Doingthat which is right because it is the right thing to do, shouldalways remain as the foundation of every existing business. The goalshould not be complying with the law and making money but to abide bythe highest principles of integrity that majorly concern others(Juliaet al., 2013, Pg. 7).It is imperative to note that ethics and character are the pillars tobe maintained for attainment of success.
Companieshave collapsed not for any other reason, but lack of moral direction.Enron, Arthur Andersen and Health South are such examples ofcompanies that failed for one simple reason, ethics. Others that wereimmensely damaged are AIG and Freddie Mac. The management failed toconsider the company and pursued their self-interest with no moralvalues (Simon2009, Pg 15). In today’s business world that is fenced by stiffcompetition,charismawithout conscience and cleverness without character fuels economicand personal downfall.
Ethicsis the moral standards that govern a person or organization whilegovernance is the way or the how of controlling an organizationstating explicitly the role of various department in a company, forexample, decision making (Vilcox & Mohan 2007). Managementinvolves the coordination of activities in an organization to achievecertain laid objectives. It requires day to day running of theorganization both marketing and innovations. Hence, management shouldconsider good governance and ethics.
Ethicsbuilds the loyalty of customers, which is a key to long stability ofa company in business. It is also important for it to retainproductiveemployees in the company for they will always want to be part of thecompany due to its reputation and its edge over its competitors(Carroll,& Buchholtz2009,pg56).Positive work environment is another factor contributed by properethics since employees will always be on the lookout to be ethicallyright.
Theseare the standards regarded as the universal of right or wrong statingthe kind of behaviour a person or company should engage. Theprinciples guide in decision-making and how they will later bejudged. The sustainability of a business is determined by people’sjudgment majorly on your character. For success, companies ororganizations must be concerned of their character and reputation. It has been said more and more that character is the exact whilereputation is a thought in someone else’s mind (Vilcox & Mohan2007). There are laws governing ethics explained below
Managementshould always be truthful and forthright in whatever they are doingespecially in communications. They at no point should deceive ormisinterpret any statement or business deals. Managers deserveworthy of trust and honest being the cornerstone. With honest,customers and employees are inspired with respect to the missionbuilding more foundationsof trust.
Doingwhat is right honestly should remain the cornerstone of every managerin every single organization. Ethics and character are the pillars tobe maintained for the attainment of success.
Thisis a modest character of maintaining consistency in both words,thoughts and actions. Organization should at all-time maintainintegrity in all aspects. Trust is earned through integrity, whichcalls for moral courage and an inner urge to practice the right thingat all-time even if it costs much more than it pays back. Leaderswith integrity are known to walk the talk. They practice consistency,honesty, moral and trustworthy. Without integrity, managers will notbe trusted which will lead to problems in the company. Leaders shouldbe mindful of integrity and build it as they climb the ladder andensure fulfilling commitments and promises. Itis with fulfilling a promise and leaving up to a commitment thatexecutives can be trusted (Cowton, & Haase, 2008). They rarelyprovide excuses to justify their failure. This is majorly what ethicscalls for in business.
Executivesat all-time should demonstrate loyalty by safeguarding their abilityto ensure they make independent and sound judgments professionally.Loyalty applies both to the framework and other principles of ethicshence executive ensure protecting every value and advancing thelegitimate and lawful interests to the companies. Every executive ormanager should ensure that they are at all times involved in just andfair dealings always striving and committed to fairness (Vilcox &Mohan 2007). They should not be involved in indecent but should becommitted to justice and balanced treatment of individuals and alwaysready to engage in open minded activities.
Caringand respect for others
Thisis an act of showing concern to every individual and show of genuinecompassion. Managers and executives should be benevolent and kindready to understand stakeholder’s concept. Business objectives needto be accomplished in a manner that inflicts no harm to the massesbut for the good of them all. No one deserves to be treated withcontempt but all people deserve due respect especially at theworkplace. It is with a demonstration of human dignity and autonomyby the executives that businesses will grow keeping the golden rulealways, “treating others the way they would like to be treated.”
Thelaw is provided for everyone to follow. As a principle of ethics,laws should be adhered to the latter. Business executives abide bythe rules and regulations to ensure their business activitiesblossoms. Managementabiding by the law means achievement of a common goal with nojeopardy on integrity of the company and minimal fraud activities andany other criminal acts (Vilcox& Mohan 2007).The management will automatically pursue and commit itself toexcellence. Ethicalexecutives are ready to improve on its proficiency in all areas byexcelling in their duties and responsibilities
Leadership,Reputation and Accountability
Leadership,Reputation, morale, and Accountability are the other principles to beadhered as far as ethics is concerned. Good reputation should bebuilt to protect the image and boost the morale of the employees.Every aspect of business need must be accounted for by the managementto the shareholders (Gabrielsson,J. & Huse, 2005).
