Company ethics, as a question of business politics,

along with the social responsibility of the

companies, gain more and more importance in
societies governed by market economies. Reasons
for this were first the “oil shock” in the „70s,
afterwards the release of the “Club of Rome” with its
wide-ranging statement for an environmental friendly
use of the earth resources, as well as the current
economic scandals with Enron (USA), on the same
track, the disappearance of “Arthur Andersen”, one
of the biggest audit companies of the world, and, of
current interest, the events in Germany regarding
Siemens, Deutsche Bank (the victory sign), with
reference to the acquisition of Vodafone-
Mannesmann, in order to mention only some
important “highlights”.

Ethical management – is it an
issue in Romania, as well?
You will agree on the fact that there are
lots of examples in Eastern Europe,
either in Russia, but also in Romania,
which could be taken into
consideration.
The goal of this short article could be
only to take a look over this theme and
to see how we stand, in Romania. This is
why I take the liberty to avoid questions
regarding definitions, but, in order to
remove misunderstandings:
Company ethics versus profit
“Gaining profits is today, as well,
definitely a main issue for the
companies” – neither companies, nor
employees would be able and willing to
give up “their profits/salaries”.
Meanwhile, many parties question the
fact that the “absolute maximization of
profits” or the “current shareholder
value” can be considered the one and
only company goal. The “invisible hand”
of the market according to Adam Smith
– 1782 -, respectively according to
Milton Friedman – “shareholder value
maximization increases the company’s
welfare” does no longer rule everything!
The climatic changes are an obvious
signal and determine a limit regarding
devastation of the jungle, extensive
agriculture with soil exploitation,
remarkable increase of the health costs,
environmental damages caused by
energy production, the discussion about
the pollution determined by cars, etc.
Each company carries the general social
responsibility! Without this change of
mentality, “running business” in future
will generally become very difficult, if
not impossible. Another obligation for
the international companies derives
from globalization.
Those questions have arisen meanwhile
in many big companies and in their
management, and attempts are being
made to involve the entire firm. Only a
“corporate instruction” would not reach
too much, but it is clear that the
“owners” and the management are the
ones who have to lead the way. Then, all
employees and also the clients and
suppliers (stakeholders) have to be
involved. It is also very important that
every company formulates its “ethic
question”! From the point of view of the
company’s politics, it does not become
easier when getting deeper into details,
e.g. the profit question versus the height
of the salaries and versus cutting down
the working places, the energy question:
economically versus resource
protecting; the environment question:
waste versus recycling, etc.
Ethic business seems to be profitable!
Meanwhile there is a series of studies
which prove the economic success of
ethical company policy. Above all, the
long term success of the company is
linked to an ethical oriented company
management. Higher motivation of the
personnel, higher acceptance from the
clients, suppliers and the general public
are serious reasons for such important
strategic decisions.
WHO CARES, WINS! The UN defined
its “GLOBAL COMPACT” criteria for an
internationally oriented economy on
ethic bases for a world looking towards
the future.
Ethical management and
Romania?
he does not only have to prove his
professional understanding, but also his
The author Werner E. Stein is founder
competence in communicating with the
and chairman of the international
employees, the public, his/her
human resources consulting company:
engagement and attitude towards this
The Amrop Hever Group / Stein &
country and the willingness to take
Partner in Bucharest. Since more than 10
over responsibility in general ethical
years, he is also an honorific professor at
aspects.
the Technical University Bucharest –
From our point of view, the companies
Polytechnics – teaching Management/
which will, now and in future, gain
Personnel/Communication. He is also
important market and image
founding member of the DWR (German
advantages in the booming Romania
Business Club in Romania).
are those which understand to locally
Further practice oriented literature on
implement a sound combination of
this theme: “Ethik im Management”,
ethical company policy and SOCIAL
Hans Ruh-Klaus, recognized Economist
COMPETENCE of the local
and Professor in Zurich, M. Leisinger,
management. From my point of view,
Professor and Executive Director of the
this route has already started in
Novartis Foundation Publishing House:
Romania!
orell füssli AG, Switzerland

At a first glance, strong contrasts, isn’t

it? Anyway, the ethical company
management will become soon the
main “management duty” here, as well.
Nowadays it would be hard for
international companies to create a
different strategy especially for one
country, respectively to afford unfair
practices, which means that a manager
responsible for Romania would have to
implement here the guidelines of the
company, even if in some individual
cases special efforts are necessary.
Let’s think of all the privatizations of
state-owned companies and of other
“public tenders” during the last years
and let me be sincere – not always fair
negotiations led to success, probably
rather the opposite. Companies’ leaders
in Romania are also under strong
pressure regarding success, and
reaching the turnover! But this is
exactly the place where the manager’s
“local responsibility” has to intervene. I
am sure that Romanian authorities and
local employees expect especially from
foreign companies/managers an exam-
ple of fair/ethical business behavior!
This is the reason why today every
manager should have a pronounced
SOCIAL COMPETENCE, meaning that