Institutional Culture and Individual Behavior: Creating an Ethical Environment
Christopher Meyers, PhD
Abstract: Much of the work in professional ethics sees ethical problems as resulting from ethical
ignorance, ethical failure or evil intent. While this approach gets at real and valid concerns, it does not
capture the whole story because it does not take into account the underlying professional or institutional
culture in which moral decision making is imbedded. My argument in this paper is that this culture plays
a powerful and sometimes determinant role in establishing the nature of the ethical debate; i.e., it helps to
define what are viable action options, what is the organization's genuine mission, and what behaviors will
be rewarded or criticized. Given these conclusions, I also argue that consulting ethicists need more than
an understanding of ethics theory, concepts and principles; they also need a sufficiently rich
understanding of organizational culture and a willingness and an ability to critique that culture.
Key Words: organizational culture, Patricia Werhane, character, consulting ethicist, ethnography
Whether business organizations should commit to creating an ethical environment is, one
would hope, no longer under question. That is, arguments by the likes of Albert Carr (1) and
Milton Friedman (2) notwithstanding, one no longer needs to justify the importance of creating
ethical organizations. Rather, the interesting question now is how to achieve this.
My argument in this paper is, first, in order to achieve an ethical organization, one must
focus as much on organizational culture as on individual behavior. And, second, when one does
so focus, one sees that culture is created and maintained by two processes: the top-down
establishment of institutional values by owners and managers and the carrying out of those
values by in-the-trenches employees. Importantly, these conclusions carry across a wide
spectrum of organizational settings, including those in technical fields. The key is not so much
the mission of the organization, but its structure - how it is governed and what values are
promoted and sustained. If anything, these arguments apply all the more to technical
organizations: they typically have clear hierarchical structures and their core employees,
engineers, have already been inculcated into professional norms.
Scientists and engineers are also inclined to compartmentalize their work, to focus on
their individual project without questioning, let alone regularly challenging, the organization’s
overall mission and activities. Because, I argue, such criticism is vital to an organization’s
ethical health, I also conclude that it is one of the important tasks of organizational ethicists.
This role, however, necessitates that ethicists have both empirical skills adequate to
understanding and analyzing organizational culture and sufficient distance from that culture to
make effective ethics recommendations.
The Importance of Culture. The subtitle of this paper might be "Why Do Good People
Do Bad Things?" The question has to be asked in this way because much of ethics, both popular
and professional, too often presumes that morally bad actions result from three sources: good
people making mistakes (out of confusion or ignorance), good people having weakness of will,
or bad people choosing to do evil. With this presupposition as a backdrop, the goal of
professional ethics becomes finding ways to help good people avoid mistakes and have their will
strengthened, and to determine appropriate punishment for wrongdoers. Theory and method,
then, become tools for achieving this goal; i.e., they provide principled guidance and explain
when to exact retribution when such guidance fails.
Such a goal is a worthwhile start, as many ethical problems do result from error,
weakness and vice. But many also result from an organizational culture that promotes internal or
prudential values at the expense of ethical ones, e.g., the culture often values productivity over
moral principles (3). Within such a culture, good people will thus sometimes make 'correct'
choices that are nonetheless ethically problematic. That is, they will make knowledgeable
choices, they will do so with strength of character and virtuously, and yet these choices will be
unethical.
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This claim is admittedly counter-intuitive. How can it be that good people make correct
choices that are nonetheless unethical? The question has to be answered in two parts--first, why
are the choices "unethical" and, second, if they are, how can they nonetheless be "correct"? The
first part is relatively easy: they are unethical because they violate accepted moral principles or
produce ethically undesirable outcomes, at least as the choices are seen from outside the
organization.
The "outside the organization" caveat also points to the answer to the second part:
persons within the organization make choices consistent with its cultural values--with its norms,
its goals, its beliefs--and because of this consistency the choices are organizationally "correct,"
even when they do not align with broader moral principles. In its stronger form such consistency
becomes a mindset, a filter through which participants view their world. And it does more than
simply motivate certain attitudes; it also works to create a conceptual scheme. Patricia Werhane
explains it as follows:
We all perceive, frame, and interact with the world through a conceptual scheme
modified by a set of perspectives or mental models. Putting the point
metaphorically, we each run our "camera" of the world through certain selective
mechanism: intentions, interests, desires, points of view, or biases, all of which
work as selective and restrictive filters. We each have what I call our own
metaphysical movies of the world, because they entail projections of one's
perspective on the given data of experience (4).
