Most executives acknowledge that it’s a good idea to talk about ethics with their employees from time to time, but they may be reluctant to bring in a professional ethics trainer.  It costs money to hire outside speakers, and a lot of managers think they can do ethics training just as well as a professional can.  They might want to think again.  There are at least three reasons to bring in an outside speaker to train your employees in business ethics: 

Expertise.  Most of us know something about right and wrong, but very few executives can afford to spend a lot of time to thinking about business ethics or how to train on ethics in an engaging, inspiring way.  A professional trainer is an expert in business ethics who almost always provide a more thoughtful, meaningful and complete presentation to your employees than you can.  The trainer’s speaking skills are likely to be better than yours are, too - being a great executive doesn’t necessarily make you a great presenter. 

Significance.  Your employees see and hear from you every day, and might well take an ethics presentation from you with a very large grain of salt.  (Familiarity may not breed contempt, but it rarely inspires excitement.)  If you hire an outside trainer, your employees will see a fresh face, hear a new voice, and may listen with greater interest.  They’ll also recognize that you made the special effort to bring in an expert, which underscores your company’s commitment to business ethics.

Credibility.  Even the best run companies have ethical issues from time to time, and may find themselves under scrutiny by regulators, the press, or even prosecutors.  It’s often helpful in those uncomfortable situations to be able to demonstrate that your company’s management takes ethics seriously even if one or two rogue employees did not.  If you can prove that you brought an outside expert in to train your staff in business ethics, that will support your assertion that you and your company is innocent of wrongdoing.

Thankfully, business ethics is a “hot” topic and likely to remain so, which means there are great trainers available in almost any price range.  Hiring a professional ethics trainer to work with your staff is a terrific investment in your company’s future.

Topics: Business Ethics, corporate responsibility, ethics | 1 Comment »

My friend Amy was very frustrated this week when she got her daughter’s birthday cake for free.  Sounds crazy?  Read on. 

Amy works a demanding job and only gets a half-hour lunch break.  At the end of every workday she fights through traffic to collect her kids from daycare, so she can’t run errands on the way home.  (This is not a woman with a lot of free time on her hands.)  Amy works near an upscale supermarket and her daughter asked for one of their fabulous birthday cakes.  Not wanting to disappoint her daughter, Amy ordered the cake well in advance and received a firm promise from the bakery that it would be ready by 1 PM on the appointed day.

You can see where this is going, right?

Amy arrived at the supermarket at 1:15 PM, reasoning that if she allowed a little extra time her cake would surely be ready.  After Amy had waited for about five minutes to get the attention of anyone behind the bakery counter, a staffer finally took her order form and disappeared.  Five minutes later, a different staffer told her that the cake would be “ready in ten minutes.”  Amy used the ten minutes to collect a few extra groceries, then came back and waited yet another ten minutes before she finally got the hastily decorated, none-too-gorgeous cake, which the bakery gave her free of charge with an apology for the inconvenience.  Amy paid for her other purchases, grabbed the cake, and rushed back to work … twenty minutes late, and in trouble with her boss.

What really angered Amy was that she’d had almost identical problems the year before.  This was the second time the supermarket ended up giving her a free cake because the cake decorators didn’t have their act together.  Although she appreciated the apology, Amy no longer trusts the supermarket to meet its promised deadlines.  She probably won’t buy another cake there no matter how hard her daughter begs.

If someone on your staff makes this kind of mistake with a customer, it’s good to apologize and make amends.  But one of the most essential elements of an effective apology is to avoid repeating mistakes.  Use errors as clues to where your business processes need improvement, so your employees don’t end up having to offer customers the same stale apologies over and over again.

Topics: Apologies, business communications, customer relations, ethics | 1 Comment »

Congratulations to President-Elect Barack Obama for his historic Presidential victory last night!  And kudos, too, to Senator John McCain for his gracious concession speech.  Whether you’re elated or disappointed in the wake of yesterday’s Presidential election, it has to be a relief to know that the vote is in and the results are clear.

As soon-to-be President Obama has acknowledged, the road ahead is a steep one, and not just because of the many problems that our nation faces.  While he received a solid majority of the votes cast, there remains a sizable group of Americans who strongly oppose the policies the new President wants to pursue.  Not only will President Obama have to address all of the ethical issues I’ve highlighted in previous posts, he’ll also have to answer this question:

How can President Obama unite a deeply divided America while remaining honest with the American people and true to his fundamental principles?

Last night, President-Elect Obama promised to be the President not only of his supporters, but of the Americans who voted for John McCain.  It’s a laudable promise, but it may not be easy to fulfill.  Politicians from both sides of the aisle are urging Americans to put aside political differences and come together behind the new President.  People who deeply disagree with President-Elect Obama on matters of principle will do so reluctantly, if at all.

