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Ethics Training and Education
An Investigation of the Practices of
Top Canadian Companies
Research sponsored by the
Canadian Centre for Ethics in Public Affairs
Dr. Margaret McKee
Sobey School of Business
Saint Mary’s University
February 6, 2014
Agenda
• Overview of Proposed Research
–
–
–
–
–
Literature Review
Local Research Context
Research Purpose
Research Questions
Research Approach
• Findings
– Survey Results
– Interviews Themes
• Conclusions
Research Purpose
• To gain a detailed understanding of the
ethics education and training practices of
leading Canadian companies.
• Focus on those deemed “best” in the
country
– i.e. Progress’ Top 101 Companies and Globe
and Mail Top 1000 companies
Research Questions
• What are Canadian organizations doing relative to ethics
education and training?
• What methods are they using to deliver educational and training
programs?
• When is such training and education being done? Is it done
primarily when employees join the organization? Is there also
ongoing training and education?
• Who is receiving the training? Are there employees or positions
that are specifically targeted for training? Is their training all the
same?
• What are the specific aims of the training? Is the focus primarily on
making employees aware of the organizations’ codes of conduct
and/or ethical rules and regulations? Alternatively, is there more of
an emphasis on developing more of a culture of ethical behavior?
Literature Review
 Ethical values, responsibility and accountability rated as some of
most important employee behaviours, but new employees are
sometimes lacking in these areas (e.g., Cacioppe, Forster, & Fox,
2008; Hall & Berardino, 2006; Otter, 2003; Tanyel, Mitchell, &
McAlum, 1999).
 Research has shown organizations can use ethics training and
education to address such deficiencies and help employees:
◦ identify ethical scenarios,
◦ appreciate more fully the dimensions of ethical dilemmas,
◦ enhance their moral reasoning and judgment
◦ increase their attentiveness to ethical challenges
 (e.g., Gautschi & Jones, 1998; Grant, 2008; Halbesleben,
Wheeler, & Buckley, 2005; McWilliams, & Nahavandi, 2006;
Sims & Sims, 1991).
 Research suggests ethical thinking and ethical behaviours must be
nurtured over time and over one’s career (Sims & Felton, 2006)
Local Research Context
• Sobey/Progress Survey (Driscoll & McKee, 2005)
– Little formal ethics training being done by
Atlantic Canadian firms in the workplace
• Less than 5% of Progress Top 101 companies
completing the survey reported having any training
in 2004; 6% in 2003
• 50% of firms reported having formal code of ethics
• 55% reported having mechanism for
whistleblowing
Local Research Context
• Interview Study (MacInnis & Driscoll, 2009)
– Seventeen out of 18 Atlantic Canadian senior
managers responded they believe business
and ethics are integrated:
– “Some businesses operate ethically, some operate very
ethically, and some operate without ethics.” [P9]
– “When operating with full disclosure, it is important to
think about long term sustainability and stakeholders.
There has to be a high degree of thinking about
[ecological] sustainability to thrive in Atlantic Canada.”
[P18]
Local Research Context
• Majority of respondents reported university
course work was useful, but insufficient to
prepare employees for ethical challenges
in workplace:
– “Coursework can help, but certain components have to
come from within the individual.”
– “[Ethics education] …helps, but what is learned in the
workforce is just as or more important.”
– “Most [graduates] are more prepared for ethical
challenges, but do not have a strong understanding of
the complexities in the workforce.”
– “It is experience not education that allows you to act [on]
grey situations.”
Research Methodology
• Mixed-Method Approach
– Study 1 – Survey of Training/Education Practices
• Email survey to leading Canadian firms to quantify:
– Current practices in terms of training aims, delivery
methods, timing, frequency, and recipients
– Differences related to organizational size or focus
– Instrument modeled after Sekerka (2009).
– Study 2 – In-depth Assessment of Practices
• Interviews with HR professionals of “Top 101
Companies” who completed survey to explore:
– Rationale for use of specific practices over others
– Perceived challenges and wish-list for additional ethics
training and education
Study 1 – Survey Findings
• Surveys completed by 253 firms but 30
were lacking data on size
• Final sample: 223 usable surveys
– Size: 13% small, 30% medium, 56% large
– Unionized: 28%
– Industry Sector:17% forestry, fishing, mining and oil &
gas; 14% manufacturing; 13% finance, insurance and
real estate, 8% health care and social services and 7%
professional services and sciences
– Firm Location: 19% Atlantic Canada, 55% Central
Canada, 26% Western Canada
– Ownership: 52% publicly-traded, 27% privately held
– Head Office: 84% in Canada
Findings from Survey Analysis
• Firms making
investments in
training as part
of an overall
strategic human
resource are
more likely to
conduct ethics
training.
Table 2: Probit Analysis of the Provision of Business Ethics Training
Variables
Model 1
Small Business
-.621** (.288)
Medium Business
-.217
Atlantic Canada
-.746** (.285)
Western Canada
-.835** (.274)
Industry
-.030 (.232)
Public Company
.699** (.253)
Location of Head Office
.044
SHRM Training
.492** (.122)
Chi-Square
55.20 **
Pseudo R2
.200
N
223
(.245)
(.309)
Note 1: standard errors are in parentheses.
Note 2: *p<.05. **p<.01
Findings from Survey Analysis



