholders. We

must protect the interests of our stakeholders as well as our professional integrity

and should not engage in activities that create actual, apparent or potential conflicts

of interests.

u HR professionals consider and protect the rights of individuals, especially in the

acquisition and dissemination of information while ensuring truthful communications

and facilitating informed decision making.

window into
practice

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right exists, there must also be a duty or responsibility to recognise, support and

acknowledge that right.

John Locke (1632–1704) was one philosopher who emphasised and elaborated an

ethics based upon human rights. He argued that it is not so much the application of

reason to acts that is important to morality, but an appreciation of the fair and equal

treatment of all people, enshrined in the recognition of basic human rights. For

Locke, the key rights included freedom, and rights to property.

There have been many attempts to codify and elaborate human rights, including

the declaration of the Rights of Man (1789), the Universal Declaration of Human Rights

(1948) and the European Convention on Human Rights (1950). Recently, the UK has

passed the Human Rights Act (1998) in an attempt to codify rights within British law.

The full implications of this act for the business and employment arenas are cur-

rently being explored through case law and, undoubtedly, this will have major impli-

cations for HR practice.

Virtue ethics

Virtue ethics is an approach that is seen to originate with Aristotle (384–322 BC). It

has recently regained prominence through the work of the philosopher Alasdair

Macintyre (1981). Aristotle was not concerned to identify the qualities of good acts,

or principles, but of good people. Acting as a ‘good person,’ Macintyre suggests,

‘is the state of being well and doing well . . . a complete human life lived at its best’

(pp. 148–149). For Aristotle, the virtuous man has to know that what he does is

virtuous; a good man has to ‘judge to do the right thing in the right place at the right

time in the right way’ (p. 150). This is not just the simple application of rules. The

virtues include both intellectual and character virtues. Macintyre includes the need

to feel that what one is doing is good and right; to have an emotional as well as a cog-

nitive appreciation of morality is an essential component of virtue.

A key distinction between this approach and others is that it focuses on the issue

of agency in ethical conduct. It suggests that neither good intentions nor outcomes,

codes and the recognition of basic rights will necessarily ensure ‘goodness’. In the

final analysis, the effectiveness of an ethical system depends on the nature of the

people who employ it. And are people essentially good or bad?

Stakeholder analysis

This approach has emerged from the area of applied business ethics, and proponents

include Freeman (1998) and Weiss (1994). As discussed earlier, free market eco-

nomics accords rights only to shareholders in the business enterprise. Stakeholder

analysis offers an alternative view.

Stakeholder analysis sees morality as evolving within a community of equals,

where rights and needs are recognised as residing within all individuals and groups

that partake in business life. Organisations consist of many interwoven webs

of relationships, rights and responsibilities. Many individuals and groups have

a ‘stake’ in how an organisation performs, apart from just the shareholders and

members of the board. Employees, customers, suppliers and the wider community

should all be considered when decisions are made, and they should be consulted

accordingly.

E T H I C S I N T H E B U S I N E S S E N V I R O N M E N T

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Winstanley and Woodall (2000) argue that this is a very useful approach for

analysing ethical issues in HRM. Jones (1995) has presented evidence to suggest

that companies that follow a stakeholder approach are actually more profitable.

Greenwood (2002) finds this an underused approach in analysing the ethical aspects

of HRM. She feels that it provides a framework which brings into relief both the

macro (ideology) and micro (specific policy) aspects of HRM.

However, there are a number of practical problems with this approach. Firstly,

companies must identify relevant stakeholders – and this is not always an obvious

matter. Secondly, when stakeholders are identified, an organisation has a moral

obligation to discover their views. This is not always easy. For example, ‘the com-

munity’ is a very vague term – who is included here? Will everyone in the ‘commu-

nity’ have the same views? Can they all realistically be consulted? A company may,

with the best of intentions, obtain a partial view of the wishes of its stakeholders that

does not acknowledge the voices of several relevant diverse groups.

Corporate social responsibility (CSR) and HRM

Crowe (2002) defines CSR as, ‘all the ways in which a company relates to society

from purchasing to product disposal, from human resources to human rights’. The

concept is generally used in management literature to refer to the responsibilities

and relations between an organisation and the community within which it operates.