Organizationsthat develop systems in place to control and monitor have anadvantage over those done without any form of governance. Goodgovernance is blended in the behaviour and the judgment of thoseentrusted to run an organization (William,2004).Management is always on the forefront to ensure the tip or the headis well governed to determine what the others on position will do.
Organization’splans and strategies will be well-placed to lay a solid foundationfor more developments and growth. Organizations operations will toobe improved due to the order followed and no overstepping of roles ormandates(William,2004).More advised regulatory compliance, financial and risk management,proper member and stakeholder involvement and flow of communication,raised likelihood and degree to which an organization can deliver onits mandates
Thefuture of every organization or company is shaped by its management.The management of every firm determines the success/ failure of thewhole company through its utilization of resources, setting up ofvision, mission goal, as well as the objectives. Policies andguidelines govern an organization.
Witheffective structures of governance, companies can create value,through innovation by use of technology, development and explorationthrough various aspects of research, account and control systems towaive risks and challenges. Management always should be on thelookout on the need to consider the right structures are in place toenable every individual mandated to undertake a task exercise itappropriately. It enables control of financial knowledge in the rightdepth and on personal protection (Huberts et al., 2008, pg. 19). Agood example is when companies are funded on a certain project it isnecessary for directors to be active and closely monitor itsallocations especially grants by the government.
Goodgovernance is one way of getting investors on board, enhances theirconfidence, and lowers the cost of borrowing money by companies(Sison,2008).The company’s competitiveness will gain a boost through goodgovernance and will ensure the company stands the test of economiccrisis. Good governance forms part of the overall checks and balanceson big business that ultimately benefits society ensuring a fair dealto shareholders and stakeholders.
Itserves an organization in realizing its goals and societal goals aswell. It is all about the strategic aspects of putting the company onthe track and in making larger decisions about the direction and theroles of a company. Good governance is about shining a light throughthe whole organization. Businesses should be conducted in waysreflecting the standard of business conducts and not forgo theintegrity of the company for the achievement of business objectives.
Thisis one of the companies that is ready to do anything to maintain goodgovernance for they believe it will promote future interests ofshareowners by strengthening management`s accountability and that ofthe board and build public trust in the Company (Laurence& Carolyn2004).The company has established frameworks that address the board’smission, responsibilities of the directors as well as itsqualifications and review on the developments and provide othergovernance materials that deem necessary and appropriate.
Whenevera company fails to adhere to good governance, effects may be far muchreaching. It has been established that there is always a serious fallin share price that in turn will affect shareholders and the industryand company at large (Gabrielsson,J. & Huse, 2005).The company may fail to lead to loss of job opportunities and fall inrevenues. In some cases, the citizens/taxpayers will end up repayingin government bailouts for example.
Principlespromoting good governance
Goodgovernance enables directors to handle specific roles efficientlybecause each of them is clear on their responsibilities and avoidconflicts. Trainings will smoothly run on the designated areas thatone is expected to operate (Laurence& Carolyn2004, Pg 180).The board, for example, is mandated to select individuals andevaluate the performance and approve every corporate action in theorganization. The board need to overlook the risks that may beencountered and monitor shareholders and employee relations.
BoardComposition and Organizational Performance
Theboard formed should have the required mix of skills knowledge as wellas the experience. For effectiveness and accountability, the rightpersonnel should be in place to drive forward the objectives and thestrategic plan of the company (Jonas& Morten 2005, pg 24).Organizationsneed to deliver on their purpose and measure its performance byhaving a scorecard for example. The type of the company is not muchof interest, but the way the organization utilizes the availableresources is of the essence.
Itis the major role of the board to set the vision, purpose andstrategies of the firm. This will help in understanding the companybetter and channelling all efforts towards future sustainability. Itis here where the board needs to state clearly, why the company is inexistence. This explains precisely the reason behind the existence ofthe company, its aims, vision and objectives, monitor and evaluatethe level of success.
BoardEffectiveness, Integrity and Accountability
Properplanning need be emphasized to provide efficient manner of howeverything is done in the organization and enhance good performance. The way the board is structured and how it carries out its operationsimpacts directly the ability of a firm to meet its strategicobjectives. Smooth flow of information to aid in decision-making,transparency and accountability and to safeguard the integrity offinancial statements and other key information
OrganizationBuilding and Engagement
Therole of the board is to enhance the capacity and capabilities theyserve. The board at all-time should serve the best interest of thecompany and avoid conflict of interest if the organization is to growto experience its objectives. The organization should effectivelyengage with the stakeholders(Avshalom& Mark, 2009 Pg 237). Stakeholders need be engaged activelyin every aspect of the company especially when giving an overview ofthe business.
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