Moral Disengagement in the Corporate World

Jenny White M.Sc. M.P.H., Albert Bandura Ph.D. & Lisa A. Bero Ph.D.
(2009) Accountability in Research, 16:1, 41-74,
DOI: 10.1080/08989620802689847

Abstract

We analyze mechanisms of moral disengagement used to eliminate moral consequences by industries whose products or production practices are harmful to human health. Moral disengagement removes the restraint of self-censure from harmful practices. Moral self-sanctions can be selectively disengaged from harmful activities by investing them with socially worthy purposes, sanitizing and exonerating them, displacing and diffusing responsibility, minimizing or disputing harmful consequences, making advantageous comparisons, and disparaging and blaming critics and victims. Internal industry documents and public statements related to the research activities of these industries were coded for modes of moral disengagement by the tobacco, lead, vinyl chloride (VC), and silicosis-producing industries. All but one of the modes of moral disengagement were used by each of these industries. We present possible safeguards designed to protect the integrity of research.

A copy of the research is here.

The Growing Marketplace For AI Ethics

Forbes Insight Team
Forbes.com
Originally posted March 27, 2019

As companies have raced to adopt artificial intelligence (AI) systems at scale, they have also sped through, and sometimes spun out, in the ethical obstacle course AI often presents.

AI-powered loan and credit approval processes have been marred by unforeseen bias. Same with recruiting tools. Smart speakers have secretly turned on and recorded thousands of minutes of audio of their owners.

Unfortunately, there’s no industry-standard, best-practices handbook on AI ethics for companies to follow—at least not yet. Some large companies, including Microsoft and Google, are developing their own internal ethical frameworks.

A number of think tanks, research organizations, and advocacy groups, meanwhile, have been developing a wide variety of ethical frameworks and guidelines for AI. Below is a brief roundup of some of the more influential models to emerge—from the Asilomar Principles to best-practice recommendations from the AI Now Institute.

“Companies need to study these ethical frameworks because this is no longer a technology question. It’s an existential human one,” says Hanson Hosein, director of the Communication Leadership program at the University of Washington. “These questions must be answered hand-in-hand with whatever’s being asked about how we develop the technology itself.”

The info is here.

A New Model For AI Ethics In R&D

Forbes Insight Team
Forbes.com
Originally posted March 27, 2019

Here is an excerpt:

The traditional ethics oversight and compliance model has two major problems, whether it is used in biomedical research or in AI. First, a list of guiding principles—whether four or 40—just summarizes important ethical concerns without resolving the conflicts between them.

Say, for example, that the development of a life-saving AI diagnostic tool requires access to large sets of personal data. The principle of respecting autonomy—that is, respecting every individual’s rational, informed, and voluntary decision making about herself and her life—would demand consent for using that data. But the principle of beneficence—that is, doing good—would require that this tool be developed as quickly as possible to help those who are suffering, even if this means neglecting consent. Any board relying solely on these principles for guidance will inevitably face an ethical conflict, because no hierarchy ranks these principles.

Second, decisions handed down by these boards are problematic in themselves. Ethics boards are far removed from researchers, acting as all-powerful decision-makers. Once ethics boards make a decision, typically no appeals process exists and no other authority can validate their decision. Without effective guiding principles and appropriate due process, this model uses ethics boards to police researchers. It implies that researchers cannot be trusted and it focuses solely on blocking what the boards consider to be unethical.

We can develop a better model for AI ethics, one in which ethics complements and enhances research and development and where researchers are trusted collaborators with ethicists. This requires shifting our focus from principles and boards to ethical reasoning and teamwork, from ethics policing to ethics integration.

The info is here.

Rise Of The Chief Ethics Officer

Forbes Insight Team
Forbes.com
Originally posted March 27, 2019

Here is an excerpt:

Robert Foehl is now executive-in-residence for business law and ethics at the Ohio University College of Business. In industry, he’s best known as the man who laid the ethical groundwork for Target as the company’s first director of corporate ethics.

At a company like Target, says Foehl, ethical issues arise every day. “This includes questions about where goods are sourced, how they are manufactured, the environment, justice and equality in the treatment of employees and customers, and obligations to the community,” he says. “In retail, the biggest issues tend to be around globalism and how we market to consumers. Are people being manipulated? Are we being discriminatory?”

