Conflicts Between Ethics and Organizational Demands

Subject: Business Ethics
Pages: 6
Words: 1719
Reading time:
7 min
Study level: PhD


The following essay examines conflicts between ethics and organizational demands. However, it is important to first determine what ethics and organizational demands entail before examining the conflict that exists between the two. Ethics entails the morality of a character i.e. the nature of being right or wrong. It is through ethics that virtuous character is studied and also the process whereby correct decisions are made. Organizational ethics refers to the principles that control and unite the proper functioning of organizations. Usually, a breakdown of organizational values implies that the proper functioning of an organization fails as people tend to act unethically. Conflicts between ethics and organizational demands usually arise when some of the values are given up in order to maintain other values. The main challenge as far as ethics and organizational demand is concerned is what principles and organization should be adopted and also the nature of their priority when they clash with each other. Most organizations try to make ethical decisions as much as possible. However, the individuals in organizations are different making ethical conflict to be inevitable. Society plays an important role in judging the morality of certain activities by the organizations. If society criticizes a certain activity or if it judges a certain act to be unethical, the organization’s goal attainment ability is affected. Usually, the leadership has the ability to guide others towards attaining goals, and thus leaders have a larger impact as far as ethics in organizations are concerned. Usually, an organization is faced with the following demands; profit maximization, increased market share, quality product, job retention, improved employees relations, efficiency in production among others. These organizational demands in turn conflict with the ethics and the following section shall therefore analyze how each of the organizational demands conflicts with the ethics and the solution therefrom.

Characteristics of an ethical company

The following are the characteristics of an ethical company; an ethical company respects its customers. An ethical organization usually treats its clients fairly and in a respectful manner. The act of treating clients in a fair manner entails refraining from cheating or deceiving them. Thus, an ethical organization does not charge their customers more than necessary. By treating customers with respect and in a fair manner, customers feel happy and this in turn helps to create customer loyalty. Once the customers realize that they are cheated, they choose not to buy the firm’s products and in turn buy from the competitors.

An ethical company treats its employees fairly by compensating them satisfactorily as a result of their hard work of ensuring success in the organization. An ethical company usually accommodates the needs of the employees as and when necessary. Compensating the employees adequately involves providing them with good salaries and wages and also paying them for their dedication to the organization. An organization should be sensitive when it comes to employees needs and this in turn enhances satisfaction among employees. Satisfied workers perform their duties enthusiastically and are also reluctant to leave the organization. This saves the organization the costs of training new workers. Satisfied employees have no tendency to commit fraudulent activities. Ethics thus contributes to workers commitment. Workers commitment is usually present in the workers who believe that their future lies in that organization.These employees therefore have a willingness to sacrifice themselves for the sake of the company. The more an organization commits itself to catering for the employees needs, the more the employees contribute to that company and vice versa (Mark, & Harbin, 2010, P.6).

Other characteristics of an ethical organization include the following; an ethical company abstains from being involved in fraudulent activities. A decent common usually offers decent products.

How organizational demands conflict with ethics

The following section examines how the various organizational demand conflicts with ethics; the first conflict between ethics and organizational demands is the conflict between ethics and profit maximization. Usually an organization can maximize its profits by maximizing on revenue i.e. increasing the unit selling and output sold if the company is not operating at full capacity or minimizing cost. The profit maximization by a company has several limitations i.e. it conflicts with ethics in the following; profit maximization is a short term objective which may not be inconsistent with the going concern aspect of a firm. For a firm to remain a going concern, long term objectives should be pursued. Profit maximization thus ignores the welfare of other stakeholders such as customers, government, employees, society e.t.c. The objective also ignores the fact that there are risks or uncertainties in business i.e. it doesn’t consider the fact that there are business cycles. Furthermore, the, the profit maximization is vague i.e. it does not specify which profits to be maximized i.e. EBT or EAT and hence it conflicts with ethics. Ethics usually constrains people from making higher profits. Ethics and profits conflicts with each other i.e. they are inversely correlated. This implies that an organization could reduce profit while trying to act in the rightful manner (Daft, 2010, P.128).

The business environment has greatly changed over the years and therefore, companies are finding new methods of competing instead of relying on traditional methods of producing quality products. More organizations have come to the reality that, producing better products has a negative impact on the profitability of their businesses. The more a business becomes ethical, the lesser profitable it tends to become and vice versa. Ethics thus conflicts with organizational demands in that it put a ceiling on a business from maximizing profit. This implies that the sales volume may remain relatively low at a certain quarter due to the fact that the businessman is selling what the clients’ needs rather than what he or she feels is the best. A seller who operates on commission basis makes smaller profits. Business ethics trains the businessmen to put their clients’ needs a first priority and also not to cheat them. In the modern times, business competition is high implying that, businessmen requires being a bit unethical in order to achieve more.

