Misconduct is wrongful, improper, or unlawful conduct motivated by premeditated or intentional purpose or by obstinate indifference to the consequences of one's acts. It is an act which is forbidden or a failure to do that which is required. Misconduct may involve harm to another person's health or well-being.
Misconduct is of particular importance in professional settings (e.g. lawyers, doctors, military personnel), in the workplace and various institutions (e.g. schools, prisons). Two categories of misconduct are
sexual misconduct
Sexual misconduct is misconduct of a sexual nature which exists on a spectrum that may include a broad range of sexual behaviors considered unwelcome. This includes conduct considered inappropriate on an individual or societal basis of morality, se ...
and
official misconduct
An official is someone who holds an office (function or mandate, regardless whether it carries an actual working space with it) in an organization or government and participates in the exercise of authority, (either their own or that of their su ...
. In connection with school discipline, "misconduct" is generally understood to be student behavior that is unacceptable to school officials but does not violate criminal statutes, including
absenteeism
Absenteeism is a habitual pattern of absence from a duty or obligation without good reason. Generally, absenteeism is unplanned absences. Absenteeism has been viewed as an indicator of poor individual performance, as well as a breach of an impli ...
, tardiness,
bullying
Bullying is the use of force, coercion, hurtful teasing or threat, to abuse, aggressively dominate or intimidate. The behavior is often repeated and habitual. One essential prerequisite is the perception (by the bully or by others) of an ...
, and inappropriate language.
Misconduct in the workplace generally falls under two categories. Minor misconduct is seen as unacceptable but is not a criminal offense (e.g. being late, faking qualifications). Gross misconduct can lead to immediate dismissal because it is serious enough and possibly criminal, e.g.
stealing or
sexual harassment
Sexual harassment is a type of harassment involving the use of explicit or implicit sexual overtones, including the unwelcome and inappropriate promises of rewards in exchange for sexual favors. Sexual harassment includes a range of actions fr ...
.
Organizational
Organization and management scholars have paid much attention to the causes, forms, modes of development, and consequences of misconduct within or among organizations. They have studied different types of misconduct, such as
white-collar crime
The term "white-collar crime" refers to financially motivated, nonviolent or non-directly violent crime committed by individuals, businesses and government professionals. It was first defined by the sociologist Edwin Sutherland in 1939 as "a ...
s,
insider trading
Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider informati ...
, or deceptive accounting.
Financial misconduct
Misconduct is wrongful, improper, or unlawful conduct motivated by premeditated or intentional purpose or by obstinate indifference to the consequences of one's acts. It is an act which is forbidden or a failure to do that which is required. Misc ...
became prominent after the
financial crisis of 2007–2008
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of ...
that revealed how financial organizations can operate profitable illicit activities over decades.
Organizational misconduct can involve many organizations that collaborate, such as the case of
cartel
A cartel is a group of independent market participants who collude with each other in order to improve their profits and dominate the market. Cartels are usually associations in the same sphere of business, and thus an alliance of rivals. Mos ...
s where firms reduce competition by agreeing on production or pricing, then conceal their actions together and maintain collective secret.
Financial
The failure to understand and manage
ethical
Ethics or moral philosophy is a branch of philosophy that "involves systematizing, defending, and recommending concepts of right and wrong behavior".''Internet Encyclopedia of Philosophy'' The field of ethics, along with aesthetics, concerns ma ...
risks played a significant role in the financial crisis. The difference between bad business decisions and
business
Business is the practice of making one's living or making money by producing or buying and selling products (such as goods and services). It is also "any activity or enterprise entered into for profit."
Having a business name does not separ ...
misconduct can be hard to determine, and there is a thin line between the ethics of using only financial incentives to gauge performance and the use of holistic measures that include ethics, transparency and responsibility of
stakeholders. From CEO's to traders and brokers, all-too-tempting lucrative financial incentives existed for performance in the financial industry.
The past widespread financial misconduct led to a call for financial reform. The
Dodd-Frank Wall Street Reform and Consumer Protection Act was passed in 2010 to increase accountability and transparency in the financial industry and protect consumers from deceptive financial practices.
[Ferrell, Fraedrich: ''Business Ethics'', ''eleventh edition'' Ethical Decision Making and Case, Sexual Harassment in Workplace. February 17, 2017. p. 80]
References
Further reading
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{{abuse
Legal terminology