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Asia Pacific Journal of Human Resources

http://apj.sagepub.com HR managers as ethical decision-makers: Mapping the terrain


Diannah Lowry Asia Pacific Journal of Human Resources 2006; 44; 171 DOI: 10.1177/1038411106066394 The online version of this article can be found at: http://apj.sagepub.com/cgi/content/abstract/44/2/171

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Asia Pacific Journal of Human Resources

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HR managers as ethical decision-makers: Mapping the terrain Diannah Lowry Flinders University, Adelaide, Australia

Discourse surrounding the ethical responsibilities of human resource (HR) managers is in its infancy in Australia, despite an increasing concern with broad matters related to corporate governance and the ethical behaviour of organisations. Recent industrial relations legislative changes in Australia arguably place greater responsibilities on HR managers, and raise issues related to the role they may take in promoting fairness and justice within the workplace. Based on a review of empirical findings from Australia and the United Kingdom, this paper attempts to map the theoretical terrain of the HR manager in terms of a range of decision-making options and resultant ethical positionings. From a synthesis of empirical findings and philosophical perspectives, a heuristic is derived which outlines the varieties of ethical or non-ethical stance an HR manager may make. The argument is made that an understanding of ethical decision-making in human resource management warrants the exploration of the dynamics involving ethical inaction, not just the dynamics of ethical action.
Keywords: ethical assertiveness, ethical decision-making, ethical muteness, HR managers and ethics, moral courage

the highest ideals, which move us most forcefully, are always formed only in the struggle with other ideals which are just as sacred to others as ours are to us. (Weber 1904, cited in Shils and Finch 1949, 57)

In the United Kingdom, Europe and the United States, contemporary debates on human resource management and ethics underscore the role of the human resource manager as a crucial actor in strategic human resource management and sustainable organisation. This topic of debate is still in its relative infancy

Correspondence to: Dr Diannah Lowry, Senior Research Fellow, National Institute of Labour Studies, Flinders University, Adelaide, SA 5001, Australia; fax: + 618 8276 9060; e-mail: Diannah.Lowry@flinders.edu.au
Asia Pacific Journal of Human Resources. Published by Sage Publications (London, Thousand Oaks, CA and New Delhi; www.sagepublications.com) on behalf of the Australian Human Resources Institute. Copyright 2006 Australian Human Resources Institute. Volume 44(2): 171183. [1038-4111] DOI: 10.1177/1038411106066394.

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in Australia, despite an increasing concern with broad matters related to corporate governance and the ethical behaviour of organisations. In some professions, ethical behaviour in certain activities is mandatory. For example, the Sarbanes-Oxley Act 2002 involves significant changes to securities laws for all US listed organisations. The act was passed in large part to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities laws. Some of the most significant provisions within the Sarbanes-Oxley Act concern the criminal and civil penalties that place executive management and the board of directors in the hot seat. While many organisations are adopting ethical codes of conduct, there is no statutory requirement that explicitly demands management processes of ongoing transparency, fairness, and justice in the treatment of workers in the workplace. The International Labour Organization (ILO) seeks to promote social justice in the workplace and humane conditions of labour; however, the lack of enforcement of ratifications is problematic and arguably renders them as somewhat symbolic. While Australia is a member state of the ILO and party to certain ILO conventions, the recent Workplaces Relations Amendment (Work Choices) Act 2005 potentially paves the way for a (further) degradation of employment conditions and a decline in fairness and justice in the workplace (see for example Hammond 2006; Ellem et al. 2005; Waring, de Ruyter and Burgess 2005; Howe et al. 2005). Under the Work Choices Act 2005, HR managers are likely to play a greater role in enterprise based conditions of employment and have more responsibility and discretion in decision-making. While the views expressed in this paper are applicable to all organisational actors, the recent industrial relations legislative changes in Australia arguably place greater responsibilities on HR managers, and raise issues related to the role they may or may not take in promoting fairness and justice within the workplace. This means that HR managers not only have to come to grips with the legislation, but also will need to carefully consider the impact, particularly the ethical impact, of their HR practices and strategies. A fundamental assumption underlying this proposition is that for organisations to be sustainable, ethical human resource management practices demand serious consideration. But ethics and human resource management (HRM) are not usually considered in tandem. For critics of HRM, the existence of an ethical HR manager is about as likely as a visit from Mary Poppins, and any discussion of ethics and human resource management is administered with more than a spoonful of cynicism. The usual approach to unravelling ethical issues in HRM has been characterised by posing questions such as is HRM ethical? or can HRM ever be ethical? (see for example Greenwood 2003; Legge 1998a, b). The discussion in this paper takes a different form of exploration. As indicated above, discussion here rests on the fundamental premise that strategic human resource management involves the establishing of principles and practices which facilitate the

