Ethics in the Workplace Assignment

Ethics in the Workplace Assignment Words: 9645

Ethics in the Workplace Chapter 1 THE PROBLEM AND A REVIEW OF RELATED LITERATURE These are revolutionary times; all over the globe men are revolting, against old systems of exploitation and oppression. The shirtless and barefoot people of the world are rising up as never before. The people that walked in darkness have seen a great life…we must move past indecision to action… If down the long, dark and shameful corridors of time reserved for those who possess power without compassion, might without morality, and strength without sight. ‘MARTIN LUTHER KING, JR.

April 4, 1967′ (Phillips, 1998, p. 1) People are often led to causes and often become committed to great ideas through persons who personify those ideas. They have to find the embodiment of the idea in flesh and blood in order to commit themselves to it. ‘MARTIN LUTHER KING, JR. February 13, 1961’ (Phillips, 1998, p. 1) Sectors of the trade industry and business leaders have stressed the importance of looking at the moral conviction of leaders and managers that make up the field of business (Badaracco & Webb, 1995; Alatas, 1999; Nuusbum, 2002).

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Nuusbum (2002) wrote, “There are business scandals that are so vast and so penetrating that they profoundly shock our most deeply held beliefs about the honesty and integrity of our corporate culture. Enron Corporation is one of them. The lesson from the Enron debacle should be to restore basic integrity to the bottom line, ethics to business professionals…” (p. 31-32). In most cases, the moral behavior of a corporation depends to a large extent on the moral conviction of its owners and managers (Valero, 1993). The exigent need to look at the moral behavior of business leadership has likewise been affirmed by the current

Philippine President, Gloria Macapagal-Arroyo (Yuson, 2001) in a message to the corporate citizenry which states, Indeed in all sectors of trade and industry, it has been impressed upon us that profit alone does not make a good company. Recent events in our country have highlighted the need for business entities to become good corporate citizens and serve as exemplars in resolving conflicts between values. Beyond the vision and mission statements, or the credo that sometimes serves to polish the company’s image, there is fresh vigilance over social and environmental responsibilities. p. 4) Like pleas for ethical conduct, demands have been made for more socially responsible behavior. At the minimum, a socially responsible organization integrates the welfare of society into the business decision-making process (Davis, 1975; Hunt & Chonko, 1985). Related to this, the role of men in changing morality must not be underestimated. The change in the historical and sociological context, which discourages corruption, can only be translated into a living force only if there are effective and influencing individuals to act as catalyzing agents.

In the absence of such a group, corruption will continue to thrive. How to ensure a society’s steady supply of these individuals and to facilitate their rise to vital positions is always a central problem (Alatas, 1999). In 1977, in its General Assembly, the Philippines’ Bishops-Businessmen’s Conference for Human Development called for the formulation of a Code of Ethics for Philippine business that would guide the committed businessman in the management of his business and against which he could question and measure his policies, decisions and operations within his firm and the larger society.

A Code Committee was organized. The Committee was entrusted with the task of researching on the latest thinking on social responsibilities of business, existing codes of ethics in other countries and business philosophies expressed by the enlightened sectors of Philippine business and industry; and in formulating a proposed Code of Ethics based on the research. In structuring the Code, the Committee focused attention on six critical areas of business responsibilities: employees, customers, suppliers, shareholders and other providers of capital, local and national government, and society in general.

A section was also developed dealing with principles for the professional manager. The initial draft of the Code was subjected to a series of consultations and workshops. Participants were representatives of numerous business enterprises ??? large, medium, and small. They represented manufacturing, service, and financial, agricultural and other types industries. Church leaders likewise took active part in the deliberations (Bishops Businessmen Conference for Human Development Philippines, 1977).

Despite this recognition of the significance of ethical practices in business as early as 1977, more than twenty five years later, the Philippines has been perceived as the eleventh most corrupt among nations covered in a 2002 global survey by Transparency International, an international coalition against corruption (Batino, 2002). The country shared the spot with Pakistan, Romania and Zambia. The survey results indicated, “corruption in the country is perceived by business people and risk analysts to have worsened” (Batino, 2002).

The Philippines ranking in the Transparency International 2002 was number seventy-seven (77) among the one hundred and two (102) nations with a corruption perceptions index (CPI) score of 2. 6. The CPI score refers to the perceptions towards the degree of corruption observed by business people and risk analysts. The score ranges between zero for the highly corrupt to ten for the highly clean (Batino, 2002).

This revelation of the worldwide survey revealed an immediate, timely and pressing need to make a study of the factors that can contribute to increasing the level of moral judgment of Filipino managers which increasing consciousness may result in the observance of ethical conduct. Among the predictors of practice of ethics in the workplace that this study looked into were formal business ethics education, the manager’s cognitive moral reasoning and spiritual intelligence which factors were hypothesized to lead to the adoption of an educational intervention as well as contribute to changes in management practice.

This study explored the possible influence of an individual business manager’s formal education in Business Ethics to the practice of ethics in the workplace. A purposive study into the influence of formal business ethics education to ethical management practice in the local setting among business managers in Metro Manila was an offshoot of several foreign studies that there is a positive relationship between formal Business Ethics education and ethical conduct (Purcell, 1977; Barach & Nichol, 1980). Purcell (1977) in a long-term study measured thical reactions of business students just before taking a business ethics course and ten years later when they were in the business world making actual ethical decisions. He found out that the respondents were more apt to recommend ethical behavior ten years after graduation than when they were asked to make similar judgments just before taking the business ethics course. Barach and Nichol (1980) found that a business ethics course positively affected students not only on the subjects covered in the course but affected their business behavior in general.

However, in spite of widespread encouragement for ethics instruction, the goals of teaching ethics to students in schools of business and public management are still murky. There is serious disagreement on both when and how to teach ethics to adults in programs and school of management (Purcell, 1977; Rohr, 1978; 60 Minutes, 1988; Rest, 1988; Wilkes, 1989; Levin, 1990; Toffler, 1991; Fineman, 1994; Carlson & Burke, 1998).

But there is a strong consensus, even without empirical evidence that an ethics course and course modules must be included (Carlson & Burke, 1998). This was further emphasized by McCabe and Trevino (1993) when they said that business school students may need ethics training more than most because research has shown that they have ranked lower in moral reasoning than students in philosophy, political science, law, medicine and dentistry.

