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Organizational and Applied Ethics (Question Three) 20 November 2000

VisualOrganizational ethics is a developing field that recognizes a dynamic in organizational life that requires its own special attention regardless of the purpose of the organization. Organizational ethics is one of the four broad categories of applied and practical ethics.

The figure above depicts the integration of applied ethics as four overlapping circles of ethical theory and practice:

  • Essential Social Responsibility
  • Ethics of Social Purpose
  • Organizational Ethics
  • Environmental Ethics

Within each circle are applied ethics approaches raising and treating issues distinct to its own arena. A contribution from each circle is a necessary, but not sufficient, condition for an effective ethics system. Ethical leadership, at all levels, identifies those approaches that are appropriate to a particular organization or community and integrates them. In an organization, these overlap are where awareness, imagination, inquiry, judgment, and action are brought together by leadership. Ethical leadership identifies and integrates the approaches within each circle that are appropriate for the organization.

Within the Ethics of Social Responsibility are three broad categories: government, for-profit, and not-for-profit. Each type of organization has broadly different responsibilities within society, which are of the essence of its nature.

Each has different key participants and opportunities for and constraints on action.

  • The essence of government is its monopoly on the exercise of coercion and violence within a community: the police, the military, and the courts. Its participants are governors, the governed, and the aliens. Bureaucracy and stability characterizes its institutions.
  • The essence of for-profits is meeting the most urgent needs of owners and consumers through free exchange: business and the professions. Profits and adapting to changing customer needs characterizes its institutions.
  • The essence of not-for-profits is meeting the needs and values of a community without coercion or exchange: charity or philanthropy. Its participants are charitable organizations or associations, beneficiaries, and donors. Recognizing needs of the community and soliciting community support characterize its institutions.

These are the essences, but there is much overlap, which makes ethical policy more difficult. In the area of health care, for example, federal subsidization of corporate employee benefits and Medicare and Medicaid is a situation where government, business, and the not-for-profit merge to the great confusion of policy-makers.

In practice, these functions may merge within any particular organization. For example, the military may take on humanitarian assistance, a business may contribute to the opera society, or an educational institution may contract for consulting services. Nonetheless, complete understanding requires keeping the essence of any organizational entity-and its avowed social purpose-firmly in mind.

Also, there are levels of socials responsibility for each sector. In business, for example, there are at least three levels:

  • Essential Social Responsibility is to be accountable for meeting the most urgent needs of consumers in the most effective and efficient manner with due regard to the impact of operations on the environment.
  • Good Citizen Social Responsibility is to meet the most urgent needs of consumers, as described above, without harming the longer-term interests of the consumers or those otherwise affected, or doing so unethically, which precludes using economic power to gain competitive advantage solely through political means.
  • Supererogatory Social Responsibility is going beyond the requirements of the lower levels, that is, taking actions that are good for the community if taken, but otherwise responsible, if not taken.

Seen through this lens, a business organization that effectively and efficiently meets the most urgent needs of consumers is socially responsible. That is precisely what it is responsible to the community for doing. Contributing to local charities or the Opera Guild to the extent that the organization is unable to effectively and efficiently meet consumer needs would be essentially irresponsible. more

The Ethics of Social Purpose include the various bodies of values and principles that govern a particular practice. Examples of social purpose ethics include: medical ethics, nursing ethics, banking ethics, legal ethics, biomedical ethics, and accounting ethics. Which bodies of ethics apply to a particular organization depends upon its vision and the tasks required to achieve it.

The Ethics of Organizational Life is the domain of the structures, systems, practices, procedures, and protocols necessary for a body of people to achieve their shared visions in accordance with its core purpose and values and organizational culture. The thrust of organizational ethics is to increase human energy, knowledge, and trust-and to drive out fear.
Organizational ethics applies to all organizational life, regardless of specific social purpose. As such, it shapes the process and content of dialogue and the context for ethical awareness, reasoning, leadership, and action. It is where ethical leadership may perhaps best be exercised, again at all levels.

Environmental Ethics is that body of concepts, values, and principles that both defines opportunities for life and places limits on freedom of action in the struggle for existence. All of ethics evolved so far rests upon a single premise: that the individual is a member of a community of interdependent parts. These approaches have largely been centered on the human community to the exclusion of the world around it.

Environmental ethics enlarges the boundaries of the relevant community to include soils, water, plants, and animals, or collectively-the land. This enlargement of the community requires more than applying existing theory to a broader community, however.

Enlarging the community-more properly reentering the broader community-requires a rethinking of economics and politics as well. It also requires looking to the broader community for concepts, values, principles and practices to guide our individual and organizational behavior.

Environmental ethics is the domain of the relationships between our species and world of which we are an integral part. It is the most fundamental of all approaches to applied ethics. It addresses who we are, what the rest of the world is, and our relationship to the world as a whole. In its most fundamental and comprehensive form, it is each individual's worldview. Following the distinction made between worldview and ideology by the Austrian Economist, Ludwig von Mises, the first three circles represent ideologies, ways thought to be good or best to deal with the world as a whole. But this circle of environmental ethics represents what is the best way to approach a world of which we are an integral part, a worldview.

For the application of this model in the area of health care. click here.

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Applied Ethics Integration Model:

This concept was first proposed by Ken Johnson in an August 1997 article in the newsletter, Ethical Management.

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