This focuses attention away from individual practices and procedures, to the strate-

gic direction and mission of the corporation as a whole.

One approach that companies can take to CSR is to include a ‘social audit’ in their

annual reports. This was first recommended by Medawar (1978), and shows not just

the financial performance of a company, but also details of its impact on both the

environment and the community. It was reported in 2003, that 132 of the FTSE 250

companies now report their environmental performance, and 100 also report on

social and ethical issues.

CSR can affect a company through the message it signals to potential recruits.

Research conducted by Duncan Brown of the CIPD (2003) suggests that companies

that adopt a policy of social responsibility tend to fare better in attracting new

recruits – a key concern for UK companies in the current labour market. Eighty-

eight per cent of participants surveyed said concordance of individual and organisa-

tional values was a key component in job choice.

Current CSR policies include an attempt to involve employees in voluntary com-

munity work. One-third of companies based in the City of London have community

and volunteering programmes, covering an estimated 27,000 staff and providing

charitable support worth an estimated £337 million (Heart of the City, 2002).

Examples of companies that have implemented such schemes through the Business

C H A P T E R 2 E T H I C S A N D H U M A N R E S O U R C E M A N A G E M E N T

Have a look at the Warbings case study.

Who are the various stakeholders in the organisation?

What rights and duties do you think they have concerning the activities of the company?

How could their concerns be raised and dealt with?

exercises

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in the Community initiative include Walkers Snack Foods and IBM. Potentially, CSR

can usefully form part of an employee development programme, and may benefit

the community, employees and the organisation itself.

Corporations are unelected and unmonitored, and their involvement in charitable

enterprises could be seen to compromise people’s right to self-determination.

Social critics, such as Klein (2000), have argued that corporations that involve them-

selves in community projects may be accused of promoting their own self-interest.

Tesco has spearheaded a ‘Computers for Schools’ campaign that gives shoppers

in their stores tokens which can be exchanged for much needed IT equipment for

schools. Many schools publicise this to parents – effectively asking them to shop at

Tesco. This moral pressure is in Tesco’s interests, and while the outcome may

be positive and therefore applauded from a utilitarian point of view, it cannot be

viewed as ethical from a non-consequentialist perspective. A similar discussion

took place in the book and film The Constant Gardener, which explored the prac-

tice of a pharmaceutical company that killed healthy African adults in its clinical

trials.

From a stakeholder perspective, CSR initiatives might seem to be the right

approach, where companies acknowledge their responsibilities to their surround-

ing environment and community. But the critics of the approach would caution

that a clearer analysis of the needs and interests of respective stakeholders needs

to be undertaken in order to establish whether these are always beneficial, and

ethically laudable. Employees and community members alike may be exploited

through such initiatives. Both parties might benefit more from greater corporate

governance in collaboration with national and international …

Global Ethics and Labour standards

UNIT III

WHAT IS ETHICS?

Ethics in general is seen as the following –

A set of moral principles : a theory or system of moral values

A sense of what is right or wrong

International Business ethics can be seen as –

The business conduct or morals of MNCs in their relationships to all individuals and entities.

Such behavior for MNCs is based largely on the cultural value system and the generally accepted ways of doing business in each country or society.

Those norms are based on broadly accepted guidelines in religion, philosophy, professions, and the legal system

Different ethical approaches

Cultural relativism and absolutism

One core distinction when analysing morality is the issue of relativism – the idea that morality varies with culture, time and circumstances.

The opposite position is that of absolutism, the notion that there are universal truths in morality that apply at all times and in all circumstances.

In a global business world, this aspect becomes significant. When businesses operate globally, how far should they adapt company rules to local circumstances?

Situational ethics can become problematical for organisations wishing to expand into new international markets.

Different ethical approaches

Ethical Imperialism directs people to do everywhere exactly as they do at home.

It is based on the theory of absolutism:

There is a single list of truths,

They can be expressed only with one set of concepts,

and they call for exactly the same behavior around the world

Different ethical approaches

Consequentialist approaches (utilitarianism)

This approach was developed by Jeremy Bentham (1748–1832) and John Stuart Mill (1806–1873). Its main premise suggests that the morality of an act is determined by its consequences: people should do that which will bring the greatest utility (which is generally understood to mean whatever the group sees as good) to the greatest number affected by a given situation.

