The Business of Ethics and The Ethics of Business

The Business of Ethics and The Ethics of Business

In 2002 the corporate world in the United States was rocked with scandals. Enron, Arthur Anderson, WorldCom, Citi Group, HCA, Tyco and others were headline news in print and the lead story on the television news because of business ethics failures. This caused me to reemphasize and stress to each of my clients then and now, the importance of business ethics and to challenge each of my clients to integrate their core values into their policies, practices and decision making. And I recommend that they rededicate themselves to conducting business to the highest ethical standards.

A 2005 National Business Ethics Survey (NBES) was released by the Ethics Resource Center on October12, 2005. Some of the key findings include:

52{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} of employees observed at least one type of misconduct in the workplace in the past year, with 36{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} of these observing at least 2 or more violations.

69{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} of employees report their organizations implement ethics training, up 14 percentage points from the 2003 NBES.

65{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} of employees indicated their organizations have a place they can seek ethics advice.

55{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} of employees who observed misconduct at work reported it to management, down 10 percentage points from the 2003 NBES.

Five of six elements of a formal ethics and compliance program measured by NBES have increased over time with the presence of written standards of ethical business conduct up 19 percentage points since 2004.

The NBES defines misconduct as any behavior that violates the law or organizational ethics standards. The two most common types of misconduct observed by employees are abusive or intimidating behavior towards employees and lying to employees, customers, vendors, or the public.

Types of misconduct most observed by employees include:

21{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed abusive or intimidating behavior towards employees.

19{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed lying to employees, customers, vendors, or the public.

8{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed a situation that places employee interests over organizational interests.

16{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed violations of safety regulations.

16{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed misreporting of actual time worked.

12{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed discrimination on the basis of race, color, gender, age or similar categories.

11{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed stealing or theft.

9{dc8f321d37baba791adf66cf81f163453760aaaccf35e9902d00ceb1d834317a} observed sexual harassment.

Note: For the full news release on the NBES go to:

At the close of 2005 I am still asking the question – How can a company “SUSPEND” the company’s ethics code? How can an individual businessperson in conducting business or an elected or appointed government official, at the local, state or federal level, waive ethics in their governance activities? And what can be done to respond to this dysfunctional and unacceptable behavior?

Here are five things I believe we need to assure will happen.

1. Business and government need to seriously look at strengthening their ethics programs and demonstrate a commitment to integrity in the way they perform their business and governance activities.

2. Companies and organizations must build ethical values and goals into the Vision and Mission Statements of their strategic plans and make sure the managers and employees understand the importance of these values and ethical standards.

3. Ethics should be integrated into everything the organization and individual does.

4. Organizations should reward ethical behavior and penalize unethical behavior. Everyone needs to be held accountable for his or her actions.

5. Any new ethical issue should be addressed immediately and a definite plan established to deal with the issue.

How does your company or organization address ethics? I would be interested in hearing from you. If you would like to share how your company addresses the subject of ethics, please submit your thoughts to me by going to our contact form on my web site at