Another persistent question is whether ethics can be taught to adults at all (Wilkes, 1989). As cited in Carlson and Burke (1998), Lester Thurow, while Dean of MIT’s Sloan School of Management, stated on the Sunday Night CBS 60 minutes show (1988) that “…people, by the time they come here (MIT), are 27, 28 years of age, that’s when we let them in, that’s a kind of very peculiar time in life to start teaching ethics. If you haven’t learned it before you’re 27, I don’t think you’re going to learn it. (p. 1179) In another instance, when John S. R. Shad as cited in Carlson and Burke (1998), former head of the U. S. Security and Exchange Commission, was questioned as to what effect his $23 million donation, which is dedicated to ethics education at the Harvard Business School, would have on adults, he replied: I think it is a valid question to ask: ‘Is it too late to try to teach ethics to people in their 20s? ‘ No school, no matter how good, is going to rehabilitate criminals.

But what this ethics course can do is to sensitize the students to conflicts of interest in business decisions they may never have considered. (p. 1180) Another direction is to take fairly minimal goal-setting for any adult ethics instruction (Rohr, 1978) where “the best we can do-at least in schools of public administration- is to encourage bureaucrats to reflect upon our values, suggest a method for doing so, and then trust them to exercise their discretion along lines compatible with these values. (p. 75) In the Philippines, among the more recognized part-time graduate schools of business (Asiaweek Regional Survey of MBA Schools, 2000), De La Salle Professional Schools Graduate School of Business has substantially integrated Business Ethics into its curriculum as a core course and used it as a pedagogical approach in the study of different business disciplines that include marketing, finance, production and human resource management. (Refer to Appendix A for the DLSU MBA curriculum).

The course, an educational intervention in Business Ethics called Ethics, Family Life and Work Life Balance (BUS 8300) aims to raise the student’s level of moral awareness by providing them with the frameworks to make moral and ethical decisions in business and non-business organizations. It is a foundation course of concepts, theories and skill building in values clarification, personal mastery, work and family life balance and ethical decision making in business. The course examines the sources of societal pressure, the reaction of business, and the community’s expectations.

The entire spectrum of corporate and government activities are discussed against the framework of the demand made on the firm and government by forces outside of the marketplace. In addition, ethical concepts such as the utilitarianism, rights, justice, ethics of care frameworks, corporate social responsiveness, public policy, family and work life issues are examined as they relate to the functioning of an economic system. Specific problems using moral dilemmas and real issues from newspaper articles and case situations in movies that impact the business organization are discussed from an ethical perspective.

The course aims to transform the business manager into a socially responsible leader and change agent. The course syllabus on Ethics, Family Life and Work Life Balance is found in Appendix B. Because of the breadth and depth of the subject area of business ethics, the researcher has decided to limit this study to individual issues in business ethics where ethical questions are raised about the morality of decisions, actions, or character of an individual in business.

This supports the contemporary approach to ethics where emphasis has shifted from a previous traditional approach in ethics focusing on the human act to concentration on the person, who is the fountain source of human acts (Cruz, 1984). This contemporary approach provides strength to the working definition of the role of ethics in business in the new millennium where ethics is a specialized study of what is right or wrong. It concerns itself with the correct application of some fundamental ethical principles to business decisions and policies.

Therefore, to be ethical is to determine whether a particular behavior, decision or action of an individual is morally right or wrong and where the basis is a universal standard (Goolsby & Hunt, 1992). Moral reasoning, like other kinds of decision processes is viewed as being influenced by individual characteristics and environmental factors. The individual, though viewed as an intentional, voluntaristic, free agent, both reacts to and interacts with situational and environmental factors in solving ethical problems and determining appropriate behavior (Goolsby & Hunt, 1992).

Therefore, the function that managers play in leadership and modeling ethical behavior cannot be understated. Drucker (1981) as cited in Bowman and Wittmer (2000) stated that while managers are but individuals, private and alone and anonymous in many respects, “collectively (they) are the ‘leaders’ in a modern society” (p. 4). Managers, consequently, have responsibilities in their leadership roles. “Similarly, executives set examples, whatever the organization. They ‘set the tone’, ‘create the spirit’, ‘describe the values’ for an organization and for the people in it”(p. ). Thus, managers are seen as leaders who must demonstrate integrity and exemplary behavior to maintain continuity of values in the organization. The possibility that a local business leader’s level of spirituality can influence ethical decision making is a new dimension that this study aims to determine. Modern theorists like Bolman and Deal (1995), Covey (1990), Fairholm (1996) maintain that a spiritual dimension allows leaders to reach followers in a compelling way, towards a common good.

Overall, the study defined the attributes of ethical business leaders and the factors that may influence a business leader’s ethical decision-making. Some of these factors included awareness of business ethics principles through formal education in Business Ethics in graduate business school, cognitive moral reasoning and level of spiritual intelligence. By having identified these attributes and factors that may influence ethical management practice, this research is likely to influence the recruitment, education, and training of industry practitioners as well as help enhance management practice in the workplace.

REVIEW OF RELATED LITERATURE This section provides antecedent literature on the significant correlates of the criterion variable, practice of ethics in the work place, predictors that include formal business ethics education, cognitive moral reasoning and level of spiritual intelligence. Principles Of Business Ethics Mounting evidence suggested that most managers experienced role conflicts between what is expected of them as efficient, profit-minded members of an organization and what is expected of them as ethical persons.

In a series of in-depth interviews with recent graduates of the Harvard MBA program, researchers Badaracco and Webb (1995) found that these young managers frequently received explicit instructions or felt strong organizational pressure to do things they believed to be sleazy, unethical or even illegal. The young managers interviewed by Badaracco and Webb identified four powerful organizational “commandments” as responsible for the pressure they felt to compromise their integrity: “First, performance is what really counts. Second, be loyal and show us that you are a team player.

Third, do not break the law. Fourth, do not over-invest in ethical behavior” (p. 8). Badaracco & Webb (1995) discovered that although most corporate goals and norms are not objectionable when viewed, they frequently put the people who must implement them under tremendous pressure. The need to meet corporate objectives, to be a team player, and to conform to organizational norms can lead otherwise honorable individuals to engage in unethical conduct (Shaw, 2000). Business people’s interest in ethics came about piecemeal and it came gradually.