Ethics conflicts with organizational demand in that they lead to inefficiency and hence wasted time. Usually, ethics in organization requires people to dedicate a considerable amount of time in such inefficient manners as taking time to create a rapport with the clients e.t.c. inefficiency usually restricts a business from making money.

Ethics also conflicts with organizational demands in that it causes people to engage in those objectives which are unattainable. Ethics usually emphasis on respecting the employees in persons rather than respecting their performance and this is dangerous since it causes workers production to decline. The employee’s productivity declines due to the fact that the center of attention is deviated from results and focused on creating an ideal working environment. Ethics also conflicts with the firm’s performance in that, it raises the expectations from the societal members to levels which are unattainable and this in turn forms an environment that is not conducive for workers as they strives to keep up with their performance levels while on the same time trying to learn new laws (Michael, 2010, P.7).

Ethics also conflict with organization demands in that they create moral autonomy in organizations. Moral autonomy entails the capability of acting and thinking independently as far as ethical issues are concerned. The employees and senior leadership team in an organization are usually bound to follow the laid down code of conducts. Such expectation though is important particularly in a situation where the ethics contain clear ethical guiding principles. However, moral autonomy has the disadvantage of blunting employees towards ethical guidelines which are not enclosed in code of conduct. This thus implies that various initiatives are required in order to enhance moral sensitivity within the organization.

Despite the fact that ethics provides employees with important guidance relating to organizational objectives, it usually does not help in ensuring that workers apply ethics in instances that demand them to make ethical decisions. In order to come up with ethical decisions, one is required to posses the relevant expertise and this implies that ethics is not a means of enhancing the organizational demands as the two conflicts with one another (Norcross, 2010, P.11).

Solution to conflicts between ethics and organizational demands

The following are solutions to conflicts between ethics and organizational demands; Organizations should strive to handle and face the ethic problem. The conflict between ethics and organizational demands is sometimes caused by very real and inescapable situations and thus, the best attitude is to focus on the root cause of the problems so as to handle the problem.

Organizations should come up with a way of evaluating their progress as time progresses. Organizations should resolve to give their best to managing conflicts between ethics and organizational demands. This means that they must punish the senior leadership team if an answer does not come right away. Organizations should face the issue head-on, having in mind the best intentions of bringing out the solution.

Organizational leaders should strive to cerate workplaces that are more collaborative and more team oriented. Employers and employees should ensure there is good relationship in order for them perform better results. Ethics should be given a top priority and penalties for breach of any provision should be well articulated. Forward looking companies are embarking on production and management systems that are capable of ensuring decentralized authority in an organization (Coon, & Mitterer, J2011, P.676).


In a large organization, employees are usually drawn from diverse backgrounds and therefore, ethics allows people to work together so as to meet the organizational objectives as well as personal goals. Also, organizations doesn’t exist in a vacuum i.e. there are many stakeholders that operates in and around the organization e.g. employees, customers, local community e.t.c. The stakeholders are all affected by the company’s decisions. Ethics takes all this into consideration in that it cut across all the aspects of a business i.e. it deals with the suppliers, employees, local community, and customers’ e.t.c. As an organization seeks to meet its demands such as profitability, increased market share.e.t.c., conflicts arise between ethics on one hand and organizational demands. It is important for the organizational leaders to strive to create workplaces that are more collaborative and more team oriented. Organizations should strive to handle and face the conflict between ethic and organizational demands.

Reference List

Coon, D & Mitterer, J. (2011). Psychology: Modules for Active Learning (with Concept Modules with Note-Taking and Practice Exams Booklet), 12th Ed. London: Cengage Learning.

Daft, R. (2010). Understanding Management, 7th Edition. London: Cengage Learning.

Mark, L. & Harbin, J. (2010).The International Journal of Psychology (IJP). Vol. 46.

Issue 2: London: Psychology Press. Web.

Micheal, A. (2010).Industrial/Organizational Psychology (5th Ed.). London: British Psychological Society. Web.

Norcross, (2010). Insider’s Guide to Graduate Programs in Clinical and Counseling Psychology: 2010/2011. (7th Edition): Guilford Press. Web.