Cultural workplace norms can compromise ethics
Spring is my favorite time of year. I love the longer days, more sunshine, and the best part – the ensuing flowers and vegetables that will bloom in my garden.
My parents are avid gardeners and in the early springs of the past, they would prepare the garden soil well in advance before planting the first seed. As a young child, my father’s deep voice would frequently advise me to pay close attention on how to till and fertilize the soil. I recall often complaining about how quickly the dirt would accumulate under my fingernails and into every crevice of my hands. No matter, my father would patiently remind me that “If you plant a good seed in bad soil, it will affect how it roots and grows.” In other words, the initial hard work of cultivating the soil coupled with close attention to light, water, and warmth would directly impact the quality and quantity of the future harvest.
Bad Apples
According to the U.S. Department of Labor, approximately 3 million workers go to work in Indiana and a full third of those employees are working in the Indianapolis-Carmel area. I like to think that Indiana employees have a lot in common with soon to be planted, hearty seeds. Each employee is packed with a storehouse of talents that will supply the fuel for Indiana’s economic growth within a myriad of trades and industries.
Now, here’s some unsettling news regarding the workplace – a recent survey conducted by the Washington, D.C. based Ethics Resource Center (ERC) reported that almost half of the surveyed employees personally witnessed some form of unethical behavior while on the job: corruption, fraud, and other egregious behavior. As a result, workers are not fully engaged and committed to a company’s success.
The ERC reported that employees most often observe the following five unethical behaviors in the workplace: 1) employees misusing company time, 2) supervisors abusing subordinates, 3) employees stealing from their employers, 4) employees lying to their employers, and 5) employees violating company internet policies.
Indiana employers pay close attention to the importance of the condition and quality of the employment soil which is the workplace. Employers must hire the best quality of employees. But if the workplace is infiltrated with culture of unethical conduct, employees will not thrive.
“Bad apples” can most certainly turn a company’s culture into “a rotten barrel.” But what effect are these unethical behaviors having on the “good apples” – those dedicated employees at all levels of an organization who have a strong and positive ethical base, but who are working side-by-side with the “bad apples?
Fostering unethical conduct
To answer that question, a corporate think-tank - the Business for Social Responsibility - compiled findings from 23 integrity and ethical compliance experts and identified 5 organizational traits that foster unethical conduct and scandals in businesses and companies:
1.“Get ‘Er Done!”
Business leaders that create urgency and fear by pressuring employees to succeed at all costs can increase the risk of provoking unethical behavior. For example, in the case of the recent Wells Fargo scandal, bank employees opened fake accounts and credit cards in their client's name to make quota. The quota, however, was unrealistic and almost impossible to make without cutting corners. To keep in good standing with their managers and keep their jobs, employees may make unethical decisions in a high-pressure toxic sales environment.
2. “When the Cat is Away, the Mice Will Play.”
Groups and teams that are far away in time or space from their bosses are more inclined to deal with work stress by creating and playing by their own rules and ethical standards. Physical distance directly affects how psychologically close employees feel to their boss which helps determine whether they’ll imitate or reject their bosses’ ethical or unethical behavior.
3.“I See Nothing, I Hear Nothing, I Say Nothing.”
Corporate leaders that engage in selective blindness by denying knowledge of their subordinates’ egregious conduct encourage other employees to do the same thing.Even in cases where leaders can plausibly deny knowledge of corrupt activities, a lack of engagement with employees and business conditions on the front lines will foster a lack of transparency and culpability.
4.“Winner Winner Chicken Dinner.”
Everybody loves a winner, right? Just asked Volkswagen. In January 2008, Volkswagen bragged that its engineers were indeed “the winners” after they announced slashing nitrogen oxide emissions by 90%. As a result, sales of VWs steadily increased and in early 2015, VW became the world’s largest auto manufacturer. Yet, a mere six months after becoming #1, the unethical hammer dropped when it was revealed that starting in 2008, Volkswagen employees had intentionally programmed 11 million diesel cars with sophisticated software to trick regulators into believing the vehicles were compliant with emissions standards. The bogus and perpetrated high-achieving success from a team of VW engineers had created a culture by which other employees felt compelled to stay silent.The result was the one of the biggest unethical corporate scandals ever reported, which resulted in $2.8 billion in criminal penalties for VW from the United States (not counting the civil and criminal penalties from other countries) and virtually destroyed VW’s brand.
5.“You say bribes, I say gifts.”
Norms vary on what constitutes a bribe. Employee handbooks that include explicit policies and detailed information on what is acceptable are extremely useful. There are, however, a myriad of ethical nuances. As a result, employees may attempt to rationalize whatever free merchandise or service that comes their way by paraphrasing it as a “gift,” “token,” or “freebie.” The real issue is not whether the gift is a token or freebie, rather, if it’s set up with an expectation or hope for something in return.
Any or all these unethical traits can adversely impact the economic viability of a business. That is why it is crucial for companies to proactively garner input from their employees regarding workplace culture and thereafter, plant good seeds of clear of guidance and expectations of what is okay and what is not.
Finally, leadership without ethics is manipulation. Thus, stellar business leaders need to understand that bringing ethics to bear on a company’s day-to-day operations will in turn construct a sturdy corporate “barrel” or environment filled with success and opportunities.
Charlotte Westerhaus-Renfrow is an Assistant Clinical Professor of Management and Business Law at Indiana University, Kelley School of Business, Indianapolis and President of ChangePro LLC, a leadership consulting firm.
(Originally published in the Hamilton County Business Journal, April-May 2018 Issue)
