Ethical Misdeeds

Since every organization experiences both ethical and unethical behaviors, the question becomes, what is the extent of unethical behaviors in the workplace. In a 2013 work-related issues study, the ERC, the Ethical Resource Center surveyed 6,420 for-profit employees and forty-one percent of the respondents reported observing at least one major ethical misconduct at work during the last year, some of which were illegal. Although most of the misdeeds were one-time events, 26% were ongoing within the organization. Of the observed misdeeds, managers accounted for 60 percent; including 24% committed by senior management.                                                                                                                                                                               
Sixty-three percent of the survey participants reported the observed misdeeds, with a little more than one-third going unreported. Of the sixty-three percent who reported the miscount, 21% experienced retaliation. The ERC extrapolated its findings over the entire 18 and over workforce population in 2011 to better demonstrate the magnitude of the problem, resulting in misconduct being observed by 62 million employees in the past year, with 41 million of those reporting the misconduct, and 9 million experiencing retaliation for reporting the misconduct.

In a 2013 survey, the Institute of Leadership & Management found the same troublesome trends in the United Kingdom. They surveyed 1,174 managers having forty-three percent reporting of being pressured to violate the company's code of ethics; 9% reporting they had been asked to break the law, and 10% had to quit their because they were asked to do something that compromised their ethics.

In a 2014 survey, the ILM asked UK managers what they considered to be common examples of unethical behavior in the workplace. The top misbehaviors the 1,600 manager respondents listed are as follows:

• Taking shortcuts or performing low quality work - 72%
• Lying to hide mistakes - 72%
• Bad-mouthing colleagues - 68%
• Falsely blaming others when you don't get your work done - 67%
• Slacking off when no one is watching - 64%
• Lying to hide your colleagues mistakes - 63%
• Taking credit for other colleagues' work - 57%
• Lying about being sick - 56%

In 2016 Gallup Poll public trust surveys, only 18% of respondents expressed confidence in "Big Business" compared with 73% confidence in the military. When asked to assess whether a profession had "very high" ethical standards, only 2% rated business executives or bankers "very high." Only 1% rated advertising, automobile or insurance salespeople as "very high." At 29%, nurses were the only profession with a "very high" rating above 15 percent.

Consumer frauds also contribute to the public's generally low opinion of business. A 2011 Federal Trade Commission (FTC) telephone survey revealed, 10.8% of the adult population had been victims of fraud. The top categories and corresponding estimates are as follows;

• weight-loss products - 5.1 million
• prize promotions - 2.4 million
• unauthorized billing for buyers' club memberships - 1.9 million
• unauthorized billing for Internet services - 1.9 million
• work-at-home-programs - 1.8 million
• credit repair scams - 1.7 million

Wells Fargo, one of the largest banks in world, winning multiple awards, including being "Best Bank in the US.," "25th Most Admired in the World," and "Most Community-Minded Company," engaged in ethical misconduct. Dating back to 2011, approximately 5,300 employees created more than 1.5 million fraudulent checking and savings accounts and 500,000 fraudulent credit cards.

                                                                                                                                                                                                                        

Ethics is not an Oxymoron

Since we usually find what we are looking for, businesses that operate based on good ethical principles attract good employees and good customers. Likewise, businesses that lack good ethics usually suffer from high employee turnover, lost customers and often their bad reputations are held accountable through litigation. "A man reaps what he sows"; Galatians 6:7, (NIV).

An organization should be more than just a bunch of individuals, but rather a community of people on a common mission. For them to be effective, efficient, and ethical, your job as a manager is to develop a sense of a common mission among this community of people. At the heart of any business operation is service. The financial well-being of the organization depends on its community of people to appropriately serve the needs of its stakeholders. Without ethical employees, the effectiveness and efficiency of the organization is short-lived.

Because of the imperfections in human nature, organizations, some more than others, are ethically challenged. Aside from your customers you will also be interacting with suppliers. Unfortunately not all those in your network nor those wanting to become part of your network will have high ethical standards. Awareness of these factors is essential to succeeding as manager; which is why as a manager you need to manage your organization's ethical environment.

At work, ethical behavior is a personal choice influenced by one's previous behaviors and the current work environment. There are organizations who choose to meet the rules and regulations set forth by federal, state, and local governments; as there are others who continually exploit the loopholes. Stakeholders however tend to praise those organizations whose owners and managers choose to exceed the minimum requirements set forth by the regulators.

Business Ethics - Flawed Humanity

 I do not understand what I do. For what I want to do I do not do, but what I hate I do. 
(Romans 7:15, NIV).

