HR MANAGERS AS ETHICAL MANAGERS
Abstract Human Resource Management being one of the valuable pillars of an organization is majorly concerned with the productive management and utilization of personnel in such a manner that would ultimately result in attainment of the pre-desired organizational objectives. Over the years it has been realized that, the role of HR Professionals has somewhere been restricted and achievement of the strategic business goals is the sole responsibility that is expected to be performed by HR department. As a result, the value of ethics, standards and morals seem to have become strangers and are on stake.
However, in this rapidly changing business environment, especially in terms when frequent unethical practices and misconducts are taking place, it is now time for the HR Professionals to explore new dimensions wherein they can focus on imbibing an ethical culture at workplace by expanding their scope and turning themselves into Ethical Managers rather than mere HR Managers.
This Research Paper would specifically aim to analyze and highlight the following points:
- Critical aspects that shall help HR Professionals to think beyond their parameters and lead by example by constantly developing an ethical culture and
- Ensuring that personal values of the employees are well aligned with that of the Organization’s values.
As rightly mentioned, if the roots of a tree are strong, the tree flourishes and if HR Professionals of an organization are strong, the entire organization flourishes ethically.
Keywords Ethics, HR Managers, Ethical Culture, Ethical Managers, HR Professionals
Ethics in general sense means the power of understanding a clear difference between what is right and what is wrong. Most definitions characterize ethics as concerns with moral judgment and standards of conduct (Angeles, 1981; Lacey, 1990). However, in this modern world, the value of ethics and standards seem to rapidly reduce at each phase, whether personal or professional. Therefore, it becomes important to understand the cost that an organization has to bear for ignorance of ethics in business. Who shall be held responsible for the consequences that might occur due to such ignorance? Ethical environment affects a broad range of decisions as they are deeply embedded in many of the characteristics of an organization (M.R. Buckley, 2001). Hence, it is essential for every individual to contribute their bit by expanding their scope and volunteer to take an initiative to create an ethical culture at workplace.
Some researchers have argued that individual goals must be aligned with the organizational objectives in order to create an ethical workplace though; it has been observed that the personal interests are moving way ahead of ethical behavior thereby creating a huge gap that if not filled in time, may lead to disastrous consequences in future. However, if the companies are truly concerned about future competitiveness, the challenge of ethical behavior in organizations must be met and accepted at every level of the organizational hierarchy (M.R. Buckley, 2001), specifically targeting the Human Resource Managers as they possess inherent strength to persuade people and make them understand the basic cultural values of organization by communicating and encouraging a sort of ethical consciousness in such a way that it becomes infectious. In addition, the ethical atmosphere must encourage employees to start resisting their temptations to perform unethically. In this area, employees’ perceptions of their managers’ and peers’ ethical attitudes and ethical behavior is a valid tool of appraisal which deserves more attention in our research efforts (Jeffery Kantor, 2002).
Human Resource Management (HRM) has been defined as “a strategic, integrated and coherent approach to the employment, development and well-being of the employees in an organization (Armstrong, 2014).” Basically, HRM is reflected as an ethical activity, where its core values are connected with the treatment of humans, thus conceptualization of HRM automatically raises ethical concerns (Greenwood, 2013). Keeping in view the developments over past few years, it is advisable for the large sized companies to have a separate department in the name of ‘Ethics and Compliance’ yet, many mid and small sized companies cannot afford such departments due to lack of resources. Here, the role of HR Managers turns out to be multidimensional as they extend their wings towards being Ethical Managers to such organizations. It is very clear that an organization functions through its employees and HR Managers are the biggest influencers who can align the individual values with the shared values of an organization thereby aiming to imbibe an ethical culture and environment. Alison Carter, Principal Associate (2015) argued that as the standards, morals and values have become increasingly complex in this postmodern society, this is the most appropriate time for HR Professionals to do some Continuing Professional Development (CPD) on ethics and develop standards that shall enable the employees in living up to the values of an organization.
Stepping into the shoes of Ethical Managers would be challenging and hence, there will be no shortage of ethical dilemmas that HR Professionals might have to encounter especially in cases relating to gender discrimination while hiring employees, sexual harassment, discrepancies in maintaining confidential records of employees, inconsistent disciplinary measures, environmental issues and many more. The Society for Human Resource Management (1998) survey found that 47% of the human resource professionals reported that they felt pressured by other employees or managers to compromise their organization’s standards of ethical business conduct in order to achieve business objectives (P.L. Schumann, 2001). Therefore, ethical leadership must certainly come from the top of the organization so that even the HR Professionals who aim to promote an ethical culture are at relief of not compromising their standards of values and moving forward as Ethical Managers thereby ensuring that their own behavior or attitude gives a positive message to all the individuals who form part of the organization.
