Managing Values, Author at Business Ethics Consultants - Managing Values

How to Develop a Code of Ethics for Your Workplace

The process of developing a code of ethics can determine its success. Many codes today are simply PR statements. Authentic ones appreciate the specific contexts and ethical challenges of the company. They also acknowledge the stakeholders and employee engagement needed to win support. Consultation and collaboration in its design will ensure its relevance. Relevance is the key to user engagement. Critical steps include:

1. Consultation – Discussions with staff members and critical stakeholders is crucial. These sessions lay the foundation for engagement with the final content. Workshop the draft content to enable stakeholders to feel it speaks to the issues that concern them. That way, hopefully, they will be happy to commit to the final version of the code.

2. Relevance – Effective codes speak to the day to day ethical challenges managers and employees face. These will vary depending on their roles within the business. Invite staff to identify challenges or conduct an ethics audit to pinpoint issues. Incorporating these into the code will ensure its authenticity and relevance for the different groups within the company.

3. Content – A typical code might include:

An inspirational message from the CEO about the benefits of ethical behaviour.
A clear definition of business ethics and the reasons why they are critical to business success.
An explanation of the company’s core principles and values. Also, include specific workplace behaviours that will demonstrate these.
Examples of typical ethical challenges and how the code can clarify the right action to take.
Identification of key stakeholders and reciprocal obligations.
Handy checklists of enablers and barriers to engagement with the code’s intent.
A ladder of escalation on how to raise issues and the key people who can help.
The protections awarded to employees who speak up.

4. Language – Choice of voice or tone can help users to engage with your message or turn them off to it. Choose inclusive, inspirational language to deliver clarity and win employee engagement. Avoid legal language and prescribed responses to hypothetical challenges. Real life is often more complicated, so these become irrelevant.

5. Embedding – Cross-check code content with existing business protocols to ensure consistency. If there is a lack of consistency, seek to streamline policies. Face-to-face training and an engaging communications plan need to accompany the roll-out. All leaders need to publicly demonstrate how they link their critical decisions to the code’s intent. This linking will reassure your workforce of the code’s authenticity.

6. Role modelling – Develop metrics to hold all leaders to account to role model the code’s values. Build this into performance reviews.

7. Maintenance – Companies must frequently review and update their codes. That is the only way they can take account of new technologies and the related changing societal values.

Remember, it’s what leaders do and talk about rather than the code that determines ethical behaviour. Have regular conversations reminding people about the code. Also, give out monthly awards to employees who demonstrate their values. Together, these actions send a strong message that ethical behaviour matters.

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Virtues-based business ethics will make companies more sustainable

New generations are looking for a more balanced purpose for business. They want one that seeks to profit by enhancing societal well-being. At the same time, the range of external stakeholders is increasingly diverse. These people are asking for more social accountability from listed companies. Leading this movement are investors and their demands for ESG accountabilities. This shift suggests that adopting virtues-based business ethics will make companies more sustainable. Plus, it provides executives with engaging new ways of mitigating conduct risk.

Ethics at the Personal Level

Those seeking to build more ethical business cultures must work both through people and systems. Virtue ethics asks each of us to clarify our ethical ambitions. It leverages off our identities as ethical people. It enlists everyone’s commitment to building and safeguarding ethical standards. At the personal level, virtuous conduct involves responding to what might seem competing interests, such as:

an ethical orientation vs pragmatism
shareholder vs customer interests
balancing short and long-term goals
duty of care vs target or goal-setting
fairness vs opportunistic or exploitative practices
self-interest vs company interests
truthfulness vs PR spin
responsible for company assets but also a risk-taker
respect for others vs achieving goals
sustainable business growth vs unsustainable growth

How to Build More Ethical Organisations

At a higher level, the critical steps in building virtues into systems involve:

Identifying how the existing culture promotes personal gain rather than working together. This focus on personal reward is the systemic cause of conduct risk. Developing plans to dismantle existing cultural barriers.
Recognising our human needs to feel safe at work. This involves building systems to enable more inclusive and collective orientations to emerge.
Measuring the existing trust gap between where you are and your trust goal. Then define the path you can use to close the gap.
Insisting that all leaders develop personal action plans to promote desired virtues. Embed these in day-to-day actions.
Use regular ethical culture reviews to learn what’s not working. Track progress, provide feedback, and feed into personal performance appraisals to make people accountable.