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carrying out of work tasks that enable sustainable organisation. Strategic human resource management then is not a homogenous activity it draws on a wide range of principles, practices and options, as is evident in the consideration of high and low commitment strategies and the multitude of variants that exist in between. To examine whether or not HRM is inherently ethical or otherwise is inappropriate, given the heterogeneity of human resource management in practice. Arguably, a more useful approach is to explore the ethical dimensions of specific aspects of the principles and practices of strategic human resource management. In this way we can explore the ethical implications of say, a long hours work culture, or of flexible labour, or the ethical issues associated with dismissals, downsizing and redundancy, as well as with performance management and reward practices (see for example Winstanley and Woodall 2000; Wilcox and Lowry 2000; Lowry 2001). Importantly, we can also explore the role of human resource specialists, since they are assumed to make a significant contribution to strategic human resource management and are engaged in associated processes of ethical decision-making. Literature that has examined the ethical role of the HR manager can be found in professional/practitioner HRM journals, which from time to time have addressed the issue of the HR manager as the provider of ethical stewardship. Such literature views the HR manager as a guardian of ethics, responsible for a variety of activities such as the provision of training in ethics; communicating codes of ethical conduct; managing compliance and monitoring arrangements; and establishing and maintaining principles of corporate social responsibility (see for example Arkin 1996; Johns 1995; Pickard 1995). Critical explorations of the ethical role of the HR manager found in academic journals. however, present a more vexed account, whereby HR managers are able in varying degrees contingent upon circumstance to exert some influence on ethical practice in organisations, but at some risk. Empirical evidence reveals that HR managers are faced with distinctive ethical difficulties. In a study based on interviews with 120 HR managers in Australia, Ardargh and Macklin (1998, 75) describe the role of the HR manager as the meat in the sandwich between ethics, social policy and individual cases. In a similar study, Foote and Robinson (1999, 94) note the ambiguities associated with the dual roles of the HR manager as both strategist and conscience of the organisation. Such findings are of little surprise when we contend that one of the fundamental tenets of HRM involves the reconciliation of organisational and individual interests. An inherent tension then for the HR manager lies in making decisions related to strategic and usually economic-driven policies while also attending to the ethically warranted needs of employees. Carey (1999) highlights this problem of dual loyalty (or dual agency) in her discussion of the HR profession in an Australian context. Carey (1999) argues the case for a heightened focus on codes of conduct and professional development within

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HR professional bodies such as AHRI. In such discussions, however, there is again the problem of trying to understand a variety of complex ethical dimensions of HRM processes while treating the phenomena under question as homogenous. Treating HRM specialists as congenerous, all experiencing the same dual loyalty moral dilemma, does little to significantly advance our understanding of the subtle complexities of ethical decision-making associated with strategic human resourcing. While the acknowledgment of tensions associated with dual loyalty and dual agency shed some light on dilemmas surrounding ethics and the HR manager, a more useful approach might be to examine the means by which an HR manager, as an organisational actor, interacts with other organisational decision-makers, especially in those interactions that have ethical implications. If we consider that strategic human resource management activity involves the values of the strategy-makers, which then inform, and are informed by, processes of debate and negotiation, we can more closely examine the ethical role of the HR manager. This lays the foundations by which we can incorporate other factors such as the personal orientation of the HR manager (their own ethical standards and how they sit with the values of the organisation) as well as their views towards the way other decision-makers in the organisation treat employees. This view implicitly adopts the Weberian assumption that the world and forms of organisation within it consist of autonomous individuals, selecting from an infinity of values and struggling to impose their own meanings upon their existence (Dawe 1971). HR managers thus face moral choices as a continuous and necessary feature not just in organisational life, but more widely as an essential feature of the human condition. Consistent with this view of the HR manager as an organisational decision-maker possessed of a personal ethical orientation, this paper attempts to unravel the nature of the range of decision-making options available. In contrast to prescriptive accounts of the ethical responsibilities of HR managers, the discussion here explores the processes of ethical and non-ethical decision-making, on the basis that our understanding of ethical decision-making by HR managers might be improved by incorporating the dynamics underlying ethical inaction, not just the dynamics of ethical action. Ultimately, ethical inaction is even more likely to persist without a better understanding of its causes. Based on a review of empirical findings, this paper attempts to map the theoretically terrain of the HR manager in terms of a range of decision-making options and resultant ethical positionings. The discussion here is in four sections. The first section broadly considers the notion of ethics and the role of the individual in the construction of meaning against the background of the notion of Webers heroic ethic. The second section attempts to build on the notion of the individual as creator of meaning by exploring relevant empirical evidence associated with the different types of ethical stance adopted by HR managers. This section maps the terrain of the HR manager in terms of the range of decision-making options and resultant ethical positionings. Following

