BUS 401.

Organizational Ethics and Job Satisfaction: A Strong yet Indefinite Relationship

Submitted to: Mr. Mahmood Karim Submitted by: Wasif Ul Alam 082 014 030 18th April, 2012

Introduction
Relativity applies to physics, not ethics, quoted one of the greatest scientists Albert Einstein (1879-1955). The complexity of ethics itself has made the relationship between organizational ethics and job satisfaction indefinable. The magnitude to what extent job satisfaction is dependent on the ethics of organization is impossible to measure in this world of business. Since, an organizations first and foremost responsibility is to ensure profitability, adopting ethical means does not confirm satisfaction from the employees. On the other hand, an organization exposed to unethical operations may create the feeling of fulfillment among the employees, in which the personal gains are prioritized over organizations responsibilities. Thus, trying to find a solid relationship between these two aspects is very much sophisticated. There are various researches conducted to define the variable relativity of organizational ethics and job satisfaction. Most of them ended up with a proper conclusion, where these two points would meet. Organizational ethics is simply the response of an ethical activity, and job satisfaction is nothing but a perpetual content of an individual. There is somewhat dependency between these two since the majority of employees primarily prefer to work in an organization that promotes ethical activities. In case of long term personal benefits this dependency would be very much ineffective. Likewise, if an organization is employed with a satisfied workforce, the ethical environment is created naturally where every employee respect and perform duties accordingly. There are in fact few factors such as age, experience etc. that may affect job satisfaction apart from the ethical climate of the organization. On the other hand the factors they play key role in terms of determining the ethical climate would include social responsibility, code of conduct, company profit, team interest etc. of an organization. Therefore, establishing a precise relationship between these would determine relevance.

Theoretical Relevance
Traditional Theories An organization which nurtures ethical culture definitely is a socially and ethically responsible one. As a result, the result, an employee generally considers a socially responsible company as a preferable workforce generally. In such a company the job satisfaction relies on the proper implication of core values and principal of the company. Therefore, organizational ethics would ensure job satisfaction if there is Ethical Relativism cultured in organizations environment. For example, an employee gets late to attend an important meeting, such culture would expose and opportunity for justification and bear greater satisfaction for the employees. The job satisfaction on the other hand has a totally negative relationship with Ethical Absolutism, where the workplace culture does not have space for justifications for any employees actions. Consequential Theories Organizational ethics articulate the values of an organization to its employees and perhaps ensure intrinsic and extrinsic rewards for observance. Considering the Utilitarian view, organizational ethics often prefer greater harm than greater benefits that would fulfill the economic success of the organization. However, if downsizing less skilled workers would bring proficiency to a companys operations; it essentially does not guarantee job satisfaction for the other employees. Thus, considering the Utilitarian concept may vary from situation to situation and does not conclude in a concrete relationship between organizational ethics and job satisfaction. Contemporary Theories Apart from the Traditional and Consequential theories, Contemporary theories can also be accepted in terms of evaluating organizational ethics. The virtue ethics of a top manager would greatly contribute in the ethical climate of an organization. Disclosure ethics involves information sharing with all stakeholders including employees. Thus, ethics and job satisfaction meets at this point. The post modern theory involves the top managers to judge their own actions from an ethical point of view which apply for the employees as well. Based on the emotions of feminist theory, when the ethical climate is very much caring job satisfaction is ensured.

Considering the job satisfaction, which can be defined in a psychological context derived from the feelings of an employee. The feeling can be in terms of appraisal towards the job, attitude towards the job and accounts belief and behavior. Job satisfaction is therefore modeled by different theories. Affect Theory The main premise of this theory is that satisfaction is determined by a discrepancy between what one wants in a job and what one has in a job. Further, the theory states that how much one values a given facet of work (e.g. the degree of autonomy in a position) moderates how satisfied/dissatisfied one becomes when expectations are/arent met. Dispositional Theory It is a very general theory that suggests that people have innate dispositions that cause them to have tendencies toward a certain level of satisfaction, regardless of ones job. The dispositions include self-efficacy, locus of control, self esteem etc. Equity Theory Equity Theory suggests that if an individual thinks there is an inequality between two social groups or individuals, the person is likely to be distressed because the ratio between the input and the output are not equal. It shows how an employee views fairness in regard to social relationship. Therefore, in case of theoretical relevance, organizational ethics comply with affect theory as well as equity theory where the environment may enforce differentiation and inequality in the workplace that can result as dissatisfaction for any employee. Role of CSR CSR models also play a great role at this situation. Four part CSR model involves legal and ethical perspective that is concerned with employees rights. An organization adopting Corporate Social Responsibility is believed to possess an ethical climate in the workplace. The Triple Bottom Line also ensures job satisfaction and organizational ethics.

Literature Review
From the perspective of organizational justice theory, perception of fairness in one area makes employees feel fairness in other areas also. As a result employees feel more satisfaction with management and organization (Hartman et al., 1999).

Ocpra and Vein conducted a survey on the effect of work ethics on job satisfaction and organizational commitment in Nigeria and concluded that there was a meaningful relationship between work ethics and job commitment and job satisfaction. Chiko and Boo investigated the relationship between the structure of ethics culture and job satisfaction and organizational commitment. Review of literature in Iran would show similar results to previous research. Attarian found that there was a positive and direct correlation between environment ethics and job satisfaction. This researcher, accordingly, believes that in the literature on ethical orientation in organizations, there is still a lack of theory building and need for research to be conducted.