It may be said that the real big concern for ethics as an academic course in business schools began in the United States, when the alarm signals were sounded due to moral failures of some notable businessmen. When Harvard School of Business offered the first course in Business Ethics in 1915, there were few takers and most students were bewildered about what the class was supposed to teach them. To date, however, more than ninety percent of all business schools in the United States offer ethics courses and business ethics as a regular subject continues to be in strong demand.

The whole world is asking collectively, “Should not Ethics be taught in business schools so that future businesses would at the very least know what they should not do? ” (Maximiano, 2001,p. 18). Business Ethics has been defined as the code of morals or body of principles, which governs the conduct of the businessman in his relationship with the government, the public, his customers and his competitors. The purpose of business ethics is to help us determine what business practices are right and what are wrong in the light of modern moral standards.

It is the right way of doing things in business and with the right principles underlying the realization of recognized values in all human relationships (Angeles & Garcia, 1981). It has been further defined as a specialized study of moral right and wrong. It concentrates on moral standards as they apply particularly to business policies, institutions and behavior (Velasquez, 2000). Velasquez (2000) maintained that there are three different kinds of issues that business ethics investigates: systemic, corporate and individual issues.

Systemic issues in business ethics are ethical questions raised about the economic, political, and legal and other social systems within which businesses operate. On the other hand, corporate issues in business ethics are ethical questions raised about a particular company. These include questions about the morality of the activities, policies, practices or organizational structure of an individual company taken as a whole. Finally, individual issues in business ethics are ethical questions raised about a particular individual or particular individuals within a company.

These include questions about the morality of the decisions, actions or character of an individual. (Velasquez, 2000). Velasquez (2000) asserts that a person’s ability to use and critically evaluate his or her moral standards develops in the course of a person’s life. Intervention studies consistently demonstrate that formal training in moral philosophy has a positive impact on the level of cognitive moral development (Rest 1986). Therefore, it can be expected that business managers trained in moral reasoning have higher levels of cognitive moral development than individuals who have not received formal ethics instruction.

Many managers assume that any individual of good character should be able to function effectively, making the moral decisions required of a manager in today’s complex business environment. However, Rest (1988) argued that “to assume that any 20 year old of good general character can function ethically in professional situations is no more warranted than assuming that any logical 20 year old can function as a lawyer without special education” (p. 59). The basic disposition of good general character requires additional special education in the profession’s unique problems and the approaches to solving them.

Continuing adult development as cited in Trevino (1992) by Rest , J. , Thoma, S. , Moon, Y. , 1986; Rest and Deemer, 1986; has been linked to higher education. The longitudinal research found significant positive correlations between adult CMD and educational level ranging from 0. 54 to 0. 69. In fact, years of formal education have been one of the more consistent correlates of CMD, although it is not clear what accounts for this relationship. Deemer (1987) argued that education is a proxy variable for other kinds of life experience.

They suggested that moral judgment accompanies a growing awareness of the social world and one’s place in it. In the Philippines, Villanueva (1982) conducted a study among a sample of 500 Filipino students, comprised of high school, college and graduate students as well as seminarians, using the Exercise In Evaluating Issues Test (EEI), an objective pencil and paper instrument adapted from Rest’s Defining Issues test. The EEI, based on six ethical dilemmas revealed that moral judgment is developmental and increased with higher educational level.

This information reinforced the findings made by Rest (1974) from a cross-sectional study of subjects of various ages and educational levels that indicated that the group that predominantly used principled thinking are mainly doctoral students in political science or moral philosophy (as cited in Villanueva, 1982). Cognitive Moral Development As cited in Trevino (1992), the groundwork for cognitive moral development (CMD) theory was laid by Jean Piaget (1932) in his seminal study of moral development in children.

He viewed morality as cognitive and developmental. Moral rules developed through the child’s active role in constructing moral judgments as well as through interactions with the social environment. Piaget identified two separate moralities that characterize children from ages six through twelve. The first type of morality, characteristic of young children, can be described as a morality of constraint or heteronomy (subject to another’s law) where right is defined as obedience to authority.

This morality is gradually replaced by a morality of cooperation or autonomy where children begin to comprehend rules separate from adult authority figures. Through peer interaction and cognitive development, the child eventually began to see morality as a necessity of the social system and rules are viewed as mutually beneficial. The child became more autonomous and less dependent on externally imposed rules. Kohlberg (1969) as cited in Trevino (1992) built on Piaget’s work with his longitudinal research on children and young adults.

Kohlberg followed fifty-eight American boys with ages ranging from ten to sixteen years of age, interviewing them every three years over a twelve-year period. His research, based upon the boys’ open-ended responses to hypothetical moral dilemmas, delineated a structure of moral reasoning and their gradual transformation from middle childhood to adulthood. According to the theory, changes in moral reasoning result from cognitive dis-equilibrium that occurs when an individual perceives a contradiction between his or her moral reasoning level and the next higher one (Turiel, 1969).

Over twenty years of research had provided considerable support for Kohlberg’s model. In general, this research supports the major components of the model, that is: (1) moral judgment has a cognitive base; (2) stages represent qualitative differences in modes of thinking ??? hierarchical, integrated systems of thought, each representing a structured whole; (3) individuals develop through an invariant sequence of stages; (4) individuals prefer problem solution at the highest stage available to them (Kohlberg, 1969).

As cited in Trevino and Nelson (2004), many of these studies have demonstrated increases in moral judgment in a relatively concentrated period of time. A meta-analysis review of over 50 DIT-based studies included 12 studies with adult students. This review suggested that the most effective educational programs are those that involve dilemma discussions and those that last from four to twelve weeks. In addition, adult groups advanced more than younger groups. One potential practical approach to influencing moral reasoning is through cognitive moral development (CMD) based education and training interventions.

The moral education literature suggests that moral education programs based upon moral development theory have succeeded in producing substantial gains in moral reasoning specially with participants in their twenties and thirties. These training programs are aimed at helping participants to think through moral controversy by raising hypothetical ethical dilemmas. The purpose of the training is to promote movement through moral reasoning stages by exposing participants to reasoning one stage higher than the one the participant generally uses.