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from this, a heuristic is derived which outlines the varieties of ethical or nonethical stance available for adoption by a HR manager. The implications of this heuristic for models of ethical decision-making are then discussed in the third section, and a model is proposed. Finally, comments on the role of the HR manager as ethical decision-maker are made. Ethics and the construction of meaning It is well acknowledged that the role of the HR manager is potentially ambiguous and complex, given the inherent tensions associated with the reconciliation of organisational and individual interests. Like any other actor within an organisation, the HR manager is a part of a complex and emergent set of structural, political and symbolic aspects of organisation. The HR manager is expected to both conform to and devise rules and procedures, and must debate and negotiate their activities in a way that is politically and culturally acceptable. This context suggests that the ethical stance adopted by the HR manager is likely to be affected by more than their personally held moral convictions. On the one hand, the HR manager may be viewed as an autonomous individual, choosing from an array of values and imposing their meanings upon their existence, as noted above. On the other hand, however, the extent of this autonomy can be questioned when we consider the bureaucratic context in which the HR manager is situated and when we acknowledge that an essential feature of bureaucracy is its relation to the creation and maintenance of control. Bureaucracy then, as a ubiquitous feature of capitalist work organisation, serves as powerful and all-pervasive feature of modern life. Webers influential (albeit male-centric) view is chillingly and prophetically expressed in this passage:
Already now, rational calculation is manifest at every stage. By it, the performance of each individual worker is mathematically measured, each man becomes a little cog in the machine his one preoccupation is whether he can become a bigger cog this passion for bureaucracy is enough to drive one to despair ... It is as if we were deliberately to become men who need order and nothing but order That the world should know no men but these; it is in such an evolution that we are already caught up, and the great question is therefore not how we can promote and hasten it, but what we can oppose to this machinery in order to keep a portion of mankind free from this parcelling-out of the soul, from this supreme mastery of the bureaucratic way of life. (Weber, quoted in Mayer 1956, 1278, emphasis added.)

HR managers are also subject to the mastery of the bureaucratic way of life and, depending upon circumstance, are likely to become (like any other

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organisational actor) enslaved by certain features of bureaucracy. Webers antidote to the parcelling-out of aspects of self (due to the mastery of bureaucracy) lies in his view that the construction of a meaningful life is in keeping with the importance of the individual as creator, potentially affording all of us the ability to make decisions consistent with our beliefs across a range of different circumstances, a notion referred to as Webers heroic ethic (see Willmott 1998). According to this view, the construction of a meaningful life is guided by norms of an individuals own making, which serves to endow it with dignity, consistency, autonomy and thus, moral worth (Willmott 1998, 1023, emphasis added). These themes of separation or the parcelling-out of the self, and the contrasting notion of consistency as a component of moral worth are discussed in the next section. Ethical choice and the HR manager The tensions inherent in HRM activities are manifest in the way that HR managers interact with other strategic decision-makers and constituents. As stated earlier, the HR manager is expected to both conform to and devise rules and procedures, and must debate and negotiate their activities in a way that is politically and culturally acceptable. Interaction characterised by debate and negotiation, based on a blend of both organisational and personally held values, is thus a necessary feature of the role of the HR manager. Empirical evidence reveals that this is no easy task for the majority of HR managers. Macklins (2003) study of Australian HR managers revealed that they were actively engaged in processes of reflection and deliberation of how their own moral norms and principles were meshed or otherwise with desired organisational outcomes, or in other words, the outcomes desired by other strategic organisational decision-makers. Yet evidence suggests that a significant number of HR managers feel powerless and manipulated by the organisational and bureaucratic context in which they operate (see for example Ardagh and Macklin 1998; Foote and Robinson 1999). While we like to think of ourselves as autonomous moral agents, we may become engaged by bureaucratic models of practice that involve us in varying degrees in manipulative relationships with others (MacIntyre 1984). An important consideration here, and one that is related to notions of parcelling-out of self versus consistency and moral worth, is that manipulative relationships do not necessarily involve active manipulation, for manipulation can also take a passive form. Jackall (1988, 6) puts it eloquently:
bureaucratic contexts typically bring together men and women who initially have little in common with each other except the impersonal frameworks of their organizations. Indeed, the enduring genius of the organizational form is that it allows individuals to retain bewilderingly diverse private motives and meanings for action as long as they adhere

