Ethical Issues in Organizational Behavior 2 - Assignment Example

Corporate ethics have become a critical success factor in the 21st century. The stakeholders of corporations expect more than ever companies to behave in a socially responsible and ethical manner. Corporations must incorporate various initiatives and systems to achieve ethical behavior. The implementation of a corporate social responsibility system (CSR) can help guide corporations in the right direction. In terms of employee conduct two documents that can help maintain the highest ethical conduct possible among employees is the employee manual and the code of conduct.

A code of conduct can be defined as a set of conventional principles and expectations that are considered binding on any person who is a member of a particular group (Thefreedictionary, 2011). Multinational corporations are expected to closely monitor the employee behavior and the behavior of stakeholder groups including suppliers. Back in the late 1990’s Nike Corporation suffered from an avalanche of bad publicity which costs the company half its sales in 1998 due the existence of sweatshops in Nike’s supply chain.

A proper code of conduct can influence the behavior of the employees. A code of conduct can be prepared for other specific stakeholder groups such as suppliers. The use of a good and effective CRS plan can help build the brand value of an enterprise. Companies that effectively implement a branding strategy are able to charge a premium for their products. SAIC Inc. was recently in the news due to a scandal associated with a project with the city of New York called CityTime payroll. The CEO of the company, Walt Haventein, took a proactive approach to deal with the scandal.

He admitted the company messed up due to poor corporate governance and cooperated with the justice department to bring to justice the white collar criminals. In order to control collateral damage the company hired the international law firm of Gibson Dunn to undertake a thorough review of key policies and practices of the company (Wsj, 2011). The CEO made public statements stating that what occurred with the CityTime project was criminal behavior that was not aligned with the mission and vision of the company.

The estimated cost of the CityTime project in 1998 was $63 million. The cost of the project increased in value more than ten times. The contractors would earn kickbacks for each hour worked by consultants. This financial scandal associated with the CityTime contract was revealed due to the tips authorities received from a whistleblower. A whistleblower is a person that leaks information to the authorities about illegal activity occurring at a corporation. The top executives of the company, particularly the CEO, did a great job of handling the situation.

Despite the company’s involvement in the scandal the firm has maintained a reputation as an ethical firm. The firm has landed several governmental contracts in the aftermath of the financial scandal. Due to the high levels of competition in most business industries firms have to differentiate themselves. The use of an aggressive corporate social responsibility program can be used as a differentiation strategy to stand out from the competition. References Jsj.com (2011). Citytime scandal causes shakeup at co.

hired by NY. Retrieved October 29, 2011 from http://online.wsj.com/article/APf42b83974e714382bb7f6dd16fdbc5a6.html?KEYWORDS=ethics Thefreedictionary.com (2011). Code of Conduct. Retrieved October 29, 2011 from http://www.thefreedictionary.com/code+of+conduct