The Role of Human Resources in Business Ethics

Human resources professionals have a more significant role in businesses than recruiting talent and handling internal activities, such as payroll. They are instrumental in creating and maintaining the culture of a workplace, and, in that way, they shape the code of ethics that a business follows. Maintaining a definite code of ethics is appropriate for both employees and customers, and it creates goodwill on all sides.
 
An organization’s culture can be the strongest predictor of how much money it will make because a company with a good business culture is able to consistently retain employees and satisfy customers. Practicing good ethics is a vital part of conducting good business, and this simple fact is being emphasized more and more as companies realize its benefits
.
There are four ingredients which serve to make up an ethical workplace: compliance, fairness, trust, and an ethical self-concept. Most companies fall into one of three different workplace models: compliant ethical, positive ethical, and virtuous ethical. Compliant ethical businesses promote the minimum ethical standards which are required by law, and their sense of responsibility toward ethical conduct is limited to what the law specifically requires.
Positive ethical businesses attempt to go beyond the bare minimum and actively seek to promote a positive workplace culture whenever possible. Virtuous Ethical Businesses make justice, and social responsibility their priority, and they make a point of holding themselves to the highest possible ethical standards. Also, each of these models implement the four ingredients of an ethical workplace in different ways.
 
Compliance consists of the norms, values, and ethical expectations an organization sets. These may be backed directly by laws, or they can be an expression of a business founders’ moral preferences. They must be expressed, however, in terms that employees can understand and use within their daily activities.
 
It should be made visible how compliance standards safeguard the company’s mission and benefit employees so that employees will be directly motivated to follow them. Merely doing the bare minimum in terms of compliance will not motivate employees, and this could, in fact, contribute to the creation of less ethical workplace culture.
Fairness involves the perceived justice of the policies and practices that affect employees and their work. When employees feel that they are being treated fairly, and when customers feel that a company’s policies are just, trust in the company can be built over time.
 
This trust is built through the way in which decisions are made, how information is shared, and how people interact with the company, among other things. Respecting customers and employees is essential in terms of building an ethical workplace and taking the time necessary to demonstrate that respect is beneficial to everyone involved.
 
Trust, specifically motive-based trust, is based upon the assessment employees make about the ethical character of people they interact with at work. These individuals can be coworkers, bosses, or customers. To maintain trust, people must actively work to foster it. They should be willing to listen to criticism, to admit and take responsibility for ethical mistakes, and to take corrective action when necessary.
 
Managers and leaders should also be good role models for other employees by demonstrating principles that encourage trust because the positive effect of trust translates throughout all of a company’s functions and various undertakings.
 
Success can be measured by the degree to which employees make the ethical values of the organization part of their own daily lives within the company. Organizations should promote the idea of internalizing the company’s positive moral values. Each company has different ways of doing this yet encouraging ethics can be as simple as giving employees easy ways to remember the values they should promote. This can be achieved using abbreviations or acronyms that help employees remember concepts, specific goals that they are expected to reach, or anything that brings together people’s aspirations and the various aspects of their work.
 
With all this in mind, human resources professionals should seek to foster a balance between the ethos, or ethical climate of an organization, and the ethics that the company wishes to promote. These two things should, ideally, always go hand-in-hand, and, consequently, they should also have a reciprocal relationship. The ethos of a company results from the ethical behaviors of its people. Ethos and ethical behavior should reinforce one another within a workplace culture.
 
Human resources professionals, therefore, should strive to help ensure that everyone in a company feels valued, as well as mediate disputes in a way that is consistent with the company’s positive values. These professionals should guard and champion the company’s ethics. They must protect people from inappropriate conduct in order to help their workplace flourish. They should make sure that people’s rights are respected, as well as that they are treated with dignity and fairness, in addition to ensuring that all employees have ample opportunities to contribute to the accomplishments of the organization.
 
Over time, the standard for company ethics is shifting from a mostly compliance-based approach to one that includes the enhancement of a company’s culture. Human resources professionals realize that a company’s most significant resource is its people and holding a high ethical standard for the sake of those people is key to effective leadership, both inside and outside the company.
 
At a time when many people don’t consistently trust companies to do the right thing, showcasing positive ethics is the best way for a company to enrich itself and provide security to its customers. It all starts with human resources, but it doesn’t end there, and sustaining an ethical culture within an organization is an ongoing process.
 
Lauber Business Partners can assist you in defining your code of ethics, designing policies and programs to help employees live the ethical values of the organization, and measuring adoption of these values. We can also help select the right tools to ensure candidates are evaluated against the organization’s ethical values.