Introduction

Ethics and morals are usually used interchangeably; ethics mainly

includes the rules of behaviour that depends on moral duties and obligations,
showing the way individuals must behave. It shows the differentiation of
wrong and right and motivates individuals to perform what is right. While
contrary to this, morals refer to what is the good and right character and
conduct. Few of the values that address ethical principles comprise respect
for others, responsibility, leadership, the pursuit of excellence, accountability,
caring for others, fidelity, keeping promises, fairness, integrity,
trustworthiness, and honesty (Crane and Matten, 2016).
In the hospitality industry, there is an increasing concern for the
relevant business ethics as the professionals in the hospitality industry are
confronting ethical dilemmas in their routine operations. Interesting and
complex ethical issues impact this vast industry whose business activities
ranges from tourism-related businesses to restaurant operations. By integrity
of the hospitality industry's nature, it places employees and customers in
inviting situations along with attracting abuse. Chances to steal rise in various
events particularly because of the large cash transactions and the
vulnerability of the hospitality sector to dishonesty (Teng, Hsu and Cheng,
2017). Few of the ethical challenges that the hospitality managers are facing
today are not new, and these are happening for a long time.
As a consequence of the regularly altering competitive environments,
the organisations related to hospitality should come up with techniques and
ways to keep themselves ahead of their particular competitors besides the
traditional methods of lowering prices, more services relevant to better selling
products. Currently, many customers are of the view that competing products
and services are similar reasonably in terms of quality. Hospitality and tourism
managers now realise that competing organisations only by price resulted in
uneven profits and erratic market. Hospitality organisations are giving the
response to all this by developing coordinated relationships and improved
partnerships with their customers (Teng, Hsu, and Cheng, 2017).
Ethical Dilemma in the Hospitality Industry
For assessing the ethical nature of organisational decisions, there are
three broadly accepted strategies. First is the utility approach that
concentrates on how much benefits a society can gain from the
consequences of behaviours and decisions. Second is the justice approach
that analyses whether benefits and costs are distributed fairly across groups
and individuals. Final is the rights approach that focuses on the welfare of
people (Mohd Rasdi and Ismail, 2017). Ethical codes are established by the
organisations that base on these ethical aspects to guide the decision-making
process. Although, there is not always unclear effectiveness of these ethical
codes (Kaptein, 2015), executives must base and create them on their
personal values to give moral clarity, to acknowledge worker about the
expectations of the company, and showcase all these in the external and
internal environments of organization that how the integration of ethics takes
place in the process of decision-making. This importance put the
organisational ethics at the centre of most of the procedures or processes in
both social and natural sciences disciplines. In this context, problems
regarding business ethics have been occurring unevenly in some business
related books, conference proceedings, and journals, and in a more focused
way in ethics-related publications and journals.
In the hospitality industry, ethical problems refer to challenges that are
taking place in the people-intensive, cash-based industry. Today, managers
are learning ways to watch for unreported sales, disappearing inventory,
beverage-and-food pilfering, and transaction errors. Violation of ethics is not a
new happening. Theft inside the industry of hospitality was both costly and
rampant in the 1990s and around 44% of the restaurant employees reported
that they stole merchandise or cash from their employers or organisations
(Wijesinghe, 2014). A recently conducted research shows that only 1 out of 30
workers in the food-service sector and the local restaurant was caught red-
handed for stealing from her or his employer during the year 2008 (Uysal,
2010).
Currently, theft from construction areas and loading docks are
particularly common, as products are taken before these items go to their
destinations in restaurants or hotels (Goh and Kong, 2018). There are quite
common examples of the inside theft that are occurring in the hotel industry.
The financial controller of London's Stafford Hotel was sentenced to jail after
stealing more than $500,000 for paying his casino gambling debts ("Stafford
Hotels'," 2009). Research conducted in 2010 revealed the average loss
happened due to stealing of $385,000 in the US and it normally takes 4.5
years to reveal or uncover these (Stevens, 2011).
It was observed by a famous hospitality expert that all types of
dishonesty are susceptible to the industry by individuals who are underpaid
notoriously (Stevens, 2011). Regular and quick cash transactions along with a
part-time job offer employees with attractive opportunities. Mostly, there are
long hours and unpredictable events. Along with this, while attempts are made
by managers to develop high ethical standards in hotels, the data mostly not
always reach the workers at front-line. Low ethical standards are also resulted
due to poor training of staff, along with various other factors, for example,
theft. Workplace issues can be minimised through improved training and this
strategy is recommended even in companies which have high turnover, as it
minimised the workplace issues (Poulston, 2008).
When the matter is workplace ethics, managers themselves are not
standing above this approach. It was discovered by the reporters of the
London Times that in Britain and Scotland, the owners of businesses are
publishing fake hotel reviews on websites. It was claimed by both owners that
they hadn't done anything wrong (Poulston, 2008). Furthermore, a lawsuit
was filed by Starwood Hotels and Resorts against the Hilton hotels. They
claimed corporate theft and espionage of trade-related secrets. The former
president of the luxury brands of Starwood was hired by Hilton, ad the suit by
Starwood claimed that the officer took confidential data along with him,
permitting Hilton to create its Denizen brand frequently by making use of
millions of dollars’ research of Starwood (Stevens, 2011). Allegations that
were in knowledge of the CEO of Hilton about the theft have been surfaced
recently, but this case is yet in the lawsuit (Stevens, 2011).
