Aldira Jasmine Rizky Arifin (12010119190284)

JOURNAL SUMMARY
Corporate ethics concerns the relationship between the company and employees as an
integral part of the environment. An ethical culture therefore would be one in which employees
are empowered and expected to act in ethically responsible ways even when the law does not
require it. Also, there is still a lack of understanding concerning how organizational ethics leads
businesses to excellence both in moral and technical terms. Helping behavior, putting in extra
hours as needed, offering new ideas to improve processes and structures, etc. are examples of
extra-role actions that might be enhanced by ethical culture.
Ethical behavior in international business contexts was the highest in the subset of the
sample where both individuals and their organizations scored highly on assessments of ethics.
So, it is reasonable to expect role modeling (for example) to be more impactful to the extent that
the behaviors exemplified are aligned with the values of the employee. Ethical behavior is that
which is morally accepted as "good" and "right" as opposed to "bad" or "wrong" in a particular
setting. The effective management of ethical issues requires that organizations ensure that their
managers and employees know how to deal with ethical issues in their everyday work lives.
Therefore, organizational members must first understand some of the underlying reasons for the
occurrence of unethical practices. In addition, some firms are known to selectively recruit and
promote employees who have personal values consistent with illegal behavior; firms also may
socialize employees to engage in illegal acts as a part of their normal job duties.
The ethical tone or climate of organizations is set at the top. What top managers do, and
the culture they establish and reinforce, makes a big difference in the way lower-level employees
act and in the way the organization as a whole acts when ethical dilemmas are faced. The ethical
climate of an organization is the shared set of understandings about what is correct behavior and
how ethical issues will be handled. Organizations committed to promoting an ethical climate
should encourage principled organizational dissent instead of punishing such behavior.
Organizations should also provide more ethics training to strengthen their employees' personal
ethical framework. That is, organizations must devote more resources to ethics training programs
to help its members clarify their ethical frameworks and practice self-discipline when making
ethical decisions in difficult circumstances. Organizations have to ensure that their employees
know how to deal with ethical issues in their everyday work lives. As a result, when the ethical
climate is clear and positive, everyone will know what is expected of them when inevitable
ethical dilemmas occur. This can give employees the confidence to be on the lookout for
unethical behavior and act with the understanding that what they are doing is considered correct
and will be supported by top management and the entire organization.
Leadership which lacks ethical conduct can be dangerous, destructive, and even toxic.
Because, ethical leadership plays a mediating role in the relationship between employee
outcomes and organizational culture. Leaders must demonstrate the highest moral standards and
ethical conduct in their everyday talk, actions, decisions, and behaviors so that others in their
organizations can follow suit. The ethical leadership predicts outcomes such as perceived
effectiveness of leaders, employees’ satisfaction with the job, and their willingness to extra effort
into the work and to report problems to management.