Different ethical approaches

Non-consequentialist or deontological approaches

This approach, associated with Immanuel Kant (1724–1804), is sometimes referred to as ‘duty ethics’. Kant’s aim was to establish a set of absolute moral rules, developed through the application of reason. He believed that moral rules should follow the principle of reciprocity: do as you would be done by.

This premise can be found in the moral principles of many religious systems, including Islam, Christianity, Judaism and Buddhism. See, for example, the Ten Commandments.

Kant further stated: ‘Act in such a way that you always treat humanity . . . never simply as a means, but always at the same time as an end.’ The defining characteristics of this approach are the universal applicability of principles to all humanity, and basic respect for humans.

Different ethical approaches

Goodpaster (1984) has attempted to develop a set of rules along Kantian lines for business practice:

1. Avoid and prevent harming others.

2. Help those in need.

3. Do not lie or cheat.

4. Respect the rights of others.

5. Keep promises or contracts.

6. Obey the law.

7. Be fair.

8. Encourage others to follow these principles.

Different ethical approaches

Human rights

Another very influential view stems from seeing people as having basic human rights. In this view, there is recognition of a core set of human rights. Where a human right exists, there must also be a duty or responsibility to recognise, support and acknowledge that right. John Locke (1632–1704) was one philosopher who emphasised and elaborated an ethics based upon human rights. He argued that it is not so much the application of reason to acts that is important to morality, but an appreciation of the fair and equal treatment of all people, enshrined in the recognition of basic human rights. For Locke, the key rights included freedom, and rights to property.

There have been many attempts to codify and elaborate human rights, including the declaration of the Rights of Man (1789), the Universal Declaration of Human Rights (1948) and the European Convention on Human Rights (1950). Recently, the UK haspassed the Human Rights Act (1998) in an attempt to codify rights within British law.

The full implications of this act for the business and employment arenas are currently being explored through case law and, undoubtedly, this will have major implications for HR practice.

Hr Role in global ethics

HR has a key role in helping organizations develop internal controls and governance structures to ensure ethical behavior by corporate managers and employees

They should be responsible for the following where applicable

establishing ethical guidelines which mitigate against matters of race and sex discrimination, hiring, job placement, compensation, working conditions

not depriving workers of their rights as declared by the Universal Declaration of Human Rights e.g. physical movement, physical security, political participation

developing a clearly articulated set of core values as part of organisational culture

Code of conduct/ code of ethics

Code of conducts:

Help to define desirable behaviours in business

May relate to organisations, sectors or professions

Provide a balance between aspiring to ideals and offering relevant guidance for real-life situations

Must provide clear direction about ethical behavior when temptation to behave unethically is strongest.

But, also must leave room for a manager to use his or her judgment in situations requiring cultural sensitivity.

A code of ethics is a guide of principles designed to help professionals conduct business honestly and with integrity. A code of ethics document may outline the mission and values of the business or organization, how professionals are supposed to approach problems, the ethical principles based on the organization’s core values, and the standards to which the professional is held.

Code of conduct/ code of ethics

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effective implementation of ethical standards for international operations

 

Develop and implement a code of ethics that can ensure an effective, ethical, standard for worldwide operations

Ensure ongoing training for all members of staff

Consult broadly with people who are affected

Treat corporate values and formal standards of conduct as absolutes

Be aware of principles and standards of the W.T.O and ILO. Be aware of international laws and standards

Designate an ethics officer for overseas operations and for regions where there are large numbers of employees

Support efforts to decrease institutional corruption. Exercise moral imagination in dealing with cultural differences that conflict with the ethical standards of the home country

key characteristics of a good code of conduct? How can they improve
standards of behaviour?

The meaning of rules- is there to be obeyed without question or exception or merely be ideal guides.

How to deal with Government Bureaucrats

Rules regarding gender roles

Standards for working conditions

Approach to the protection of group confidentiality.

They provide the bases on which decision are made, thus creating consistency across MNC.