Theoretically, the discussion will promote internal cognitive conflict, leading the participant to question his or her own reasoning, and consider the next higher stage reasoning. This begins a restructuring of cognitive patterns and positive change (Rest, 1988). As cited in Trevino and Nelson (2004), these strategies have been tested and supported with children as well as adults in dental, medical and business education settings. Stages of Cognitive Moral Development

Drawing on the seminal work of Piaget (1965, 1970) as cited in Goolsby and Hunt (1992), Lawrence Kohlberg (1969) proposed that advanced moral reasoning requires a highly developed capacity for advanced logical reasoning and hypothesized that moral development should follow a cognitive developmental processes. In a decision having a moral dimension, persons with poorly developed logical reasoning abilities would be unable to recognize and analyze the complex relationships among all the elements involved.

Hence, such individuals would neither be able to recognize all the possible options and consequences that might result from a particular course of action nor be able to assimilate the rightful needs of all parties into a judgment satisfying a moral ideal. The level of cognitive moral development is determined in part by the cognitive ability to integrate the legitimate interests of many distant, diverse publics. Individuals high in cognitive moral development could be expected to recognize the social contract, the importance of multiple stakeholders and socially responsible behavior in organizations (Goolsby & Hunt, 1992).

Kohlberg (1969) who has pioneered research in the development of a person’s ability to deal with moral issues identified six stages of cognitive moral development. Kohlberg has grouped these stages of moral development into three levels, each containing two stages. He contended that cognitive moral development can be characterized as a progression through a maximum of six stages. The first level is the premoral or preconventional stage where behavior is motivated by anticipation of pleasure or pain. This level has two stages.

Stage one is known as the punishment and obedience orientation where the physical outcome of an act determines the goodness or badness of an act. This means that the very reason for doing the right things are to avoid punishment or to defer to the superior physical power of authorities. Stage two is the instrument exchange or relativity orientation. At this stage, the right actions are those that serve to satisfy an individual’s own needs or the needs of those for whom the person cares. This is summed up in the expression “You scratch my back, I’ll scratch yours”.

Likewise, their belief is aptly described in the metaphor “Do unto others as they do unto you”. Kohlberg’s level two, otherwise known as conventional morality is characterized by acceptance and adherence to the rules and standards of one’s identified group. The person at this level exhibited strong loyalty to his group and its norms. Once again, Kohlberg’s second level has two stages, i. e. stage three and four. Stage three is described as interpersonal concordance orientation or interpersonal conformity.

At this stage, the right action is characterized by conformity to the behavioral expectations of one’s society or peers. Doing what is right is motivated by the need to do actions that please or help others within the group. Stage 4 is described as law and order orientation. At this stage there is greater respect for rules, laws and properly constituted authority. Right and wrong actions are classified by their impact on the welfare of others in society. Justice at this level demands that the wrongdoer be punished.

Injustice happens if good work goes un-rewarded and wrongdoing not punished. Right action is determined by loyalty to one’s own larger nation or surrounding society and precedes individual interpersonal relationships and motives. Kohlberg’s level three or stage 5 known as the post-conventional or principled morality, which is prior rights and social contract, and stage 6, which is universal ethical principles. At the post conventional, autonomous or principled level, the individual looks at situations from an impartial point of view that takes everyone’s interests into account.

The individual’s sense of right action is based on what is fair to everyone in terms of justice or human rights or society’s overall welfare. At this stage, right action tends to be defined in terms of general individual rights and in terms of standards that have been critically examined and agreed upon by the whole society as reflected in the Constitution. The freedom of the individual is limited by society only when it infringes upon someone else’s freedom. The final stage, which is the universal ethical principles, is the stage where the individual acts out of universal principles based upon the equality and worth of all human beings.

Having rights means more than individual liberties. In this final stage right action is defined because of their logical clarity, universality and consistency. At the post-conventional level, the individual takes a reflective and critical look at the situation and acts on the basis of equality and reasonableness (Velasquez, 2000). Higher stage thinking is more independent of external influences. The post-conventional principled thinker has developed his or her own justice and rights-based principle that guide ethical decision-making (Trevino and Nelson, 2004).

This individual characteristic known as locus of control has been found to influence ethical conduct (Rotter, 1966). Locus of control refers to an individual’s perception of how much control he or she exerts over life events. Locus of control can be thought of as a single continuum from a high internal locus of control to a high external locus of control. An individual with a high internal locus of control believes that outcomes are primarily the result of his or her own efforts whereas an individual with a high external locus of control believes that life events are determined primarily by fate, luck or powerful others.

Locus of control is not something a person is born with. It develops over time through interaction with other people and the social environment. Therefore, although it is thought to be relatively stable, one’s locus of control can shift (Trevino and Nelson, 2004). Individuals with a high internal locus of control see the relationship between their behavior and its outcomes more clearly than do those with an external locus of control. Internals see themselves as being in control of things that happen.

Therefore, they are more likely to take responsibility for the consequences of their actions. Studies have found that internals are more likely to help another person, even if there is a penalty for doing so (Midlarski, 1971). In another development, as cited in Trevino and Nelson (2004), in 1982, psychologist Carol Gilligan published a research on women’s cognitive moral development. Gilligan (1982) who had been Kohlberg’s student claimed that Kohlberg’s theory was flawed because he had studied only boys and then had simply applied the same theory to girls.

Gilligan’s claims have received a great deal of attention particularly in the child and adolescent development fields. But their applicability to adults working in business organizations is limited (Trevino and Nelson, 2004). Gilligan’s (1982) own research which compared the moral reasoning of male and female medical students found no significant difference between genders suggesting that both men and women are strongly influenced by the powerful cultural norms of medical practice.

Similarly, an intervening study by Derry (1987) among business managers based on Gilligan’s theory found no gender differences. Finally, many cognitive moral development studies based on Kohlberg’s theory and conducted by many researchers over the years have found only trivial, if any gender differences. As cited in Ambrose, M. L. and Schminke, M. (1999), business ethics researchers now agree that additional research on the question of gender differences is unnecessary and likely to be fruitless. In the Philippines, Dr. Eva S.

