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When we look at the previous millenniums of business and organizations, one could see immense changes and advancements in terms of organizational practices: from local trade to multinational corporations (MNCs), from hard selling techniques to marketing and corporate social responsibility concepts, from family hires to globally diverse work force, and from one to one contact to virtual organizations. In the face of this reality, organizations should introduce clear and precise system of values and work ethics which could pave the way to a sustainable road of success (Abbasi, Rehman, & Bibi, 2011).
Business ethics denotes social responsibility on the part of organization and its members. This responsibility could be reflected in economic, legal, ethical, and philanthropic practices (Johnson, 2012). Business ethics dilemmas have caught the attention of Western world due to the increasing number of white collar unethical practices on the job, and now it has become the prime concern of every stakeholder in Pakistan (Shah, 2007). Therefore, the adoption of ethics training is no longer optional today because we are in an environment of promising but challenging future ahead; so instead of reacting to environmental forces organizational leaders should act in a more proactive and strategic manner based on predetermined values (Enderle, 2001). Ethics could be defined as a field of study which has its roots in such professions as philosophy, religion, psychology and sociology (Sargent, 2007). Rossouw (2012) defines business ethics in a comprehensive sense which includes issues at the individual, organizational, and systemic levels of decision-making in one’s personal and professional lives. Ethics denotes the strength and relationship of compliance between individual or organizational actions and accepted ethical standards. Ethics serves as motivators for managers to reflect moral and ethical fairness in their organizational decisions (Mujtaba, Sikander, Akhtar, & Afza, 2012).
Code of ethics has been defined as a set of guidelines which regulates the behavior of members and company itself, and in return it becomes the company responsibility as to decide which particular behaviors comes in its acceptable range and which does not (Chiedozie, 2012). Ethical standards focus on the moral concerns, and they are needed to govern the organization’s relationship with its employees and customers in the deliverance of goods or services (Morley, 2012).
Ethics is an organization-wide phenomenon lending itself to every facet of organizational decisions and actions. However, ethics is broader than laws and is concerned with variety of subjective factors like individual, societal, religious, legal, etc. (Webster, 2012). Business ethics implementation becomes critical during periods of change or transition, because work values previously held are now in halt. In addition to this there is no clear mechanism to guide managers in ethical dilemmas (Gebler, 2012). Ethics and values held by any organization affect the way the organization responds to various issues within the course of its action in its environment. Ethics are generally adopted polices, and it differs from laws and government regulations but it conveys the values of organizations to employees (McGew, 2012).