Thankfully, President-Elect Obama has demonstrated his ability to speak candidly and thoughtfully about the issues facing America.  Compromise is the backbone of Washington but if, as President, Obama compromises too much, his integrity will suffer - if he compromises too little, his goals may never be achieved.  Ultimately, honesty, accountability and transparency are likely to be the new President’s best tools as he seeks to bring the American people together into a harmonious whole.

Topics: Personal Ethics, Presidential Campaign, Social Ethics, ethics | 2 Comments »

The 2008 Presidential campaign has been slogging on for almost two years, and the time to vote has finally arrived.  For the past several months, I’ve devoted Fridays’ posts to ethical issues that the next President is sure to face, and have encouraged you to find out more about how your candidate plans to address those issues.  You probably have a pretty good sense of your candidate’s positions, and I hope this blog has helped you reach a thoughtful choice about who should get your vote.  But before you head to the polls, please take a moment to think about one last question:

Is your candidate serious about ethics?

WIth all the problems facing the United States and the world, you may be tempted to move that question down your list of reasons to vote for a particular candidate.  If so, please think again.  A President who takes ethics seriously is much more likely to make good choices and take responsible action on the nation’s behalf.  This may be the most important election that many of us will ever see.  We can’t afford to elect a President who puts expediency or personal ambition ahead of honesty, integrity, and accountability. 

We’re all human, and even the most seasoned politician makes mistakes from time to time, especially when under the pressure to perform in a hotly-contested campaign under the scrutiny of hostile witnesses waiting eagerly for every slip-up.  But take a moment to think back to how your candidate has behaved during the past months.  Has your candidate been truthful, forthcoming, and willing to admit to error?  Has your candidate revealed relevant information about his finances, health, and personal background?  Has your candidate either stood by his positions or credibly explained his changes of heart?  Are you satisfied that your candidate is a man of honor and integrity who deserves the extraordinary trust that the nation is about to put into his hands?

The election is tomorrow - you decide.

Topics: Presidential Campaign, Social Ethics, ethics | 1 Comment »

With less than a week before the election, it’s time for American voters to choose between the candidates for President.  Many of my prior posts on ethical issues facing the next President have focused on economic and domestic topics.  Today, let’s look at some of the ethical issues the next President will face concerning the war in Iraq.

We know at this point that Iraq did not have weapons of mass destruction when we invaded and that reports to that effect were exaggerated, based on faulty intelligence, or both.  We know that Saddam Hussein was a brutal dictator who deserved to be ousted from power, but that Iraq was not home to the 9/11 terrorists and probably wasn’t hiding Osama bin Laden when U.S. troops went in.  We also know that it’s been a long time since President Bush declared victory in Iraq from the deck of a Navy warship but our troops are still there, the casualties continue to mount, the new Iraqi government isn’t ready to assume its responsibilities, and American tax dollars continue to pour into the war effort.

Here are some things we don’t know.  U.S. casualties have been relatively low (though I wouldn’t want to say that to the grieving families of fallen American troops), but the Administration has been loathe to give us accurate numbers on Iraqi casualties and it’s almost impossible to find out how many slain Iraqis were innocent civilians.   Marine CorpsTimes recently reported that the war is creating an environmental disaster in Iraq, but you won’t hear that from the White House.  We don’t know how many U.S. deaths could have been prevented if our troops had adequate equipment.  We don’t really know how much money has been and is being spent on the war in Iraq, because so many expenditures get excluded from the federal budget and so many of the post-invasion reconstruction contracts were sweetheart “cost-plus” deals with friends of the Administration.  We don’t know how long our troops will have to stay in Iraq, we don’t know how the allocation of military resources into Iraq has affected the war in Afghanistan, we don’t know what impact extended tours of duty are having on our men and women in uniform (although it can’t be good), and we don’t have an accurate assessment of how much damage the war in Iraq is doing to America’s reputation with the rest of the world.   Perhaps worst of all, the Administration has failed to give the American people any meaningful prediction of when the war in Iraq will finally end.

There are always reasons to argue that, in war, the best strategy is silence.  At the same time, one of the few points on which the American people seem to agree these days is that this war needs to be brought to a close.  Senators McCain and Obama both have presented proposals to end the war, but the American people also deserve to know how we got into this mess, what we can learn from it, and how we can avoid similar mistakes in the future.  Will the next President have the integrity to tell the American people the truth about the Iraq war, even if it means breaking with the Bush Administration or departing from his party’s “official” position?  Will the next President deal honestly with the new Iraqi government and other nations, taking responsibility for any American mistakes and apologizing if appropriate?  Do you trust your candidate to be truthful and forthcoming about the causes and consequences of the war?  You decide.