Small businesses
were less likely to
provide ethics
training.
Ethics training less
likely in Atlantic
and Western
regions of Canada.
Publicly-traded
companies had a
higher probability
of providing ethics
training.
Table 2: Probit Analysis of the Provision of Business Ethics Training
Variables
Model 1
Small Business
-.621** (.288)
Medium Business
-.217
Atlantic Canada
-.746** (.285)
Western Canada
-.835** (.274)
Industry
-.030 (.232)
Public Company
.699** (.253)
Location of Head Office
.044
SHRM Training
.492** (.122)
Chi-Square
55.20 **
Pseudo R2
.200
N
223
(.245)
(.309)
Note 1: standard errors are in parentheses.
Note 2: *p<.05. **p<.01
Descriptive Results – Ethics Training
• 89 firms or 35% reported having training.
• Timing of Ethics Training Introduction:
• 18%
• 26 %
• 46%
10 years ago or more
6 years ago
3 years ago
• Top Reasons for Introducing Training:
• 36%
• 24%
desire to ensure consistent culture and values
ensure compliance with rules/regulations
• Responsibility for Ethics Training
• 48%
• 27%
HR staff
Operations staff
Descriptive Results –Training Activity
• Internal Stakeholders Targeted for Training
• 93% All employees
• 25% Supervisors/Senior Managers Or Senior Management
• 16% Board of Directors
• External Stakeholders Targeted for Training
• 28% Business Partners;
• 18% Suppliers
• 16% Vendors
• Timing of Business Ethics Training
• 44% As part of new employee orientation
• 40% On an annual basis
Descriptive Results –Training Delivery

Focus of Ethics Training
•
•

Company values and expected ethical behavior
Company rules and regulations
Primary Delivery Methods:
•
•
•

65%
35%
35%
30%
27%
Combination of face-to-face and self-study
Face-to-face only
Self-study with on-line materials
Instructional Techniques and Aids:
•
•
•
•
39%
38%
62%
39%
Practice ethical decision making
Participant sharing
Ethical scenarios and mini-cases
Videos with ethics focus
Descriptive Results – Ethical System

