Regulation

Building A More Ethical Workplace Culture

It’s hard to blame anyone for feeling less inspired by workplace ethics these days. The run of recent headlines could convince even a naturally upbeat sort of person that workplace ethics, at best, are severely ailing these days – and at worst, are an actual oxymoron.

There was Wells Fargo’s account scandal, Uber’s sexual harassment detonation, Google’s memo-gate and a veritable flood of stories from virtually all industries – particularly the entertainment industry, care of the #MeToo movement – the depressing hit parade has been somewhat deflating.

That feeling, Ethics and Compliance Initiative (ECI) CEO Patricia Harned told Karen Webster in this week’s Data Drivers podcast, is not entirely misplaced.

 

ECI has been surveying the workplace since 1994 – specifically, for their National Business Ethics Survey, it has been polling the U.S. workforce for the last 25 years on the state of workplace ethics, asking them about all aspects of workplace compliance issues.

“We really ask about a wide range of different types of issues: abuse and intimidation by supervisors, sexual harassment, environmental violations, fraud, abuse of the internet – we draw much of this from companies and their codes of conduct to take a really wide variety of behaviors that are not acceptable.”

And, despite what the headlines would have one believe, there really are some things to feel good about. It’s not all doom and gloom when it comes to workplace ethics.

That’s the good news.

Unfortunately, there’s a bit more bad news to follow.

The Good News

Despite the trend of the headlines, misconduct is not raging out of control. In fact, it is actually on the decline, according to employee self-reporting. ECI, Harned explained, checks in with employees every two years to ask if they have seen or participated in a violation of their workplace code of conduct.

And that figure, she observed, is dropping.

“We are actually seeing that approaching an all-time low,” she noted.

And employers are increasingly interested in taking on these problems ahead of time, so that these behaviors are stopped before they ever start. That, Harned noted, includes an increasing number of workplaces that are including private or anonymous tip lines where workers can call in to log their concerns.

“Interesting, though, we are seeing employees less likely to actually use those phones and more likely to work with their immediate supervisor,” Harned noted.

That, she said, is actually a positive sign in and of itself, since employees who view their supervisor as interested in ethical behavior are themselves more likely to behave ethically. And the increasing access channel for reporting, she noted, is a good sign that employers are taking the problem seriously.

That’s the good news.

The Bad News

Despite that “all-time low,” Harned noted that the raw numbers aren’t wholly inspiring: 47 percent of consumers still report having seen some flavor of misconduct in the last two years. Not all of that is criminal, or extremely serious, but some of it is.

Moreover, among American workplaces, just slightly more than half ethical is not exactly a ringing endorsement.

More concerning, Harned noted, is the data trend that indicates employees are feeling increasing pressure to behave unethically – or even illegally, in extreme cases – as part of their everyday job duties.

“That is a historical pattern we see, particularly when the market is strong – employees start feeling more pressure to really start cutting corners to perform, ethically speaking.”

Moreover, she noted, bad ethical habits in workplaces tend to be a bit on the contagious side: 87 percent of employees who report being put under pressure to cut corners or break rules also report having seen someone else in their organization do it.

“And what that really speaks to is a cultural problem – employers are saying that they value this, as we see them acting on it at the top. But that is not filtering down to the employee level – it often isn’t creating a culture where employees see it as unacceptable to break the rules, and where they think the consequences of following the rules will be bad for their careers.”

That, she notes, is not a good pattern – but it’s not the worst news.

The Worst News

Among the positive findings in the report was the fact that reporting is on the rise by a whole 19 percent, with 69 percent of employees stating they had reported misconduct in the last two years.

But that number, Harned said, comes with a bitter side note. Retaliation has also spiked during the same time period, with 44 percent reporting it – up from 22 percent two years ago.

The rate of retaliation going up faster than the rate of reporting, Harned noted, is disturbing.

“That is a very real problem for employees, and I think over the last year, we’ve seen what a huge problem it has become for employers.”

The door-to-door on retaliation for reporting is short – about three weeks on average. That is just about the time it takes for firms – even those serious about doing a good job with improving compliance – to get any investigation up and organized.

“By then, the damage is already done,” said Harned. “We are better at seeing misconduct, but we aren’t doing enough to prevent it from happening – especially because retaliation is such a big problem.”

There are not easy solutions, Harned noted, but the good news – even in the face of the worst news – is that improvement is possible, and is even being logged in some segments. Employees, she stated, mostly come in the door with a moral compass to call their own, and want to work in environments that are healthy, not vicious.

“The answer is culture is everything: Companies need to constantly communicate to employees that conduct is the expectation for all levels of the organization, and that breaking those rules will always have consequences.”

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