For Foehl, all of these issues are just part of various ethical frameworks that he’s built over the years; complex philosophical frameworks that look at measures of happiness and suffering, the potential for individual harm, and even the impact of a decision on the “virtue” of the company. As he sees it, bringing a technology like AI into the mix has very little impact on that.

“The fact that you have an emerging technology doesn’t matter,” he says, “since you have thinking you can apply to any situation.” Whether it’s AI or big data or any other new tech, says Foehl, “we still put it into an ethical framework. Just because it involves a new technology doesn’t mean it’s a new ethical concept.”

The info is here.

Business Ethics And Integrity: It Starts With The Tone At The Top

Betsy Atkins
Forbes.com
Originally posted 7, 2019

Here is the conclusion:

Transparency leads to empowerment:

Share your successes and your failures and look to everyone to help build a better company.  By including everyone, you create the illusive “we” that is the essence of company culture.  Transparency leads to a company culture that creates an outcome because the CEO creates a bigger purpose for the organization than just making money or reaching quarterly numbers.  Company culture guru Kenneth Kurtzman author of Common Purpose said it best when he said “CEOs need to know how to read their organizations’ emotional tone and need to engage behaviors that build trust including leading-by-listening, building bridges, showing compassion and caring, demonstrating their own commitment to the organization, and giving employees the authority to do their job while inspiring them to do their best work.”

There is no substitute for CEO leadership in creating a company culture of integrity.  A board that supports the CEO in building a company culture of integrity, transparency, and collaboration will be supporting a successful company.

The info is here.

Why good businesspeople do bad things

Joseph Holt
The Chicago Tribune
Originally posted October 30, 2018

Here is an excerpt:

Businesspeople are also more likely to engage in bad behavior if they assume that their competitors are doing so and that they will be at a competitive disadvantage if they do not.

A 2006 study showed that MBA students in the U.S. and Canada were more likely to cheat than other graduate students. One of the authors of the study, Donald McCabe, explained in an article that the cheating was a result of MBA students’ “succeed-at-all-costs mentality” and the belief that they were acting the way they believed they needed to act to succeed in the corporate world.

Casey Donnelly, Gatto’s attorney, claimed in her opening statement at the trial that “every major apparel company” engaged in the same payment practice, and that her client was simply attempting to “level the playing field.”

Federal authorities engaged in a yearslong investigation of shadowy dealings involving shoe companies, sports agents, college coaches and top high school basketball players have reportedly looked into Nike and Under Armour as well as Adidas.

Time will tell whether those companies were involved in similar payment schemes.

The info is here.

Pharma exec had 'moral requirement' to raise price 400%

Wayne Drash
CNN.com
Originally published September 12, 2018

 A pharmaceutical company executive defended his company's recent 400% drug price increase, telling the Financial Times that his company had a "moral requirement to sell the product at the highest price." The head of the US Food and Drug Administration blasted the executive in a response on Twitter.

Nirmal Mulye, founder and president of Nostrum Pharmaceuticals, commented in a story Tuesday about the decision to raise the price of an antibiotic mixture called nitrofurantoin from about $500 per bottle to more than $2,300. The drug is listed by the World Health Organization as an "essential" medicine for lower urinary tract infections.

"I think it is a moral requirement to make money when you can," Mulye told the Financial Times, "to sell the product for the highest price."

The info is here.

Does your nonprofit have a code of ethics that works?

Mary Beth West
USA Today Network - Tennessee
Originally posted September 10, 2018

Each year, the Public Relations Society of America recognizes September as ethics month.

Our present #FakeNews / #MeToo era offers a daily diet of news coverage and exposés about ethics shortfalls in business, media and government sectors.

One arena sometimes overlooked is that of nonprofit organizations.

I am currently involved in a national ethics-driven bylaw reform movement for PRSA itself, which is a 501(c)(6) nonprofit with 21,000-plus members globally, in the “business league” category.

While PRSA’s code of ethics has stood for decades as an industry standard for communications ethics – promoting members’ adherence to only truthful and honest practices – PRSA’s code is not enforceable.

Challenges with unenforced ethics codes

Unenforced codes of ethics are commonplace in the nonprofit arena, particularly for volunteer, member-driven organizations.

PRSA converted from its enforced code of ethics to one that is unenforced by design, nearly two decades ago.

The reason: enforcing code compliance and the adjudication processes inherent to it were a pain in the neck (and a pain in the wallet, due to litigation risks).