Villanueva developed in 1982 a measurement of moral judgment known as the Exercise In Evaluating Issues (EEI), a Filipino-adapted version of Rest’s Defining Issues Test (DIT). (Refer to Appendix C). The EEI, an objective pencil and paper test contained six moral situations, which are presented to the respondents who are then asked to choose a course of action. After having made a decision on what to do in the dilemma, the respondents evaluated and rated the issues accordingly based on what they consider important in the process of decision-making. There are twelve issues to choose for each moral dilemma.

Each issue represented any of the five stages of moral development excluding stage 1. No issues belong to stage 1, for the reading level and general cognitive adequacy required to answer the questionnaire is such that it is most unlikely to find stage 1 respondents among the respondents in the sample who have at least a high school education (Rest, 1979). The results of the study indicated that the average E indices of the students increase with higher educational level, strongly suggesting that moral judgment is developmental (Villanueva, 1982). Spiritual Leadership

As cited in Isaacson (1991), there are almost as many different definitions of leadership as there are persons who have attempted to define the concept. Early on the focus of leadership was to view a single leader as the focus of group activity (Bass, 1990). This authoritarian model of leadership was viewed as a method of inducing compliance (Hagberg, 1994). The most obvious type of hierarchical leadership is military leadership (Moxley, 2000). Followers in the military must be able to take orders without questioning or lives might be lost. In authoritarian leadership, the compliance of the worker is demanded (Moxley, 2000).

Another form of leadership is the transactional leadership marked by making deals which involves one person contacting others to exchange valued things, whether economic, political or psychological (Hagberg, 1994). No enduring purpose holds the parties together once the transaction is completed (Hagberg, 1994). The transactional leader works in the framework of self-interests of his or her constituency (Bass, 1990). However, this form of leadership has its shortcomings in that it breaks down when the terms of agreement, promises or bargains are not kept, leading to broken trust between the leader and the follower (Bass, 1990).

Both authoritarian and transactional leadership are often characterized by an atmosphere of fear and mistrust in the organization (Hagberg, 1994; Moxley, 2000; Ryan & Oestreich, 1998). In yet another leadership practice known as transformational leadership, the leader engages the follower, an interaction that raises them both to a higher level of motivation (Bass, 1990). Burns (1978) stated that the crucial link between the leader and follower is purpose. Leaders inspire followers to pursue certain goals that represent values and motivations, wants and needs, the aspirations and expectations of both leaders and followers.

Transformational leadership involves such leader values as authenticity and integrity and being true to one’s inner being, to the being of which we are all part (Gardiner, 1998). As cited in Isaacson (2001), Senge (1990) and Wheatley (1999) added yet another dimension to the transformational leadership approach, one where Wheatley “describes organizations as living systems” (p. 31). Likewise, as cited in Isaacson (2001), Palmer (1998), Starratt and Guare (1995), Chaleff (1995) and Vaill (1989) added another dimension, a spiritual element, to systems thinking/living systems leadership.

According to these researchers, spiritual leadership includes such ideas as leading from within (Palmer, 1998), inspiring the growth of the follower (Bolman & Deal, 1995; DePree, 1989), and informing vision with sacred values (Chaleff, 1995; Moxley, 2000). The spiritual aspects of leadership are rooted in the following concepts: One, spirituality is a deep belief in one’s life purpose (Becvar, 1997; Hagberg, 1994; Moore, 1994; Richards & Bergin, 1997); two, life is sacred and interconnected (Palmer, 1999; Vaill, 1989); the spirit is motivating (Drucker, 1954).

As cited in Magnusen (2001), modern theorists recognize that it is spiritual dimension which allowed leaders to reach followers in a compelling way, toward a common good. Spirituality set great leaders apart from others, revealing their greatness to be a feature of honor, integrity, and morality (Blanchard & Peale, 1988; Bolman & Deal, 1991, 1995; Covey, 1990, 2004; Fairholm, 1996,; Palmer, 1983, 1998). The idea that moral values are closely related to a life of integrity is by no means new.

For example, Witmer and Sweeney (1992) as cited in Young (1998) suggested that purposiveness (or meaning in life) and moral values are building blocks of a healthy spirituality. Hagberg (1994) as cited in Isaacson (2001) cited the following qualities characteristic of a spiritual leader: self-reflection, renewal, recognizing one’s gifts, leading from the heart, community, relationships, intuition, trust, God or higher power, mission enabling others, knowing self, connecting to a higher power, hope, willingness to be open, alignment, empowerment, connecting to others, peace, authenticity and integrity.

Similarly, Fairholm (1996) suggested three foundations stones for spiritual leadership: morality, stewardship and community. Spiritual leaders are moral leaders who prefer not to compromise, accommodate or collaborate where their core values are at stake. Collins (2001) in his qualitative research of eleven companies revealed that truly great companies are visionary and values driven, equally led by leaders who exhibit what the researchers call Level 5 leadership whose qualities demonstrate all the characteristics present in a leader with high spiritual intelligence including strong faith nd profound personal humility. Spirituality need not, therefore be viewed as an ethereal and otherworldly consciousness but has wide implications for day-to-day living. Spirituality and spiritual intelligence have their general application and most profound relevance in day to day activities such as how one interacts with friends or family or the ways in which one feels the meaning of work (Wolman, 2001). Emmons (1999) as cited in Wolman (2001) adds, Spiritual concerns influence the way in which people construe their world, pursue strivings, and regulate their behavior in day-to-day living.

This pragmatic approach to spirituality offers a perspective on spirituality that can counter the mistaken belief that spiritual states of mind are somehow on another “plane of existence” ??? a state of being that is phenomenologically valid, but has little relevance for problem solving and goal attainment in concrete life situations. (p. 92) Spiritual Intelligence (SQ) Spiritual Intelligence (SQ) is the capacity to sense, understand and tap into the highest part of oneself, of others and the world around oneself.

Signs of spiritual intelligence include wisdom, courage, integrity, intuition, compassion, creativity and inner authority (Christian, 2000; Hales, 2001;McMullen, 2003;Overell, 2001; Zohar, 2001; Wolman, 2001). Spiritual intelligence is one of several types of intelligence that can be developed with relative independence (Wolman, 2001; Vaughan, 2002). Much elements of spiritual intelligence have found concrete form in the works of Dana Zohar’s SQ (2001) and Dr.