Topics: Presidential Campaign, Social Ethics, ethics | 2 Comments »

Now that the $700 billion that Congress and the White House approved to bail out Wall Street is officially available for distribution, it’s probably not surprising that other industries are coming forward, hat in outstretched hand, to ask for a piece of the pie.  Life insurance companies, auto industry representatives, and almost anybody else who can cobble together a marginally credible claim in the wake of the financial meltdown have managed to find the funds to send lobbyists to Washington.  These industries lost money on their investments, took bad lending risks, or both, and now they’re looking to the government to cushion the blow. 

Not surprising … but is it ethical?

On one hand, there’s something to be said for the “why should our shareholders suffer when Wall Street is getting rescued?” argument.  After all, other industries didn’t create the financial crisis, but they got caught in the fallout when the financial markets collapsed.  They’re arguably more deserving of help than the financiers who caused the meltdown, and their lobbyists would probably consider it borderline malpractice not to ask for money if they have any chance of getting it.

On the other hand, the $700 billion wasn’t allocated as a “general corporate rescue fund.”  It was set aside specifically to shore up the banking industry and (at least some of us hope) help desperate homeowners stay out of foreclosure.  There’s already a question about whether $700 billion will be enough to accomplish those goals.  If other industries start nibbling away at that money, the answer to that question will almost certainly be no.

Millions of Americans suffered major losses when the financial markets caved in.  It wasn’t just wealthy folks with individual stock portfolios - anyone with money invested in a pension or 401(k) plan got clobbered.  And most of those Americans are also taxpayers who contributed to the $700 billion bailout fund that corporations are fighting over now.   Should they have to pay still more to keep corporate America from suffering the consequences of unfortunate financial decisions?

This isn’t an entirely simple issue.  The corporations that are lobbying for bailout money employ millions of people, and if they fail because of the financial crisis it’ll put a lot of people out of work.  But I have to question the ethics of industries that ask for money just because it’s there.  A basic principle of economics is that investments pay a profit because they also involve a risk of loss.  Corporations that choose to take investment risks shouldn’t assume they’re entitled to taxpayer money when those risks don’t pay off.

Topics: Business Ethics, Risk Management, Social Ethics, corporate responsibility, ethics | 1 Comment »

Last week, the British Medical Journal  published the surprising results of a new survey of American doctors concerning the use of placebos, harmless vitamins or over-the-counter painkillers that work because a patient thinks they will.  According to the Journal, almost half of the doctors surveyed reported that they prescribe placebos two or three times a month for various conditions.  However, only one in twenty doctors actually told patients they were getting a placebo.  The other nineteen doctors’ patients apparently took the placebos thinking they were taking drugs that had been clinically proven to treat their ailments.

Here’s the ethical dilemma doctors face: patients have a right to know about their medical care, and it’s normally considered unethical for a doctor to withhold information about prescribed treatments.  However, placebos work because the patient’s faith in the treatment triggers an improvement in the patient’s health.  If the patient knows the prescribed treatment is a placebo, the treatment probably won’t be anywhere near as effective.  And, some doctors might argue, if a treatment is beneficial, does it really matter whether the benefit is the result of a chemical reaction or the work of the patient’s mind?

The American Medical Association thinks that it does.  Its Council on Ethical and Judicial Affairs has issued an opinion stating that doctors should only use placebos with the patient’s consent, and “must avoid deception when administering placebos.”  The opinion recognizes that “the use of a placebo without the patient’s knowledge may undermine trust, compromise the patient-physician relationship, and result in medical harm to the patient.”  It might also lead to a malpractice lawsuit; a patient who feel that his or her trust has been betrayed may very well turn to the courts for redress.

Doctors who fail to disclose to their patients that they’ve been taking placebos are probably well-intended, but they’re taking a serious professional risk.  For ethical as well as professional liability reasons, telling the patient the truth about placebo treatments is the better course of action.

Topics: Business Ethics, Professional Ethics, business communications, ethics | 3 Comments »

Our nation is facing over $1 trillion in debt in the coming year.  Yes, I’m including the $700 billion Wall Street bailout - our leaders have committed us to pay the money, so I think it counts as debt regardless of what the politicians want to call it.  Consequently,  it was disheartening that Senators McCain and Obama both failed to respond specifically in the debates to questions about which of their planned programs they would cut or defer in the wake of the financial crisis gripping the nation.   

Both candidates have talked about using various instruments to cut the federal budget. Senator Obama has promised to use a scalpel.  Not to be outdone, Senator McCain has said he’d use a sledgehammer and a scalpel.  (What’s next - a jackhammer?)  It’s all hyperbole anyway - the real question is what each of them would do to bring our national budget back into balance. 

