Sustainability: Ethics

The ethical tool-kit

Dr. Abdullah Telmesani offers a simple but profound test for making ethical decisions in business—a useful guide for board members and executive committees to clarify the ethical basis for executive choices.

 

Achieving higher levels of ethical conduct, as is the case in achieving all optimal positions, is a balancing act. For corporations, ethical attitude and sustainable success are achieved by striking a balance between the bottom-line on one side, and the interest of the employees and the community at large on the other. Employees’ ethical behavior and success, on the other hand, are achieved by balancing their personal interest with their companies’ interest.

The formula above seems, according to Deloitte 2010 Ethics & Workplace Survey, to be partially compromised. In their struggle to survive the recession, some companies seem to have had to take drastic decisions that are not typical to their corporate cultural norms. These corporate actions and decisions naturally lead to employees’ uncertainty about corporate decisions and intentions.

This feeling of uncertainty and lack of clarity shaped the responses of 46 percent of the employees surveyed, when they indicated that a lack of transparent leadership communication would drive them to seek new employment opportunities. Furthermore, 48 percent of employed Americans who plan to look for a new job when the economy is more stable cite a loss of trust in their employer as a result of how business and operational decisions were handled over the last two years, as a reason for leaving their companies.

While the ethical formula outlined above is partially compromised, the good news is that it did not collapse. The Deloitte 2010 Ethics & Workplace Survey indicates that, in spite of the feelings of uncertainty about their companies’ decisions and actions, 72 percent of them still believe that their employers are responsive to their work/life balance needs. In essence, the employees, according to the survey, believe that their employers are still honoring the fundamentals of the ethics formula. Employers are, at least, attempting to balance the companies’ interests with their employees’ interest. The Deloitte 2010 Ethics & Workplace Survey does not go into the second part of the formula, however, which is related to companies’ attitude towards the interest of their communities at large.

As in the case of employers, employees’ ethical formula can also get partially compromised under pressure and times of uncertainty. This is indicated by the Deloitte 2007 survey, when 91 percent of employees surveyed indicated that they are more likely to behave ethically at work when they have good career-life fits. This statement does indicate that employees’ ethics formula of balancing their interest with their companies’ interest can also be compromised under pressure.

The balance of the ethics formula, in light of the above, could be compromised under pressure for both the employers and the employees, especially in times of difficulty and uncertainty. In attempting to minimize compromising the ethics formula between the employer and the employees, companies have elaborate codes of ethics to guide employees and employers’ choices.

From my experience and from teaching professional ethics to architecture students in the 1990s, it became evident to me that balancing the ethics formula comes from inside us, not from codes of ethics. Making choices between ethical and non-ethical actions are among the most personal decisions, which we don’t usually like to discuss with others. This makes it important to simplify this formula and make it readily available to employees and employers, whenever needed, and with total privacy.

In an attempt to simplify the ethical formula and improve its applicability for employees and employers, there is a practical tool, which I call the ethical tool-kit. This tool-kit consists of two levels. The following case study describes these two steps and indicates their applicability to professional practice.

While evaluating tenders from various suppliers, John noticed how close the bids were in terms of prices and quality. During this period of evaluation, John met a friend who informed him indirectly that one of the suppliers was willing to pay for a personal trip for him and his family if he overlooked one of the conditions that this supplier did not satisfy.

John faced a dilemma in making a decision to award the contract to the supplier related to his friend. Overlooking the condition of this supplier would not affect his company negatively, and no one would even notice it. In trying to arrive at a decision, John followed the two-level ethical tool-kit-test as follows:

1.                  The internal test: In this test, John checked his gut feeling about awarding the contract to this company. Doing that, he realized that he felt uncomfortable about it; however, knowing that awarding the contract to this company would not affect his company negatively, made him feel more comfortable about awarding the contract to that specific supplier. In order to arrive at the right decision, John followed the second step of the test.

2.                  The disclosure test: In applying this step of the test, John looked at whether he would feel good about letting his colleagues, his family, and others know about the basis for awarding the contract to this supplier. Thinking about that made it very clear to him that awarding the contract to this supplier would not be ethical, since he would not be comfortable with letting others know about the real basis for awarding this contract to this supplier.

The above Tool-kit can be used by employees and employers at all levels. It can also be a useful guide, or exercise, for board members and executive committees in clarifying the ethical bases for executive choices.

 

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Dr. Telmesani holds a master’s degree from Harvard University and a doctorate from the University of California at Berkeley. In his book The Balanced Way: The Path to Excellence and Contentment he provides insight on ethics as it relates to business and personal behavior, along with many other topics relating to balancing career success without sacrificing your personal life.