The Line in the Sand: What is an Ethical Organization?

by Cheryl Wilson, PMP, RMP, CCEP

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Every time we turn on the news, we hear yet another story of organizations making decisions that are from the view point of the newscaster, a good or a bad decision.  Does good decision making equal good ethics and do bad decisions point to being unethical?  Who decides?

What exactly is an ethical organization and where is the line drawn in the sand between being ethical or unethical?

Does being ethical equate to business success?  Is it the company that touts the badge of being ethical, or is it each individual that makes up the ethical tone for the organization? If the organization has decided to “be ethical” and includes a statement of ethics in their code of conduct, does that mean every employee that signs their yearly code of conduct is ethical?

Dr. Jana Matthews, founder and CEO of Boulder Quantum Ventures, in her article, “Eight Elements of an Ethical Organization?” says “the drive to ‘get ethics’ is now a huge push.”1 So what does it mean to ‘get ethics?’ and is it the organization or the employee that needs to “get ethics” for the organization to be ethical?

Basic definitions of ethics from Google are:

  • Moral principles that govern a person’s or group’s behavior
  • The discipline dealing with what is good and bad
  • A set of moral principles
  • The principles of conduct governing an individual or a group

Dr. Matthews goes on to say that “ethics are a foundation of a good company, and while they can be fixed, the best companies begin with a solid ethical footing.”  I also would like to use the quotation from our longtime friend, CJP Stoneman who said in 1996: “An organization is ethical due to its employees not the reverse.”

We can require our employees to take “Ethics Training” every year, but that does not mean they will be ethical or do what is right as it is each individuals’ decision to decide what is their definition of ‘being ethical’.  Organizations can go as far as requiring each new employee explain their ethical viewpoint prior to being hired, but again, as each individual sees ethics from their individual view point – one person’s view of being ethical can be far different from another’s.

I recently spoke to a colleague of mine that visited an office where everyone held a security clearances.  She noted that everyone left the office open without locks, no one had locked draws, and she was told there was never an issue with things being stolen.  She said since they all had the correct security clearances and the moral compass of their office suite was that of trust they did not have one instance of things being stolen.  This moral compass of trust was explained to all new employees and they were told there was a NO tolerance for stealing.  Of course, security cameras were also a huge deterrence.

However, if this condition were to be made aware of to the US Government client given the current situation of the impact that Edward Snowden has had on the understanding of just what is considered ethical security behavior, would the client agree from their perspective that the firm was being ethical and trustworthy in their adjudication of federal secrecy procedures? Probably not.

This was an interesting story to me as I ponder:  was this answering the question…. was each employee ethical because the organization had drawn a line in the sand for this office of no tolerance for stealing or was each employee ethical because everyone that had a clearance had deep rooted ethics that they did not want to steal?

The goal of the ethics program is to support the organization’s business objectives, help identify the boundaries of ethical behavior, and establish a system to alert management when the organization is getting close to a boundary that will prevent the achievement of their business objectives.

Also as we can see, ethics is somewhat of an enigma.  I feel to establish an ethical organization, there are two aspects to this consideration:

  • leaders of the organization need to set the tone for what employees are expected to do, and
  • employees are to bring to the organization a set of standards that are ethical.

[1] Dr. Jana Matthews. “Eight Elements of an Ethical Organization.”  http://www.kauffmanlabs.org/en/resource-center/eight-elements-of-an-ethical-organization.aspx

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