Building A More Ethical Workplace Culture

PYMNTS
PYMNTS.com
Originally posted March 20, 2018

Here is an excerpt:

The Worst News

Among the positive findings in the report was the fact that reporting is on the rise by a whole 19 percent, with 69 percent of employees stating they had reported misconduct in the last two years.

But that number, Harned said, comes with a bitter side note. Retaliation has also spiked during the same time period, with 44 percent reporting it – up from 22 percent two years ago.

The rate of retaliation going up faster than the rate of reporting, Harned noted, is disturbing.

“That is a very real problem for employees, and I think over the last year, we’ve seen what a huge problem it has become for employers.”

The door-to-door on retaliation for reporting is short – about three weeks on average. That is just about the time it takes for firms – even those serious about doing a good job with improving compliance – to get any investigation up and organized.

“By then, the damage is already done,” said Harned. “We are better at seeing misconduct, but we aren’t doing enough to prevent it from happening – especially because retaliation is such a big problem.”

There are not easy solutions, Harned noted, but the good news – even in the face of the worst news – is that improvement is possible, and is even being logged in some segments. Employees, she stated, mostly come in the door with a moral compass to call their own, and want to work in environments that are healthy, not vicious.

“The answer is culture is everything: Companies need to constantly communicate to employees that conduct is the expectation for all levels of the organization, and that breaking those rules will always have consequences.”

The post is here.

Business ethics: am I boring you?

Katherine Bradshaw
The Guardian
Originally published November 8, 2012

Here is an excerpt:

We need to bridge the gap between ethics programmes and daily worklife – and stories can help us do that.

No matter how sophisticated we are as a society, stories continue to be our preferred way of communicating and sharing our experiences of life. From a book at bedtime to the latest cliffhanger of our favourite soap, stories help us connect and communicate our emotions and values with each other.

Business ethics training at its worst can include material which seems distant to staff and how they do their day-to-day job. A set of compliance dictats communicated with slides animated with clip art, or an eLearning programme with easy multiple choice questions conducted in isolation, is unlikely to engage anyone with what really matters.

Ethical values need to be embedded into company culture so that they are reflected in the way that business is actually done. This requires an ethics programme with objectives beyond just imparting knowledge and raising awareness of expected standards – the challenge is to communicate their relevance and importance at all levels and locations in a way that impacts on understanding, decisions and behaviours.

The article is here.

Middle managers may turn to unethical behavior to face unrealistic expectations

Science Daily
Originally published October 5, 2017

While unethical behavior in organizations is often portrayed as flowing down from top management, or creeping up from low-level positions, a team of researchers suggest that middle management also can play a key role in promoting wide-spread unethical behavior among their subordinates.

In a study of a large telecommunications company, researchers found that middle managers used a range of tactics to inflate their subordinates' performance and deceive top management, according to Linda Treviño, distinguished professor of organizational behavior and ethics, Smeal College of Business, Penn State. The managers may have been motivated to engage in this behavior because leadership instituted performance targets that were unrealizable, she added.

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Middle managers also used a range of tactics to coerce their subordinates to keep up the ruse, including rewards for unethical behavior and public shaming for those who were reluctant to engage in the unethical tactics.

"Interestingly, what we didn't see is managers speaking up, we didn't see them pushing back against the unrealistic goals," said Treviño. "We know a lot about what we refer to as 'voice' in an organization and people are fearful and they tend to keep quiet for the most part."

The article is here.

The target article is here.

Working for an Algorithm Might Be an Improvement

By Elaine Ou
Bloomberg
Originally posted January 13, 2017

Here are two excerpts:

Bridgewater isn’t alone. Offices around the country are deploying tools to continuously monitor and assess employee activity. Complaints about the dehumanizing nature of working for algorithmic bosses such as Uber and Amazon have inspired comparisons to “Taylorism,” a scientific management theory remembered primarily for its use of stopwatches and specialized slide rules (like the one pictured below).

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Scientific management doesn’t have to be a dehumanizing experience. Dalio says that Bridgewater's management systems are designed to improve decision-making, conflict resolution, and personal development. This doesn’t necessarily mean removing managers from the equation; it simply recognizes that humans are unique and fallible, and ideally enables them to develop unbiased solutions. Dalio says that Bridgewater employees have a turnover rate of less than 6 percent after the first two years of attrition. Assuming his employees haven’t been turned into cyborgs, he's probably doing something right.

The article is here.

The Psychology of White-Collar Criminals

Eugene Soltes
The Atlantic
Originally posted December 14, 2016

Here is an excerpt:

Usually, a gut feeling that something will be harmful is enough of a deterrence. But when the harm is distant or abstract, this internal alarm doesn’t always go off. This absence of intuition about the harm creates a particular challenge for executives. Today, managerial decisions impact ever-greater numbers of people and the distance between executives and the people their decisions affect continues to grow. In fact, many of the people most harmed or helped by executives’ decisions are those they will never identify or meet. In this less intimate world, age-old intuitions are not always well suited to sense the kinds of potential harms that people can cause in the business world.

