Ethical Leadership Notes

Ethical Leadership The Purpose of Corporate Social Responsibility Corporate social responsibility (CSR) is important for all organizations. It keeps a business accountable taking care of its employees and those it serves. Nelson and Trevino (2017) exemplify this by stating, “…business must use its power responsibility in society or risk losing it” (p. 326). This may include keeping employees safe or obtaining only locally-sourced goods. To illustrate, some companies could demonstrate CSR by hiring refugees. Doing so ensures that companies provide ethical judgements to the public in addition to internally. Therefore, corporate social responsibility ensures that companies make ethical decisions for their employees and those within the community. Two primary and two secondary stakeholders that influence Paradigm Toys and how they should meet their CSR Two primary stakeholders that influence Paradigm Toys are the employees and the customers. The support from both parties directly impacts how the company succeeds. The first consideration is the employees. Employees should feel content and safe in their positions with Paradigm toys. Employees keep the organization moving forward and alive. To meet their corporate social responsibility, Paradigm Toys should ensure that the workers are happy and healthy. This includes creating detailed policies and procedures that maintain a safe and thriving environment. To illustrate, procedures that ensure an employee will not be bullied or threatened would make sure that he or she feels valued. Consecutively, conducting safety inspections and correcting possible hazards are important for ensuring employee safety. Therefore, Paradigm Toys should meet CSR for their employees by keeping them happy and safe. The second primary stakeholder for Paradigm Toys is the customer. The customers’ relationships with a business is synonymous with that of the employees. Consumers do not only want to see a business as a place that delivers goods or services. It is important to the public that 1 businesses show they care for their customers and their customers’ concerns. To illustrate, many organizations offer recyclable plastics and papers so that consumers feel like the company cares about the future and the consumers’ concerns. To meet their corporate social responsibility, Paradigm Toys should relate to what consumers desire. For example, some companies may participate in social events or donate openly to a charity that is popular. Consecutively, it is important for a company’s CSR to show care with customer service. Some businesses are highly-regarded for their customer service because they quickly answer consumers’ complaints and replace the products. Taking responsibility improves businesses’ images when mistakes happen. Therefore, taking responsibility for mistakes and standing out in social culture are two ways that Paradigm Toys can meet their CSR with consumers. Two secondary stakeholders for Paradigm Toys are competitors and government entities. It is important for the company to consider both parties because they indirectly impact Paradigm Toys’ sales. Competitors influence this business’ place in the current market. Some competitors may offer different products and tactics. Nevertheless, while contending in the toy market, it is Paradigm Toys’ responsibility to be honest when deploying tactics. When the company promises lower prices or deals, adhering to them allows consumers to rely on them. Furthermore, competition between two companies can lead to mudslinging to gain an audience. Being respectful toward a competitor instead of disparaging them shows tact and gains respect from consumers. The final stakeholder that influences Paradigm Toys is the government. This company must uphold government-directed regulations and standards to ensure it provides safe products and environments for its employees and customers. To illustrate, enforcing safety standards from the Occupational Safety and Health Administration (OSHA) in manufacturing departments 2 ensures that the toys are safe for their users. By being ethical and safeguarding the production of products, Paradigm Toys ensures that consumers will experience fewer malfunctions that could lead to harm. It additionally allows employees to work under healthy conditions. Keeping employees safe allows them to be happy and healthy. In general, those that work in an environment where they feel protected should take fewer days off and provide higher-quality work. Overall, it is evident that Paradigm Toys should meet their CSR for the government by adhering to safety regulations regarding their products and employees. The Importance of Ethical Leadership Importance of Developing an Ethical Culture Developing an ethical culture is important for many reasons. The first reason is that culture and normative behaviors influence the environment of a workplace. Leadership are responsible for making strong, moral codes a part of a company’s culture. These habits influence workers and instill the importance of maintaining an ethical environment. In contrast, employees would establish their