Last updated on May 13th, 2019 at 02:22 pm
Unethical behavior in the workplace can stem from a number of factors
Jo Hawkins Donovan
There seems to be no end to the accounts of wrongdoing by Enron, and now other organizations’ shaky practices are hitting the headlines. We’re all hurt one way or another by such stories. As business owners, we’re affected by unethical behavior going on in companies anywhere. I’m just glad that bad business is "news" rather than the norm.
I like this working definition of unethical behavior offered by T. M. Jones in Ethical Decision Making by Individuals in Organizations, published by the Academy of Management Review in l991: "Behavior that has a harmful effect upon others and is either illegal or morally unacceptable to the larger community."
Small business owners are always challenged to find ways to make sure that they and their employees come down squarely on the right side. And small firms are especially vulnerable. They can be out of business in no time if it is found that the company is taking advantage of others, or if one "bad apple" wreaks havoc with the financial health – or reputation – of the organization.
There is an ongoing debate among organizational researchers as to whether unethical behaviors are more a function of "bad apples" – unethical behavior attributed to the personal characteristics of individuals, or "bad barrels" – the theory that organizational and societal variables in the system influence unethical decisions and behaviors within the organization. A third group argues that an additional consideration is the relationship among actors. We can draw some helpful guidelines from each of these theories.
Bad Apples – "Man is an animal with primary instincts of survival. Consequently, his ingenuity has developed first and his soul afterward. Thus the progress of science is far ahead of man’s ethical behavior." So said Charlie (Sir Charles Spencer) Chaplin in My Autobiography. In recruiting, shopping for our "apples" so to speak, what can we do to ensure that new hires are morally sound, that they have evolved beyond this basic survival instinct?
First, we can be thorough in the hiring process. Background checks are essential, as one of my friends learned who skipped that step with a well-recommended new staff assistant. After being entrusted with details of the financial operations of the organization, this assistant played with bank accounts in order to give himself a nice six-figure bonus. We have all made hiring mistakes. We have all "fallen in love" during a first interview and rushed to bring someone on board.
Another guideline: Don’t take it for granted that everyone shares your values. Before bringing in a new employee, and frequently afterward, engage in dialogue where you share your perspective regarding what the company stands for and what it won’t stand for. I was in a meeting with Karen Vernal, head of Vernal Management Consultants, when she advised a start-up business owner, "One of the most important considerations is that the people you bring into your organization have values compatible with yours."
When I’m coaching teams or small firms, I use a simple values clarification tool to shed light on each person’s highest priorities – what that person would go to the wall for. However it’s done, you do your best to discern the values of prospective or existing employees. Their values and yours shape the company’s ethical standards.
Bad Barrels – The "apple" at the top of the barrel sets a critical example to employees. If your subordinates ask, "What would the CEO do?" you want them to answer unequivocally, "The right thing!"
Nan DeMars, a consultant who writes a monthly column on office ethics for The Secretary magazine, surveyed readers and found them acutely aware of their bosses’ ethical lapses.
In DeMars’ survey, more than half of the 1,500 respondents reported experiencing verbal or emotional harassment from a boss. (In my coaching work I see improvement here; bosses are realizing they can’t have temper tantrums in front of the people who work for them.) A large percent of DeMars’ respondents said they had notarized documents without witnessing the signature. That might seem like nothing to the boss but could loom large to his employee. What about cheating on expense reports?
A formal ethics program can help employees know what’s right and make it easier to do what’s right, and can offer some protection from criminal penalties if an employee breaks the law. The program needs to be written, and supported by leaders wholeheartedly; it has to be the real deal or people see right through it.
Michael G. Daigneault, president of the Ethics Resource Center in Washington, D.C., encourages small businesses to have a formal code. "What a code tends to do for an organization is establish a set of expectations, an understanding, a common language."
The program includes a safe system for reporting unethical behavior, even a safe channel for questioning the CEO’s actions. Employees and their bosses are faced with ethical choices daily, from e-mail privacy, to inflating promises to customers, to a boss taking credit for a subordinate’s ideas. So the program has to be continuous, like strategic planning, and the more employee involvement the better. Daigneault recommends even bringing customers and vendors in on the formulation of the code.
Relationships in the system – Many factors in business relationships contribute to the possibility of "bad apples" emerging – or not. Most important is the strength of the relationship – measured by frequency, reciprocity, emotional intensity and intimacy. Strong trusting relationships build slowly over time. Here small organizations have an advantage, as there is usually more contact among all employees. Close, empathic relationships forestall conspiracies.
As an organization grows, fragmentation of employees into cliques decreases the shared attitudes about ethical behavior. Communication needs more attention. In Jeffrey L. Seglin’s book, The Good, the Bad and Your Business, he cites the case of a Malcolm Baldrige Award-Winning company that was sued because employees misunderstood the company’s concept "stealing ideas shamelessly". The firm meant that employees should emulate other companies’ good practices. Some employees thought it meant to gain information unethically from a competitor.
In spite of Charlie Chaplin’s words, most employees want to do the right thing. Research shows us that most American adults engage in a level of moral reasoning which makes them want to comply with the roles and expectations of others. And as we all know, people like to do business with other people they trust.
Jo Hawkins Donovan has a coaching and psychotherapy firm in Milwaukee, and can be reached at 414-271-5848 or firstname.lastname@example.org. The firm’s Web site is www.hawkinsdonovan.com. Hawkins Donovan will respond to your questions in this column. Her column appears in every other issue of SBT.
March 15, 2002 Small Business Times, Milwaukee