Organisational Ethics, Narratives and Social Dysfunctions
Abstract: The paper explores the joint determination of economic output, wages, corporate culture, employees' ethical standards and monitoring intensity in an analysis of organisational dysfunction. Economic activities are frequently accompanied by unethical and socially harmful activity, such as corruption, sexual harassment and environmental degradation. The ethical sensitivities of managers and their employees are shaped through their social interactions and thus organisational dysfunctions can arise. Such dysfunctions may be mitigated through changes in government policies or social norms. These changes become particularly effective if they encourage the managers and employees to adopt more ethical narratives. Narratives align managers' and employees' recognition of the social harm from unethical activities, determining their objectives and thereby their economic behaviours. The intersubjective quality of narratives means that policy interventions may either be amplified or counteracted by how discussion unfolds around the issue.