own patterns and ideas if they felt that leadership did not care about relaying an ethical culture. Some might take advantage of others while few may feel unprotected or uncared for. Because these drawbacks can severely impact operations, outlining ethical standards for employees to follow is inherently important to a company. How Paradigm Toys Can Foster Ethical Culture Paradigm toys should foster this culture because of these reasons. Doing so will ensure that employees and other stakeholders feel happy and safe. The company should establish strong policies and procedures that cover ethical standards. This can be done by creating a thorough employee handbook and having weekly meetings to talk about safety. Another way that Paradigm Toys can foster this culture is to create habits that exhibit ethical practices as part of 3 the company’s culture. For example, demonstrating ethical practices daily, throughout the facilities should influence employees to do the same. Overall, establishing policies and demonstrating ethical habits are two ways Paradigm Toys can foster ethical culture. Purpose of an Ethics Audit An ethics audit is a way for a company to determine how it meets ethical standards by using an objective party (Nelson & Trevino, 2017, p. 93). By using an outside party, companies can refrain from bias when searching for ethical dilemmas and practices. Audits further keep companies honest. After an audit is conducted, the findings are reviewed and shared with the company and its workers. They highlight what should be maintained and what should be fixed. Nelson and Trevino (2017) further emphasize the purpose of an objective audit by stating, “Regular attention to the importance of maintaining the integrity and long-term reputation of the audit firm is essential, as is the leader’s role in creating a strong ethical climate” (p. 94). Thus, both parties’ attentiveness to ethical standards are paramount to enforcing such standards to a company. The Value that an Ethics Audit Could Bring to Paradigm Toys Recurring ethics audits can ensure that Paradigm Toys maintains strong ethical standards as it conducts business. Audits would allow leadership to identify the company’s weakest areas so that they could develop ways to strengthen them. Some of these weaknesses may have gone unnoticed and could have caused lead to damaging consequences. Finding the root to these incidents will inevitably lead to the company developing stronger procedures to prevent them in the future. Additionally, audits will correct bad habits. Some habits could incite harm to employees or consumers. Such behaviors could have been unreported by workers and added stress to their day-to-day work lives. By amending these practices, Paradigm Toys could create a 4 more ethical environment and improve its overall output. Hence, it is evident that ethics audits would add significant value to Paradigm Toys. Ethical Framework Identify and Analyze an Ethical Dilemma in a Business Setting One ethical dilemma that could be placed in a business setting is cutting costs on supplies to make a better profit. A company could use cheaper materials that impact the safety of the products it is selling. With a company like Paradigm Toys, it is imperative to be aware of how this could impact stakeholders. To illustrate, some materials may be cheaper, but could fall apart easy in use. Toys that are built like this could become a choking hazard for children. Moreover, unreliable parts that are made for machines, such as toy cars or drones, could lead to a user getting hurt. While it could cost the company more money to acquire premium parts, it ensures that users are safe from harm and the company maintains an honorable reputation. Evaluate Two Possible Solutions to This Ethical Dilemma The first possible solution to this dilemma is to acquire quality parts. The company should research materials, their effects on users, and fail rates. Then it should use the collected data to make its products. Doing so will ensure that quality products are released to the public and will pose fewer safety concerns. Guaranteeing quality products is further beneficial for employees. Materials may have to be manipulated by being melted, shaved, or cut. If the materials are higher-quality, employees are safer from becoming contaminated with potentially toxic materials. The second possible solution to this dilemma is testing a product before releasing for sale. While some materials may be higher-quality, they may not handle certain stressors caused by everyday use. To illustrate, toys made with plastic parts may not all need the same types of 5 plastics. Some toys for younger children may need a dense and durable plastic while plastics used in toy drones may need more flexible materials. Testing these products before selling them allows the company to understand which materials best fit the products’ uses. It will further implicate failures that could lead to harm. Thus, a company can prevent ethical dilemmas caused by using cheaper materials by acquiring better-quality materials and testing products before selling them. Which Solution Would be