Hospital Ethics Review Committees and Business Ethics: What Managers Can Learn (2004)

Issues of ethics are prominent in business today. Managers are required to address complex ethical questions and resolve conflicting stakeholder obligations. Managers can learn ways to address these issues from the health care industry. In particular, the experience of hospital ethics review committees (ERC) and the issues they face can help inform ethical decision making in other managerial areas. This paper will review the implementation of ethics in corporations today, the history and workings of ERC's, raise some of the issues currently facing ERC's, and analyze what corporate managers can learn from ERC's. Introduction Recent corporate scandals involving such companies as Enron, Tyco, and World Com have refocused national attention on business ethics. While many of these scandals included intentional violation of law as well as ethics, they bring to light the continuing need for the review and implementation of ethics programs today. Managers face complex ethical challenges and dilemmas, such as privacy, allocation of resources, and conflicting duties to various stakeholders (e.g., owners, employees, consumers, the community, society). Where in business organizations can managers turn to find the ethical reasoning and moral principles necessary to guide them in resolving these dilemmas? How can managers best be helped to identify and appreciate their ethical obligations? Insights into the answers to these questions may be gained from an examination of a mechanism which has already been put in place to resolve such ethical issues in a setting which contains these and other, often more complicated, ethical dilemmas. The hospital ethics review committee (ERC) has developed over the last two decades as a means of addressing ethical concerns in health care organizations. This paper first examines current corporate ethics practices, focusing on the implementation of ethics in corporations today. Next, the ERC is addressed as a mechanism for the raising, examination, and resolution of ethical issues in the hospital setting. Characteristics of ERCs and some of the issues faced by ERCs are highlighted. Finally, the issue of what business organizations in general can learn from hospital ERCs in evaluating and solving their own moral problems is considered. This examination of ERCs will yield benefits for the study of values in business generally; hospitals have a great potential for showing other types of business how to address and solve moral problems. Corporate Ethics Practices The importance of ethics in U.S. business organizations has increasingly become a subject of public attention, government regulation and corporate concern. Changing social values and business scandals (such as those in the defense industry in the 1970's and 1980's; insider trading and hostile takeovers in the 1980's and 1990's; and the current rash of accounting and financial manipulation scandals) have increased the pressure for corporations to review their ethical policies. Businesses have been encouraged by United States Sentencing Commission (c.f., Dalton, et al, 1994), the media, and their own stakeholders to enact formal ethics programs. These programs may have a variety of components ranging from simple codes or policy statements to active involvement by the CEO and committees of the Board of Directors. Weaver, Trevino, and Cochran (1999) recently examined the elements of formal ethics programs in Fortune 1,000 corporations, measuring the percentage of companies with various degrees of ethics codes, personnel, offices, reporting systems, training, and top management involvement. They concluded that, ...major American corporations generally have adopted one or another form of ethics-oriented company policies, but vary substantially in the extent to which those policies are supported by ethics-specific structures, personnel, and activities. (p. 293). Most corporations in this study seemed to be responding to media and government pressure by instituting window dressing solutions, but not following through with truly functioning ethics programs. …