Presence of Supporting Ethics Program Elements
•
•
•
•
•

81%
28%
60%
35%
30%
Require employees to sign a code of conduct
Distribute code annually
Whistle blower system in place
Conduct formal risk assessments
Designated ethics officer
Pro-active Formal Communications on Ethics Topics
•
•
•
•
13%
10%
15%
7%
Articles in employees newsletter
Employee meeting agendas
Company conferences/events
Special ethics related communications
Descriptive Results – SHRM Integration
• Ethical Character Considered in Hiring/Promotion
Decisions
• 27%
• 29%
• 21%
Employee Selection
Performance Evaluations
Executive Succession Planning
• Ethical Climate and Culture Assessed in Employee
Feedback Mechanisms
• 38%
• 18%
• 37%
Employee surveys
Request feedback on ethics materials
Exit interviews
Study 2 – Interview Findings
• Interviews conducted with 15 participants
from the survey study
– Participants were primarily Human Resource
Professionals from NS, NB and NL
• Representing 13 industries
– Included firms from manufacturing, agricultural,
automotive, construction, food and beverage, insurance,
IT and communications, mining and energy, real estate,
retail, and transportation
• Number of employees ranged from 35 to 5,000 +
• Revenues ranged from $8 million to $2.7 billion
Study 2 – Interview Findings
• Semi-structured interviews ranging from
10 to 53 minutes in length
– Majority of interviews were conducted in
person, allowing for prolonged conversations
and non-verbal cue observation
• Interviews were transcribed for coding
– Open-system coding was utilized, per Strauss
and Corbin (1998), to discover key themes
within the data
Study 2 – Interview Findings
• Few Firms Conducting Ethics Training
– Predominant response from all companies was “no”;
they are not conducting training
• Senior executives seen as drivers of any
existing ethics commitment
- “It comes right from the top”, and “Yes it is a priority for
senior management. It comes right from the top down
- “It starts with the principal shareholder of the company
…..so their personal ethics are those which the rest of
the company must abide by”
Study 2 – Interview Findings
• Ad hoc Approach to Organizational Ethics
Most Common
– When asked if their organization placed an emphasis
on ethics, all respondents answered yes. However,
when questioned about the specifics, most found it
challenging to articulate anything concrete.
– Specific policies were often not mentioned.
Study 2 – Interview Findings
• Hiring Practices Seen as Key to Ensuring
Ethical Culture
– Several respondents stated that sound employee
selection processes promote ethical work
environments and therefore training should not be
necessary.
– One participant strongly questioned the need for
ethics training; his justification being that “You have to
find the right people to begin with” and “If you breathe
that ethical culture’, that’s what you get.”
Study 2 – Interview Findings
• Overall Lack of Collaboration/Coordination
– No participants mentioned collaborating with
other firms or organizations on ethics training.
– Several participants thought industry groups
might be able to offer assistance in this area
through templates and other materials.
Conclusions
• Overall our findings suggest that firms in
Canada are lagging behind the United
States in terms of providing ethics training.
– Western and Atlantic Canadian companies trail their
Central Canadian counterparts.
– Results for Atlantic firms little changed from 2003/04
studies of “Top 101” firms
– However small/medium firms and those with different
business models, i.e. co-ops, seem to be taking a
more pro-active approach to ethics training in Atlantic
Canada
Conclusions
• Participating firms primarily targeting internal
stakeholders and conducting training as part
of new employee orientation
– Focus on ensuring employees were aware of
organizational values and desired behaviour as
opposed to rules and regulations.
– HR professionals playing a key role
• More training being conducted face-to-face
using a variety of instructional approaches
– Ethical decision making exercises, role playing,
ethical scenarios/cases and videos most popular.
Conclusions
• Training often being supported with other ethics
program elements
– E.g. code of ethics or whistleblower system
• Most firms doing a basic evaluation of ethics
training, but a surprising number conducting
more sophisticated evaluations.
• Few organizations reported significant ethics
integration with key strategic HR practices,
although interview participants suggested this
was how firms were addressing the issue
Conclusions
• Consistent with previous research, lack of
internal expertise, time constraints, limited
financial resources and no perceived need by
organizational leaders were most commonly
identified as reasons for lack of training
• Small businesses seem to be particularly
challenged to provide ethics training
– Potential opportunity for third parties to build
resources for ethics training and development
Thank you!
For more information:
[email protected]
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