How do you stop bad apples?

It's important to stop bad apples from doing wrong. But why not set up your organisation so everyone wants to do the right thing all the time?

It's important to stop bad apples from doing wrong. But why not set up your organisation so everyone wants to do the right thing all the time?

When we talk about ethics at work we tend to focus on bad apples, bad barrels or even rotten orchards. We appear to find it a lot easier to name companies that have been tarnished because of their unethical actions than to identify companies that are ethical. Enron seems to be a default reference in most articles on business ethics.

But there is a different lens that provides a very different insight, and can redefine our thinking and views on ethics in business; it’s called positive organisational ethics.
Instead of focusing on how we can make sure people in our organisation don’t behave unethically, positive organisational ethics is about ensuring the only available choices in a workplace are ethical ones. Or as business and legal ethics expert Amy Verbos and her colleagues put it: In a positive ethical organisation, the right thing to do is the only thing to do.

How can we move from doing no harm and focusing on compliance to doing what creates benefit and focus on shared values? To accomplish an ethical organisation we need to pay attention to what the entity sees, thinks and does. And to have an organisation that sees, thinks and does the right thing, its leaders, as well as its formal and informal systems, need to focus on doing the right thing all the time.

"The organisation sprays some ethics around as if it's a room deodorant and prays that it won't happen again."

This level of commitment to ethics is only possible when it is real. All organisations can react to an ethical failure or scandal by more discipline or more policies. But to create an ethical organisation requires authenticity and commitment.

While it is more common to focus on specific misconduct and try to plug the hole that allowed it, focusing on positive ethics can help us discover and establish new ways of doing the right thing all the time.

Like individual people, organisations have identities and character. These identities have moral content and affect their employees’ behaviour.
To develop an ethical organisational identity, attention is required on:

  • Leadership that is visibly ethical, with explicit commitment to ethics
  • Culture and informal systems, which include values, role models, language, norms, symbols and heroes
  • Formal systems, which include codes of conduct, policies and rules, structure, performance management and reward systems, and decision-making processes.

Leadership and the formal and informal systems are, of course, interdependent. It’s important that they are aligned so they strongly support an ethical organisational identity. This is possible and natural if the organisation truly believes that it exists to do the right thing. But it may be impossible if an entity is only paying lip service to ethics and acting in this way so individuals, rather than the organisation, can be blamed for being unethical if things go wrong. Meanwhile the organisation sprays some ethics around as if it’s a room deodorant and prays that it won’t happen again, while it continues with misaligned values, policies and expectations.

While we can learn from organisations that have done the wrong thing, we need to also focus on creating ethical business identities where the right thing to do is the only choice.

Dr Eva Tsahuridu is CPA Australia’s policy adviser, professional standards and governance.

This article is from the May 2015 issue of INTHEBLACK.

Read more: Why ethics and law are not the same thing


May 2015
May 2015

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