A quick glance at the broken promises and deception in the marketplace indicates that being holy-just-loving is easier said than done. Why, despite our noblest intentions , we seem so incapable of living as we ought. Why do company CEOs commit securities fraud? Why do companies systematically overstate their earnings?

Scripture labels the fundamental human flaw as sin. Sin,at its core, is setting our own independent agenda and the refusal to emulate God. In elevating ourselves to godlike status, this attitude of self-sufficiency results in spiritual alienation. In his book, Just Business, Alexander Hill states, analogous to cancer, sin, this moral disease infects our entire being, clouds our moral vision, and alters our very character. the results is a chasm between us and God.

At this point a important distinction must be made between the concept of "sin", which describes our defective moral character; and "sins", which includes actions that naturally follow, stealing, lying, promise breaking and so forth. Our fallen natures are like petri dishes in which sinful actions flourish. As stated in Romans 7:16-20 - 16 And if I do what I do not want to do, I agree that the law is good. 17 As it is, it is no longer I myself who do it, but it is sin living in me. 18 For I know that good itself does not dwell in me, that is, in my sinful nature. For I have the desire to do what is good, but I cannot carry it out. 19 For I do not do the good I want to do, but the evil I do not want to do—this I keep on doing. 20 Now if I do what I do not want to do, it is no longer I who do it, but it is sin living in me that does it.(NIV).

In the marketplace where career destinies are decided, the temptation to rationalize unethical behavior is strong, and financial stakes are high, this is particularly problematic. Before the finger of accusation is pointed to quickly, we all must acknowledge our own susceptibility to temptation of justifying imprudent or unethical behavior. Matthew 7:5 reminds us, You hypocrite, first take the plank out of your own eye, and then you will see clearly to remove the speck from your brother’s eye.

Lewis Smedes correctly observes, "Self-deception is a fine art. In one corner of our mind we know that something is true; in the other we deny it....We know but we refused to know." 

Psychologists have a label for such behavior - "denial."




 From Just Business: Christian Ethics for the Marketplace: Alexander Hill

Is Christian Ethics in Business Possible?

Man is to complicated. I would have made him simpler. - Feodor Dostoyevsky

An ethical man is a Christian holding four aces - Mark Twain

Ethics, the study of doing the ''right thing" the "shoulds" attempts to provide a grid, a value laden framework, which real life decisions can be made. Ethics therefore is the application of values to the decision making process. When the our values and relationships are brought to the forefront, and the "shoulds" are dealt with, we simply find the right rule that matches to the current problem, "Viola", the two pieces fit. Problem resolved!

While this strategy might work fine for relatively simple issues, what about the more complex situations.  In ambiguous situations, it's clearly deficient in its capacity to provide exact answers for every situation; therefore shouldn't the "rule book" approach give pause to those who would take a rules-based approach? Research ironically as shown that corporations with strict codes of ethics are cited more frequently for breaking the the law than their counterparts without such strict codes. Perhaps a rules-keeping perspective, with its minute regulations, provides little guidance in morally ambiguous situations. Theologian and ethicist Dietrich Bonhoeffer was candidly uncharitable to this approach, calling it "naive" and those who practiced "clowns."

What then of a Christian Business Ethic? Critics argue that (1) the Bible is rule-bound, and (2) that it lacks relevance; that Scripture has minimal applicability to modern business practices. One Humanist Philosopher, P.H. Nowell-Smith labelled Christian ethics rule book approach as "infantile." Other critics argue that the Bible has no relevance, as it was written between eighteen hundred and three-thousand years ago, largely in the context of an agrarian economy. What significant insights, they ask, can Scripture say about business today. They contend using Scripture as a business rule book would be like using ancient medical scholars, such as Hippocrates, to train today's physicians.

Not rules, but the changeless character of God is the foundation of Christian ethics in business. Christianity operates on the premise that ethics, the study of human character, logically follows theology, the study of God's character. When as humans we behave in a manner consistent with God's character, we act ethically. We act unethically when we fail to do so. All Scripture, from Moses to Paul, serves to illustrate behavior that is aligned with God's moral character.

This approach is quite different from the human-based, whose primarily focus on egoism, promoting the individual pleasures of materialism and career success; and utilitarianism, the option that best maximizes pleasure and minimizes pain, for all those involved. Christian ethics however, does not reject all of these values. There is much overlap between many of the human-centered and Christian ethical approaches. The major difference rests in its central priority. Yes it is true that Christian ethics is concerned about human happiness and the fulfillment of ethical obligations. It does not however, see them as the ultimate goal, but rather prizes the life that emulates God's character.