The info is here.

Ivanka Trump in China: The trademarks raising an ethics firestorm

Aimee Picchi
CBS News - Money Watch
Originally published May 29, 2018

Ivanka Trump this month received trademark approval from China for a broad array of items, including baby blankets, wallpaper and carpets. That wouldn't be unusual for a global business built on consumer goods such as elegant women's clothing and shoes, but it raises numerous ethical issues given that her father is the U.S. president.

The timing appears especially fraught given President Donald Trump agreed to rescue Chinese telecom giant ZTE Corp. shortly after Ivanka Trump's brand was awarded the trademarks.

Ethics watchdogs say the approvals are problematic on a number of levels, including Ivanka Trump's role representing the U.S. at diplomatic events even though her brand's business could be impacted -- for good or bad -- by relations with foreign nations. Then there's also the conflicts that arise from her father's role as president amid rising trade tensions between the U.S. and China.

The article is here.

A Two-Factor Model of Ethical Culture

Caterina Bulgarella
ethicalsystems.org

Making Progress in the Field of Business Ethics

Over the past 15 years, behavioral science has provided practitioners with a uniquely insightful
perspective on the organizational elements companies need to focus on to build an ethical culture.
Pieced together, this research can be used to address the growing challenges business must tackle
today.

Faced with unprecedented complexity and rapid change, more and more organizations are feeling the
limitations of an old-fashioned approach to ethics. In this new landscape, the importance of a proactive ethical stance has become increasingly clear. Not only is a strong focus on business integrity likely to reduce the costs of misconduct, but it can afford companies a solid corporate reputation, genuine employee compliance, robust governance, and even increased profitability.

The need for a smarter, deeper, and more holistic approach to ethical conduct is also strengthened by
the inherent complexity of human behavior. As research continues to shed light on the factors that
undermine people’s ability to ‘do the right thing,’ we are reminded of how difficult it is to solve for
ethics without addressing the larger challenge of organizational culture.

The components that shape the culture of an organization exercise a constant and unrelenting influence on how employees process information, make decisions, and, ultimately, respond to ethical dilemmas.  This is why, in order to help business achieve a deeper and more systematic ethical focus, we must understand the ingredients that make up an ethical culture.

The information is here.

How To Deliver Moral Leadership To Employees

John Baldoni
Forbes.com
Originally posted April 12, 2018

Here is an excerpt:

When it comes to moral authority there is a disconnect between what is expected and what is delivered. So what can managers do to fulfill their employees' expectations?

First, let’s cover what not to do – preach! Employees don’t want words; they want actions. They also do not expect to have to follow a particular religious creed at work. Just as with the separation of church and state, there is an implied separation in the workplace, especially now with employees of many different (or no) faiths. (There are exceptions within privately held, family-run businesses.)

LRN advocates doing two things: pause to reflect on the situation as a means of connecting with values and second act with humility. The former may be easier than the latter, but it is only with humility that leaders connect more realistically with others. If you act your title, you set up barriers to understanding. If you act as a leader, you open the door to greater understanding.

Dov Seidman, CEO of LRN, advises leaders to instill purpose, elevate and inspire individuals and live your values. Very importantly in this report, Seidman challenges leaders to embrace moral challenges as he says, by “constant wrestling with the questions of right and wrong, fairness and justice, and with ethical dilemmas.”

The information is here.

Leadership Takes Self-Control. Here’s What We Know About It

Kai Chi (Sam) Yam, Huiwen Lian, D. Lance Ferris, Douglas Brown
Harvard Business Review
Originally published June 5, 2017

Here is an excerpt:

Our review identified a few consequences that are consistently linked to having lower self-control at work:

1. Increased unethical/deviant behavior: Studies have found that when self-control resources are low, nurses are more likely to be rude to patients, tax accountants are more likely to engage in fraud, and employees in general engage in various forms of unethical behavior, such as lying to their supervisors, stealing office supplies, and so on.
2. Decreased prosocial behavior: Depleted self-control makes employees less likely to speak up if they see problems at work, less likely to help fellow employees, and less likely to engage in corporate volunteerism.
3. Reduced job performance: Lower self-control can lead employees to spend less time on difficult tasks, exert less effort at work, be more distracted (e.g., surfing the internet in working time), and generally perform worse than they would had their self-control been normal.
4. Negative leadership styles: Perhaps what’s most concerning is that leaders with lower self-control often exhibit counter-productive leadership styles. They are more likely to verbally abuse their followers (rather than using positive means to motivate them), more likely to build weak relationships with their followers, and they are less charismatic. Scholars have estimated that the cost to corporations in the United States for such a negative and abusive behavior is at $23.8 billion annually.

