WHAT IS YOUR ETHICS I.Q.?
WHY ARE COMPANIES AND EMPLOYEES CONCERNED ABOUT ETHICS?
There is a definite correlation between high business ethics and high business efficiency. High valued-ethical companies are responsible for creating and sustaining a healthier working environment within the company in terms of safety, trust, loyalty, and commitment to their superiors, peers, customers, suppliers, and vendors. High-valued ethical companies are viewed by their customers and competition as proactive and engaging from the top levels of leadership on down and possess more integrity regarding culture, core values, and pride in workmanship. Taking their roles and responsibility as corporate citizens seriously is yet another benefit earned by such organizations.
Research and facts support the findings that corporations with high-valued ethical standards are more profitable than their counterparts and are less susceptible to employee theft, malfeasance, dishonesty, and turnover while investigated less often for product safety, employee harassment, or sexual/ diversity discrimination cases. What’s NOT to like about being ethical and “leaving the world a better place?”
WHAT ARE THE DRIVERS OF BUSINESS ETHICS TODAY?
Mention corporate names such as, Enron, Worldcom, Adelphia, Computer Associates, and Tyco and immediately it brings to mind the increases in unethical business behavior. The growing disgust and the resulting miasma has become a global Pandora's Box. What exactly are the reasons behind the rise in corporate unethical behavior, and what, if anything, is being done to clean up their behavior? A multitude of factors is driving corporate interest in ensuring that ethical business standards are upheld. Some of those factors arise from the business environment, while other arise from the larger social environment via laws, politics, and so-forth.
According to AMA/HRI’s Global Business Ethics Survey, 2005, respondents ranked the top five reasons to run a business in an ethical manner as: (1) Protection of brand and reputation. (2) The “right” thing to do. (3) Customer trust and loyalty. (4) Investor confidence, and (5), Public acceptance/ recognition.
When respondents were asked to identify factors driving the business environment in terms of how they affect ethics, the findings were more dynamic. Based upon the answers and how the respondents ranked them, the marketplace itself is viewed as an important driver, in terms of both competition, and globalization. For example:
FACTOR: RANK
CORPORATE SCANDALS: 1
MARKETPLACE COMPETITION: 2
DEMANDS BY INVESTORS: 3
PRESSURE FROM CUSTOMERS: 4
GLOBALIZATION 5
WHAT ARE THE ROLE OF LEADERS AS DRIVERS OF BUSINESS ETHICS TODAY?
The single greatest influence of culture and ethical behavior is leadership. The AMA/HRI
Business Ethics Study, 2005 found that the two top organizational processes for ensuring an ethical corporate culture were related to leadership. Respondents gave their top rankings to this question as follows:
FACTOR MOST IMPORTANT for ENSURING an ETHICAL CULTURE:
- TRUST in Leadership from C-Level down to vendors
- Leaders support and model ethical behaviors & actions
- Keeping promises
- Transparency
- On-going ethics training
- Consistent communications come from ALL leaders/ keep employees informed
- Ethics are integrated into the organization’s goals, business processes, and strategies
- Ethics are part of the performance management system
- Ethics are part of recruitment process and selection criteria
- Whistleblower hotline remaining anonymous and free from retribution
WHAT AFFECT DOES ONE’S OPERATING CULTURE HAVE ON ETHICAL BEHAVIOR & CSR?
Operating Culture includes the social and political values, beliefs, and behaviors of individuals and/or teams. Operating Cultures create and sustain a “tone” that influence the daily "how things are done" attitude as well as the organization’s support system to operate and be successful. In a nutshell, it’s all about, TRANSPARENCY
WHAT ARE THE DRIVERS OF UNETHICAL BEHAVIOR?
According to the study, the following 5 factors (listed in ranked order) Most Likely to Cause People to Compromise Ethical Standards:
1. PRESSURE TO MEET UNREALISTIC BUSINESS OBJECTIVES/ DEADLINES
2. DESIRE TO FURTHER ONE’S CAREER
3. DESIRE TO PROTECT ONE’S LIVELIHOOD/ FOLLOWING ORDERS FROM A SUPERIOR
4. WORKING IN AN ENVIRONMENT WITH CYNICISM OR DIMINISHED MORAL
5. IMPROPER TRAINING: IGNORANCE THAT THE ACT WAS UNETHICAL.
The results speak for themselves. A lack of leadership at the top with a culture rampant with greed and selfishness (meeting the numbers) remains the principle drivers for people to compromise their ethical behaviors. Like professional athletes, CEO’s are often seen as only as good as their last “season” or “quarterly earnings.” The temptation to “bend the rules” becomes directly proportional greater as the pressure to achieved desired results becomes greater. Such incidents become even more brazen and regular if the individual behind the unethical act realizes that there exist no real penalty or consequence for their unethical behavior: most often, violators are actually rewarded . . . until caught!