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publicly to agreed-upon rules. Even the personal relationships that men and women in bureaucracies do subsequently fashion together are, for the most part, governed by explicit or implicit organizational rules, procedures and protocol. As a result, bureaucratic work causes people to bracket, while at work, the moralities that they might hold outside the workplace or that they might adhere to privately and to follow instead the prevailing morality of their particular organizational situation. (emphasis added)

The concept of bracketing provides a useful means by which to explore the level of ethical involvement exhibited by the HR manager. Recent critical studies that explore the dynamics behind the process of bracketing provide some clues as to the range of options available to the HR manager in terms of adopted ethical stance. Based on empirical research, Fisher (2000) identifies three main forms of ethical inactivity among HR managers. The most extreme form is what Fisher (2000, 68) terms quietism. This refers to an enforced (through the pressure of other organisational strategic decision-makers) process of total bracketing, whereby an HR manager is likely to be punished in some way (perhaps through termination of employment) unless organisational requirements are met. With this form of enforced bracketing, the HR manager is forced to internalise organisational values and activity, even if they are felt to be unethical. The position of quietism is an extreme position in the case of all decision-makers in the scenario. The assumption is that if the HR manager is not with the organisation they are against it. As Fisher (2000, 69) comments:
At this stage, in the dialectic of inactivity, tolerating an act whilst retaining the right to let your true feelings show, through the whispered aside, is not acceptable. Neither is an agreement to disagree and say nothing about the subject. The failure to take action against an unethical act must be reinforced by committing oneself to the act. The threat, real or implied, is that if they do not volunteer a positive compliance they will be punished.

This form of inactivity and enforced quietism bears resemblance to Deetz (1992) concept of discursive closure, in other words, a form of communication breakdown resulting in distorted communication, ultimately leading to the suspension of convictions and discussion. Thus, discursive closure exists whenever potential conflict is suppressed (Deetz 1992, 187). A second form of inactivity (also characterised by discursive closure) identified by Fisher is referred to as neutrality. This is a less extreme form of inactivity, since there is no requirement to internalise or offer voluntary positive compliance to an unethical act. With this sort of stance, an HR manager decides to be mute. In Fishers research, HR managers gave a number of reasons for such moral muteness, ranging from a lack of opportunity to blow the whistle, to the pace and political nature of organisational life as well as a sense of a lack of positional power.

