CORPORATE

MORAL

DEVELOPMENT

Atty. Vivian T. Dabu

Ateneo-Regis, AGSB, Clark

Factors in corporate moral development :

the founders,

the top management,

the stakeholders,

its industry,

the environmental factors,

the organization’s history and mission,

and others.

• Reidenbach and Robin (1991) - The behaviour of the corporation is derived mostly from the behaviour of its leaders. Leaders’ behaviour and character influenced the lives of many people.

• Edward Aronson (2001) - ethical behaviour and effective leadership are intertwined and inseparable. Leaders set the moral tone of the organisation and have great impact on others.

• Ciulla (1995, 2004) - good leadership refers not only to competence but also to ethics

Moral development of any organization can start at any stage and move up. Or regress.

Amoral organizations cannot possibly move from stage 1 to even stage 2 unless significant structural and cultural change be implemented.

Stage 5 = Social Enterprises

Corporate Moral Development

Stage 1.a – The Immoral Organization

survival

Stage 1.b – The Amoral Organization

main thrust is to make profit at any cost.

concern for ethics is usually on an after-the-fact basis when caught in some wrongdoing.

Stage 2 – The Legalistic Organization

dictates obedience to laws, codes, and regulations but emphasizes on profitability.

more concerned with adhering to the legality of an action rather than the morality of the action.

does only what it is required to do rather than what it should do.

legal = ethical

Stage 3 – The Responsive Organization

strikes a balance between profits and doing right.

more sensitive to the demands of society

dominated by reactive mentality

not a proactive mentality.

Stage 4 – The Emerging Ethical Organization

seeks a greater balance between profits and ethics.

stronger management commitment to ethical behavior where ethical values become part of the culture.

Stage 5 – The (Developed) Ethical Organization

total balance between profits and ethics exist

emphasis on making the “right” decision, even at the expense of profitability.

ethical and responsible leadership

principle-driven

• The stages of CMD exhibit the morality/ moral maturity of the leader and organisation through certain behaviours, attitudes, values, corporate culture, explicit and implicit artefacts.

• Corporate cultures can be managed to produce the desired ethical behaviors.

References

• Velasquez, Manuel G., Business Ethics: Concepts and Cases, 6th edition

• Mari Kooskora, Empirical Investigation of Corporate Moral Development, in the context of rapid and radical changes, case Estonia