Core Principle of Fairness, Accountability, and Transparency

Notions of Accountability, Fairness, and Transparency

Business leadership affects the moral capability and performance of organizations. Business leaders
influence the scope and character of formal ethics programs and the integration of ethics into everyday
organizational life. However, most practicing business leaders in most countries most of the time are not held
accountable for dysfunctional moral, social, and environmental performance. Many are seldom held accountable
for adverse impacts of their decision-making, for example, deepening poverty, social disintegration, and
environmental degradation. There is a need to convince managements that they should develop their "integrity
capacity" which is the individual and/or collective capability for repeated process alignment of moral awareness,
deliberation, character, and conduct that demonstrates balanced judgment, enhances sustained moral
development, and promotes supportive systems for moral decision-making. These four key dimensions of
integrity capacity-process, judgment, development, and system-should present challenges for business leaders
so that they become more aware of moral concerns and thus respond more effectively to the problems that arise
(Petrick and Quinn, 2001).

Accountability
The record on business leadership accountability is mixed at best. In Great Britain, continental Europe,
and Australia, the practice of social and environmental accounting has gained a strong foothold and expanded
the scope of business leader accountability beyond maximizing shareholder wealth. The works of the Institute of
Social and Ethical Accountability and other empirical research groups have demonstrated the corporate social
performance-financial performance link. Unfortunately, many of today's businesspeople are not made to account
for their activities and outcomes, especially for the things that go wrong and for their unethical actions. In terms
of global accountability, many corporate leaders act under the myth that the public interest is synonymous with
corporate property rights. Corporate business leadership's external accountability only becomes an issue where
a solid line is drawn between these two spheres.
Accountability-what it is:
To be accountable is to be liable to explain or justify one's actions and decisions.
Accountability is the process of explanation and justification.
Holding to account is the process of requiring explanation and justification, but it is also about testing,
forming a judgment, and if necessary, taking action.
Accountability implies responsibility: it is reasonable only to hold people to account for those things for
which they are responsible.
Accountability-what it is not:
It is not synonymous with responsibility.
It does not imply a management relationship.
It is not a "one off" annual event.
It is not the same as appraisal.
It is not about confrontation, "putting someone in his place" or "giving him a hard time

Accountability Structures
Accountability is the ability to account for your actions and performance to your stakeholders.
Accountability includes the fact that persons (your stakeholders) are willing- and able to hold you accountable.
With the willing and able aspects of the definition, we have an operational understanding of accountability which
can guide us in asking questions to accountability structures in the organization. Accountability, then, is the
obligation to demonstrate that work has been conducted in compliance with agreed rules and standards or to
report fairly and accurately on performance results vis-à-vis mandated roles and/or plans.

Fairness
It is the quality of making judgments that are free from discrimination. Judges, umpires, and teachers
should all strive to practice fairness. Fairness comes from the old English fæger, meaning "pleasing, attractive."
This makes sense given that the word is also used to describe physical beauty.
Fairness-in the context of a business organization-involves balancing the interests involved in all
decision-making including any decisions related to hiring, firing (including the investigatory process), and the
compensation and rewards system.
Overall, fairness has to do with justice, which is to give to another that which is due him or her. More
concretely, justice: (1) looks at the balance of benefits and burdens distributed among members of a group;
and/or (2) can result from the application of rules, policies, or laws that apply to a society or a group. In general,
the just results of actions override utilitarian results.