For the professionals of the hospitality industry, management of ethics
is a very serious business, as they are accountable for collaboration of
organisational standards and giving ethical leadership. Changing values and
cultural diversity means that perception of wrong and right may differ in areas
where right is not obvious always. Good service, integrity, fairness, honesty,
and diversity issues all are of concern of hotel manager. GM's of hotels are
challenged every day to resolve the personal issues of staff, make tough
decisions that can support one employee's group over others, and maintain
budget balance in a way that might harm other workers.
Impacts of Ethics in the tourism and hospitality industry
Decision making
The process of ethical decision-making is particularly impacted by the kinds of
ethical problems faced; the classification of ethical dilemmas is done as per
their strength with participants further likely to show respond according to the
principles of ethics if the dilemma is regarded as vital. In the past several
years, the recognition is upsurged by Europe that there is a scarcity of natural
resources which leads to the strengthening of environmental ethics. Inherent
values are possessed by the natural environment that blocks out its
importance as the leisure asset. The ethical performance of an organisation is
impacted greatly by the management through the development of appropriate
way that direct the entire organisation's ethical conduct (Ferrell ad Fraedrich,
2015). Management process and in general the priority setting of an
organisation impact the realisation of the organisation's ethical conduct by
exploring the values which are deemed as significant by the management.
Hospitality managers must maintain the highest level of guest
satisfaction, services, and optimal investment return. For complying with all
these objectives, it is required that hospitality managers should provide
services that fulfil the needs of customers. However, during the routine
activities, a range of ethical problems are faced by the management that can
leave either a negative or positive impression in the minds of employees,
customers, or management.
Quality
Establishment of hospitality and their management must always make
sure the quality of their employees and guests. Quality is a habit and not an
occurrence, and quality is only attainable with the help of maintaining
standards of the hotel. It comprises an appropriate estimate of guest
requirements, expectations, and desires along with the formation of proper
standards in the hotel. Good employees are the main source of providing
quality as they respect morality and ethics in both their life and work. So, in all
the activities of the hotel, ethics must become a component with definitions as
per the specific work and responsibility of every department. Ethics must cut
across public relations, yield management, purchasing, marketing, beverage
and food, security, front office, and housekeeping departments. Best
hospitality leaders make sure that the values, mission, vision along with the
ethics of the hotel represent a culture that is socially responsible (Smith &
Colman, 2006). Ethical leaders show by example in reinstating trust in the
organisation by reviving the ethical conduct of every worker and having a
clear acknowledgement of moral progress and quality of the hotel and
following required strategies from facts.
Employee Turnover
Hospitality businesses that are ethically and socially accountable can
retain as well as attract quality employees because the values and practices
of the organisation are in line with the values that are held by such workers,
which minimise the intention of the worker to leave the organisation. The
turnover of service employees is related directly to the hospitality company's
ethical environment, trust enhancement amongst employees, high ethical
practices to minimise the stress that will ultimately decrease conflicts and
maximise the job satisfaction level. Unlike other sectors, the hospitality sector
is relatively more diverse; it incorporates managers and employees from
every religious, sex, educational, racial, age, cultural, and social background
(Vallen and Casado, 2000). A broader spectrum of ethically appreciated
beliefs and behaviour are also embraced by the industry. So, managers and
employees of the hospitality industry require a global understanding of what is
wrong and what is acceptable. Adoption and implication of ethical values
assist individuals to realise their organisation fit along with impacting the
affections of the employee for the organisation. Unethical practices or
environment mostly result in additional organisational costs, so hospitality
organisations have to motivate ethical environment at the workplace to avoid
all this.
Employee Satisfaction
For any hospitality organisation, its highly significant assets are its workers;
therefore, it is required that hospitality organisations must take perfect care of
their workers. The management should play their role to identify the thinking
of their workers, how they perceive the culture of the company, what are their
views regarding the working environment and whether they are contented with
the prevailing policies and procedures or not. The retention rate of employees
becomes high when they are satisfied, and this will ultimately result in
lowering the turnover rate. A leading role must be played by the hospitality
managers in motivating ethical behaviour of workers in the company (Smith
and Colman, 2006). Personal competencies are involved in ethical leadership;
however, those managers who show themselves as good examples can exert
a greater effect on the ethical activities of their subordinates. Researches
have shown that as compared to other industries, a relatively greater ethical
perception is needed by the employees of the hotel industry.
Conclusion
The paper has examined the effects of ethics in hospitality industry.
Recently, in the hospitality industry, ethics have become a concerning matter
for the companies who are looking for success. Ethics of the hospitality
industry are different as compared to other industries. The overall success,
customer loyalty, job satisfaction, and employee turnover all are impacted by
ethics in hospitality. It is identified that workers are more satisfied while
working in an ethical environment, and are more loyal to customers and
organizations. Quality services are important in any tourism and hospitality
business as quality is directly connected to ethics. In past, the training in the
hospitality industry was given by focusing on foreign languages and
economics. Ethics and morality were neglected in past, however, due to the
growth in the industry, it becomes important that company managers possess
traits of honesty, trustworthiness, and leadership. There exists a positive
connection between overall success and profit of the organization.
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