Does (Business) Ethics Matter?

(from a presentation given by Marianne Jennings, professor, Arizona State University College of Business, 2004)

Ethics at Work:

According to a KPMG 2000 Organizational Integrity Survey,

• 76% of employees observed a high level of illegal or unethical conduct at work in the past 12 months.
• 49% of employees observed misconduct that, if revealed, would cause their firms to significantly lose public trust.
• 76% of MBA’s were willing to understate expenses that cut into their companies’ profits.
• Nearly all MBA’s believe that shareholder value is more important than customer service.
• Convicts in 11 minimum security prisons had higher scores on an ethical dilemma exam than MBA’s.

Reporting misconduct in a business organization:

• 65% don’t report misconduct.
• 96% feared being accused of not being a team player.
• 81% feared corrective action would not be taken.
• 68% feared retribution from their supervisors.

We need to move from the question “Could I do this?” to “Should I do this?”

Why does business ethics have such a discounted reputation?

1. A victim of urban legend:
   “You have to play the game.”
   "You can’t get ahead without cutting a few corners.”
   “You’ll be eaten alive if you follow the rules.”|
   “Ethics is for wimps.”
   “It’s a poker game. We’re all bluffing.”
    
2. Lack of enforcement
    
3. Rationalizing, not analyzing:
   “If we don’t do it, someone else will.”
   “It doesn’t hurt anyone.”
   “It’s the way it’s always been done.”

• Define issues properly.
• Examine long-term implications of proposed actions.
• Look for ways to solve problems and still maintain ethical principles.
• Discuss values, not just immediate circumstances.
• Treat others (shareholders, administrators, employees, customers) as you wish to be treated.
• Imagine discussing your decision with your supervisor, co-workers, clergy, friends, family.

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