Humanity and Ethical Organization

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Ethical business practices play a significant role in influencing the success of any organization and paying attention to ethics in business is thus an important aspect of business owners. Significantly, failure by the management to operate ethically by upholding the interest of the business and shareholders’ objectives leads to conflict of interest between the management and the shareholders. This promotes the opportunity for fraudulent business practices, unscrupulous organizational dealings and organizational scandals. Most of these scandals are deleterious to the organization and the shareholders as they lead to loss of their investments. On the other hand, the numerous ethical pitfalls within an organization when not handled in the right and professional way can damage the financial sustainability of a firm and damage its reputation. It is thus important to emphasize the importance of upholding ethics in all forms of business operations to safeguard the image of the company and avoid fraudulent operations.

Ranging from openness, transparency, and accountability in financial reporting to respect to workers and balancing the objectives of workers and organizational objectives, ethical business practices create a synergy of stable business environment. This means that in ethical business practices, all the factors that influence a healthy working environment are respected and upheld to promote a successful environment where the rights of one party are not abused by the interest of another party. Based on two movies, Enron: The Smartest Guy in the Room and Human Resources, this paper seeks to analyze how ethical problems emerge in an organization.  

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The movie, Enron: The Smartest Guy in the Room, is based on one of the greatest corporate scandals in the United States which led to the bankruptcy and then collapse of Enron Corporation. The collapse of Enron Corporation which was highly recognized as the greatest innovative firm in America and among the most established and successful energy firms in the US was a perfect case of corporate fraud. Despite the plausible success in the firm, its foundation was simmering with unethical business practices, fraud, and unscrupulous operations (Gibney, 2005). The conflict of interest between the top management and shareholders’ interests is well depicted as the top executives of the company conspire to transfer large sums of money from the company’s accounts into their overseas accounts gives a perfect example of greed. 

The film which is cast as a documentary shows how the rise of the company was plagued by underhand and unethical business operations and practices which included profiteering at the expense of the people. The bankruptcy of the company and its eventual collapse is depicted as a product of the outrageous and extravagant expenditure of the management of the firm thus leaving the employees, the investors, and the company to sink in debt and deterioration (Gibney, 2005). Similarly, giving misleading financial information to the shareholders about the financial position of the firm shows that the top management was pursuing their personal interests at the expense of the interests of the investors thus propagating financial fraud. 

It must be appreciated that the collapse of Enron Corporation provides a perfect example of how ethical dilemma emerges in a company and how greed and conflict of interest between the shareholders and management results in fraudulent and ethical business practices. Most importantly, this led to losses of investors’ savings, stock, and investment in the firm. Upon bankruptcy, many employees lost their job opportunities which shattered many dreams thus resulting in economic deterioration (Ehrenberg & Smith, 57). The United States government was also greatly blamed as the greatest regulator of business for its failure to intervene on the unethical business practices of the firm. Certainly, the government helped to provide an appropriate political environment for fraud and unscrupulous deals in the Enron Corporation. 

Similarly, the movie, Human Resources depicts the important aspect of ethical business practices from a human resource perspective. Human personnel management is a critical success factor of any firm as labor is one of the fundamental factors of production. Human Resources is a movie that tells a story of a young and fresh graduate of a business school called Franck who joins a factory’s human resource department on an internship program. His father has worked in the same factory for 30 years but Franck is determined to succeed. Although he is lauded greatly for his success by family and friends, he soon faces the personal challenges of workplace which erupts into rivalries and envy. 

Despite the general manager admiring him, Franck’s immediate supervisor envies him. This forms the basis of the internal conflicts in the human resource department in the metal factory, and as the title of the film suggests, the personal difficulties in the workplace usually culminate in conflicts between individuals and corporations and between labor and management. In his ambitions to transform the human resource department, Franck prepares a questionnaire aimed at collecting opinions from employees to promote their participation, inclusion, and involvement in decision making. However, his supervisor turns it down but devises a mechanism of using the findings to lay off workers. 

The upper management’s scheme to manipulate the findings from Franck’s field study to lay off the employees becomes a major cause of conflict, rivalry, and a huge rift between the organization and employees, between Franck and his father, and between management and labor. This plan by the management to downsize radicalizes Franck who unites with his nemesis and scourge, the leader of the trade union and a worker’s strike ensues (Cantet, 1999). Certainly, unethical business practices are evident in the film as the top management is constantly engaged in a battle with the employees whose plight is not respected. 

Although Franck wanted to improve the relationship between the management and workers, he realizes that playing in the middle ground is not helpful as the management does not negotiate with them in good faith. This portrays a powerful scenario of how workers are treated by management in various industries and the inhuman working conditions that they endure at work (Wright & McMahan, 297). Being subjected to humiliating and spirit-crushing treatment by the management, inhuman production requirement, and monotonous work that the workers are imposed to is both unethical and immoral in the business context. This is because it induces a mix of indecent insensitivity and smug superiority. 

Significantly, “Human Resources” shows how unethical practices in the human resource management, characterized by the culture of cruelty towards employees and sickening daily oppressiveness in production results in conflicts. It is also unethical for workers to be subjected to a work environment where every aspect of their life is controlled by the employer. An ethical business practice underscores the importance of uplifting the plight of workers by motivating them and addressing their concerns without intimidation and threats (Cantet, 1999). It is thus unethical for the management to use the findings from worker’s opinions for downsizing as this amounts to threat and intimidation. This depicts how greed, conflict of interest, and power are used by the management to pursue their selfish interest hence jeopardizing the lives of workers. 

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The two films provide appropriate examples of ethical problems in an organizational context which mostly result from conflict and interest between the top management and shareholders and greed. However, this can be prevented by cultivating the culture of transparency and accountability in financial reporting and other business activities to avoid fraudulent practices. On the other hand, transparency and accountability eliminates chances of the top management pursuing selfish interest at the expense of the stakeholders’ interests. This helps to promote good business ethics, free from exploitation and taking advantage of the stakeholders. 

Management of Conflict Arising at the Workplace

Human resource is a department of an organization that is mandated to cater for the needs of the employees. However, according to the film Human Resources, it is not always that the desires and needs of the workers are addressed. In fact, in most cases, the employees endure harsh working environment which crushes their spirit and whips their humanity to resemble slavery at the workplace. Therefore, management education is a vital component in resolving conflicts at the workplace. Management education involves educating the workers of their rights and limits at the workplace (Wilson, 78). Public policy is an equally powerful tool that allows workers to form and join unions that care about their welfare. In line with this union agenda, their grievances can be negotiated by the union leaders as opposed to individual resolution of grievances. Perhaps the existence of such unions at Franck’s workplace would have resolved the confrontation with his supervisor and addressed the plight of the workers. 

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  1. Ehrenberg, Ronald G., and Robert S. Smith. Modern labor economics: Theory and public policy. Routledge, 2016.
  2. Gibney, A. “Enron: The Smartest Guys in the Room, Magnolia Pictures.” Extraído el 9 (2005).
  3. Cantet, L. Human Resources,  (Ressources Humains, 1999)
  4. Valor, Carmen. “Corporate social responsibility and corporate citizenship: Towards corporate accountability.” Business and society review 110.2 (2005): 191-212.
  5. Wilson, John P. “International human resource development: Learning, education and training for individuals and organizations.” Development and Learning in Organizations 28.2 (2014).
  6. Wright, Patrick M., and Gary C. McMahan. “Theoretical perspectives for strategic human resource management.” Journal of management 18.2 (1992): 295-320.
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