Ethical problems a mnc can face

– Corruption

– Conflicting labour standards and practices, including child labour

– Disciplinary practices of the host country

– Discrimination – racial, gender etc.

Ethical issues within HR

Off-shoring and exploiting ‘cheap’ labour markets;

Using child labour;

Reneging on company pension agreements;

Longer working hours;

Increasing work stress;

The use of disputed and dubious practices in hiring and firing of personnel.

C087 – Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87) – https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_INSTRUMENT_ID:312232

PART I. FREEDOM OF ASSOCIATION

Article 1

Each Member of the International Labour Organisation for which this Convention is in force undertakes to give effect to the following provisions.

Article 2

Workers and employers, without distinction whatsoever, shall have the right to establish and, subject only to the rules of the organisation concerned, to join organisations of their own choosing without previous authorisation.

Article 3

1. Workers’ and employers’ organisations shall have the right to draw up their constitutions and rules, to elect their representatives in full freedom, to organise their administration and activities and to formulate their programmes.

2. The public authorities shall refrain from any interference which would restrict this right or impede the lawful exercise thereof.

Article 4

Workers’ and employers’ organisations shall not be liable to be dissolved or suspended by administrative authority.

Article 5

Workers’ and employers’ organisations shall have the right to establish and join federations and confederations and any such organisation, federation or confederation shall have the right to affiliate with international organisations of workers and employers.

Article 6

The provisions of Articles 2, 3 and 4 hereof apply to federations and confederations of workers’ and employers’ organisations.

Article 7

The acquisition of legal personality by workers’ and employers’ organisations, federations and confederations shall not be made subject to conditions of such a character as to restrict the application of the provisions of Articles 2, 3 and 4 hereof.

C087 – Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87)

Article 8

1. In exercising the rights provided for in this Convention workers and employers and their respective organisations, like other persons or organised collectivities, shall respect the law of the land.

2. The law of the land shall not be such as to impair, nor shall it be so applied as to impair, the guarantees provided for in this Convention.

Article 9

1. The extent to which the guarantees provided for in this Convention shall apply to the armed forces and the police shall be determined by national laws or regulations.

2. In accordance with the principle set forth in paragraph 8 of Article 19 of the Constitution of the International Labour Organisation the ratification of this Convention by any Member shall not be deemed to affect any existing law, award, custom or agreement in virtue of which members of the armed forces or the police enjoy any right guaranteed by this Convention.

Article 10

In this Convention the term organisation means any organisation of workers or of employers for furthering and defending the interests of workers or of employers.

PART II. PROTECTION OF THE RIGHT TO ORGANISE

Article 11

Each Member of the International Labour Organisation for which this Convention is in force undertakes to take all necessary and appropriate measures to ensure that workers and employers may exercise freely the right to organise.

C098 – Right to Organise and Collective Bargaining Convention, 1949 (No. 98) –https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_INSTRUMENT_ID:312243

Article 1

1. Workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment.

2. Such protection shall apply more particularly in respect of acts calculated to–

(a) make the employment of a worker subject to the condition that he shall not join a union or shall relinquish trade union membership;

(b) cause the dismissal of or otherwise prejudice a worker by reason of union membership or because of participation in union activities outside working hours or, with the consent of the employer, within working hours.

Article 2

1. Workers’ and employers’ organisations shall enjoy adequate protection against any acts of interference by each other or each other’s agents or members in their establishment, functioning or administration.

2. In particular, acts which are designed to promote the establishment of workers’ organisations under the domination of employers or employers’ organisations, or to support workers’ organisations by financial or other means, with the object of placing such organisations under the control of employers or employers’ organisations, shall be deemed to constitute acts of interference within the meaning of this Article.

Article 3

Machinery appropriate to national conditions shall be established, where necessary, for the purpose of ensuring respect for the right to organise as defined in the preceding Articles.

C098 – Right to Organise and Collective Bargaining Convention, 1949 (No. 98) –https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_INSTRUMENT_ID:312243

Article 4

Measures appropriate to national conditions shall be taken, where necessary, to encourage and promote the full development and utilisation of machinery for voluntary negotiation between employers or employers’ organisations and workers’ organisations, with a view to the regulation of terms and conditions of employment by means of collective agreements.

