Institutionalising ethics as a means of instilling ethical values and behaviour within a state owned enterprise

Abstract

State Owned Enterprises (hereinafter referred to as SOEs) are currently experiencing increasing ethical problems and they have been trying to control these problems by formalising ethics. Institutionalising ethics is an important task if SOEs are to effectively counteract the increasingly frequent occurrences of blatantly unethical and illegal behaviour (Sims, 2004:493). Ethics and values play a key role in prescribing the ethical code to be followed by an organisation in the conduct of its affairs. Efforts by organisations to institutionalise ethics have a positive effect in instilling and improving ethical behaviour. The research project discusses the ethical aspects of governance focusing on formalisation of ethics within a SOE as a mechanism to improve governance practices. The focus of the research paper is on different ethical instruments utilised by the SOE selected for the purpose of this study. The organisation that is used for the purpose of this study is based within the service industry and for purposes of confidentiality; the organisation is referred to as the “STATE”. The research paper covers five chapters. Chapter 1 highlights the background of the SOE selected for the research paper. The problem statement which is the basis of this study was identified, defined and explained. Chapter 2 discusses the relevant literature on matters pertaining to institutionalising ethics. Chapter 3 outlines the research methodology to be used. The triangulation was used as a means of understanding and addressing the research questions. Interviews and questionnaires were used as the research methods in conducting this study. Chapter 4 presents some results and interpretations through the use of statistical tables or figures. The summary of the research findings and how SOE developed and institutionalised ethics and the efficacy of the methods used was discussed. Chapter 5 is based on policy recommendations. The conclusions were drawn based on the use of the triangulation research approach. The conclusions address the questions as mentioned above. As a conclusion the study presents some recommendations specific to SOE. The bottom line is that good corporate governance is an important part for SOE. Living the values and complying with the organisational ethics starts with leadership and such leadership requires a great deal of personal commitment, courage, and perseverance guided by strong ethical values to confront and end any form of unethical practices that allow individuals to abuse positions of entrusted power for personal gain. It should be borne in mind that the existence of sound corporate governance standards does not guarantee an unethical-free environment. The exposure of unethical behaviour is a manifestation of weak corporate governance practices, with unethical behaviour at the root of the scandal. Exposure of unethical behaviour can also be viewed a positive sign. Overall, corporate governance by itself should not be regarded as a solution or an automatic cure for all corporate ills. Policy is the most influential factor in managers' ethical decision-making and behaviour.