Recommended and Why Would It Be the More Ethical Choice The most ethical choice would be to choose quality materials over materials that would be more cost-efficient. It is more ethical to consider consumer and employee safety over profit. While it is important to test products before selling them, the products must still be made with quality and safe materials. A company should not jeopardize safety so that it can make more money on cheaper materials. If it does take this less-ethical route, it could harm others, face lawsuits, and lose customer loyalty. By taking an ethical approach by supplying safe products, consumers and other stakeholders will trust the company. Overall, it is imperative that companies choose to make quality products over using cheaper alternatives for the safety of their stakeholders. Proposal for Ethics Training Program for Paradigm Toys Three Topics Covered in Proposal and Explanations The topics chosen for Paradigm Toys’ ethics training program are ethical conduct, regulatory and compliance, and conflict resolution. Ethical conduct is an important subject for Paradigm Toys. Employees represent the company at work and away from the job site. By being ethical at work, one sets a precedent for others to follow. It is important employees to be honest and treat others with respect. Additionally, should all employees display integrity, it sets 6 the ethical culture to higher standard for new employees. Ethical conduct is further important for leadership. Managers should hold their employees to high standards and be compassionate. For example, implementing sturdy procedures that hold employees accountable will deter negative ethical conduct. This could include time card policies and setting attainable goals. Consecutively, having compassion for employees in need further shows that the company cares about its team members. Should an employee have an emergency, a leader can work with the individual to flex hours. Thus, ethical conduct training would be essential for Paradigm Toys. Regulatory and Compliance training is equally as important to cover in ethics training. Establishing ethics rules and regulations for employees is important. However, some employees may not thoroughly read rule books. By training employees on the regulations and how to apply them, it ensures that all workers are aware of the importance of ethics. For example, there may be a regulation that states that employees are required to hold one another accountable for unethical actions. Nevertheless, if employees are unaware of this rule, it might be overlooked or underused. Therefore, regulatory and compliance training is an imperative topic to cover for Paradigm Toys’ ethics training program. The final topic to cover is conflict resolution. Paradigm Toys is comprised of an eclectic group of employees. Not all employees will get along or agree on some stances. Some employees may become involved in conflicts that they do not know how to approach. Conflict resolution training will give employees ideas and considerations before entering a conflict. This training could teach them ways to approach a difficult conversation with a peer or how to deescalate a heated situation. The overall goal would be to have fewer issues between employees and prevent situations that could lead to unethical conduct. Hence, conflict resolution training would be an important topic for Paradigm Toys. 7 Training Program Delivery Recommendation and Why They Were Chosen Paradigm Toys should use hypothetical, on-the-job training to deliver the proposed ethics training program. This type of training is meant to simulate situations so that employees can practice reacting to them. To illustrate, when training employees on ethical conduct, the class could talk about different scenarios when ethical conduct is necessary. One could be outside of the workplace. An employee could display being unethical in public and others can state how it reflects on Paradigm Toys. Then, solutions could be discussed. A further example could be demonstrating conflict resolution. Employees could discuss issues that they had seen on site or in previous places of employment and talk about ways to deescalate an issue. They may also talk about the consequences of not representing conflict resolution. Using hypothetical solutions has many benefits. The first benefit is that groups of individuals can share thoughts and ideas. This will influence others to consider ideas that they had not thought of before. Additionally, this delivery method is meant to encourage stronger teamwork. Should the employees work together on developing ideas, they can build stronger bonds with one another. Lastly, this method is meant to create a lasting impression on the employees. Other methods, such as reading training and testing on studied material, may not be as affective. However, creating a fun and memorable experience should encourage employees to reflect on the training as they continue to represent the company. Overall, using hypothetical, on-the-job training is an excellent way to engage Paradigm Toys’ employees and implement the topics covered in ethics training. 8