Article 5

1. The extent to which the guarantees provided for in this Convention shall apply to the armed forces and the police shall be determined by national laws or regulations.

2. In accordance with the principle set forth in paragraph 8 of Article 19 of the Constitution of the International Labour Organisation the ratification of this Convention by any Member shall not be deemed to affect any existing law, award, custom or agreement in virtue of which members of the armed forces or the police enjoy any right guaranteed by this Convention.

Article 6

This Convention does not deal with the position of public servants engaged in the administration of the State, nor shall it be construed as prejudicing their rights or status in any way.

C029 – Forced Labour Convention, 1930 (No. 29)
https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_ILO_CODE:C029

Article 1

1. Each Member of the International Labour Organisation which ratifies this Convention undertakes to suppress the use of forced or compulsory labour in all its forms within the shortest possible period.

2. With a view to this complete suppression, recourse to forced or compulsory labour may be had, during the transitional period, for public purposes only and as an exceptional measure, subject to the conditions and guarantees hereinafter provided.

3. At the expiration of a period of five years after the coming into force of this Convention, and when the Governing Body of the International Labour Office prepares the report provided for in Article 31 below, the said Governing Body shall consider the possibility of the suppression of forced or compulsory labour in all its forms without a further transitional period and the desirability of placing this question on the agenda of the Conference.

Article 2

1. For the purposes of this Convention the term forced or compulsory labour shall mean all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily.

2. Nevertheless, for the purposes of this Convention, the term forced or compulsory labour shall not include–

(a) any work or service exacted in virtue of compulsory military service laws for work of a purely military character;

(b) any work or service which forms part of the normal civic obligations of the citizens of a fully self-governing country;

(c) any work or service exacted from any person as a consequence of a conviction in a court of law, provided that the said work or service is carried out under the supervision and control of a public authority and that the said person is not hired to or placed at the disposal of private individuals, companies or associations;

(d) any work or service exacted in cases of emergency, that is to say, in the event of war or of a calamity or threatened calamity, such as fire, flood, famine, earthquake, violent epidemic or epizootic diseases, invasion by animal, insect or vegetable pests, and in general any circumstance that would endanger the existence or the well-being of the whole or part of the population;

(e) minor communal services of a kind which, being performed by the members of the community in the direct interest of the said community, can therefore be considered as normal civic obligations incumbent upon the members of the community, provided that the members of the community or their direct representatives shall have the right to be consulted in regard to the need for such services.

C029 – Forced Labour Convention, 1930 (No. 29)
https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_ILO_CODE:C029

Article 3

For the purposes of this Convention the term competent authority shall mean either an authority of the metropolitan country or the highest central authority in the territory concerned.

Article 4

1. The competent authority shall not impose or permit the imposition of forced or compulsory labour for the benefit of private individuals, companies or associations.

2. Where such forced or compulsory labour for the benefit of private individuals, companies or associations exists at the date on which a Member’s ratification of this Convention is registered by the Director-General of the International Labour Office, the Member shall completely suppress such forced or compulsory labour from the date on which this Convention comes into force for that Member.

Article 5

1. No concession granted to private individuals, companies or associations shall involve any form of forced or compulsory labour for the production or the collection of products which such private individuals, companies or associations utilise or in which they trade.

2. Where concessions exist containing provisions involving such forced or compulsory labour, such provisions shall be rescinded as soon as possible, in order to comply with Article 1 of this Convention.

Article 6

Officials of the administration, even when they have the duty of encouraging the populations under their charge to engage in some form of labour, shall not put constraint upon the said populations or upon any individual members thereof to work for private individuals, companies or associations.

Review questions

Using the PDF document issued, complete the following questions

What is ‘ethics’ and how is it relevant in International Business for HR Managers? Everyone

What is ‘cultural relativism’? Give an example from a international business context. Shardaye

What is ‘utilitarianism’? Give an example of a utilitarian argument in human resource management. Paula

List three (3) human rights that are relevant to the work context. Shanetta

Give an example of an ethical code of conduct? What are three (3) of the key characteristics of a good code? How can they improve standards of behaviour? Ravyn