Sustainable enterprises depend on virtues similar to those related to individuals flourishing. Such traits include being self-aware, honest, fair, trustworthy, and dependable. These same virtues underpin employee and customer loyalty and build social capital and brand value. Honesty, for example, is a core virtue. It enables positive relationships between staff and businesses. It also facilitates trust between companies and their customers.

Leadership relies on the virtues of trust and integrity. Being a productive team member means being dependable and cooperative. At the manager level, you should expect to see the virtues of fairness and empathy.

A company embarking on a journey to embed virtues will accelerate the building of trust. It will create a shared language in which a renewed culture based on personal behaviour change can emerge. This strategy leverages our identities as ethical people and responds to our need to be our best selves.

Covid brings out the pro-social in us

The Covid-19 pandemic has brought some appalling consequences on the world. One unexpected impact has been the reappraisal and revaluing of the importance of the social world. Stephen Brookfield called them ‘disruptions’ and said that all real critical thinking comes from such disruptions. As a nation, as a society, as individuals, people have been forced to think beyond the economic. They are slowly beginning to recognise that it is not self-interest that makes for social progress. Instead, it is a higher calling of which everyone is capable. The sacrifices emergency workers make daily who respond to this higher calling are a poignant reminder. Protecting human life and reducing harm has become the most critical accountability of leaders.

Responses to the Covid-19 Pandemic

Civil society has never shone more brightly. Inspiring, spontaneous grass-root actions such as the national #virtual kindness movement have begun. Neighbourhoods of people sung from balconies and streets, clapping to thank emergency workers. For nations stuck indoors, social media has become the outlet to show support for each other. Singers and artists reach out to their fans and perform requests from their lounge rooms. A flurry of innovative home videos and podcasts are released daily. These highlight the creativity of ordinary folk and a universal need to feel connected to humankind. This spontaneous global movement demonstrates society’s social interdependence. It proves the reliance people have on each other to feel safe, sane, and hopeful. The need for belonging and for social inclusion is the zeitgeist of the moment. It is fellow citizens, and not the marketplace, that gives us purpose, inspires us to loftier ideals, and makes living worthwhile.

Learnings in the Workplace from Covid-19

What is also now in stark relief is that social natures, needs and desires, are too often silenced in workplaces. People have succumbed to the prevailing political culture of ‘economic self-interest’.

Science suggests that people act cooperatively or prosocially because they are social by nature. Prosocial behaviours are those actions intended to help other people. They are characterised by a concern for the rights, feelings, and welfare of other people. Associated actions include sharing, helping, and volunteering. These are the very behaviours that dominate the Covid-19 social world. As social beings, humans are motivated by altruism, empathy, and a sense of purpose. At least as much as they are by extrinsic rewards.

Behaviour science shows that the way societies behave is a consequence of how they are designed. Society can choose to learn from Covid-19 and redesign culture to serve social needs better. At the individual level, the crisis is challenging everyone to rethink their sense of self, values, and priorities. People are reconsidering their technological skills and employability. There is a need for ongoing development to meet the demands of a new normal.

Rethinking How Our Society is Designed

Rethinking at a societal level requires the sort of leaders who can call on the higher nature of humans to enable everyone to flourish. One that can tap into prosocial dispositions. One who can gain the commitment to sharing the economic pain that will inevitably follow this crisis. Such cooperation is possible. ‘JobKeeper’ was the result of such collaboration. Society must encourage similar partnerships between political parties.

Covid-19 has given the world the chance to hit the pause button on daily routines and underlying assumptions. Employees are embracing remote working. The world has also seen that micro-management is pointless and a barrier to excellent work. Many employees are flourishing amidst the chance to be self-directed. This change is challenging managers to rethink assumptions about employee capabilities.

