Perceptions of Organizational Justice Vital to Workplace Ethics Programs

PERCEPTIONS OF ORGANIZATIONAL JUSTICE VITAL TO WORKPLACE ETHICS PROGRAMS

UNIVERSITY PARK, PA-Many organizations are devoting substantial resources to formal ethics programs in efforts to discourage unethical behavior, but a new study shows that the success of those efforts will depend in part on whether employees perceive that their organization treats people in a generally fair way.

"Perceptions of organizational justice not only reduce a broad range of unethical behaviors that can harm the organization, but they also increase helpful behaviors, particularly employees' willingness to cooperate with the goals of organizational ethics programs by reporting ethical problems to management," says Linda Trevi--o, professor of Organizational Behavior and Chair of the Department of Management and Organization in Penn State's Smeal College of Business.

Trevi--o co-authored an empirical study of four large corporations on the topic with Gary R. Weaver of the University of Delaware. The study, "Organizational Justice and Ethics Program Follow-Through: Influences on Employees' Harmful and Helpful Behavior," appeared in Business Ethics Quarterly (Volume 11, Issue 4).

"When they perceive the organization to be unfair, employees engage in harmful unethical behavior in order to rebalance the scales of justice and improve their own outcomes at the organization's expense, by stealing for example. However, when they perceive that the organization treats employees fairly, they give back by going above and beyond the call of duty to help management, by reporting ethical problems," says Trevi--o.

Although ethics programs are widespread, they are sometimes perceived to be "window dressing" only. In order for employees to respond positively to them, they need to perceive that their organization means what it says by following through on ethical failures and addressing problems. Follow-through is perceived as important because it is a matter of justice. Ethics programs are likely to make fairness issues particularly salient just because they call attention to issues of ethics in the organization. "Consistently following through on espoused policies also indicates that an organization values procedural justice, and the discipline that comes from following up on ethical failures indicates that retributive justice expectations are taken seriously," says Trevi--o.

This study found that employees' perceptions of ethics program follow through decreases unethical behavior and increases the extent to which employees will support an ethics program by reporting problems.

Trevi--o notes that the impact of such follow through is even higher when employees perceive the organization to be unfair. When employees perceive unfair treatment, they are motivated to rebalance the scales of justice. Therefore, company efforts to act on ethical problems have even greater impact.

The randomly selected sample for the study was drawn from a larger survey of ethics/compliance management in four companies with formal ethics/compliance programs in place: a utility company, a telecommunications company, and two energy-related companies. Surveys were then sent to 3,800 employees' homes. Respondents were asked a series of questions on items representing ethical or illegal behaviors.

A key study finding was the strong relationship between perceived general fair treatment and ethics-related outcomes. "Because employees today are more likely to work unsupervised than in the past in jobs that are less precisely defined, they face opportunities for a broad array of unethical behavior directed against the organization. These employees have many opportunities to engage in covert actions that have the potential to subvert or harm the organization and its goals. We found that a broad spectrum of unethical actions was significantly lower if employees believed that their organizations generally treated people fairly," says Trevi--o. Firms also rely upon employees to help the organization by detecting and reporting ethical problems. "Obviously, following through on actual or suspected ethical failures can serve as a deterrent to unethical behavior, but our data indicates it also encourages employees to report ethical problems."

The results of the study also have implications for ethics/compliance managers.

"Ethics programs are generally administered separately from other human resource programs and practices. Therefore, ethics program administrators may have little influence on employees' broader evaluations of organizational justice," says Trevi--o. "Our results suggest that ethics/compliance management should be more tightly coupled with the management of the broader organizational culture to improve employees' perceptions of fairness in the organization in general, and in the ethics/compliance program."

-smeal-

Editors: Dr. Trevi--o can be reached via e-mail at [email protected] or 814-865-2194. For assistance, or a copy of the paper, contact Steve Infanti of the Smeal College Media Relations' Office at 814-863-3798 or [email protected]

Penn State's Smeal College of Business is a pre-eminent learning community, shaping business practice for tomorrow's converging economies. With 5,900 undergraduates, Smeal College has the third largest undergraduate business program in the country. In addition to the nationally ranked undergraduate program, Smeal College is home to internationally ranked MBA and Executive Education Programs. Smeal College's seven academic departments, as well as its ten research centers and institutes, present programs and studies in leading-edge areas such as B2B marketing, supply chain management, e-business, and entrepreneurship along with the traditional areas of marketing, management, finance, real estate, accounting and information systems.