GSBS6040 Human Resource Management
Ethical and Professional HRM
On one end of the political spectrum, proponents of the importance of protecting the welfare of employees at work argue that:
companies which are run with a view to the long-term interests of their key stakeholders are more likely to prosper than those which take a short term
“shareholder first” approach … Put simply, companies need to listen, to process and to respond constructively to the values and needs of their stakeholders, most especially their employees, customers and investors. Failure to do this will reduce long-term commercial viability and increase the risk of corporate demise (Sillanpaa and Jackson, 2000: 227).
Conservative advocates at the other end of the political spectrum agree:
The business that treats its customers contemptuously, or its staff unjustly, or its suppliers dishonestly, will often find them hard to retain. In a free market, the most productive staff, the finest suppliers and the cheapest and most flexible sources of finance can do better than to stay with a business that cheats or treats them unfairly … In the long run, unethical business is less likely to succeed (Sternberg, 2000:19).
Lafer finds it notable that both sides “share this central conviction: that the drive to maximize long-term profits naturally overlaps with the imperative to treat employees justly. It is, in fact, more than striking. It is a fact that begs for explanation, because the shared conviction is so palpably at odds with evidence from the business world” (Lafer 2005:288).
Can the interest of employees and the interests of business really coincide? What happens when they are in conflict? And what role should HR managers take when they do?
Lafer, Gordon (2005) The critical failure of workplace ethics, in Budd, J and Scoville, J (eds), The Ethics of Human Resources and Industrial Relations, Illinois, Labor and Employment Relations Association, pp. 273-297
Sillanpaa, M and Jackson, C (2000) Conducting a Social Audit: Lessons from the Body Shop
Experience, in Winstanley, D and Woodall, J (eds) Ethical Issues in Contemporary Human Resource Management, New York, Palgrave Macmillan, pp. 227-49
Sternberg, E (2000) Just Business: Business Ethics in Action, 2nd edition, New York, Oxford
1. Find an example of a situation in which you believe that the interests of senior management/owners are clearly in conflict with the interests of some or all of their employees. NB. Chose an example described in the public domain. When you submit your paper, append key article/s or any lengthy descriptive information.
NB. If your example is not current, you may need to nominate a specific point in time for your analysis.
2. What are three options available to an HRM professional in this situation? Which option would you chose and why? Defend your choice in relation to what constitutes ethical and professional behaviour.