Australia needs to recognise, as so many Nordic countries have already done, that the marketplace is a social invention. It, too, can be better designed to distribute rewards and recognition to benefit the common good. Instead of self-interest being the driving force, cooperation can underlie the design of all our systems. Aspirations for the common good rather than small government need to be debated more broadly. This discussion can enable a more inclusive society to emerge. There is no invisible hand that guides the marketplace. It is a social fiction that needs to be re-tuned to our social needs.

Building a better society post-Covid-19 requires drawing on scientific insights. Leaders should consider how best humans flourish. Then they can purposely design the economy to serve society’s collective needs better. All Australia needs to do is seize the moment!

Working from home presents opportunities to redefine trust

The degree of micromanagement in most Australian workplaces suffocates relationships of trust. Working from home (WFH) – ‘the new normal’ – presents an opportunity to redefine trust. It is an opportunity to reconsider and establish trust between managers and employees. This trust begins when leaders move away from the current tick box of ethics initiatives. Their enablers; consultants, HR managers, lawyers, and risk managers must facilitate this. This approach didn’t work in the past, and it will not work in the future. The loudest message in any company is what leaders do.

Questions Ethical Leaders Ask Themselves

Ethical leaders begin by asking themselves some essential ethical questions. Here are some good ones to start with:

Am I impacting positively or negatively on the people I lead?
Are my decisions personally motivated or based on what’s right for the business?
Am I aware of my prejudices and bias undermining my integrity?
Have I invested time in getting to know the strengths of each employee, so I can help them be their best at work?
Do I encourage my people to learn from mistakes, or do I punish them?
Do I have the interpersonal skills to manage group dynamics and nurture group harmony?

Ethical accountability is not easy, but answering these questions will put you on the right path.

What Needs to Change

The old comfortable management paradigm of command and control is no longer suitable in a Covid-19 world. Ignoring the social and psychological factors impacting employees is no longer acceptable. Consumers and public opinion won’t stand for it.

Transactional or conventional management uses command and control management styles. These feature risk and reward as key motivators and don’t appeal to the social nature of people.

Transformational managers adopt a more equal approach. They focus on empowering employees and tapping into social needs and psychological motivations. It shifts the manager’s focus from employee output to encouraging inputs that will enable them to thrive. This shift enhances the ability of staff to deliver desired results.

Why Companies Fail To Eliminate Conduct Risk

Many companies seem to be unable to eliminate conduct risk. This failure is due to leaders’ unwillingness to recognise patterns of unethical behaviour in workplaces. They are reluctant to hear issues of concern. Inside most companies, these revolve around the absence of procedural justice. This reluctance reduces employee engagement which research shows us correlates with employee perceptions of fairness. It impedes resilience which, science again tells us, is linked to engagement. It hinders innovation as employees are reluctant to expose themselves to trial and failure.

How To Build A Better Workplace Culture

When you understand that companies are a collection of social relationships, you start to see them in a different light. You can appreciate the importance of nurturing shared perceptions, attitudes and decision-making models. These cultural changes act as a prelude to shared behaviour standards.

To date, businesses have paid scant attention to the relationship between employee thinking and organisational culture. This interdependence is shaping the social dynamics that play out at work, enabling conduct risk to thrive.

To change thinking, prevailing mindsets need to come to light. To change context, bring to surface the informal practices that become the institutional roadblocks to trust. Chief amongst these is the absence of authentic leadership commitment to a culture where it is okay to speak up. Such a commitment can enable the business to learn from root cause analysis of where and when its systems are failing.

Trust emerges when people feel safe. How can this be achieved? Staff must experience consistency between what the organisation says it values and how managers treat them. It’s the hallmark of an ethical culture. Without trust, WFH becomes a logistical challenge. Employee well-being becomes a luxury managers continue to believe they cannot afford.

At this moment, it is time to step up to ethical leadership and beyond leadership as usual.

Now is the time to ensure you have the right managers in place to realise the human potential dormant in your company. Ethical skills are complex, and would-be leaders need to invest time in crafting these skills. Now is the time to allocate that time.

None of us is perfect, that’s for sure. However, you can hone the skills necessary to catch ourselves sliding into unethical patterns of managing. Acquiring ethical leadership skills will enable your organisation to emerge stronger from this crisis. You will have the inbuilt resilience to address the inevitable challenges our post-COVID-19 world will bring.