Transparency
Transparency has become an increasingly popular word in recent times; it is used and sometimes
misused by both scholars and practitioners. In this context, the associated academic literature has recently
analyzed several issues associated with corporate transparency such as the ethical justifications for information
disclosure, the ethical nature of corporate information transparency, or the use of transparency in relationships
management-employee.
Transparency is an issue that often emerged in the documents by Pope Benedict XVI. Caritas in Veritate
(CV) referred to transparency seven times. The intrinsic or ethical salience of transparency appears at the
individual level, while its instrumental salience manifests itself on both the organizational and social levels. At
the individual level, transparency acquires intrinsic or ethical salience as an important feature of a person's
relational dimension. It is described as a personal quality necessary to develop unity and communion between
individuals (CV 53, 54). Indeed, a transparent approach allows an individual to be more authentic and genuine
in his/her relationships to express his/her points of view and to actively work to find shared meanings and
objectives.
Transparency is essential in building families, and through families, in strengthening civil society as a
whole: "The human family does not submerge the identities of individuals, peoples, and cultures, but makes
them more transparent to each other and links them more closely in their legitimate diversity" (CV 53). On the
organizational level, the instrumental salience of transparency is referred to in two instances (CV 47, 65). In the
first case (CV 47), transparency is identified as an important mechanism for guaranteeing social accountability.
The discussion is focused on the role that transparency plays in international and non- government organizations
(NGOs) working in humanitarian projects. This understanding of transparency as a means for organizational
accountability is consistent with previous Catholic Social Thought (CST) documents. Appropriate information
disclosure is necessary to inform donors about how their money is used by these organizations. Benedict XVI
makes precise indications about the kinds of information that should be disclosed, such as the percentage of
funds directly used to help people, the activities and the results achieved, and how these organizations' budgets
are distributed among different organizational functions. Transparency allows stakeholders to understand
whether the activities of social institutions such as international organizations and NGOs provide a genuine
service to civil society and whether money is used appropriately.
Notions of Competence, Professionalism, and Responsibility
Studies show that moral character and technical competence are viewed as being equally important for
worker excellence. The greater the need to engage with co-workers who have different values, interests and
needs, the more important it becomes for employees to be able to connect with colleagues, to understand
different perspectives, to balance sometimes conflicting claims and to act competently both interpersonally and
ethically. In order to do that, a responsible worker needs a minimum set of skills, as well as moral and relational
qualities (Whetstone, 2003). The following are the minimum competencies expected of professionals:
Technical skills encompass the ability to apply specialized knowledge or expertise. When you think of
the skills of professionals such as civil engineers or oral surgeons, you typically focus on the technical skills they
have learned through extensive formal education. Of course, professionals do not have a monopoly on technical
skills, and not all technical skills have to be learned in schools or other formal training programs. All jobs require
some specialized expertise, and many people develop their technical skills on the job (Robbins and Judge,
2013).
Human skills is the ability to understand, communicate with, motivate, and support other people, both
individually and in groups, which defines human skills, Many people are technically proficient but poor listeners,
unable to understand the needs of others, or weak at managing conflicts. Because managers get things done
through other people, they must have good human skills (Robbins and Judge, 2013).
Conceptual skills are the skills and the mental ability that managers must have to analyze and diagnose
complex situations. Decision-making, for instance, requires managers to identify problems, develop alternative
solutions to correct those problems, evaluate those alternative solutions, and select the best one. After they have
selected a course of action, managers must be able to organize a plan of action and then execute it. The ability
to integrate new ideas with existing processes and innovate on the job is also a crucial conceptual skill for today's
managers (Robbins and Judge, 2013).
The working professional also needs "relational intelligence (RI)" in order to connect and interact
effectively and respectfully with people and stakeholders from various backgrounds, diverse cultures, and with
different interests, inside and outside the organization, and to build lasting and trustful relationships. RI is based
on a combination of emotional intelligence and "ethical intelligence. Commercial viability and long-term business
success depend on the ability of a firm and their leadership to act responsibly with respect to all stakeholders in
business, society, and the environment. Responsibility means to make sure that the company's products and
services meet the needs of the customers and clients; that they are safe and not harmful, and that real and
potential risks are openly and transparently communicated (Maak and Pless, 2006).
Part of the responsibility of the worker is to be trustworthy: employees need to demonstrate that they
have integrity, benevolence, and ability in situations where trust is important say, where they could behave
opportunistically or let employees down but do not. Trust can also be won in the ability domain simply by
demonstrating competence. This trustworthiness is all the more important in managers: those who break this
psychological contract with subordinates, demonstrating they are not trustworthy, will find employees are less
satisfied and less committed, have a higher intent toward turnover, engage in less citizenship behavior, and have
lower task performance. When there is "participative management," (ie., when management is willing to share
decision-making with subordinates), then the result is an increase in or improvement in overall morale and
productivity (Robbins and Judge, 2013).
Businesses also support the well-being of members of society through their other key functions. At the
very least, a good business carefully avoids any actions that undermine the local or global common good. More
positively, these businesses actively seek ways to serve genuine human needs within their competence and thus
advance the common good. In some cases they actively promote more effective regulation on a regional,
national, or international level. For example, some destructive business strategies, including corruption,
exploitation of employees, or destruction of the natural environment, might thereby lower short-term costs for
themselves, while leaving the much higher long-term costs to future generations of the local society (Pontifical
Council for Justice and Peace, 2012).
The Relationship of Accountability/Stewardship/Responsibility with Ethical Businesses
Scholars have recently considered ethical leadership from a new angle by examining servant leadership.
Servant leaders go beyond their own self-interest and focus on opportunities to help followers grow and develop.
They do not use power to achieve ends; they emphasize persuasion. Characteristic behaviors include listening,
empathizing, persuading, accepting stewardship, and actively developing followers' potential. Because servant
leadership focuses on serving the needs of others, research has focused on its outcomes for the well-being of
followers. What are the effects of servant leadership? One study of 123 supervisors found it resulted in higher
levels of commitment to the supervisor, self-efficacy, and perceptions of justice, which all were related to
organizational citizenship behavior (OCB). This relationship between servant leadership and follower appears to
be stronger when followers are focused on being dutiful and responsible. Second, servant leadership increases
team potency (a belief that one's team has above-average skills and abilities), which in turn leads to higher levels
of group performance. Third, a study with a nationally representative sample of 250 workers found higher levels
of citizenship associated with a focus on growth and advancement, which in turn was associated with higher
levels of creative performance (Robbins and Judge, 2013).

The Notion of Organizational Diversity and the Role of Women in Business Organizations
Organizations use a variety of efforts to capitalize on diversity, including recruiting and selection policies,
as well as training and development practices. Effective, comprehensive workforce programs encouraging
diversity have three distinct components. First, they teach managers about the legal framework for equal
employment opportunity and encourage fair treatment of all people regardless of their demographic
characteristics. Second, they teach managers how a diverse workforce will be better able to serve a diverse
market of customers and clients. Third, they foster personal development practices that bring out the skills and
abilities of all workers, acknowledging how differences in perspective can be a valuable way to improve
performance for everyone. Much concern about diversity has to do with fair treatment. Most negative reactions
to employment discrimination are based on the idea that discriminatory treatment is unfair. Regardless of race
or gender, people are generally in favor of diversity-oriented programs, including affirmative action, if they believe
the policies ensure everyone a fair opportunity to show their skills and abilities.

Women in Organizations
Studies suggest that having women on boards of directors can benefit business organizations by improving
recruitment of capable managers, increasing charitable giving, enhancing corporate governance, providing a
female perspective in decision-making, and potentially improving financial performance. Firms with a higher
proportion of women in management and governance systems tend to perform better, as they are more
progressive and competitive. These findings support policies aimed at advancing women in business.