Research conducted by Alison Carter, Principal Associate, highlighted few questions that might help solve some of our ambiguities while conducting the study:
- What is the ethical role of HR?
- Should HR be critiquing organizational culture/health as a matter of routine and being more pro-active in diagnosing problems and assessing ethical risk?
- What message does HR professionals’ own behavior give? Are we leading by example in acting with integrity, openness and honesty?
Why should HR Manager focus on imbibing an ethical culture at workplace?
In the era of constant misconducts taking place in the form of scandals, scams etc. resulting in crisis of trust within an organization, it is time for the organization to demonstrate its core values and principles to all its employees as well as the stakeholders. The commitment to ethics can lead to a long list of effects that can lead directly or indirectly to financial gain- through better cost control and risk management, through enhanced employee creativity and contribution, through strengthened reputation among key constituencies, and through expanded access to resources and opportunities etc. (Dr. Anita Shantaram, 2006). But the biggest question that arises here is ‘How’ i.e. who shall communicate with the stakeholders on behalf of the organization.
While answering this question, ‘HR Professionals’ probably would be the topmost on the list, because their profession has been designed uniquely to embed principled decision making into the daily business practices. Therefore, HR Managers could be considered as the greatest influencers who have the inherent capability to impart a value based culture at all the levels in an organization and thus influence employees at large. They must ensure that all the employees or stakeholders learn from their mistakes and through this assurance, the HR specialists shall manage to train the employees to uphold the organizational reputation for honesty and competence. In this journey of being Ethical Managers, the HR Professionals should constantly set standards high by talking to the employees about hypothetical scenarios that can lead to avoidance of unethical practices.
How can HR Professionals take greater ethical responsibility?
One role identified for the human resource function has been that of ethical “stewardship” (Diana Winstanley, 1996). HR specialists will build respect and credibility when they adhere to the highest standards of ethical and professional behavior. They must work consistently within the values of their profession, maintaining throughout their appreciation of employees as human beings while balancing employee responsibilities and employer obligations (Magdy Hussein, 2009). Adhering to such highest standards of conduct and putting ethics into practice will always be a challenging task therefore, rather than making it an imposing mechanism, it should more incline towards self-regulation. A cut paste action of ethics code is not enough. In practice many organizations’ try to influence norms and values by formulation and communication of ethical codes. This together with professional training will not only improve the standards adopted generally by companies but also introduce the necessary level of support from the boardroom to ensure effective implementation in areas which to date is causing many companies some difficulty. Thus the 7 area framework of ethical practices are 1.1. CSR 2. Diversity 3. General 4. Employees 5. Government 6. Customer 7. Environment (Dr. Anita Shantaram, 2012).
Although challenges in terms of building an ethical culture will certainly vary from organization to organization, yet HR Professionals may still take decisions that can be against the organizational challenges and decide to stand by their moral principles in the long-run. Over the years, it has been observed that the role of HR Managers is witnessing downside in the profession. There are certainly the reasons to it which clearly indicate that people pursue their jobs only for the sake of being in that position, rather any job profile if pursued, must definitely be accompanied by passion which shall be the ultimate driving force for that profession to survive even in adverse circumstances. It is very essential for people in every profession to maintain dignity and respect so that they are not taken for granted. In many cases it has been observed that the casual behavior on the part of professionals’ result into unrecoverable losses to an organization. Therefore, HR Managers should not only be intelligent and academically strong persons but should also be ethical persuaders who are capable of inspiring all the stakeholders to foresee their vision with passion thereby encouraging them to build an ethical culture at workplace. Usually the charters in the form of ‘Code of Conduct’ are being issued to the employees as a mandate which states the values, philosophy, culture and principles of any organization. Do we really think that the role of HR Professional is over once the mandate has been duly distributed to the employees? In our opinion, the role of HR Manager actually starts from this point wherein they ought to step into the shoes of employees by understanding the interests that they seek from this piece of paper known as ‘Code of Conduct.’ This arrangement or relationship shall be same as that of a mother and a daughter, wherein at the time of marriage a daughter seeks answer to multiple questions and ultimately it is the mother who resolves all her doubts and motivates her to step in the new phase of life with all confidence by carrying the set of values she has been brought up with. Similar is the situation for HR Managers and employees. When employees at the time of difficult situation seek answers to multiple questions, it is the duty of HR Professionals to motivate and guide them towards the right path by adhering to the ethical values on which the organization stands. In our opinion, ethics in every profession should act like a salt, without which everything will be tasteless. Therefore, it is all about making ethics a trend or fashion that once liked by everyone, will certainly be copied for years and years to come.
