Personal Values and Organizational Commitment of Employees and Ethical Climate of Medium Enterprises

Analyn M. Banagbanag

University of Eastern Philippines

This descriptive-correlational study determined the personal values, an organizational commitment of employees and ethical climate of medium enterprises in Eastern Visayas. Respondents were 21 managers and 182 rank-andfile employees of 16 medium enterprises, determined using purposive sampling technique. Personal Values Scales, Organizational Commitment Questionnaire and Ethical Climate Questionnaire were used. Results were analyzed using Pearson-Product Moment Correlation Coefficient, Point-Biserial Correlation Coefficient, Eta Correlation, and t-test. The twelve Personal Values were "dominant" for both respondents. The managers had an average level of Organizational Commitment, and the rank-and-file had high commitment. Both groups perceived their organization to be highly ethical. Being manager was significantly related to ethical climate while for the rankand-file employees, household size, monthly salary, highest degree, and employment status were significantly related to ethical climate. Physical development, honesty, religiousness, self-control, creativity, and independence were significantly related to ethical climate for managers, and all 12 variables were significantly related to ethical climate for rank-and-file.

Values contribute to a person's behavior and choice, including values that involve ethical decision making. Researchers have found that people's values tend to be congruent with the values that are upheld in their work environments (Holland, 1996). Organizations that have an ethical culture, coupled with systems that are also congruent, can influence the likelihood that employees will behave in ethical ways (Trevino, Weaver, & Reynolds, 2006). However, the critical issue of whether employees will choose to take the correct path is a matter of an individual's choice, and such a choice will be shaped by the individual's environment.

Organisational commitment, as its name denotes, has been regarded as having work behavioral impacts that are instrumental in organisational success (Meyer & Herscovitch, 2001). Highly committed employees are found to exhibit better job performance and higher levels of attendance (Stephens, Dawley, & Stephens, 2004). The potential of commitment for facilitating employee's intention to participate in a professional activity is also confirmed (Snape & Redman, 2003). In addition, the commitment has been considered influential in the employee's willingness to do more than is required by organisations. It is presupposed that these personal values and organizational commitment of employees make up the ethical climate of the work environment of these employees.

Ethical climate refers to the shared perceptions of organisational members regarding what is considered correct behaviour in the organisation and how the organisation deals with ethical issues (Cullen, Parbooteah, & Victor, 2003). These personal values have a significant influence on decision-making, and they propel people in their commitment to the organization and to behave in an ethical or unethical manner. Personal values, although individualistic in nature, are largely influenced by societal and cultural factors. They influence an individual's behaviour and attitude, and this can at times conflict with the values held by colleagues or organisations within which they work. The approach to resolving ethical issues can become critical to the longevity of an organization, the individual’s commitment to his/her organization and therefore determine the individual’s future with the organisation.

In the world of business, the profit motive is singularly the biggest stumbling block to ethical behavior and practices. Business is business, and the drive for profit very often undermines ethical behavior, regardless of the political or economic environment. But what constitutes unethical behavior in the business world? Clearly, that which is prohibited by law is unethical. In the conduct of business and trade, there is often a large gray area wherein the distinctions between right and wrong are not so clear. What may be perceived to be unethical by a firm's competitors may well be justified as simply aggressive marketing methods. Thus self-regulation or selfpolicing comes into play, and personal values are a great factor. The focus of this study are the medium enterprises in Eastern Visayas. It looked into the personal values and organizational commitment of the managers and the rank-and-file employees of medium enterprises in Eastern Visayas and how these factors relate to the ethical climate of their work environment.

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