In his book, Just Business: Christian Ethics for the Marketplace, Alexander Hill states, ... the great Catholic Saint Ignatius Loyola was eulogized as follows, "The aim of life is not to gain a place in the sun, nor to achieve fame or success, but to lose ourselves in the glory of God." Hill also notes, In a similar vein, Reformer John Calvin wrote, We are not our own: in so far as we can, let us therefore forget ourselves and all that is ours.Conversely we are God's: let us live for Him and die for Him. We are God's: let His wisdom and will therefore rule all our actions. We are God's: let all the parts of our  life accordingly strive toward Him as our only lawful goal.

If being ethical in business is reflecting God's character, the crucial question is, "What is God's character?" Focusing on God's self-revelation recorded in Scripture, three divine characteristics that have a direct bearing on ethical decision-making are repeatedly emphasized in the Bible; (1) God is holy; (2) God is just; and (3) God is loving. (Later we will explore each of these qualities in greater detail.) For now it suffices us to say that a business action is ethical if it reflects God's holy-just-loving character. As Alexander Hill further notes in his book, Such hyphenation is appropriate because the three qualities are so intertwined that it would be just as accurate to describe God as being loving-just-holy or just-loving-holy.

Hill further uses the human body as a helpful illustration. With holiness being comparable to the human skeleton, thus providing the core strength; justice being analogous to the muscles ensuring balance, and love, similar to the flesh, emanating warmth. Obviously all three are equally needed. A business with just a skeleton, with only a code of ethics, would be immobile and rigid. Justice, without a skeleton (holiness) and flesh (warmth), it would become a business steeped in policy manuals and detailed procedures. And finally the flesh (loving), a business unsupported by any infrastructure (skeleton and muscles), trying to meet every need would be undefined and undisciplined.

As we can see, when decisions are made, Christian ethics requires that all three characteristics be taken in to account. Justice and love when untethered from holiness drifts into hypercritical legalism. Likewise, justice produces harsh outcomes when it loses its anchor in love and holiness. And finally love, lacks an adequate moral compass when orphaned from holiness and justice. Like a leg on a three-legged stool, each balances the other two as each of the three contain a vital ethical ingredient.

Christian ethics doesn't involve an either or analysis; as if we could choose between the three - holiness, justice and love. Rather it's a synthesis, where all three conditions must be met before an action can be considered to be moral.




 From Just Business: Christian Ethics for the Marketplace: Alexander Hill

Ethical Choices - Three Ways to be Wrong

Each individual wrong begins with someone's decision to do something other right. Corporations spend millions of dollars in an effort to keep from losing more millions in fraud and employee theft. A significant portion of a government's budget is dedicated to discovering, policing, judging, incarcerating, and rehabilitating wrongdoers. Much of private charity is given to recifying such wrongs as street crime, family violence and drug abuse. As each of these problems comprises a collection of individual acts, right versus wrong constitutes considerable ethical considerations.

Right-versus-wrong choices are commonplace and widely understood to be wrong. We typically think of them in three ways: Violation of the Law; Departure from the Truth; and Deviation from Moral Rectitude.

Violation of the law wrongdoings involve failure to comply with specific laws. Lack of compliance can arise ignorantly, because we don't know the law and its applications; or intentionally, because we willfully choose to violate the law. Increasingly corporations are designating "compliance officers." Their task is to keep managers informed about the law and urging respect for it. As promoters of the respect for the law, they tend to become the corporate ethics officers.They serve as sources of information, helping to warn managers away from preventable regulatory and legal problems.

Departure from the truth describes the wrong that does not align with the facts as generally known. These sorts of "wrongs," where a great deal of energy is spent trying to determine the relation between what is said to have happen and what actually happened, lie at the core of the legal process. However, these departures from the truth go well beyond the law. At their simplest, they concern the honest misreading of data. Incorrectly calculating your bank balance and bouncing a check. At their most complex, such departures shade into complicated issues of misinterpretation. The assertion that a statement may in fact be "wrong" in that it does not depict what actually happened - may not be able to determine "what actually happened" and in these cases , we may never know.