Richard Wolman’s (2001) PsychoMatrix Spiritual Inventory (PSI) which is a groundbreaking system for evaluating the levels and areas of spirituality in people’s lives without reference to a specific religious ideology. Zohar (2001), a quantum physicist established that there are two things going on in the brain that provide each human being a spiritual intelligence. These include the God-spot activity and 40 hertz. God-spot is an area behind the temples in the temporal lobe area of the brain which when it becomes excited starts asking fundamental questions like, Why am I here?

What is it all about? , Why am I in this relationship and am I waiting my time in this planet? , etc. The God-spot activity is measured by a magnetic meter near the temples indicating a much stronger magnetic field in the area of the temporal lobes during deep spiritual thinking. Zohar (2001) maintained that when a person focused on something, the brain neurons become connected by a set of coherent oscillations, which move at 40 hertz or 40 cycles per second. The 40-hertz oscillation unified the experience and brought everything in balance including unifying the IQ, EQ, SQ and God-spot activity.

Zohar (2001) maintained that spiritual intelligence included one, self-awareness, you know who you really are and recognize that you are connected with the whole universe; two, vision and values-led or idealism, the need to naturally want to serve which is characteristic of humanity; three, the capacity to face and use adversity which means owning one’s mistakes and using pain and tragedy to learn; four, holistic, which refers to how an individual sees the connection between things including being open to and interested in everything; five, diversity which refers to thriving in and celebrating diversity that is to look and see at what is different in one’s person and say ‘thank God for that! ‘; six, refers to independence; seven, the tendency to ask why; eight, the ability to reframe that included to put things into a larger context of meaning and finally, spontaneity or response which refers to one’s responsiveness to the world. Wolman (2001) identified seven factors that make up human spiritual experience and behavior. They are divinity, mindfulness, intellectuality, community, extrasensory perception, childhood spirituality and trauma. Wolman stated that an understanding of the spiritual makeup strengths and limitations is critical to being able to see and improve personal relationships and relationship to the world.

According to Wolman (2001), an understanding of one’s spiritual makeup provided insight into behavior, internal experience and empathy for the experiences of others that in turn provided one a conscious context for one’s actions and choices. Wolman (2001) defined the seven factors as follows: one, divinity is associated with the sense of or intuitive knowledge about a Divine Energy Source, a Higher Being or the feeling of awesome wonder in the presence of natural phenomena; two, mindfulness which included activities associated with attention to bodily processes such as conscious eating, regular meditation with focused breathing and exercise as well as use of alternative or integrative health practices; three, extrasensory perception that related to the sixth sense or paranormal psychic events; fourth, community which described social ctivities that include peers or activities that are on a volunteer basis and charitable in nature such as working with the less fortunate and socially disadvantaged; fifth, intellectuality which denoted a desire and commitment to read, study and/or discuss spiritual material or sacred texts as well as incorporated the active questioning of traditional teachings of religion; six, trauma which referred to the crisis-oriented stimulus to spirituality and seven, childhood spirituality which is a factor that referred to spiritual experiences that took place during childhood such as attending religious services or being read to from books like the Bible or the Koran. Wolman (2001) used the development sequencing of Lawrence Kohlberg’s six stages of moral development as basis for spiritual growth. Wolman’s (2001) study from data gathered from the PsychoMatrix Spirituality Inventory revealed the following: One, positive age correlation i. e. as age increases, so does the report of spiritual experience and behavior for both sexes for all seven spiritual factors and; two, there is a development dimension to spiritual intelligence. An important finding is the demonstration of the progress of development of mental capacity, qualifying spiritual intelligence as an intelligence that corresponds to a unique set of human experiences. Thus, spiritual intelligence is an innate capacity that with attention, training and additional life experience increases over time. Wolman (2001) related that of the thousands of people, who participated in the study, the majority of the sample was between the ages of thirty and sixty and scores changed depending on the age grouping. As people got older, they scored higher on each of the seven factors.

An analysis of the results of personal PSIs revealed patterns in spirituality that one may opt to change if one chooses. This study established which among the seven factors of spiritual intelligence are predominantly present among those managers who practice ethics in the work place. Synthesis Of The Review of Literature Many of today’s organizations recognize that there is a need to strengthen the ethical makeup of the company and the individuals who make up the company (Maximiano, 2001; Yuson, 2001; Nusbuum, 2002; Trevino & Nelson, 2004). While much literature has been published about methods of teaching ethics, very little empirical evidence has been reported to its relationship to ethical conduct (Carlson and Burke, 1998).

Historically, there is much extant literature and intervention studies on moral philosophy and ethics education related to cognitive moral development and moral reasoning (Kohlberg, 1969; Rest, 1974; Gilligan, 1982; Villanueva, 1982; Trevino, 1992; Trevino & Nelson, 2004). While there has been extensive research on cognitive moral development and moral reasoning, there has been scant research on its relationship to ethical conduct. Nor has there been research linking spiritual intelligence to cognitive moral reasoning. In the same way, while Wolman’s (2001) Psychomatrix Spiritual Inventory reveals the spiritual makeup of individuals that can influence their behavior, there has been no research worldwide relating spirituality to ethical practice in the workplace. Nor has there been an empirical study that links up spiritual intelligence to cognitive moral reasoning.

This study explored a connection between a manager’s formal education in business ethics, cognitive moral reasoning and level of spiritual intelligence to practice of ethics in the workplace, which combination of relationships between independent, intervening and criterion variables was never explored in any study both locally and abroad. A meticulous search online and visits to other local university libraries reveal no existing research of similar nature. Nowhere, has the relationship between formal business education in graduate business school, cognitive moral reasoning and spiritual intelligence to practice of ethics in the workplace had been empirically studied locally and even worldwide.

The purported decline in the moral conviction and integrity of business leaders has led to an examination and empirical validation of the predictive factors that can help influence the business managers’ practice of ethics in the workplace among them, the principles of business ethics, cognitive moral reasoning and level of spiritual intelligence. Conceptual Framework This study is anchored on the concepts of business ethics (Velasquez, 2000; Trevino and Nelson, 2004), cognitive moral development (Kohlberg, 1969; Rest, 1983; Trevino, 1979; Villanueva, 1982; Trevino and Nelson, 2004) and spiritual intelligence (Wolman, 2001). Principles of Business Ethics One variable covered by the study is the participant’s understanding of business ethics. Business Ethics is defined as a specialized study of moral right and wrong.

