What does an organization’s ethical culture achieve?
- lessens misconduct;
- helps avoid litigation;
- safeguards reputations;
- furthers team cohesion;
- reduces employee absences;
- identifies conflicts of interest;
- promotes a good public image;
- safeguards fairness in the work place;
- contributes to professional satisfaction;
- keeps and attracts top-notch employees;
- demonstrates that employees are valued;
- underscores the duties of each board member;
- protects fundraising opportunities for non-profits;
- creates trust between employees and management;
- identifies public relations problems before they occur;
- encourages open discussion of ethical concerns that arise;
- provides employees with guidance when making tough decisions; and
- meets public expectations that no harm is being done to, as one example, the environment.
What is Ethics?
- Ethics is people.
- Ethics is a two way street. People write policies and people are impacted by them. These policies can be both staff policies for internal use and external policies involving marketing or branding.
- Ethics impact employee behavior toward one another and how clients or customers are treated.
- Ethics should be directly linked to the best we are as individuals and to an organization’s mission statement about goals, social responsibility, and good corporate citizenship.
- Ethics cannot be compartmentalized. There should not be one set of private or personal ethics and an expectation that another set of professional ethics be used while in the office or interacting with clients, donors, consumers, or customers.
- Ethics is legal and non-legally binding conduct. Ethics is not merely about liability or risk management, but also respect for staff and customer, fairness to staff and customer, openness and honesty to staff and customer, and honesty shown to staff and customer.
Shouldn’t in-house counsel, the lawyer on retainer, or the attorney who is a board member worry about the ethics policy?
No. The role of a lawyer and ethics adviser or officer is very different. Although there may be overlap and the two may need to work together, organizations often try to keep these roles separate. A lawyer is trained to be a zealous advocate for a person or organization. Their objective is to position them in the best way possible to avoid liability and manage risk. A lawyer may sign off on a project or strategy because it is legal without necessarily looking into the unintended ethical consequences. Something can be legal, but not necessarily ethical thus harming a person or organization’s reputation.
Aren’t only bad or dishonest people unethical?
No. Honest, hardworking, and good-intentioned individuals and organizations can be confronted with ethical dilemmas or unknowingly violate ethical standards. These situations can occur through no fault of their own and can happen to anyone. Senior managers, board directors, human resource departments, and entry level employees can all be placed in ethical situations and not know it.
Suppose a senior manager is invited to an exclusive after hours party at the home of a vendor who has long wanted the organization’s business? If the vendor received the job, it would be at a higher cost. Should she accept the invitation? Suppose the vendor and senior manager are childhood friends?
A board member may have a close relation that just accepted a position at a business in competition with his company. Should the board member disclose it to other members and senior management? Would it matter if it were an entry level position?
Complaints have been made to management and human resources about a problem staffer. Is it fair to other employees to do nothing and let them endure or deal with the bad behavior because of the staffer’s perceived value?
A receptionist greets guests and serves as a first line of defense to outside persons trying to gain access and influence decisions. The receptionist accepts a gift – a pair of baseball tickets. Should he be allowed to keep it? Or should he pay fair market value?
It may be perfectly acceptable to go to the party, not disclose the relative’s position, or accept the tickets without payment. The problem employee is likely to be a different matter. The greater issue is whether potential conflicts have been identified and discussed.
How do you develop an ethics policy or assess an existing organization’s ethical culture?
A careful review of the organization must be made. Employees may need to be interviewed, the mission statement must be reviewed, an evaluation of the personnel handbook is necessary, and how fundraising or marketing strategies are developed and implemented should be considered. Annual anonymous employee surveys could be very useful. Discussions with members of the board are also important. Each situation and organization will have different needs.
How does an ethical culture in an organization add value? How does it make or save money?
According to ethics expert Patrip Kar, “Follies are inevitably counter-productive and ethical follies are self-destructive — for individuals, companies, organizations and countries.”
Increasingly, consumers throughout the world, especially in the West, expect ethics and social responsibility from businesses and non-profits they patronize, donate to, work for, or with whom they invest.
Non-profits need to keep in mind that donors and the individuals served through the organization are “customers” or “consumers.” The donor is purchasing a service on behalf of someone else not unlike a gift card. The customer or consumer using it needs the benefit of the service. Boards not fully engaged risk not meeting legal/fiduciary responsibilities and maximizing staff talent.
According to former GE CEO Jack Welch, shareholder value is not the be-all and end-all. The consumer and employee are a priority in order to have an end result of improved shareholder value. John Young, CEO of Hewlett-Packard at the time, observed that “to win, and winning is judged in the eyes of the customer and by doing something you can be proud of. There is a symmetry of logic in this. If we provide real satisfaction to real customers – we will be profitable.”
Why hire Paul Jesep and Entrepreneur Spirit?
Paul is the founder of Entrepreneur Spirit. He has an unusual combination of experience and education. Independent of being a lawyer and having served as an Ethics Officer, he has an appreciation for communications and public affairs having worked in these areas as a director.
He is very sensitive to image making, brand marketing, and community relationships. Paul has worked for non-profit, for-profit, and government organizations providing him with unique insights. He has been a member of several boards of directors and Secretary and General Counsel to a board overseeing a budget that exceeded $40 million. Paul has a specialty in research enabling him to stay current on trends while taking difficult concepts as a professional writer and breaking them down into understandable terms for print or use in workshops.