For a company, organizational culture is very important because the culture is like something that the employee can be based for. In addition, the organizational culture is defined as a system of shared meaning and beliefs within an organization that determines, in a large degree, how employee’s act (Robbins, et al., 2003, p. 70). Founders of new organizations and managers play an important role in creating and maintaining organizational cultures. However, ethical organizational cultures are those in which ethical values and norms are emphasized. As Jones and George (2003, p. 350) argue that ethical organizational cultures can help organizations and their members behave in a socially responsible manner. Some might believe that if they do the ethical corporate culture, they will be able to get much profit.
Meanwhile, Arnold and Lampe (1999, pp. 1-19, cited in Robbins, et al., p. 154) claim that the content and strength of an organization’s culture also influences ethical behavior. Nevertheless, a strong culture will have a very powerful and positive influence on managers’ decisions to act ethically and unethically. whereas, in a weak organizational culture, managers are more likely to rely on subculture norms as a behavioral guide. Work groups and departmental standards will strongly influence ethical behaviour in organizations with weak overall cultures.
Alongside with organizational culture, there are two more things that have strong correlation with it. The first one is ethics. Ethics is the code of moral principles and values that govern that behavior of a person or group with respect to what is right or wrong (Robbins, et al., 2003, p. 150). The second thing that has strong correlation with culture is social responsibility. It is a management’s obligation to make choices and take action that will contribute to the welfare and interest of society as well as to the interest of the organization (Robbins, et al., 2003, p. 138).
Nevertheless, managers who have ethical behavior and social responsibility can build a good reputation for their company. As Donaldson and Werhane (1993, pp.249-254) argue that having a good reputation of a company can increase profit. In addition, Robbins (et al., 2003, pp. 161-165) defines social responsibility is “an obligation, beyond that required by the law and economics, for a firm to pursue long-term goals that are good for society”. However, social responsibility is the duty of manager to make decision consider with well-being of stakeholders and society. In fact, there are two main views of management’s social responsibility, which are classical view and socioeconomic view (Robbins, 2003, p. 407). Additionally, classical view aims to maximize profits, whereas socioeconomic view is that social responsibility goes beyond the increasing profit to improve the welfare of society.
It is very important that managers support and develop an ethical culture because employees more likely to act ethically if their leader work having an ethical role model (Jones, & George, 2003, pp.101-103). Working ethically is a responsibility to the society. Nevertheless, this is very important as it can avoid harming stakeholders and also enhance the well-being of society as a whole. Stakeholders including employees, customers, suppliers, competitors, governments, media, union, communities, social and political action groups, etc (Robbins, et al., 2003, pp. 92-93).
There are still some examples for the reference of socially responsible behavior such as providing training for workers, eliminating discrimination and reducing pollution (Robbins, et al., 2003, p. 407). Providing training for workers can enhance their skills and techniques for work and it can improve the productivity and efficiency. Workers will not be obsolete by the changes of technology so it benefits employees as well as the company (Tsang, 2003, p. 25). Social responsibility and economic growth is related sometimes. At first, the profit may be reduced by the costs of training workers, however, when the trained employees can work efficiently, the productivity will be increased followed by increasing profit at last.
Eliminating discrimination is a social responsibility of managers. Some companies would like to employ a specific kind of person but not the others and cause inequality is known as discrimination. For instance, some companies would prefer employ a local student to an international student or they prefer employ man to woman (Pagan, 2000, p. 619). It is harm to firm if they refuse to employ some other races people since they can provide some new ideas to the company for reference.
These new ideas may not be gained from local employers as foreigners have different culture from the local and they can offer some useful information from the other view for the decision making. This is why an organizational culture which has formally adopted a specific position, philosophy, or set of beliefs regarding the fundamental values or principles, is an important thing to be used as the basis for business decision making. Moreover, if managers keep labor Market discrimination, it would lead to society chaotic and harm the society. Therefore, managers should bear the social responsibility to reduce discrimination.
Another point that supports an organization to become socially responsible is that when a company being socially responsible, which means that the company has long-term goals. Company should higher the quality of a product to benefit customers to provide a better quality of life (Samli, 1992, p.12). The real example about this is The Body Shop. Although The Body Shop is looking for the profit, they still very concern about the environment. They use goods that not give bad impact on the environment.
The product that the body shop sells is more expensive than others because they use the materials that do not give bad impact to the environment. As a result, people still buy their product because people know that they choose the right product. More expensive but in their product, it can’t be found anything that can damage their self and more important damage the environment. As we have seen, by being socially responsible, the firm can gain long-run profit and improve the company’s public image (Davis, et al., 1988, p. 37).
In short, it can be seen that being socially responsible and following ethical corporate culture is much more profitable. But, since not all the companies have ethical corporate culture, there are some policies or practices that can be worked to encourage it. Firstly, the company should provide some training for the new and current employee because with the training activities it will make all the employee know about the culture and can adapt with the organization’s culture. Secondly, the company should punish the person who do not obey or perform appropriate with the culture and give respect to the person who perform and do the culture. With that punishment and respect the employee will think that obey the culture is important. Third, the leaders in the company have to do the culture, so the employee can follow the leader to do the culture. Senior management needs to zealous avoid any decision or action that could reasonably be expected to communicate selfish motive for imposing an ethics philosophy, system, or measurement on employees (www.centeronline.org/knowledge/article.cfm?ID=2431).
In conclusion, social responsibility is an important element for a company to success. Social responsibility brings company reputation followed by higher profit. Those firms having social responsibility can improve people’s quality of life and their health. It can also stable the society from chaotic. Therefore, managers should follow regulations and work ethically with the consideration of society’s well-being. Briefly, if one company is concerned about the ethical corporate culture which means that the company and the employee know what is right and wrong and know how to behave in the company. Thus, in one company it is very important to have ethical corporate culture.