Who are the ethical Filipino managers

Published in Philippine Daily Inquirer, April 16, 2007

Study indicates workplace can be made to support ethical conduct.

Worldwide, business leaders have stressed the importance of looking at the moral conviction of leaders and managers that make up the field of business. In a special report written in January 2002 by Bruce Nussbum titled “Can you trust anybody, anymore?” he 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…”

Business ethics guru J. Valero said much the same thing in an excerpt from his article Business Ethics In Practice published in the journal Economics and Society, that in most cases the moral behavior of a corporation depends to a large extent on the moral conviction of its owners and managers.

This observation is not lost among our Filipino business leaders and moral guardians. 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 committee was subsequently formed comprised of representative businessmen from small to large businesses and industries.

Despite this recognition of the significance of having ethical business practices as early as 1977, more than thirty years later, the Philippines has been ranked as the eleventh most corrupt among nations in a 2002 global survey by Transparency International, an international coalition against corruption. Then, the country shared the spot with Pakistan, Romania and Zambia.

In a survey conducted among thirteen Asian economies in January and February 2007 by the Political and Economic Risk consultancy based in Hongkong the Philippines, was ranked as the number one most corrupt among Asian nations. The perceived worsening state of corruption has led this author to conduct an empirical research to study the attributes common to ethical business leaders and the factors that may influence a business leader’s ethical decision making. Interestingly, the findings have practical implications to organizational recruitment, retention and leadership policies.

The results of the research work reveal the make-up of ethical Filipino business managers to include a high-level of cognitive moral reasoning, low level of mindfulness and high spiritual intelligence; the last two being dimensions of spiritual intelligence as key attributes common to individuals who practice ethical decision-making and behavior.

The meaning of cognitive moral development

Noted psychologist Lawrence Kohlberg who developed the six stages of moral development collectively refers to the last two stages as the post-conventional level of cognitive moral development and stage of higher reasoning.

For the unfamiliar, the first stage of cognitive moral development is known as the punishment and obedience orientation where an act is defined as good or bad depending on the resulting action whether the act merited a reward or punishment. The second stage, known as the instrument and relativity orientation, depends on how satisfying the act is in addressing the person’s needs. Thus, an act is said to be good if it satisfies the person’s needs. The third stage, called the interpersonal concordance orientation, classifies an act as good if it meets the expectations of the group/s the individual belongs to. The fourth stage, termed as the law and order orientation, classifies an action as good or bad depending on the dictates of the larger society. If society tolerates the action, then it must be good.

Few individuals are able to reach the last two stages, collectively called the stages of cognitive moral development, because few engage in moral reasoning processes when making a decision confronted by an ethical issue. Kohlberg maintains that the last two stages are defined by ethical principles of justice and rights. He maintains, “Stage five known as the social contract orientation, 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 called the universal ethical principles orientation 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”.

Business ethicists have reached general agreement that a person’s high level of cognitive moral reasoning helps predict ethical decision-making in business.

Understanding spiritual intelligence (SQ)

Richard Wolman, author of the best selling book that dwells on spiritual intelligence (SQ) titled Thinking with your soul and originator of the self-accomplished SQ instrument called the PsychoMatrix Spiritual Inventory (PSI) tested among several thousands of individuals worldwide, posits seven factors that make up human spiritual experience and behavior. These are the person’s level of divinity, mindfulness, intellectuality, community, extrasensory perception, childhood spirituality and trauma.

Divinity is associated with the level of awareness and sense of connection to a Higher Being or Divine Presence. Mindfulness posits a strong connection between mind and the body i.e. the state of wellness of the body is an extension of the mind. Also, it refers to the level of affiliation with other people. Extrasensory perception means the level of psychic awareness or sixth sense while community refers to the level of involvement with a group in a variety of social and spiritual activities. Intellectuality refers to the degree of conscious desire and commitment to read, study, discuss and engage in critical thinking. Trauma means the degree of experience of physical or emotional pain and suffering while 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 Koran.

