Ethical Concerns and Dilemmas in Government and Private Institutions

• 02 Aug 2024

For Prelim: Accountability, Oath of Secrecy, Corruption, Bribery, Innovation, Unfair Employment Practices, Misleading Advertising, Financial Reporting, Investor Confidence, Insider Trading, Anti-Competitive Behavior, Good Governance

For Mains: Managing conflicts of interest that may arise due to ethical concerns and dilemmas in government and private institutions.

What are Ethical Concerns and Dilemmas?

• Ethical concerns are defined as situations in which a moral conflict arises in the workplace. Thus, ethical issues tend to interfere with a society's principles.
  • They are concerned with what is right and wrong, good and bad and how we use that information to decide our actions in the real world.
  • Examples of ethical concerns in the workplace include empathetic decision-making, promoting conduct in regard to trust and integrity, and diversity accommodation.
• An ethical dilemma can be described as a circumstance that requires a choice between competing sets of principles in a given, usually undesirable or perplexing situation.
  • There are three conditions that must be present for a situation to be considered as ethical dilemma:
    • The first condition of an ethical dilemma is when an individual, or "agent," must choose the best course of action.
    • The second condition for ethical dilemma is that there must be different courses of action to choose from.
    • Third, in an ethical dilemma, no matter what course of action is taken, some ethical principle is compromised. In other words, there is no perfect solution.
  • Types of Ethical Dilemmas:
    • Personal Cost Ethical Dilemmas: This dilemma arises from situations in which compliance with ethical conduct results in a significant personal cost (e.g. jeopardizing held position, missing opportunity for financial or material benefit, injuring valued relationship etc) to the public-servant-decision-maker and/or the Agency.
    • Right Versus Right Ethical Dilemmas: This dilemma arises from situations of two or more conflicting sets of bona fide ethical values (e.g. public servants' responsibility of being open and accountable to citizens versus that of adhering to the oath of secrecy/confidentiaIity etc).
    • Conjoint Ethical Dilemmas: This dilemma arises from situations in which a conscientious public servant decision maker is exposed to a combination of the above-indicated ethical dilemmas in searching for the "right-thing-to-do".
• Ethical Concerns in Government Institutions:
  • Abuse of Power: Exercising authority in an arbitrary or repressive manner can infringe on citizens’ rights and undermine democratic processes. It damages the interests of the state or certain citizens.
  • Indifferent Attitude: Authorities show reluctance to take decisions and lack of professionalism though they are expected to act according to certain standards.
  • Corruption and Bribery: Corruption is dishonest behavior by those in positions of power. It entails a variety of actions, including giving or accepting bribes or inappropriate gifts undermining the fairness and integrity of government processes.
  • Evasive Attitude: It is the tendency to avoid responsibilities and difficult decisions. It can contribute to a culture of excessive paperwork and procedural delays, as officials may use these as excuses to postpone actions.
  • Post Retirement Benefits: The promise of generous post retirement benefits might lead some civil servants to focus more on securing their benefits rather than striving for excellence or innovation during their tenure.
  • Mismanagement of Public Funds: Person fails to follow the rules or guidelines when handling money for another person or organization. Though he had lawful access to the money, it is their use for personal gain or another unapproved purpose that makes it a crime.
• Ethical Concerns in Private Institutions:
  • Unfair Employment Practices: They are deceitful practices by either employers or employees to obtain profits that are prohibited by the statutes e.g., discrimination, interference with employee rights, unfair suspension etc.
  • Misleading Advertising: It ranges from exaggerated claims to outright falsehoods which poses a serious challenge to consumer trust and the integrity of the advertising industry itself.
  • Faulty Audits: It can occur for various reasons like inadequate or incomplete audit procedures, a lack of understanding of the business, fraudulent financial reporting, or management override of internal controls. It can lead to damage to its reputation, loss of investor confidence, regulatory penalties, and legal liabilities.
  • Insider Trading: Insider trading means trading a company's securities using confidential, unpublished information to make a profit or avoid a loss. It breaches the fiduciary duties of company officers.