What neither candidate has told you is that the discretionary items in the federal budget represent a very small percentage of the money the government spends overall.  The vast majority of federal dollars go to fixed expenses, like servicing all of that debt.  And then, of course, there are the expenses that get paid but somehow magically never make it into the budget, like much of the cost of the war in Iraq.  (More on that next week.)  A private person who ran up a mountain of debt with the expectation that his or her kids would pay it off someday would be considered grossly unethical - isn’t it long past time we got our nation’s budget under control?

The next President will face tough choices about what programs to cut, what expenses to defer, and how to bring our nation’s wildly unbalanced finances back into order.  Would it be ethical to cut taxes when the national debt is already so high?  Would it be ethical to deny essential services to people who truly need them when we’ve just promised Wall Street a record bailout?  What’s your candidate’s position on balancing the national budget, and are you okay with it?  You decide.

Topics: Presidential Campaign, Social Ethics, ethics | 2 Comments »

NPR reported this morning that the FBI has begun investigating the financial crisis on Wall Street, and has already started uncovering instances of subprime mortgage lending fraud.  That’s no surprise, because we already know that loans were being made to homeowners who couldn’t possibly afford to pay them.  The good news is that the FBI is bringing the fraud to light, and at least some of the financiers who let greed overcome their better instincts will be facing prosecution soon.

The bad news is that the FBI will have to do its job on a badly frayed shoestring.  Apparently, when Congress and the Administration committed $700 billion of taxpayer money to bailing out the Wall Street firms that got us into this mess, they allocated all of that money to the Department of the Treasury, without putting aside funds to help the FBI figure out how much of the current financial crisis was brought about by stupid-but-honest decisions and how much by outright dishonesty.  Now, the FBI is going to have to investigate one of the biggest financial scandals in American history at a time when federal agencies’ budgets will almost certainly be deeply slashed to help cover the $700 billion bailout.   What were our leaders thinking? 

If everyone involved in the subprime mortgage debacle had been ethical enough to follow the rules voluntarily, we wouldn’t be in the financial mess we are today.  Unfortunately, a lot of them weren’t.  There’s no point in having federal laws that prohibit fraud unless they’re enforced, and federal prosecutors will depend on the FBI to ferret out the evidence to support the criminal charges they bring.

Financial fraud is difficult to prove under the best of circumstances.  It takes, time, money, and meticulous research to search through the haystack of complicated documents to find the evidentiary needle that proves dishonest intent.  Denying the FBI the necessary resources to do its job amounts to a decision by our leaders to let at least some of the scoundrels who created the subprime mortgage crisis to get off scott-free.  Shame on them - the American people deserve better.

Topics: Business Ethics, Legal Ethics, Social Ethics, corporate responsibility, ethics | 3 Comments »

USA Today’s Del Jones has published an article speculating about why Wall Street CEOs have failed to apologize for the financial crisis gripping the nation.  Jones has several theories.  First, there’s enough blame to go around between the government and Wall Street to allow CEOs to disclaim responsibility for the mess.  Second, both CEOs and politicians operate in such competitive environments that they have to be tough and arrogant to survive - in other words, not inclined toward the introspection and remorse that can inspire effective apologies.  Third, with criminal investigations pending and the threat of indictments looming, CEOs’ attorneys are counseling their clients to keep mum.  Fourth, most of the financial CEOs who created the crisis have been replaced, so they may think they can quietly ride off into the sunset without saying they’re sorry.

Jones has put his finger on all the reasons why a CEO might not apologize, but none of them hold water.

The federal government had a hand in creating this mess (and apologies for its mistakes would be very welcome), but its errors don’t excuse Wall Street’s leading role in creating the crisis.  As for the arrogance of CEOs, it’s high time they got over it - after all, if they’re so brilliant, how did we end up in this mess?  Legal liability is a legitimate concern, but there are ways to develop and deliver an apology without destroying one’s case in court.  And being replaced is not an excuse for withholding an apology, even when it should have been delivered before the CEO walked out the door.  When it comes to apologies, better late than not at all.

The pundits are calling our current financial situation the biggest economic crisis since the Great Depression – even so, apologies have been delivered for far worse.  The Prime Minister of Australia has apologized for the mistreatment of native aboriginals.  The government of South Africa found a way for its citizens to apologize for their role in apartheid.  The U.S. government has apologized for the internment of Japanese-American citizens in World War II, the abuse of native Americans and institutionalized racism directed against African-Americans. 

If they could do it, so can Wall Street.

To read Del Jones’ article, go to http://money.aol.com/news/articles/_a/bbdp/why-ceos-dont-say-sorry-anymore/219451.

Topics: Apologies, Business Ethics, Social Ethics, business communications, corporate responsibility, ethics | 1 Comment »

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