Its concentration is on moral standards as they apply specifically to business policies, institutions and behavior (Velasquez, 2000) Participants’ understanding of business ethics is operationally defined in this study as the individual’s familiarity or awareness of ethical frameworks and principles acquired through formal business ethics education in a post-graduate business course in this case, Ethics, Family Life and Work life Balance (BUS 8300) under the De La Salle Professional School’s Graduate School of Business curriculum. While business ethics covers systemic, corporate and individual issues, this paper shall concentrate on individual issues where ethical questions are raised about a particular individual or individuals within the company. This study determined whether formal business ethics education is a significant predictor of practice of ethics in the workplace among business managers in Metro Manila.

As cited in Goolsby and Hunt (1992), intervention studies consistently demonstrate that formal training in moral philosophy has a positive impact on the level of cognitive moral development (Rest 1986) where individuals trained in moral philosophy would have higher levels of cognitive moral development than individuals who have not received formal ethics instruction. Several foreign literatures describe a positive relationship between formal Business Ethics education and moral reasoning (Andersen, 1990; Purcell, 1977; Barach & Nichol, 1980). For example, the study made by Carlson and Burke (1998) among college students reveals that there are some effects of teaching ethics to adults, particularly with regards to increased analytical ability of students. Likewise, their students had at the end of the course began to develop comprehension of “how to build an organization of integrity”. Trevino and Nelson (2004) state that ethical behavior relies on more than good character.

In today’s highly complex organizations, one’s moral compass is certainly not the only factor determining ethical conduct. Individuals need additional guidance. Business school students may need ethics training more than most because research has shown that they have ranked lower in moral reasoning than students in philosophy, political science, law, medicine and industry (McCabe & Trevino, 1993). In fact, young adults in their twenties and thirties in moral development educational programs have been found to advance in moral reasoning even more than younger individuals (Rest, 1987). This study tested the applicability of this finding among Filipino business managers who have had formal training in business ethics.

Cognitive Moral Reasoning There is a general agreement that cognitive moral reasoning is one variable that can assist in predicting ethical decision making in business (Fraedrich, Thorne & Ferrell, 1994; Trevino & Nelson, 2004). This study determined the applicability of this finding among Filipino business managers. This study used an empirically validated measurement of moral judgment known as the Exercise In Evaluating Issues (EEI), a pencil and paper test developed in 1982 by Dr. Eva S. Villanueva, using six moral situations adapted to Filipino moral dilemmas but closely patterned after Rest’s (1974) Defining Issues Test (DIT). (Refer to Appendix c).

The result known as the E index, expressed in percentage reveals the degree of principled thinking provided by an individual when faced with a moral dilemma and when arriving at a moral decision. This study used the psychologist Lawrence Kohlberg definition of the six stages of moral development. These are stage one, punishment and obedience orientation; stage two, instrument and relativity orientation; stage three, interpersonal concordance orientation; stage four, law and order orientation; stage five, social contract orientation; and stage six, universal ethical principles orientation. At stage one, the goodness or badness of an act is dependent on the obtained reaction from the act.

If the act results in physical punishment, then it must be a bad act. At stage two, the motivation is the individual’s need. An act must be good if it will satisfy the person’s needs. In situations like this, the person is willing to compromise in order to get what he or she wants. At stage three, an act becomes classified as good if it lives up to the expectations of the person’s group. Stage four is where the individual learns that he is part of a larger society and the person acts on the basis of what society expects him to do. Stage five is where the person believes that the rightness and wrongness of an action is driven by fair ways of reaching consensus by agreement, contract and due process.

Stage six is defined in terms of moral principles that are logical, universal and consistent where justice, society’s welfare, equality of human rights, and respect for the dignity of individual human beings prevail. Stages five and six belong to the post-conventional level of cognitive moral development where Kohlberg argued that the higher the reasoning stage, the more ethical the decision because the higher stages are more consistent with prescriptive ethical principles of justice and rights. (Valero, 1993; Shaw, 1999;, Velasquez, 2000; Trevino & Nelson, 2004). Kohlberg (1969) maintained that what is counted is the reasoning processes involved in a decision, not just the decision.

Further, the actual moral decision is not as important as the reasoning process used to arrive at it. Spiritual Intelligence This study determined whether moral reasoning can influence or be influenced by another factor, which is spiritual intelligence. Likewise, the study determined whether spiritual intelligence can lead to practice of ethics in the workplace. Given the research support for a relationship between moral cognition and moral action, it is best to also consider whether moral reasoning can also be influenced by another factor, which is spiritual intelligence. According to Wolman (2001), spiritual intelligence is an innate capacity that with training increases over time.

Wolman (2001) used the same Lawrence Kohlberg’s six stages of moral development as framework and development sequencing for spiritual growth. Further, according to Covey (2004), spiritual intelligence and its dimension ??? how true people are to universal, timeless principles of right and wrong – is the overarching and underlying supreme governing force. Covey (2004) states that spiritual intelligence is a higher endowment and is the pathway to moral authority. Developing and using this intelligence will instill in one quiet confidence, internal strength and security, the ability to be simultaneously courageous and considerate and have personal moral authority.

The effort to develop this intelligence will profoundly impact the ability to influence others (Covey, 2004). Wolman (2001) posits that there are seven factors that make up human spiritual experience and behavior. These are divinity, mindfulness, intellectuality, community, extrasensory perception, childhood spirituality and trauma. Divinity is associated with the level of awareness and sense of connection to a Divine Energy Source, a Higher Being or Divine Presence. Mindfulness is a factor grounded in the belief that there is seamless connection between mind and body. Mind and body, are not separate entities but are integrated into one, mindbody.