These schemes, especially when they are rooted in a powerful group culture, significantly
contribute to how agents perceive problems, how they categorize them, how they understand and
ascribe value, and when and how they act. Dennis Gioia, the Ford manager responsible for
making the recommendation not to recall the Pinto despite the car's history of devastating fires
following minor accidents, describes Ford's corporate scheme in his memoir of those events:
My own schematized ... knowledge influenced me to perceive recall issues in
terms of the prevailing decision environment and to unconsciously overlook key
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features of the Pinto case, mainly because they did not fit an existing script.
Although the outcomes of the case carry retrospectively obvious ethical
overtones, the schemas driving my perceptions and actions precluded
consideration of the issues in ethical terms because the scripts did not include
ethical dimensions (Werhane, 1999: 56, italics added).
This description reveals why traditional accountability ascription, i.e., why appeal to evil
intent, weakness of will or error, is inadequate. By all accounts Gioia was hardly a vicious
person, his account does not fit weakness of will--which assumes the agent knows better but
gives in to temptation--and his choices were anything but ignorant--he had all the relevant facts
at his disposal. In short, he was a good person who did bad things. The key to seeing why this
follows is present in Gioia's statement that he "unconsciously overlook[ed] key features" of the
case. It is not that he chose to set those aside, or that he fearfully refused to broach them with his
superior; rather, he literally did not see them. He was caught up in the organizational script.
How can this be? A complete answer would require a fuller account of the metaphysics
involved than is appropriate for this paper, but let me point to a couple of central elements. First,
as Aristotle stressed, humans are social animals. For Aristotle, and particularly for those from
the Continental (a) and crossover (b) traditions who have made intersubjectivity core to their
theories, this means much more than just that we enjoy being in other humans' company: our
values, our interests, maybe even the very way we perceive the world is the product of our social
relations. Isolated individuals cannot, a lá Descartes or Jefferson, simply use reason to discern
truth, moral or otherwise. Or at least persons do not do so and especially do not do so when they
acquire and act upon their values.
Second, even if much of moral decision making is individualized, it is far more likely
persons will rely upon socially determined moral frameworks when placed in a new cultural
environment, for example, when starting a new job. In such an environment we spend much of
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our time just getting settled, determining our role and place, learning the institution's goals,
interests and methods. When all this occurs within a well-established and defined organizational
culture, those goals, interests and methods, soon get internalized by employees. And as
internalized, they become the filter through which employees see their world, understand its
norms, and make "correct" choices.
None of this is meant to preclude the possibility of independent moral evaluation and
decision making (a point to which I will return later). But it does reveal the power of the
corporate scheme and its impact on agents' choices and behavior.
Creating the Culture. Given the complex nature of corporate culture, attention must be
paid to how it is established and maintained. The most powerful influence comes from just
where one would expect--executives, directors, managers, and, in smaller companies, owners;
i.e., it comes from those who create and sustain the organizational agenda. They do this in both
explicit and implicit ways.
Explicitly, they develop the policies, organizational rules and codes of ethics that
proclaim company values. Implicitly, they do so through promotions and subtle social approval,
ranging from invites to lunch or for drinks, to the "nudge-nudge, wink-wink" forms of body
language. Key here is the relationship between what managers say is of value and what they
actually reinforce, combined with the recognition that, according to most accounts of
organizational theory, it is the implicit and subtle processes that most effectively establish
organizational culture. Humans respond more to behavioral reinforcement than to verbal rules
and policies.
Take, for example, the recent debacle involving Jason Blair and the New York Times, in
which it was discovered that Blair, at hot young star at the nation’s leading newspaper, had
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plagiarized (or simply made up) many of his news stories. You can be sure editors at the Times
verbally extol the value of honest and accurate reporting. Yet, despite mounting evidence of
problems, they also regularly, and preferentially, treated Blair to lunch and drinks and gave him
plum assignments. As was widely discussed among journalists and social critics, racial factors no
doubt contributed to this unusual treatment (Blair is African-American); but the important point
here is that editors reinforced his unethical practices through their approval-behavior, even
though, again, they verbally condemned such practices. A similar, if more general, example is
the reaction--social, professional, and sometimes academic--to hackers: the negative
consequences of their actions are criticized, while their technical skills are often held in high
esteem.