Our review makes clear that helping employees maintain self-control is an important task if organizations want to be more effective and ethical. Fortunately, we identified three key factors that can help leaders foster self-control among employees and mitigate the negative effects of losing self-control.

The article is here.

How Much Do A Company's Ethics Matter In The Modern Professional Climate?

Larry Alton
Forbes
Originally posted September 12, 2017

More than ever, a company’s success depends on the talent it’s able to attract, but attracting the best talent is about more than just offering the best salary—or even the best benefits. Companies may have a lucrative offer for a prospective candidate, and a culture where they’ll feel at home, but how do corporate ethics stack up against those of its competition?

This may not seem like the most important question to ask when you’re trying to hire someone for a position—especially one that might not be directly affected by the actions of your corporation as a whole—but the modern workplace is changing, as are American professionals’ values, and if you want to keep up, you need to know just how significant those ethical values are.

What Qualifies as “Ethics”?

What do I mean by “ethics”? This is a broad category, and subjective in nature, but generally, I’m referring to these areas:

• Fraud and manipulation. This should be obvious, but ethical companies don’t engage in shady or manipulative financial practices, such as fraud, bribery, or insider trading. The problem here is that individual actions are often associated with the company as a whole, so any individual within your company who behaves in an unethical way could compromise the reputation of your company. Setting strict no-tolerance policies and taking proper disciplinary action can mitigate these effects.

The article is here.

The Only Way Is Ethics: Why Good People do Bad Thing and How To Stop Us

www.ethicalsystems.org
MindGym

Forward

In social psychology we have this thing called the ‘fundamental attribution error.’ It refers
to the fact that when people see somebody do something unusual, their first reaction
is to assume that the act expressed the person’s internal values or personality (“he’s such
a crook!”), and underestimate the power of external factors and pressures. So, when we
hear about a company brought down by an ethics scandal, we immediately search for
the culprits, the bad actors, the bad apples. We can almost always find them, fire them,
maybe indict them, and move on… to the next scandal.

Sometimes a scandal is caused by one psychopath or sleazebag in the C-suite. But
usually not. If you really want to understand the causes of cheating, risky and unethical
behavior within complex organizations, you have to get past this attributional error
and examine the barrel, not just the apples in the barrel. You have to learn some social
psychology, which is like putting on a pair of magic glasses that let you see social
forces and cognitive biases in action.

Once you see how profoundly we are all shaped by local organizational culture, and how
clueless we often are about the real causes behind our actions, you can begin to work
with human psychology, adapt your processes to it, and obtain far better results.
Mind Gym shines a spotlight on this challenge in this whitepaper. A great deal of their
evidence shows that having ethics pays, yet most organizations focus on compliance,
rather than on ethics. Mind Gym offers you a set of tools and a framework to begin
diagnosing your own organization. And they offer concrete advice for improvement.
It is crucial that your organization is aligned on ethics at all levels – you may not see
results from just changing one or two processes. If you want to run a great organization
that employees are proud to work for, and that customers buy from with high trust, then
you should consider making an all-out commitment to ethics. You should consider
doing ethical systems design.

The White Paper can be downloaded here.

Business Leaders Get an ‘F’ in Ethics, Yet Again

Bruce Weinstein

Fortune

Updated: Jan 09, 2016 

Here is an excerpt:

Business ethics can be improved

Public perception is malleable, so there is no reason why business executives have to remain stuck in the bottom of the Gallup poll. I propose the following four strategies for businesses that want to be regarded as honest and trustworthy:

—Publicize your values. It never ceases to amaze me how few businesses list their company’s values and ethical commitments on their websites. This is the first Call to Action that I give businesses that hire me as a consultant: put your organization’s mission statement, code of ethics, and core values on the home page where they can be readily accessed.

—Hire for character. The values and ethical standards you post on your website don’t mean anything if they’re not embodied by your employees. You understandably devote a lot of energy, time, and resources to hiring people who are knowledgeable and skilled. Isn’t it at least as important to hire people who are consistently honest, accountable, loyal, and fair—that is, men and women of high character?

