Ethical people do unethical things

People find it difficult to speak up when they think something is wrong. Having an effective ethics reporting process increases the odds that employees will be able to live their values at work.

When people find out I teach ethics, they all have a story to tell. Some of the stories are so sad they are funny — like the one about the boss who asked his employee to help him cheat on an ethics exam. But more often the stories are thought-provoking.

I ran into an acquaintance at a cocktail party recently. Knowing that he is the CEO of a company that was sold to a US multinational last year, I asked how he was finding reporting to new owners. After the usual griping about slow decision-making, endless paperwork and the difficulty of finding one’s way through a large bureaucracy, he surprised me with his next comment. "Speaking of ethics," he said, "one new process I really like is the ethics hotline." He said he had expected the ethics framework, including codes of conduct, training, accountability and a formal reporting mechanism, would be cumbersome and unproductive. But his experience had been the opposite.

Several of his Canadian employees had used the hotline to report ethical concerns. The issues were investigated by an impartial examiner, who looked into the facts and spoke to the employees. It was concluded that there had been a misunderstanding on the part of the employees. The findings were discussed with the employees, who accepted and understood the decision. The employees were thanked for bringing the matter forward.

The CEO told me what he thought would have happened before his company became part of the multinational organization, without a formal process in place. The employees’ concerns would have been brought to his attention. He would have become defensive and probably would have considered the employees troublemakers. He would have dismissed their concerns as unfounded. The employees would have been dissatisfied and would have likely started job hunting. Even if they remained with the company, the troublemaker label would have dogged their careers for some time. And the employees would have been unlikely to report any concerns in the future.

Instead, the CEO gained an understanding of a situation that needed better communication in the future. He realized that rather than being troublemakers, these employees had demonstrated a concern for the company, had the courage to come forward and the capacity for independent thinking. He will now keep an eye on them as leadership candidates, and they are more likely to stay with the organization.

Of course, the mere existence of the hotline was not what made the difference. It was the seriousness with which the employees’ concerns were treated and the ability of the CEO to recognize the value of the new process that led to the positive outcome. And had the situation been different, resulting in unethical behaviour being uncovered, head office would have been able to take action and protect its investment.

This story refutes a belief frequently expressed to me that people are either ethical or unethical and there is nothing one can do about it. The conclusion drawn from this belief is that there is no point teaching ethics, having ethics officers in organizations or having a reporting procedure such as the one in this example. Just hire people with sound values, some believe, and everything will be fine.

In fact, ethical people do unethical things. People find it difficult to speak up when they see something they think is wrong. They know the risk of being seen as difficult employees, troublemakers and employees who aren’t team players or nonperforming employees with a grudge. That is why bad things can go on for years, even when everyone is aware of them. Having an effective ethics reporting process is not the only solution, but it increases the odds that employees will be able to live their values at work.

Karen Wensley, MBA, is a lecturer in professional ethics at the University of Waterloo and a retired partner of EY. She can be reached at