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The third form of inactivity identified by Fisher (2000) is the situation where an HR manager may tolerate unethical organisational activity (such as, say, poorly executed redundancies, or unfair recruitment and selection in providing jobs for the boys), but may vent their dissent in the form of ironic comments or potentially facetious humour. Again, the underlying dynamic involves bracketing personally held moral convictions from work-life, although in this case the bracketing is self-generated and temporary rather than externally enforced, as it was with quietism. The rationale for such tolerance of unethical activity offered by HR managers in Fishers study was that they could see the business case for acting in a certain (unethical) way. In this case, the conforming of the HR manager to the requirements of the bureaucratic context results in a separation or bracketing of personal values from the public domain. So far, we have only discussed the HR manager as being ethically inactive, based on the assumption that HR managers operate within a certain interpersonal and hierarchical context. HR managers are also caught up in wider institutional patterns involving the notions of resource dependence, resource trading and strategic exchange. In addition to any personal moral convictions, HR managers may need to reconcile ethical pressures being exerted by various groups with which an organisation exchanges or trades. Thus, if HR managers offend employees or future employees, they risk the loss of the labour resources and associated commitment and competencies that the organisation requires to survive. We need then to consider the options for the ethically active HR manager. Indeed, it is useful at this point to consider that the scope of ethical choices available to an HR manager may be conceptualised as a continuum. Using the dynamic of bracketing (separation of public and private domains) we can chart a set of ethical positions that an HR manager may take, depending on the ethical issue or dilemma in question, ranging from an extreme ethically mute or inactive stance through to an ethically active stance. Figure 1 illustrates the available options of ethical stance that an HR manager may adopt. At the ethically active end of the continuum in figure 1 we see that ethical activity involves a lessening of the bracketing activity discussed so far. The ethically active HR manager is likely to consciously address any discrepancy between the private and public domain. A case-study conducted by Watson (2003) suggests that there are two broad positions from which ethical activity can arise. The first of these is termed ethical reactivity. Here an HR manager may choose to deal with ethical issues, but does so because of a need to respond to pressures from the various resource-dependent constituencies with which their organisation exchanges. In this stance, the public domain may be dominant, as it is with the quietist inactive stance, but in this case it also encompasses a wider public domain that goes beyond the public domain of the interior organisation. The second stance identified by Watson (2003) is termed ethical assertiveness. Here, we have no separation between public and private domain. An HR manager acting in this way not only has managed to reconcile internal and

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external pressures with their private moral concerns, but also then acts in a way that satisfies private moral concerns and is corporately expedient (Watson 2003). How is such ethical assertiveness achieved? Satisfying both private and public domains is no easy task. It would appear that the ethically assertive HR manager is one who can successfully translate their private moral concerns into a form of business parlance (emphasising, for example, the long-term implications of various forms of HR policies), and then proceed to debate and negotiate on those grounds. HR managers at the ethically assertive end of the continuum are likely to make certain ethical decisions in different circumstances using different types of rationale to justify those decisions. This stance thus involves considerable practical skill, and also a sophisticated understanding of how the reconciliation of public and private domain (personal and organisational moral interests) is likely to require the consideration of the implications of certain ethical choices. At the extreme end of the continuum, the ethically assertive HR manager is likely to possess what Mahoney (1998) terms moral courage, defined as the capacity to do what one judges is ethically called for in spite of ones instinctive reaction to the perceived dangers and difficulties in which such action will result (Mahoney 1998, 189). In addition to the practical skills of debate and negotiation, Mahoney suggests that moral courage is characterised by confidence, patience and perseverance. The implication for ethical decision-making models Some theorists have devised models that attempt to map the stages of the process of ethical decision-making. Such models usually imply that there are a series of steps that contribute to an ethical decision or action (see for example Rest et al. 2000; Butterfield, Trevino and Weaver 2000; Trevino and Nelson 1999). Moral awareness, or recognising the moral nature of a situation, is considered to be the first step in ethical decision-making. Following this, a decision is made as to what is morally right, accompanied by a moral judgment. The third step involves the establishment of moral intent, in other words, deciding to give priority to moral values over other values. The final step is engaging in moral action. Each stage of such traditional models of ethical decision-making is considered to be distinct, in other words, an organisational actor may reach one stage in the model but this does not mean movement to the next stage will necessarily or automatically follow. In this way, it is argued that such models do distinguish between knowing what the right thing to do is and wanting to do the right thing, and actually doing something about it or knowing what the best course of action is. For example, the ethically reactive and ethically assertive HR manager can be located in the decision-making described above, since both involve the incremental steps of moral awareness, moral judgment, moral intent, and

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Figure 1

The range of ethical choices for HR managers

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(resignation to unethical acts) Quietist compliance

(no view expressed) Neutrality

(trivialising private views) Overt tolerance only

(public domain dominant) Ethically reactive

(moral courage) Ethically assertive

Separation of public and private domains


Source: Lowry (2005)

Non-separation of public and private domains

Figure 2

Proposed model of available options in the ethical decision-making process

ETHICAL INACTIVITY Enforced and internalised inaction and silence in the face of unethical acts (Quietism) Choice to be mute, with neutral intent toward acts considered to be unethical (Neutrality) Judgement to be (overtly) tolerant toward unethical acts Ethical awareness (recognising an ethical issue) Ethical judgement is made (stance adopted) (Ethically reactive)

