23 August 2007.Ethical IssuesIntroductionThe psychological processes of individuals contribute to, and are affected by, organizational life. Memberships of organizations affect the way an individual thinks, feels and behaves. Various psychological theories have been influential in how organizations and employees influence each other. Some of the dominant theories like equity theory, personality theory, behavioral theories, motivational needs theory, psychosocial theories and various other psychological models have been influential in dealing with a variety of organizational issues like team work, managerial style, job insecurity, employee motivation. The application of these theories to organizations helps to understand the mental states and processes associated with behavior in structured social groups and systems.
All this plays an important role in how business ethics is perceived and conducted within organizations. Ethical issuesThe social cognitive model of business ethics elaborated by Stajkovic and Luthans (1997) helps the managers to understand how business ethics and employees relate with each other. He describes a social cognitive model of business ethics that can begin to help international managers better understand how business ethics is perceived and conductedIntroductionAlthough there have been philosophical approaches to the field of business ethics, these theories and approaches have undertaken a limited or no analysis of existing business practices. There have also been ethical theories such as utilitarianism, rights of justice, and differential association and concepts from humanistic psychology such as moral development as well as theological foundations to study business ethics (Stajkovic and Luthans).
Researchers from management have been trying to apply these theories and concepts to business settings for a long time. Bandura’s social cognitive theory plays an important role in how personal factors and relationships affect business ethical standards.
(Social Learning Theory). The major premise of Bandura's social cognitive theory is that human action is determined by the triangular interaction among the specific environment (e. g, institutional factors), person (e. g, personal factors), and behavior itself (e. g., organizational actions) all within a particular social context (e. g., national culture) (Social Learning Theory). Thus culture, organization and personal factors affect the conduction of business ethics in an organization. CultureThe ethical behavioral conduct in an organization depends on the unique characteristics of each national culture. This is due to the fact that the social behaviors and the knowledge utilized for interpreting experiences is situated in the culture.
It is the foundation of human thought and action. Business ethics necessarily needs to be examined within a cultural context since culture forms the meaning of all the concepts related to ethical inquiry. Organizational factorsViewed from a social cognitive perspective the creation of business ethical standards by the employees is neither instinctive, nor spontaneously transmitted by institutional, organizational, or personal ethical norms. Rather, the theory would explain creation of ethical standards and subsequent ethical behavior in terms of a triangular relationship among the key variables.
Institutional and organizational factors are cognitively processed by individuals which in turn help in the formation of ethical standards. The macro-level forces like the organizations which help in generating relevant information are cognitively processed by individuals. This individual level is analyzed by the social cognitive approach which examines the ethical standards. It focuses on how individuals perceive business ethical standards which further defines their ethical behavior in social environment.