Need for HR Managers to become Ethical Managers
There has always been a substantial gap between what professionals admire to become and what they actually end up becoming. The most obvious question that hits us; whether such gaps are results of lack of dedication in professionals or it may even be an organizational glitch that could hamper their perception of becoming a person they desire to be. There is a hairline difference between understanding the fact that whether HR Professionals need to become ethically strong or the organization is somewhere losing out its sensitivity towards ethics. Few questions that may further arise can be, ‘how ethically the decisions are being taken in an organization and more importantly, how ethically are these decisions implemented to uphold or validate the value based culture of an organization’. These questions compel us to seriously ponder upon the role that HR Professionals are actually playing. Are they deliberately choosing to opt out of an ethical atmosphere or are they pressurized by the senior management to compromise their moral values and focus only on the bottom line.
Illustrations of the recent scams and scandals would be helpful to develop a clear understanding about the role of HR what steps can be further taken to encourage them to think beyond parameters by being Ethical Managers to an organization. However, weak people management practices have been attributed as the primary cause of failure in majority cases. Toyota’s crash, demise of Enron, Satyam Scam, PNB Scandal, Revised Tax Returns fraud in Infosys and many more are results of poor governance systems within an organization. All these scams may somewhere negatively highlight the role of HR department in communicating the corporate values to the employees, however, the major involvement of the senior management of these organizations in encouraging such malpractices cannot be ignored. There is an inherent conflict in the role of HR department which is responsible for promoting corporate ethics, yet seems powerless to enforce these values at the top. Therefore, it is rightly said that, “You cannot expect people to act in an ethical manner, if those at the top of the business are not doing so”; and this is where the casual attitude of the senior management as well as the employees come into picture which certainly gives rise to something miserable. The boardroom culture or the group dynamics within the board also play a substantial part in downfall of any organization as it has been observed that in majority of the cases, the board members actually work for the people who have appointed them on board, which is completely a misguided issue.
Considering the facts of the scams and scandals that we have referred to, it is now time for the HR Managers to open their wings and fly high to foresee what their organization and employees actually desire of them. It’s time for them to learn to become proactive and develop as smoke detectors for the Company that can identify bad people or processes at an early stage, before they have any adverse impact on the organization which causes irreparable harm. Since HR Managers are the base for an organization to actually start operations, they must encourage people to work within the boundaries of organizational values and ensure that the incentive to speak out in negative circumstances is much higher than the incentive to keep quiet, in case of any wrongdoing or misconduct. As a result, HR Professional could implement a reward and recognition mechanism for awarding employees who believe in ‘Doing Things Right’.
The Best practice framework is based on 7 pillars of an ethical programme - values, codes, feedback, responsibility, training, reward and external assessment (Dr. Anita Shantaram, 2011). In addition, it has also been examined by experts that, following are some best HR practices that somewhere lead to the downfall of many major Companies, however; if implemented with due care, might reduce the number of scandals that have taken place over past few years:
- Rewards and Recognitions that should encourage the right behavior in an organization and discourage the wrong ones.
- Proper training mechanism must ensure that the employees possess right skills and that they are fit to handle any situation they encounter.
- Hiring must always focus on indulging top performing individuals with high levels of skills and capabilities should be appointed on the board.
- Performance Management Processes must include performance factors to measure responsiveness to negative information. At the same time, it is also important to monitor or appraise performance management system before they get beyond control.
- Corporate Culture normally drives employees’ behavior so that they adhere to the corporate values. It is advised that the corporate culture within an organization should be closely monitored and required efforts must be taken to align the corporate culture with that of the employees’ values.
- Leadership development and succession plans must be designed in such a way that they encourage the placement of right amount of skilled leaders at the top so as to ensure that their skills and decision making abilities are worth learning.
- The activity of retention must be carried out to ensure that the skilled and valuable employees of the organization are retained.
- It has been observed that in many organizations, HR department lacks proper risk assessment team that is capable of assessing and calculating risk well within time that can be timely communicated to the concerned people in an organization.
It is therefore suggested that if HR Professionals critically think, their commitment to ethics can certainly lead directly or indirectly to financial gain- through better cost control and risk management, through enhanced employee creativity and contribution, through strengthened reputation among key constituencies, and through expanded access to resources and opportunities etc. (Dr. Anita Shantaram, 2006).
This research paper attempted to highlight major concerns relating to the profession of Human Resource Management by critically analyzing their roles in an organization. Considering the thought process and inputs from different sources, a concrete suggestion that clearly comes out is to accept the job role with due respect and passion, irrespective of the field you are into. In order to think beyond the restricted parameters, the best practices outlined in the paper can be used as guidance by the HR Managers in order to build a scam free environment by taking accountability of promoting a pure ethical environment in an organization. The paper could generate a unique perception that may help HR Professionals to understand their own need as influencers to the huge workforce by developing various methodologies that could ultimately help in proper alignment of personal objectives of the employees with that or the organizational goals.
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