Who are these ethical Filipino business managers

In the dissertation study mounted by this author, it was found out that the practice of ethics in the workplace among Filipino business managers, even among marketers, is based on an individual’s ability to engage in cognitive moral reasoning and have a spiritual intelligence characterized by low mindfulness and a high level of intellectuality.

Filipino business managers who engage in moral reasoning and critical, reflective thinking when faced with an ethical dilemma are far more likely to be ethical. This means that ethical Filipino manages who are principled thinkers, characterized by a higher level of moral reasoning, are not likely to be influenced by other people or other people’s expectations. Principled thinkers are guided by an internal moral compass based on what they believe is fair, just, humane, right and logical. Also, they have a high respect for the dignity of individuals.

There is a direct proportional relationship between moral reasoning and intellectuality, one area of spiritual intelligence. Filipino managers who have high cognitive moral reasoning also scored high on intellectuality. These individuals engage in critical thinking, and an individual commitment to read, study, question, discuss and reflect including aspects of spirituality, even traditional religious literature and philosophy.

On the other hand, there is an inversely proportional relationship between cognitive moral reasoning and mindfulness. Filipino managers who have high cognitive moral reasoning have low scores on mindfulness. High scorers, on the other hand, indicate an individual who is highly affiliative and purposely seeks and values highly the company and approval of others. According to Wolman, those with low affiliative needs are comfortable being on their own and pursuing their activities in a solitary fashion.

Highly principled individuals do not mind being solitary or having a lone voice as long as they believe and abide by prescriptive ethical principles of justice and rights.
Likewise, individuals with higher stage thinking are more independent of external influences.

The same research revealed that highly principled individuals are likely to be low in mindfulness.

Moreover, data from the empirical research revealed that role modeling is a strong behavioral indicator of ethical practice. Noted business ethicists Trevino and Nelson maintain that role modeling is critical to cognitive moral development theory. According to them, followers are strongly influenced by what leaders do, say and reward. They look up and look around for guidance from superiors and their peers. They are likely to follow what they see around them.

Thus, in business environments these individuals who have reached principled levels of moral reasoning must be singled out to lead key decision making groups. Today, these individuals can be identified with the use of cognitive moral development instruments such as the one the author has used in the empirical research.

Organization Implication of Empirical Research Results

The results of the causal study indicate that the work environment can be structured in a way that supports ethical conduct. Some of the ways that Organization Development (OD) and Human Resource/Training managers can apply these learnings include:

1. Inclusion of cognitive moral development tests in pre-employment and employments to identify early on the individuals who can be developed and singled out to lead key decision making groups.
2. Training managers must include moral reasoning and principles based training to encourage reflective, critical thinking among employees. Also, spiritual intelligence formation programs that are principles-based and include selfdiscovery exercises and case workshops may be conducted.
3. Employers must encourage employee participation in community advocacy programs.
4. Employers must reward employee pursuit of ethical practice and conduct.

Background of the Study

The empirical causal study was conducted among a random sample of entrepreneurs, middle to senior level managers with at least five subordinates. Data was cross-validated against feedback from the participating business managers’ superiors and at least two of their subordinates.

Most respondents were in general management and occupied deputy level, chief operating officer or general manager positions. These managers held finance-related jobs, while some were into production and operations, support services and sales and marketing and human resource. A number of respondents worked in services firms that included financial and insurance services, retail, food, government owned corporations, manpower and telecommunications. The rest were in manufacturing, pharmaceutical, telecommunications, petroleum, airlines, power, computer, freight forwarding, medical, construction, manpower and agribusiness. Sixty percent of the respondents were aged 24 to 30 years old. There were more male business manager respondents (54%) than female business managers (46%).

References

Kohlberg, Lawrence (1969). Stage and sequence: The cognitive development approach to socialization. Handbook of Socialization Theory and Research. Chicago: Rand McNally, 347- 480.

Trevino, L & Nelson, K. (2004). Managing business ethics. USA: Wiley & Sons, Inc

Wolman, R. (2001). Thinking with your soul. New York, USA: Harmony Books.