For Research : Ability to Implement Ethical Knowledge

Human Resource Department’s role for improving ethical knowledge is a critical element to practice ethical principles within an organization. Without Human Resource Department’s contribution on reward systems, training programs, code of ethics, and communication system to build up the strong ethical climates, the corporation may have to face serious ethical problems in the future (Bartels, Harrick, Martell, & Strickland, 1998). To ensure employees’ behaviors are ethical, the Human Resource Department (HRD) has to focus on the ethical climates of the organization. Bartels, Harrick, Martell, & Strickland (1998) found out that there is a positive relationship between an organization’s ethical climate and success in responding to ethical issues. Strong ethical climate has reduced the chances of serious ethical problems in an organization.

Human Resource Department’s function has taken a vital role in the firm’s decision making processing, not just as a partner, but, more importantly, as a player (Ulrich & Beatty, 2001). The objective for human resource department in an organization is to influence the company’s strategy, culture and capabilities to make the final success. HRD’s basic role is to affect the employees’ behaviors in an organization to take the right ethical track. Therefore, HRD staffs have to understand the issues and decide what an organization can do to reward the positive behavior, set up code of ethics for employees to follow, create an effective communication channel, and providing appropriate training for everyone in the organization to be able to result the ethical behaviors inside or outside a firm. Some researchers noted that each organization has a special way of doing things that influences how individuals within the organization perform, and it is the individual’s behavior that determines an organization’s success over time.

Reward Systems. The purpose of creating reward systems is to compensate the ethical behaviors in an organization. The reward systems is viewed as the structural source of ethical ambivalence (Jansen & Gilnow, 1985). Reward systems in an organization can provide the motivation for the employees to implement business ethics successfully. Motivation results from expression of the soft control that unifies an organization’s ability to perform effectively. Frederick (1992) mentioned that Du Pont’s strategy to become the leader in corporate environmentalism, the chief executive was compensating all of staffs who were tied to the speed and effectiveness of company’s environmental program. HRD staffs should recognize encouraging positive ethical behaviors could build up the effective ethical management in a firm.

Effective management control can bring excellent performance and business success (Verchoor, 2004). Reward system is the method to encourage employees to do the right things since HRD’s role is to influence employees’ behaviors. HRD staffs must always monitor employees’ behaviors and give the appropriate rewards for the one who actually implements ethical practice in a corporation.

Training Programs. An effective training in an organization is to make sure that every employee fully understands his or her role and responsibility of ethical practice. Corporate ethics training programs are always the ways for corporation to reinforce its business conduct guideline. Training programs will be more powerful if it is combined with code of ethics. It can contribute to improve corporate ethical climate. Corporate ethical training program also can introduce corporate values and beliefs to employees. HRD staffs can use case studies, simulations of ethical

dilemmas, and other ways to provide employees a basic idea of ethics. After training, employees should have a great ability to implement business ethics and understand their actions are all related to ethical practices. Zauderer (1992) noted that training programs can provide employees with a heightened awareness of the ethical implications of their actions, and provide them with guidance on how to exercise ethical judgment. Delany and Sockell (1992) studied the effectiveness of corporate training program; found the positive relationship of ethical awareness and reasoning.

They suggest that companies should provide training programs to improve employees’ ethical awareness to be able to implement ethical knowledge in a firm. Code of Ethics. The reason for setting up codes of ethics is to make sure that everyone in the organization follows the regulation for ethics. Russ-Eft and Hacher(2003) said, “A professional code of ethics is the foundation for responsible HRD research and practice (p.66)” is indicated that HRD should set up the code of ethics for employees to follow. Codes of ethics exist for many companies, it will not create any difficulties for HRD to develop a codes of ethics in an organization. There are many advantages by setting up code of ethics in a firm. One advantage is to state precisely the meaning of ethics in an organization. The other advantage is from the employees. The more employees can be aware of proper ethical behavior, the more they are likely to do the right things. Gellerman and Ladenson (1990) claimed, “Ethical standards are central to understanding what constitutes proper conduct as well as expectation of the virtues professionals should possess (p.8)”. Therefore, the development of code of ethics can help HRD to set up a standard of ethical behavior in an organization.

Communication Systems. Communication is the way to ensure if employees do understand the concept of business ethics. Not only needs to perceive the importance of ethics, but also encourages employees to give the feedback to the management to be able to create the good communication channel (Harshman, 1999). HRD should encourage employees to speak out their opinions of the firm and do not afraid of presenting their thoughts in an organization. HRD will get better feedbacks from employees by communicating with employees. It will help the organization to establish the efficient communication system in a company. HRD has to support and show the appreciation to those employees who present their concerns about corporate ethics in an organization. Once employees realize the communication systems are healthy, they will not be afraid of speaking out what they think and what they concern. Hayes (2002) suggests that management should exemplify the new value and clarify their commitment to implement the ethical practice. After certain of period, management can begin to punish the one who does unethical behavior and reward ethical behavior. Then employees will know that company’s management is very strict about business ethics.

Open communication is usually associated with effective ethical operation in an organization. Therefore, the organization will be able to establish an effective open communication for the employees and itself. Reporting is also an essential element for the communication system in an organization (Zadek, 1998). It is a communication bridge between the company and stakeholders. Reporting is the way for stakeholders to make company listen to their concerns and do the action on ethical practice. Auditing ensures that the reporting to shareholders of financial situation is accurate (Zadek, 1998). As a result, managers can understand the stakeholders’ viewpoints based on reporting and auditing process to ensure high quality feedback in an organization’s communication system.