Reflecting on these limits to human intuition, I came to a conclusion that I found humbling. Most people like to think that they have the right values to make it through difficult times without falling prey to the same failures as the convicted executives I got to know. But those who believe they would face the same situations with their current values and viewpoints tend to underestimate the influence of the pressures, cultures, and norms that surround executive decision making. Perhaps a little humility is in order, given that people seem to have some difficulty predicting how they’d act in that environment. “What we all think is, ‘When the big moral challenge comes, I will rise to the occasion,’ [but] there’s not actually that many of us that will actually rise to the occasion,” as one former CFO put it. “I didn’t realize I would be a felon.”

The article is here.

Fostering Collective Growth and Vitality Following Acts of Moral Courage

Sheldene Simola
Journal of Business Ethics

Abstract

The purpose of this article is to explore a critical paradox related to the expression of moral courage in organizations, which is that although morally courageous acts are aimed at fostering collective growth, vitality, and virtue, their initial result is typically one of collective unease, preoccupation, or lapse, reflected in the social ostracism and censure of the courageous member and message. Therefore, this article addresses the questions of why many organizational groups suffer stagnation or decline rather than growth and vitality following acts of moral courage, and what can be done to ameliorate this outcome. A general system, relational psychodynamic perspective through which organizational group members might receive and respond to acts of moral courage is offered, and seven insights emerging from this perspective for fostering collective growth and vitality following acts of moral courage are provided.

The article is here.

The Leadership Blind Spots at Wells Fargo

By Susan M. Ochs
Harvard Business Review
Originally posted October 06, 2016

Here is an excerpt:

This leadership blind spot is the result of misguided reverence for their culture and its ability to inoculate the bank from systemic problems. It represents a governance breakdown of the highest order for executives and board members. But it appears that some red flags never even reached them: Investigations revealed the bank has ignored, discouraged, and even fired employees who tried to voice concerns about the intimidating culture and unethical practices.

In the worst cases, whistleblowers claim they were fired after reporting violations to the bank’s ethics hotline or trying to alert supervisors to illegal behavior.  Concerns raised by other employees were reportedly ignored, including an alleged email sent to Stumpf directly, and a petition, signed by 5,000 colleagues, that sought to lower sales quotas and combat unethical conduct. Stumpf called the firings “regrettable” and assured Congress that the bank has a policy of non-retaliation against whistleblowers.

But the damage goes beyond the employees who were terminated — it sends a signal to everyone else that they should keep quiet. At best, problem-raisers will be ignored; at worst, they will lose their jobs. Why risk it? If the bank doesn’t care, why should they?

The article is here.

When Deliberation Isn’t Smart

By Adam Bear and David Rand
Evonomics
Originally published January 25, 2016

Cooperation is essential for successful organizations. But cooperating often requires people to put others’ welfare ahead of their own. In this post, we discuss recent research on cooperation that applies the “Thinking, fast and slow” logic of intuition versus deliberation. We explain why people sometimes (but not always) cooperate in situations where it’s not in their self-interest to do so, and show how properly designed policies can build “habits of virtue” that create a culture of cooperation. TL;DR summary: intuition favors behaviors that are typically optimal, so institutions that make cooperation typically advantageous lead people to adopt cooperation as their intuitive default; this default then “spills over” into settings where it’s not actually individually advantageous to cooperate.

Life is full of opportunities to make personal sacrifices on behalf others, and we often rise to the occasion. We do favors for co-workers and friends, give money to charity, donate blood, and engage in a host of other cooperative endeavors. Sometimes, these nice deeds are reciprocated (like when we help out a friend, and she helps us with something in return). Other times, however, we pay a cost and get little in return (like when we give money to a homeless person whom we’ll never encounter again).

Although you might not realize it, nowhere is the importance of cooperation more apparent than in the workplace. If your boss is watching you, you’d probably be wise to be a team player and cooperate with your co-workers, since doing so will enhance your reputation and might even get you a promotion down the road. In other instances, though, you might get no recognition from, say, helping out a fellow employee who needs assistance meeting a deadline, or who calls out sick.

The article is here.

Are MBAs to blame for VW and other business ethics fiascos?

By  Ethan Baron
Forbes
Originally published October 22, 2015

Here is an excerpt:

So, what’s wrong with recent business people today? In an interview, Queen points to an over-emphasis on tolerance, that makes it very difficult for many people to even say something is wrong. Students are entering business schools “almost as kind of blank slates in terms of [their] ability to think about, to argue about, the good,” Queen says. “Even if they may have a business ethics class, that’s not reinforced by the other messages they’re getting either in the school, from their peers, perhaps even from the business world as a whole.”

While Queen sees what may be the start of a shift away from this line of thinking, he believes that in B-schools, students are generally still coming away with a belief that a return on investment trumps all other values. And within business programs, that ideology makes it difficult for students to swim against the current. Taking an alternate view can lead students to feel alone and alienated.

The entire article is here.