ETHICAL ACTIVITY Establish ethical intent (operationalising the ethical stance) (Ethically assertive) Ethical Action (actively engaging in ethical behaviour) (Ethical courage)

(Tolerance)

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moral action. In the case of the ethically reactive HR manager, moral intent is fuelled by a felt need to respond to pressures from the various resourcedependent constituencies with which their organisation exchanges (reaction to wider public domain). The ethically assertive HR manager, however, manages to somehow combine internal and external pressures (private and public domain) which results in ethical decision-making and moral action, ultimately leading to ethical human resource management practices. While such traditional four step models are parsimonious, they provide us with a limited understanding of why a non-ethical stance leading to ethical inaction may be adopted. Traditional ethical decision-making models thus fail to acknowledge or account for the conscious decision not to take moral action. While quietism, tolerance and neutrality can be sort of linked to the first two stages of the traditional ethical decision-making model described above, they are more usefully conceptualised as distinct from a mere desire to remain fixed or static at the level of moral intent. Traditional models fail to attempt to generate underlying reasons or dynamics underlying the lack of moral intent. For example, an HR manager may recognise, say, that the targeting of employees for downsizing is dubious and unfairly disadvantages a certain group of workers (moral awareness). The HR manager may choose, however, to remain mute on the issue, for a variety of reasons, none of which are apparent in traditional moral decision-making models. As emphasised throughout this paper, an HR manager may bracket their personal ethical values from their organisational ethical values resulting in a separation of private and public domain, and among other factors this could be a result of the potentially alienating effect of authority or bureaucratic structures. HR managers may know what the right thing to do is and may even want to do the right thing, but have either decided not to follow this impulse or may lack either the method or power or courage to do so. Against the background of this critique of traditional models of moral decision-making and incorporating the heuristic developed in figure 1, a model which encompasses a comprehensive set of options in the process of ethical decision-making is provided in figure 2. A crucial component in figure 2 is the platform from which ethical activity or inactivity occurs clearly, the recognition of an issue as having an ethical dimension (ethical awareness) is fundamental to the model. How to raise the ethical awareness of HR managers is therefore a matter of some salience. Professional bodies such as the Australian Human Resources Institute (AHRI), various ethics centres, HR academics and unions can all play a role in raising the ethical awareness of current and future HR professionals. Conclusion The aim of this paper was to explore the role of the HR manager as an ethical decision-maker, and to attempt to unpack the range of options available in the

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ethical decision-making process. While the views expressed in the paper are applicable to all organisational actors, the recent industrial relations legislative changes in Australia arguably place greater responsibilities on HR managers, and raise issues related to the role they may or may not take in promoting fairness and justice within the workplace. While prescriptive accounts of HRM depict the HR manager as a type of guardian of organisational ethics, empirical findings suggest a number of difficulties faced by the HR manager in being ethically assertive. This paper has attempted to address some of these tensions and difficulties as well as the dynamics underlying them. HR managers are subjected to being responsible for the achievement of a number of competing organisational objectives (for example, high performance with low costs) alongside their personally held moral convictions, and are constrained by the nature of the bureaucratic context of organisations and associated notions of control. Against this backdrop, the space associated with public and private domains and the notion of bracketing are worthy areas of further research as matters related to ethical strategic human resource management. Our understanding of ethical decision-making in HRM would be improved by acknowledging the complexities underlying the processes of ethical decision-making. Moreover, our understanding of ethics, strategic human resource management and sustainable organisations would be greatly enhanced by a realistic exploration of the dynamics underlying ethical inaction, not just the dynamics of ethical action, since ethical inaction is more likely to persist without a better understanding of its causes.

Diannah Lowry (PhD, Monash) is a senior research fellow at the National Institute of Labour Studies at Flinders University. Prior to entering academia Diannah was a human resource manager in the power industry in NSW. Her research and publications have spanned diverse topics including: exploring improved HRM practices for casual employees, the ethical implications of flexible labour forms, the teaching of business ethics, labour force participation as a determinant of indigenous health, and the impact of the mobile phone on the worklife balance of Australian workers.

References
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