Deviation from Moral Rectitude (morally correct behavior or thinking) are wrong not because they violate the law or fail to comport with fact, but because they go against the moral grain. In other words, they don't square with our present day code of widely spread and broadly understood fundamental inner values that defines the difference between right and wrong. The "present day" reservation is important. As the history of the Western civilization easily demonstrates, what's right and wrong can change. Such changes arise not only from passing cultural frights or faddish cultural movements. They sometimes come from deep-seated shifts in the moral structure of the age. However much individual attitudes may change, one fact is clear, there remains a fixed measure within all of us, a kind of inner core that helps us separate right from wrong. It may be shaped largely by those around us. It may be based on deep religious conviction or clearly reseasoned views; or conversely on unexamined instincts and hazy notions. It may be almost out of sight, but it's there.


Taken from Rushmore M. Kidder's How Good People Make Tough Choices.

Ethical Dilemmas - Justice versus Mercy

Follow justice and justice alone. - Deuteronomy 16:20

His compassions never fail ...they are new every morning - Lamentations 3:22-23

live not according to the golden rule but beyond it - Donald Bloesch

fairness, equity, and even-handed application of the law often conflicts with compassion, empathy and love - Rushworth Kidder, How Good People Make Tough Choices

As symbolized by the blindfolded woman holding the scales of justice, despite the pressures of the moment, rights and principles must be upheld. Compassion and sympathy are not substitutes for fairness and equity. Private emotions are not to interfere with the impartiality of justice. The claims of justice are very demanding. It must be absolute.

Mercy on the other hand, is never blind. It looks at the individual. Particularly, the differences that make a difference. Mercy calls for us to rise above the dictates of law and social order. Since nothing else in the universe is of more value, it calls for us to be compassionate and treat the individual as absolute. To embrace the individual, no matter their lack of merit.

Taken by itself, there is a wholeness of life that cannot be captured by either justice or mercy. At what point do you give the addicted employee one more chance to get their life together; or do you terminate them for consistently violating company policy? The reaction to blind mercy is "tough love". At what point does compassion become enabling? What is the message being given to others?

To focus on justice and simply apply the letter of law, does not do justice to the situation. Yes choices must be made, but the reality of this type of situation cannot be adequately understood by either side. Is it right to do justice? Is it right to be merciful? How can I do both? The resolution will be based upon a personal decision determined by how one balances justice and mercy, and not on external factors. Corresponding reactions of "ruthless bottom-line tyrant" or "bleeding heart liberal" can follow either choice.

Since both sides of the justice versus mercy dilemma make profound and unyielding claims upon us, making decisions favoring either side can be heartbreaking. There is no automatic right way; but decide we must. Such is the nature of ethical dilemmas, it is only in making the decision, is the issue resolved.

Ethical Dilemmas - Short-term versus Long-term

When the short run is emphasized to the exclusion of the long run, the risk may increase that individual interests will dominate over community interests - Michael E. Cafferky, Business Ethics - In Biblical Perspective.

The present and the future are always rivals - Ralph Waldo Emerson

Profit is often a short-term concern. Ethical considerations often concern both the short term and the long run- Joseph M. Grcic, Democratic Capitalism: Developing Conscience for the Corporation.

Research shows that individuals see a higher value of the present and tend to discount the value of all gains and losses of the future. When looking to the future, we are more apt to focus on what we should do; whereas when considering the present, we tend to do what we want to do.

When immediate needs or desires run counter to future prospects and goals, it reflects the difficulties arising within the short-term versus long-term paradigm. Since it comes upon us everyday in many ways, of the four ethical dilemmas being presented, this perhaps, is the most common of them all. Without due attention to today, there is no tomorrow; whereas living for today, leaves nothing for tomorrow. It is a dynamic that runs through every personal and business operation.

Short-term decisions have long-term consequences which you may or may not like. In any given situation you may choose to grant yourself an exception to your rule. The issue here is, if granting yourself exceptions becomes the rule; you can expect to achieve a long-term outcome that is different from your goal. The short-term and the long-term are inseparable.

The developments of capitalism and its market economy figure into the short-term/long-term equation. Because quarterly corporate reports need to reflect substantial profits, and to distribute as much of the quarter's profits as possible to shareholders, the bottom line figures need to be positive. To survive, a company must also pay attention to its future. Because of the pressure to invest in research and product development, new equipment, staff, the tension between these to opposites is constant. In tough times, very few firms are immune to economic fluctuations allowing them to remain fully committed to their long-term investment.

One of the most visible short-term/long-term dilemmas is with environmentalism. Conservation versus development. Protecting the global future against present moment needs. There is great wisdom in John Galsworthy's observation, "If you do not think about the future, you cannot have one."  But it is also true, that if you don't think about today, you may not be around to think about the tomorrow. Unfortunately, there is no easy formula, quick fix. What's important to recognize is, the environmentalism issue is a dilemma that has no simple moral or single correct response.