Ethical Climate and Ethical Culture
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An organization’s formal ethical context is distinct from its informal ethical context. The formal context, also known as hard controls, consists of the tangible and explicit parts of an organization, such as its plans, policies, and procedures. An ethics program is regarded as the most relevant component of the formal ethical context and consists of ethics instruments and measures, such as a written code of ethics, an ethics training module, a policy on whistle-blowing, and an ethics monitoring system.
The informal context, also called soft controls, consists of the intangible and implicit parts of an organization, such as the shared assumptions, values, and expectations. Two of the most important components of this ethical context are the organization’s ethical climate and ethical culture. An organization’s ethical climate refers...
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