Ethical Human Resources Management

Use Corporate Social Responsibility Practices to Value Human Capital

Jul 28, 2009 Tracey Lloyd

Adopting ethical human resources management practices can improve the triple bottom line item of people for a company.

An engaged workforce can lead to increased production, innovation and good word of mouth advertising for the company as an employer. Corporate social responsibility practices in human resource management include valuing human capital, providing safe and healthy workplaces and a work/life balance; embracing diversity in human resources and continual skills development for all employees. A company can chose to extend ethical human resource management practices by ensuring that they only work with suppliers who value the same human resource ideals.

The benefits of undertaking ethical human resource management include greater engagement of employees which may lead to decreased staff turnover, opportunities for greater innovation as employees feel valued and potential to be considered an employer of choice. These benefits can be reported to all stakeholders of the company through the annual corporate social responsibility report.

Valuing Human Capital and Employee Engagement

Traditionally, many companies have viewed employees as a cost centre in relation to the business and may attempt to minimise costs through tight labour contracts and provision of the bare minimum of health and safety standards. Ethical human resource management takes the view that employees are far from a cost but are in fact a unique value adding component of business operations.

Opportunities to value human capital include formation of self-directed work teams, which allow employees to make decisions and be involved in the day to day management of the business, recognition of employee contribution to improved performance, providing regular opportunities to discuss performance and development goals and the provision of a healthy workplace and work/life balance.

Creating a Safe and Healthy Workplace

In most jurisdictions there are minimum standards which must be met in relation to employee health and safety. It is also possible to go further than the bare minimum and create a workplace health promotion program. Implementing a workplace health promotion program is also an opportunity to improve employee engagement and value human capital. Employees can nominate or be selected to participate in the design and implementation of the project and be the project’s champion in the workplace.

From a corporate social responsibility perspective, the implementation of a workplace health promotion program can be seen as the company playing its part in addressing important societal problems such as obesity and environmental pollution.

Skills Development

Another method of employee engagement is to implement a skills development program for all employees. Skills development programs can include both internal and external training opportunities, mentoring programs and corporate volunteering programs.

In a 2006 survey undertaken by the Australian Institute of Management (There are No Limits – What Keeps Employees Engaged with their Workplace), around half of the employees who identified as being disengaged from their jobs or companies felt that there was no support from management for development. However within engaged employees over ¾ felt that there was support from management for personal development.

Ethical Human Resource Management-The Corporate Social Responsiblity Benefits

The benefits for business of adopting ethical human resource management practices and viewing employees as human capital to be developed and to provide a unique advantage in the marketplace can be utilised as part of a corporate social responsibility strategy. Effective corporate social responsibility requires that along with minimising harm to the environment, a company needs to be aware of the social impacts of its operations and ensure that they are not harming human stakeholders.

Engaged employees are motivated employees who may provide an opportunity for increased production output or innovative production methods, are less likely to leave the company voluntarily and may spread word of mouth advertising about how good the company is to work for. Employee engagement surveys provide an opportunity to discover employee thoughts about the company, which if positive, can be expressed to external stakeholders through a corporate social responsibility report.

The copyright of the article Ethical Human Resources Management in Social Corporate Responsibility is owned by Tracey Lloyd. Permission to republish Ethical Human Resources Management in print or online must be granted by the author in writing.

Valuing Human Capital Leads to Employee Engagement