  • Anti-Competitive Behavior: Various companies in the same industry secretly agree to raise the prices of their products in a similar manner, which creates a situation that harms the market and consumers. It hampers healthy competition in a free market.
  • Influence Peddling: Lobbies are formed to influence officials to act in a way that is beneficial to the industry's best interests, either through favorable legislation or by blocking unfavorable measures. They are seemingly able to circumvent the democratic process.
• Ethical Dilemmas in Government Institutions:
  • Professional Duties Vs Own Personal Values: Professional duties and an individual's own personal values may clash and cause an ethical dilemma e.g., a police officer may personally believe that a law that he is required to enforce is wrong.
  • Anonymity Vs Transparency: At its core, transparency is an essential feature of accountable representative government but at the same time bureaucrat has to keep sensitive information secret from press and media.
  • Rule Compliance Vs Creativity: Public servants operate within the established legal and regulatory framework which helps to maintain public trust and confidence. However, in the modernized world public service demands novel ideas that transcend conventional boundaries and explore new approaches.
  • Rigidity Vs Flexibility: Indian bureaucracy follows a rigid hierarchy with multiple layers and procedures. But, the fast pace of technological change requires public services to be flexible in adopting new tools, systems, and processes to improve efficiency and service delivery.
  • Private Life vs Public Life: Individuals, including public figures, have a right to keep certain aspects of their personal lives private, such as family matters, health, and personal relationships. However, public figures are often expected to be transparent about their actions and decisions, as their behavior can impact public trust and confidence.
• Ethical Dilemmas in Private Institutions:
  • Data Confidentiality Vs Data Processing: Customers should know when and why their data are being collected and expect businesses to protect user information from unauthorized access. While consumer data processing offers several benefits for businesses, helping them to make informed decisions, optimize operations, and enhance customer experiences.
  • Employee Satisfaction Vs Corporate Targets: The conflict between employee satisfaction and corporate targets often arises when the goals of maximizing business performance clash with the well-being and morale of employees. Achieving high performance often requires pushing employees to meet tight deadlines, handle heavy workloads, and increase productivity.
  • Sustainable Procurement Vs Cost Efficiency: Sourcing materials and services from sustainable and ethical suppliers may involve higher costs due to more expensive practices, certifications, or premium products. Prioritizing cost efficiency might lead to opting for cheaper, less sustainable options.
  • Good Governance Vs Profit Maximisation: Good governance focuses on long-term sustainability, stakeholder interests, and ethical practices, which may involve investments that don’t yield immediate financial returns. Profit maximization prioritizes immediate financial gains by exploiting loopholes.
  • Inclusiveness Vs Efficiency: Inclusiveness promotes a diverse and supportive work environment where all employees feel valued and included. Efficiency may prioritize a culture of high performance and results neglecting inclusiveness.
• Resolving Ethical Concerns and Dilemmas:
  • Principle of Long-term Self-interest: Never take any action not in your organization's long-term self-interest.
  • Principle of Personal Virtue: Never do anything that is not honest, open and truthful.
  • Principle of Religious Injunction: Never take any action that is not kind and that does not build a sense of community.
  • Principle of Government Requirements: Never take any action that violates the law, for the law represents the minimal moral standard.
  • Principle of Utilitarian Benefit: Never take any action that does not result in greater good for society.
  • Principle of Individual Rights: Never take any actions that infringe on others agreed-upon rights.

Conclusion

Navigating ethical concerns in government and private institutions involves balancing employee Satisfaction, corporate targets, and operational effectiveness. Government dilemmas center on transparency, accountability, and the conflict between public duty and personal interests. Private institutions face challenges in reconciling profit with social responsibility, fair treatment of employees, and consumer privacy. Addressing these issues requires a commitment to ethical principles, robust governance, and a culture of transparency and inclusivity. By prioritizing ethical practices and maintaining accountability, institutions can enhance their reputation, build trust, and support a sustainable future, aligning short-term actions with long-term ethical values.