Institutionalising Ethics

1
Institutionalising Ethics
2
Successful managers have

• Traits of the head initiative, cooperativeness,
  flexibility, and coolness under pressure.
• At the expense of
• traits of the heart honesty, friendliness,
  compassion, generosity, and idealism.
• Michael Maccoby

3
Emotional detachment has an analogue in moral
disengagement

• Note the responses of NASA to Challenger, of
  Union Carbide to Bhopal, of Exxon to the Exxon
  Valdez disaster, of Barings Bank to Nick Leesons
  dealings, of Alan Bond to the Tooheys hotel
  leaseholders, of Jodie Rich to One Tel, of Ray
  Williams to HIH, of Gordon Gekko to the world

4
Jackall quotes a manager in Moral Mazes

• What is right in the corporation is not what is
  right in a mans home or in his church. What is
  right in the corporation is what the guy above
  you wants from you. Thats what morality is in
  the corporation.

5
Jackalls five rules of corporate morality
(survival)

1. Dont go around your boss
2. even if your boss invites dissent, tell him or
   her what he or she wants to hear
3. if the boss wants something dropped, drop it
4. anticipate the bosss wishes dont force him or
   her to act the boss
5. do not report what the boss does not want
   reported, cover it up and remain silent.

6
Goodpasters notion of teleopathy

• the unbalanced pursuit of goals by an individual
  or group. Teleopathy ...is a suspension of
  on-line moral judgement as a practical force in
  the life of an individual or group. It
  substitutes for the call of conscience the call
  of decision criteria from other sources winning
  the game, achieving the goal, following the rules
  laid down by some framework external to ethical
  reflection.

7
Rôles

• No licence to act unethically
• Rôles add to responsibilities, they do not exempt
• Suggest that one is impersonating another like an
  actor that the function of the rôle is what
  matters and the occupant doesnt
• Contribute to lost responsibility in organisations

8
Consider the structure of rôles in organisations

• Rather than ask What was going on with those
  people to make them act that way?, we ask, What
  was going on in that organization that made
  people act that way?
• James Waters

9
Asking this does not relieve individuals of
responsibility

• This question moves the focus to the incentives
  for good behaviour, the disincentives against bad
  behaviour, and the culture of risk or safety,
  retribution or support in which individuals and
  teams act.

10
A crook culture exhibits the following features

• 1. There is a kill the messenger ethos in the
  organisation justifies distortion and
  concealment of information.
• 2. There is a low degree of confidence in the
  accuracy of internal reports.
• 3. Despite claims to doing the right thing, in
  the last analysis, top management does the most
  expedient thing.
• 4. Employees do not know of or refer to written
  ethics policies .
• 5. The operative value of the organisation is if
  its legal, its ethical.
• 6. Top managements stated concern for ethics is
  for public relations.
• 7. Managers while basically truthful are willing
  to deceive in order to accomplish organizational
  or personal goals.
• 8. Managers do not believe there is an obligation
  to be candid where it could harm personal or
  organizational goals.
• 9. People who ignore ethics but produce bottom
  line results get promoted.

11
How do you discover this?

• An ethics audit.
• An ethics audit is a survey of the members of an
  organization to test their perceptions of the
  health of its ethical culture.
• Building an ethical culture begins with an audit
  of the prevailing culture.

12
What else is to be done?

• Codes Leadership mentoring
• Ethics training Incentives disincentives
  
• Ethics officers Hotlines
• Committees Ombudsman
• Newsletters Performance standards
• Can all support a culture of ethical excellence

13
Attending to the psychological contract

• When people join an organization they enter into
  what has been called a psychological contract
  this is the unspoken set of agreements between
  employees and the organisations that employ them.
  This makes them hard to deal with for both
  parties, especially when the psychological
  contract is broken.
• One writer has argued that the psychological
  contract may be the central determinant in
  whether a person behaves ethically (Sims 1991,
  495).

14
CODES

• Rule of law
• Common floor
• State fundamental values
• Can be codes of conduct or ethics or hybrid
• Must be used frequently to be effective
• Should be part of induction and development
• Must cover whole organisation
• Can be developed at top

15
Leadership

• Studies show that the single most important
  factor in employees adhering to ethical standards
  is example from the top. This is a more potent
  than peer pressure, or environmental factors.
• Managers ought to respond to problems identified
  in an ethics audit by making public statements
  about the organizations ethical commitments, the
  ethos it is working to establish and its
  expectations of employees.

16
Incentives

• Reward good behaviour and never punish it.
• Punish poor behaviour and never reward it.

17
An aid to clarityDecision models

• Do not make the decision for you
• Document the decision and the process
• Make plain what values are sacrificed
• Aid in moral reasoning
• Objectify moral reasoning and allow an example to
  be set

18
If all else failsWhistleblowing

• Is public exposure of a danger to public interest
• Permitted when a serious issue is not addressed
  within an organisation
• Not internal
• Involves a betrayal of kinds
• Is a costly remedy
• Motives of whistleblower not central
• Difficult to legislate protection for