Of the many periodicals I read and review, I always look forward to Business Compliance, and specifically to the Round Table discussions, where I have had the pleasure and honor of being a prior contributor. This quarter brings another compelling array of thought leaders in a discussion titled Ethics in Business, and I thank Laurenz Baltzer, Publisher, Baltzer Science Publishers, for making this quarter’s Round Table discussion available at no cost by linking here. Thus, I encourage readers to download the entire article as to enjoy the complete discourse. As a paid subscriber, I find Business Compliance to be one of the most compelling periodicals in the compliance field, from both an academic and practical perspective. Accordingly, I will continue to focus on its work in order to expose BC to the wider compliance community. The welcome page can be found by linking here.
In this review of Ethics in Business, I focus on the contributions of Editor-In-Chief, Anthony Smith Meyer (ASM), Bryan Cave Partner, Scott Killingsworth (SK), Maynard Leigh Associates founder Andrew Leigh (AL), and compliance specialist (and panel moderator) Sharon Ward (SW). This is not to minimize or in any way discount the contributions of the other panelists, Philip Weights, and Ludo van der Heyden; hence, the rationale for working with Mr. Baltzer to make the entire article available.
SW launches the discussion when she asks “what ethics means in the context of business, and if it has any practical meaning in a world in search of financial performance and continuing growth.” ASM makes an important distinction as between the concept of ethics “born of fundamental values we hold as individuals” and the “process of establishing values that the people within it (the organization) can share.” SK also echoes the importance of process when he addresses “the adherence to established values, rather than in the acceptance of them.” As part of that process SK calls our attention to why “ethical leadership in organizations is needed to constantly remind people both of the company’s key values and of how employee are expected to resolve conflicts between competing values, such as legal compliance versus sales.”
Indeed, as SK continues “it’s important that the messaging via compensation and reward systems, promotions, and discipline be consistent across the board so that employees will not be confused about the standards by which their performance will be measured.” SW asks from where these messages need to originate as to best guide the organization? Is it some “invisible hand” or perhaps a better recognized authority? AL thinks that while some part of that “hand” is grounded in an individual’s sense of “what’s right and wrong,” it also is “drawn from business leaders making a judgment of what society and others, including shareholders and the law expect of them.”
AL makes a good point, and in the field of anti-bribery compliance, where front-line personnel might get ethically “clouded” as they index incentives to compliance in low integrity regions, such a visible and steady hand provides great value. SK also reflects upon the value of strong messages when he shares that “active ethical leadership within the organization is the most powerful single factor,” adding “tone at the top is not enough by itself, but without it, there is little hope.”
AL’s comment that “doing what’s right is not divisible” is extremely compelling, as you can’t think of personal ethics and organizational ethics as compartmentalized and distinct. However, returning to prior themes of how those at the front lines can often be “irrational calculators of risk” (SK), it is important to consider that when there is confusion in the field, strong organizational values can be the ultimate tipping point “back to the right side.”
Acknowledging that not everyone makes the best ethical decisions all the time (if you think otherwise, well, that’s a different problem), organizational values and ethics can be that “steady and visible” hand which demonstrates to those in the field that taking the right path, even at the cost of business, will always be valued, and never punished. Indeed, as ASM shares, ethics and values should never “be discarded or set aside due to temporary inconvenience and self-interest. If they are, then this is the road to ethical damnation.” But back to the front lines, especially for those who are tasked with helping those in low integrity regions to manage corruption risk, this is all pedaling up-hill. With continuous, steady and exhaustive effort, progress is made. Take a break, and the slide downhill to what ASM well describes as “ethical damnation” begins.
I also appreciated AL’s comment that “relying solely on codes and regulations to guide your leadership and company actions is a sure way to land it in serious trouble,” as when this occurs “your actions can be legal, technically acceptable within some set of standards, yet still wrong.” Indeed, as a compliance professional stated at a recent symposium “when my team confronts corrupt offers in the field, their answer is no, but ‘not because compliance says I can’t do it, it’s because I don’t do it.’” Indeed, when that occurs, we have reached AL’s state of compliance as beyond a set of scripted policies and procedures that might be looked at as a “work around” at the field level.
As the Round Table started to wind down ASM cautioned “not delude yourself in bias that there is any single truth.” And I think that is a great take away for compliance teams. Like my own experience, bad behavior tends to come from multiple tipping points and hence, the solutions need to address those challenges, also from multiple points, including ethics and values. I always leave the last word to SK, who leaves us with “Policies and value statements are great but sometimes, as Emerson said “what you do speaks so loudly that I can not hear what you say.””
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