There’s No Accounting for Good
Ethics…Or is There?
Patricia J. Harned, Ph.D.
Chief Executive Officer
Ethics & Compliance Initiative
www.ethics.org | ©2015 Ethics & Compliance Initiative
www.ethics.org | ©2015 Ethics & Compliance Initiative
www.ethics.org | ©2015 Ethics & Compliance Initiative
www.ethics.org | ©2015 Ethics & Compliance Initiative
www.ethics.org | ©2015 Ethics & Compliance Initiative
What Do We Mean by Ethics?
• Ethics = a decision that impacts another person
• Most decisions have an ethics component:
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Procedures and controls
Accuracy of records
Management of errors
Meeting financial obligations
Transparency of financial statements
Funding or cutting programs
Employee supervision
Treatment of colleagues
Personal use of time & information
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Questions?
Presentation Plan
• Current State of Workplace Ethics
• Drivers of Good Conduct in Organizations
• Telltale Signs
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About ECI
• Leading the Movement for Responsible Organizations
o New ideas grounded in research
o Best practice community
o Education and certification
• Comprised of:
o Ethics Research Center
o Ethics & Compliance Association
o Ethics & Compliance Certification Institute
www.ethics.org | ©2015 Ethics & Compliance Initiative
About the National Business Ethics Survey®
• Longitudinal, cross-sectional study
• Implemented eight times since 1994
• Government data through 2007; 6,420 responses in 2013
• Dual mode: Online and phone (including cellular)
• Oversampling for companies with 90K+ employees
• Data weighted by: collection mode; age, gender, and
education of respondent; company size
• Sampling error: +/- 1.2 percent at 95% confidence level
www.ethics.org | ©2015 Ethics & Compliance Initiative
The Current State of Workplace Ethics
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Fraud, Waste & Abuse in the Public Sector
• In 2010, 11% of federal employees observed illegal or
wasteful activities in their agency.
– 35% did not report the activity
– 35% of incidents cost more than $100,000
• “I can disclose a suspected violation…without fear of
reprisal.”
– 20% disagreed/strongly disagreed
Source: 2011, US Merit Systems Protection Board, Blowing the Whistle: Barriers to Federal Employees Making Disclosures
www.ethics.org | ©2015 Ethics & Compliance Initiative
Fraud, Waste & Abuse in the Public Sector
• 34% of US employees observed fraud, waste or
abuse in their workplace during 2013.
• 8% observed some form of corruption.
-Source: ERC’s 2013 National Business Ethics Survey™
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Observed Misconduct
-Source: ERC’s 2013 National Business Ethics Survey™
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Who Commits Misconduct?
53%
-Source: ERC’s 2013 National Business Ethics Survey™
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Who Commits Misconduct?
60%
-Source: ERC’s 2013 National Business Ethics Survey™
www.ethics.org | ©2015 Ethics & Compliance Initiative
Questions?
www.ethics.org | ©2015 Ethics & Compliance Initiative
Drivers of Good Conduct
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#1 Awareness of Standards & Resources
Industry Benchmark Data
-Source: ERC’s National Business Ethics Survey™
www.ethics.org | ©2015 Ethics & Compliance Initiative
#1 Awareness of Standards & Resources
-Source: ERC’s 2013 National Business Ethics Survey™
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Questions?
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#2 Culture
Most managers think of themselves as ethical.
They are often perceived as ethically neutral or altogether unethical.
Trevino, Hartman & Brown. (2000). California Management Review
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#2 Culture
-Source: ERC’s 2013 National Business Ethics Survey™
www.ethics.org | ©2015 Ethics & Compliance Initiative
#2 Culture
-Source: ERC’s 2013 National Business Ethics Survey™
www.ethics.org | ©2015 Ethics & Compliance Initiative
#3 Accountability
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Telltale Signs
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Signs of An Unhealthy Workplace
Vast Majority of Misconduct Committed by Individual “Bad Apples”
Strong Ethics Culture
Weak Ethics Culture
-Source: ERC’s 2013 National Business Ethics Survey™
www.ethics.org | ©2015 Ethics & Compliance Initiative
Indicators of Ethics Risk
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Strong economy
Poor management practices
Lack of awareness of standards & resources
Employee feelings of pressure
Rumors of retaliation
“Listen to the whispers and you won’t have to hear the screams.” Cherokee Proverb
www.ethics.org | ©2015 Ethics & Compliance Initiative
Questions?
www.ethics.org | ©2015 Ethics & Compliance Initiative
Upcoming Resources from ECI
National Business Ethics Survey® Reports:
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Generational differences & ethics
Employee connection to culture (collective identity)
Gender Differences & Tone at the Top
National Business Ethics Survey® - Contracts Management Industry
National Business Ethics Survey® - Internal Auditors
Global Business Ethics Survey
Benchmarking Group Reports:
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Conflicts of Interest
Anti-corruption Programs
Working with Monitors
Regulatory Intelligence
www.ethics.org | ©2015 Ethics & Compliance Initiative
For More Information
Pat Harned, Chief Executive Officer
pat@ethics.org
www.ethics.org
www.ethics.org | ©2015 Ethics & Compliance Initiative