Often, maybe most often, the subtle reinforcement is negative, and again ranges from
simple body language (e.g., physically turning away from someone) to communication style
(e.g., interrupting speakers, not answering questions) to chastising. A clear example of this
occurred during the debate over space shuttle Challenger’s O-Rings. Morton-Thiokol’s Jerry
Mason responded to told his vice president of engineering, Robert Lund's cold-weather fears by
saying, "[T]ake off [your] engineering hat and put on [your] management hat" (Werhane, 1999:
49). With that simple statement, Mason effectively established the organization’s fundamental
cultural norm, recreated Lund's corporate script, and set the stage for disaster.
Addressing the Culture. Just as the culture is set by executives, directors, managers, and
owners, so must it be reset by them, to make it more consistent with broader moral norms.
Again, consider how the culture is established--those in positions of authority use their power to
create the de facto rules and values and to motivate behavior consistent with them. And since the
more subtle forms of reinforcement are the most effective, there must be a direct correlation
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between them and explicit statements and policies. Without that correlation, the latter come
across at best as window dressing, or at worst as organizational (and managerial) hypocrisy.
Indeed, the explicit statements and policies have effective value only when they serve to express
what is already present in behavior.
Done well, establishing an organizational culture that prioritizes moral norms also creates
or reinforces employees' character. One of the dangers with the model being defended here is
that it seems to relieve individuals of moral accountability: individuals do not act unethically,
organizations do. But culture does not exist independent of people; any tone--positive or
negative--set by managers must be lived-out in the actions of employees. Thus in-the-trenches
workers must have characters consistent with the desired norms. Others have effectively shown
the relationship between organizational culture and individual character (8,9,10,11). Hence I
would like instead to focus on the crucial qualities in such characters.
Of the multiple virtues present in a moral character, three are most important for
organizational ethics. Employees must, first, have practical wisdom, what Aristotle called
phronesis, to be able to analyze problems, to distinguish among more and less relevant facts, to
know the best means for achieving desired ends, and, maybe most important, to know where to
seek advice. Second, they must have honesty, with themselves--so as to avoid self-deception--,
with co-workers, and with clients. And, third, they must have courage to do the right thing, even
in the face of peer or managerial pressure.
Organizational culture plays a powerful role in creating and maintaining these virtues,
through role modeling and through implicit and explicit reinforcement of desirable habits. But
while culture is a powerful force, it is not a determining one; individual decision-making, and
thus individual accountability, is still fundamental to organizational ethics. Hence individuals
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need a means for breaking outside the script and acting instead on moral principles. Werhane
describes the process of such breaking out as using "moral imagination," by which one engages
"in a critical perspective on oneself, one's activities, one's behavior, … one's situation," and one's
organizational script (1999: 67). Being caught up in the script is an excuse, but only a partial
one; with an ethical commitment, and with help, one can employ moral imagination. Hence,
again, one sees the importance of virtuous character. Honesty is needed to truthfully appraise the
degree to which one has become embedded in the script; phronesis is needed to know what good
ethics demands instead; and courage is needed to act accordingly.
Role of the Ethicist. It is at this point that the value of the outside ethicist becomes most
clear. In organizations with powerful cultures it is often unreasonable to expect individuals to
engage in the necessary degree of moral imagination, at least without help. The culture becomes
too integral a part of the employee's identity; to a great degree she defines herself via that culture.
Thus to ask her to be able, wholly on her own, to break outside--first, to see the alternatives and
then to act accordingly--is in too many cases simply not realistic.
Enter the ethicist, who, with her different scheme (c), can help employees to break out, to
see alternative ways of considering problems, and to explore alternative actions. These skills are
all part of standard ethics training in problem evaluation, values clarification, conceptual
analysis, and complex reasoning. To be most successful at this kind of assistance, ethicists must
have two additional qualifications.
First, they must have a sufficiently rich understanding of the specific corporate scheme
with which they are working. They must be able to discern how it performs, how it defines
values, reinforces behavior, privileges some beliefs and actions while condemning others, etc.
They must be able to speak the organizational language and to appreciate employees' trials and
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tribulations. They must, in short, be able to "find [their] way about" the organization (12).
These are, however, empirical skills, ones not part of the typical training in ethics, at least not
philosophical ethics. While such training undoubtedly accepts that good facts are necessary to
good ethics, it too often has a narrow take on which ones are relevant. On the model promoted
here, the facts have to be broadly enough construed as to include the subtle processes of culture
and its impact on agents' behaviors.
