Ethics In Business, part 1

Does being “ethical” in business just mean not screwing up?  Just obeying codes of conduct and the law?

Unfortunately, it’s infinitely more complex than that.  If a decision affects another living thing, that decision has ethical implications. And how many of our decisions don’t affect another living thing?

That makes ethics apply to just about everything we do.  Everything we buy.   How we treat others.  How we spend our time.  Just about every choice, including every workplace choice, has ethical ramifications.

On Dec. 1, I’ll present a webcast for the 200,000 member Human Capital Institute (www.hci.org) on the topic of ethics in business.  I hope you’ll tune in! – no charge.   Click here for more info.

In this and my next two posts, I’ll briefly summarize the webcast content.  On Dec. 6 in this space, I’ll discuss setting an ethical tone from the top, and on Dec. 20 I’ll discuss stimulating ethical behavior from the bottom up.

Let’s start with the 30,000-foot view for organizational leaders:

The quality of ethical behavior in your organization depends in large part on the answers to two questions:

  1. What is your organization’s purpose?
  2. To what extent does that purpose drive decisions at all levels?

If you answered Question 1 by saying, “To maximize profit,” give up on expecting your employees to act ethically.  Your ethics are a product of your values – individually or collectively.  If an individual’s primary value is wealth creation (think Scrooge), expect corresponding behavior.  The same is true of course for organizations.

Now before you call me Pollyanna, consider this:  As John Mackey, founder of Whole Foods Market, says, Why is business the only profession in which “profit” is claimed as a purpose? Sure, every profession – every individual in our culture – must make money to survive.  But they don’t all claim it as their purpose.

To survive, I must also breathe and eat.  Does that mean that breathing and eating form my purpose in life?

The world’s greatest entrepreneurs started their companies not with the desire to become fabulously wealthy, but with a purpose – a purpose they stuck to doggedly through thick and thin.  Which brings up Question 2 above:  To what extent does your organization’s purpose drive decisions at all levels?  A purpose worth pursuing – a purpose that serves others or the planet – is a purpose that will maximize the ethics of all who commit to live it.

YOUR PATH FORWARD: Answer the above two questions for your organization.  If you have trouble with the first one, just come up with an initial answer, and then keep asking “Why?”  For example, if you’re a clothing retailer, you might say, “Our purpose is to sell clothes.”  So then ask, “Why do we sell clothes?” or “Why do we choose to sell the clothes we sell?”  Keep drilling down with “Why” questions until you keep getting the same answer.  If that answer doesn’t involve service in some way, you’re likely in ethical trouble.

And then don’t forget to tackle the second question, about how well your purpose drives decisions.  The question that naturally follows from it is, “What can I, as a leader, do to help ensure that our organization’s purpose drives all decisions, from executive-level to entry-level?” Living this question is a challenge every ethical leader chooses.

About the Author

Steve Motenko
Steve Motenko is an executive coach, leadership trainer, and co-host of The Boss Show, a weekly podcast on workplace dynamics. Steve and his Boss Show co-host, Jim Hessler, are co-authors of Land On Your Feet, Not On Your Face: A Guide to Building Your Leadership Platform. Steve lives on Whidbey Island, Washington, with his wife and dog, whom he loves, and a cat he tolerates usually pretty well.

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