—Fire for character. Just as it’s crucial to bring high-character people into your organization, so too is it to get rid of those who don’t share your organization’s values. No matter how much the senior vice president of marketing knows about his or her field, if he or she has played fast and loose with the truth or hasn’t honored commitments to clients, why keep him or her on the payroll?

—Reward excellence. I recently spoke at a Fortune 100 company on the day when five employees who embodied the company’s values were flown in to receive a prestigious award and a handsome bonus. One young man had found a $15,000 diamond ring in his store’s parking lot and had gone to considerable lengths to track down the owner. Imagine how the customer felt when her ring was returned. And imagine the positive word-of-mouth she gave the company.

The article is here.

Programmers are having a huge discussion about the unethical and illegal things they’ve been asked to do

Julie Bort
Business Insider
Originally published November 20, 2016

Here is an excerpt:

He pointed out that "there are hints" that developers will increasingly face some real heat in the years to come. He cited Volkswagen America's CEO, Michael Horn, who at first blamed software engineers for the company's emissions cheating scandal during a Congressional hearing, claimed the coders had acted on their own "for whatever reason." Horn later resigned after US prosecutors accused the company of making this decision at the highest levels and then trying to cover it up.

But Martin pointed out, "The weird thing is, it was software developers who wrote that code. It was us. Some programmers wrote cheating code. Do you think they knew? I think they probably knew."

Martin finished with a fire-and-brimstone call to action in which he warned that one day, some software developer will do something that will cause a disaster that kills tens of thousands of people.

But Sourour points out that it's not just about accidentally killing people or deliberately polluting the air. Software has already been used by Wall Street firms to manipulate stock quotes.

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.

Three Ways To Prevent Getting Set Up For Ethical Failure

Ron Carucci
Forbes.com
Originally posted

Here are two excerpts:

To survive the injustice of unresolved competing goals, leaders, usually middle management, become self-protective, putting the focus of their team or department ahead of others. Such self-protection turns to self-interest as chronic pain persists from living in the gap between unrealistic demands and unfair resource allocation. Resentment turns to justification as people conclude, “I’m not going down with the ship.” And eventually, unfettered self-interest and its inherent justification become conscious choices to compromise, usually from a sense of entitlement. People simply conclude, “I have no choice” or “I deserve this.” Says Jonathan Haidt, Professor of Business Ethics at NYU and founder of Ethical Systems, “Good people will do terrible things when people around them are even gently encouraging them to do so.” In many cases, that “gentle encouragement” comes in the form of simply ignoring what might provoke poor choices.

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3. Clarify decision rights. Organizational governance – which is different from “Corporate Governance” – is the distribution of authority, resources, and decision rights across an organization. Carefully designed, it synchronizes an organization and ensures natural tensions are openly managed. Knowing which leaders are accountable for which decisions and resources removes the uncertainty many organizations suffer from. When there is confusion about decision rights, competing priorities proliferate, setting the stage for organizational contradictions to arise.

The article is here.

Business students: time for a compulsory ethics major?

Erica Cervini
Sydney Morning Herald
Originally posted on April 24, 2016

Here are two excerpts:

While it is commendable that universities are attempting to make students think about business ethics, one unit can only scratch the surface. And, then it depends on how much theory students are getting and to what extent this is applied to real-world cases.

Universities are failing students and society if they see ethics units as separate to students' accounting, banking and entrepreneurship subjects. Ethics has to be embedded in business and management subjects so that it is reinforced.

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She explained there are scholars who are against teaching business ethics while there are others who argue that students' views can be swayed in ethics classes.

Dr Issa concludes that business school academics need to be "more aware of our impact on those individuals whom we graduate into the business world, and what impact they have on their communities and societies".

The article is here.

Who is on ethics board that Google set up after buying DeepMind?

Sam Shead
Business Insider
Originally published March 26, 2016

Google's artificial intelligence (AI) ethics board, established when Google acquired London AI startup DeepMind in 2014, remains one of the biggest mysteries in tech, with both Google and DeepMind refusing to reveal who sits on it.

Google set up the board at DeepMind's request after the cofounders of the £400 million research-intensive AI lab said they would only agree to the acquisition if Google promised to look into the ethics of the technology it was buying into.

The article is here.