Thus one of the goals of this paper is to recommend ethicists receive training in an
empirical method adequate to this task. Of the many available, ethnography is probably best
suited, as it has as its defining thesis that the investigator strives to acquire an insider's
perspective, one that sufficiently grasps the normative forces present in an organization's culture
(d). By becoming sufficiently immersed in the culture’s conceptual scheme as to be conversant
in it, one can get at the meaning behind the words, at the norms present in the activity of
organizational agents, at the unstated rules, values and codes of behavior that underlie the
apparent facts.
This leads, though, to the second necessary qualification. The effective ethicist will
become conversant in the culture without becoming immersed in it. That is, she must be an
outsider, or at least enough of one as not to be caught up in the script. To be able to evaluate and
criticize an organization and the behavior of its employees, one must be able to make explicit the
web of beliefs, values and norms present in organizational culture and practice. The more one is
immersed in the script, the less able one is to engage in the moral imagination necessary to
effectively critique it when it promotes ethically problematic behavior. The script provides a
conceptual scheme through which understanding and evaluation are filtered; one sees issues and
problems only as they make sense within the script. Thus, for example, if the script makes
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efficiency and profit the fundamental organizational values, appeals to quality control or safety
won’t make it through the filter. Hence the ethicist too immersed in the script simply cannot
achieve her primary function--to provide an objective critique of organizational norms and
concomitant behavior.
A second goal of this paper, thus, is to question the growing reliance on in-house "ethics
officers" (e). Most such persons have been professionally reared in the corporate world and are
thereby also embedded in its culture. The limited amount of ethics training they receive
undoubtedly assists them in appreciating moral principles and norms, in developing and
discussing ethics codes and relevant legal regulations, and in promoting character. But, for the
reasons noted above, an outsider’s perspective is vital for such skills to be truly effective.
A related concern is the problem of co-option. When ethics officers work full-time in,
and earn their primary income from, a corporate organization, it may be impossible to retain a
sufficiently critical stance. This is true even when ethics officers receive primary training
outside the corporate world (e.g., in a philosophically grounded practical ethics program), since
socialization into an organizational culture can occur at various times throughout one’s life
(Benson and Ross; Vitell and Nwachukwu). When one’s livelihood is on the line, when one’s
primary social group is the targeted organization, when one is granted authority and prestigious
status within the institution, one becomes both less inclined and less able to be the outsider.
And, thus, one also becomes less inclined and less able to be an effective critic.
Two recommendations emerge. First, organizations should not rely upon full time, inhouse ethics officers. They should instead hire consultants whose primary occupation, and
source of income, lies elsewhere, e.g., in private consulting firms or academia. Inculturation into
the corporate ethos and co-option, while still a threat, are on this model far less likely. Second,
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practical ethics educational programs, especially those in philosophy, must pay far greater
attention to empirical skills and methods (17). While such programs increasingly realize the
importance of empirical investigations, few provide the necessary techniques, no doubt in largest
part because program faculty simply do not know them. These programs should thus consider
requiring students to go outside the department--to sociology, political science or cultural
anthropology--to take necessary courses.
In short, the best-trained and most effective organizational ethicist will learn to walk a
fine line; she will be sufficiently aware of the culture to understand its impact on behavior, but
also sufficiently independent of it to be a worthwhile critic. Without these skills, it is unlikely
she can achieve, and help others achieve, the moral imagination requisite truly to guide
individuals and organizations toward ethically sound behavior.
Notes
(a) Cf. Berger and Luckmann (5).
(b) Cf. Wittgenstein (6) and Goodman (7).
(c) On most accounts of moral theory and of the role of the ethicist, the different scheme
would include a detailed understanding of universal--not schematized--moral principles. I leave
aside whether this is necessary or possible, since, in either case, the ethicist should at least be
able to point to a different scheme, one, at the minimum, with broader social sanction.
(d) Space limitations here preclude a fuller account of ethnography. For the interested
reader, good sources include, Charmaz and Olesen (13), Olesen (14), and Morrill and Fine (15).
These sources explain what ethnography is, trace its roots and provide excellent bibliographies.
(e) These same arguments can be made about similar positions in other work
environments, such as newspaper ombudsmen (16).
References
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