The mindfulness factor espouses careful attention to the state of one’s body as an extension of the mind. Related to this, mindfulness is associated with one’s level of attention to physical well-being, psychological health and bodily processes such as conscious eating, regular meditation with focused breathing and exercise like yoga or t’ai chi. Mindfulness recognizes knowledge of, understanding and use of alternative or integrative health products and practices. A high score on mindfulness indicates an individual who is affiliative i. e. feels connected with and seeks the company of, others as an opportunity to share ideas and concerns. Individuals who score low on mindfulness indicate an individual who has low affiliative needs, i. e. are comfortable being on their own and pursuing their own activities in a more solitary fashion and do not seek the company of others as a way of sharing concerns. Extrasensory perception refers to a level of psychic awareness, often referred to as sixth sense that encompasses knowledge gained from unconventional ways of knowing. Individuals who score high on extrasensory perception often have the common experience of bumping into someone they have not seen for years and were just talking about or of sensing that some event is about to occur before it does. Low scores imply that one’s approach to daily events is governed by a more practical, objective point of view.

Community refers to the level of involvement with a group in a variety of social, spiritual activities that relate to charity like working with the less fortunate and socially disadvantaged, attendance in religious services, consultation with clergy or spiritual leaders, membership in a spiritual community or participation in classes, workshops and conferences concerning spirituality. This factor is largely motivated by the presence of others and concern for them. Intellectuality relates to the degree of conscious desire and commitment to read, study and/or discuss spiritual material or sacred texts including engaging in critical thinking, reflecting and questioning traditional religious literature and philosophy. Trauma refers to the degree of experience of physical or emotional pain and suffering. Childhood spirituality refers to the degree of frequent and meaningful spiritual activities early in life such as attending religious services or being read the Bible or the Koran by parents or grandparents.

Wolman(2001) states that an understanding of the individual’s spiritual makeup that includes one’s strengths and limitations is critical to one’s actions and choices and are essential to being able to improve interpersonal relationships. Practice of Ethics In The Workplace Indicators of practice of ethics in the workplace shall be based on the results derived from the questionnaire on Ethical Practice of Business Managers (Refer to Appendices E and F), an 18-item survey questionnaire modified from the Questionnaire on Social Responsibility of Business Managers (Bishops Businessmen Conference for Human Development, 1981). Respondents to the questionnaire were the supervisor/superior and two subordinates of the middle level business manager enrolled at the De La Salle Graduate School of Business.

The questionnaire included items on professional practices of managers and a comment sheet answered by the respondent that encouraged the former to cite situations of ethical conduct or practice by the business manager. Overall, this study explored the possible relationship between formal education in business ethics, cognitive moral reasoning and level of spiritual intelligence to the practice ethics in the workplace among business managers in Metro Manila. Figure 1 shows the hypothetical relationships between the variables selected for the study. In the figure shown in the succeeding page, formal education in business ethics is the independent variable, represented by the educational intervention Ethics, Family Life and Worklife Balance (BUS 8300) while intent to practice ethics in the workplace is the dependent variable.

Among the intervening variables are the stages of cognitive moral development and the level of spiritual intelligence, which variables are likewise studied for their possible relationship to each other and to the dependent variable. Figure 1 shows the hypothesized relationship between the independent variable, formal education in business ethics and the intervening variables that include level of spiritual intelligence and cognitive moral reasoning with the dependent variable, practice of ethics in the workplace. Figure 1 A Causal Model for Analyzing the Relationship Of Completion Of A Business Ethics Course, Cognitive Moral Reasoning, and Spiritual Intelligence To Practice Of Ethics in the Workplace 2 2 3 3 1 4 4 3 Figures, 2, 3, 4, 5 show the four hypothesized causal relationships based on Figure 1. Figure 2 A Causal Relationship Between Practice Of Ethics In The Workplace And Formal Education In Business Ethics 1 Intervention studies indicate that there are some effects of teaching ethics to adults particularly on moral reasoning (Villanueva, 1982; Rest, 1988; Carlson & Burke, 1998; Velasquez, 2000; Trevino & Nelson, 2004). It was found out that business ethics courses positively affected not only the students covered in the course but their behavior in general (Purcell, 1977, Barach and Nichol, 1980).

This study tested the applicability of this hypothesis to the ethical practice of Filipino business managers in the workplace. Figure 3 A Causal Relationship Between Practice Of Ethics In The Workplace And Formal Education In Business Ethics Mediated By Cognitive Moral Reasoning 22 Cognitive moral development theory reveals that the higher the reasoning stage, the more ethical the decision because the higher stages are more consistent with prescriptive ethical principles of justice and rights (Kohlberg, 1969). Likewise, Kohlberg (1969) maintained that what is counted is the reasoning processes involved in the decision, not just the decision. Further, the actual moral decision is not as important as the reasoning processes used to arrive at it.

Many cognitive moral development researchers support the argument that moral reasoning can be increased through ethical training (Kohlberg, 1969; Gilligan, 1982; Villanueva, 1982; Rest, 1987; Rest, 1988; Trevino, 1992; Trevino & Nelson, 2004). Their studies indicate that a person’s behavior is influenced by his or her moral perception and moral judgments. Figure 4 A Causal Relationship Between Practice Of Ethics In The Workplace And Formal Education In Business Ethics Mediated By Level of Spiritual Intelligence and Cognitive Moral Reasoning 3 3 3 In today’s highly complex organizations, individuals need additional guidance.

Business school students can be trained to recognize the ethical dilemmas that are likely to arise in their jobs; the rules, laws and norms that apply in that context; reasoning strategies that can be used to arrive at the best ethical decision and an understanding of the complexities of organizational life that can conflict with one’s desire to do the right thing (Trevino & Nelson, 2004). Further, as cited in Magnusen (2001), a spiritual dimension allowed leaders to reach followers in a compelling way, toward a common good. Wolman (2001) states that an understanding of one’s individual spiritual makeup is critical to one’s actions and choices. According to Wolman (2001), there are seven factors that make up human spiritual experience and behavior. These are divinity, mindfulness, intellectuality, community, extrasensory perception, childhood spirituality and trauma.

Wolman (2001) used the same Kohlberg’s six stages of moral development as framework and development sequencing for spiritual growth. Figure 5 A Causal Relationship Between Practice Of Ethics In The Workplace And Formal Education In Business Ethics Mediated By Level of Spiritual Intelligence 44 Business ethics is a specialized study of moral right and wrong (Velasquez, 2000). Ethics training lead to higher moral reasoning common to highly principled individuals (Kohlberg, 1969; Trevino and Nelson, 2

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