Though several predictors of organizational ethics have been identified in the literature, few of these have been directed at understanding the explanatory power of organizational ethical values. One of the earlier works to have looked at this is Hunt et al. (1989). The authors theorized that when top managers create a corporate culture that emphasizes high ethical values, marketers commitment to the organization will increase (p. 80). With a sample of marketing professionals, this theoretical assumption was found to be true. The study documented that organizational commitment is significantly and substantively determined by perceptions of high corporate ethical values. This finding suggests that commitment is an organizational outcome of ethical decision-making.

Several theories have been used to explain the relationship between organizational commitment and corporate ethical values. For example, person-organization fit, social identity, cognitive dissonance theory, organizational justice theory (comprising distributive and procedural justice) etc. Of these, cognitive dissonance theory is adjudged to be more relevant in achieving the main objective of this study. Both the cognitive dissonance theory, and another version of it balance

theory are considered in this study. According to cognitive dissonance theory (see Koh & Boo, 2001 for a discussion of this theory), the individual usually exerts considerable effort to minimize dissonance in their environment, which put in an organizational context, implies employees strive and desire congruence between their ethical standards and that of their organization. Where dissonance or incongruence is perceived, this will lead to dissatisfaction (Viswesvaran, Deshpande, & Joseph, 1998) and employees would want to minimize this. The minimization could lead to withdrawal and resignation from the organization (Jansen & Von Glinow, 1985). What can be deduced from Heiders (1946) balance theory, and Viswesvaran et als (1998) extrapolation, using logic, which seems to have inspired Heiders postulation is that if a managers job causes him to behave unethically (due to pressure from superiors), and the manager does not like unethical behavior, then the manager will not like his job, because it causes him to be unethical. This assumption is verifiable, and a number of works have tried to empirically explore the relationship between organizational commitment and corporate ethical values (see Viswesvaran et al., 1998; Schwepker Jr., 2001; Koh & Boo, 2001). Findings from these works seem to suggest that where a manager experiences moral conflict due to lack of fit between his personal ethical standard, and that of the organization, but did not resign, this tends to lead to reduced job satisfaction (Koh & Boo, 2001) and lower commitment (Paterson, 2003; Rozen, De Pelsmacker, & Bostyn, 2001). Similarly, Schwepker Jr. (2001) found that greater job satisfaction is associated with stronger organizational commitment, and the higher the perceived level of organizational ethical climate, the higher the level of organizational commitment, and the lower the intention to leave the organization.

Recommendation
Since organizational ethics is significantly correlated with job satisfaction, there are few ways to enhance ethics in the organization. Apart from following code of conduct and legal compliances, an organization must integrate the core values of ethics as an essential part of the companys culture. Through proper plantation of the seed of ethics in every employee would guarantee greater job satisfaction backed up by a highly ethical company. A complete plan for enhancing ethics can be of great use for any company to be highly ethical. The plan must include setting up of proper ethical standards indifferent regarding all the employees. Apart from upgrading and reviewing the code of conduct, a secure channel must be in the organization to transmit the ethical codes to every employee. Ethical leaders within the organization may influence the other employees to coordinate with the ethical environment as well as motivate in maintaining the ethical culture regardless of difference in sex, race, age etc. Treating the discrimination would be one of the key recommendations in order to enhance ethics. Developing a Statement of Ethics would also be another essential aspect of enhancing ethics. The statement must not promote amoralization or moral muteness. Depending on the public disclosure of such statement may mislead the stakeholders as well the employees. The statement must be used as a condition during employments. Communicating the company's stance about ethics frequently would play a great role. This secure communication channel includes reminding the company employees and all who do business with the company that certain behavior is expected, while others will not be tolerated. Provide a protected means of communication to enable an employee or anyone else to alert a responsible party to the unethical behavior of other employees. Insist that all charges must be detailed enough to prevent someone from making up false charges to harass another employee.

Ethical training and promotion of reward systems for the employees that will result in a motivated workforce in the ethical environment as well as ensure job satisfaction to a greater extend. Last but not the list, if a company is socially responsible then ethics is automatically implemented. Thus, an organization should observe their social responsibilities based on four part CSR model or the Triple Bottom Line model to ensure a sound ethical climate.

Conclusion
The relationship between organizational ethics and job satisfaction is not definite yet very strong. Change in one prospect would lead to a massive downgrade or upgrade to the other. An organization would not be ethical if the employees are not ethical, and without a sound ethical environment it would be difficult for employees to be satisfied. It can be argued that work ethics is based on philosophical, social, cultural and psychological principles; each has its own effects on individuals, as well as group and organizational behavior of employees. Philosophically, assumption, values, beliefs and thoughts of managers toward society, organization and work environment, will cultivate their hypothetical and practical principles of ethics. Though theoretically and literally the relationship is positive, but considering the reality it could be inversely related as well. It seems that the work environment oriented toward psychological principle is mostly based on motivational contexts which will be able to provide the strengthening of job satisfaction if fostered in excellent level of work environment.