You’re being watched

Employees in general, and millennials in particular, need to understand what is going on when firm policies appear to be breached.

Millennials are said to be difficult employees — wanting large rewards, quick promotions and lots of attention. I don’t know if any of that is true — but judging by my business ethics students, they have high standards for the ethical conduct of their employers. And they are acutely sensitive to gaps between what companies say about their values and what actually happens.

In addition to teaching famous ethical cases — Enron, Hollinger, etc. — our ethics class also works through scenarios that are closer to what new professionals might face: a manager who wants an employee to bend the rules for a client, or not record time spent on a file, or hide an error from senior management. We talk about the right thing to do, as well as the practicalities of how to raise the issue and what to say. Inevitably, students bring up real-life ethical dilemmas they have faced at work, sometimes in class in front of other students and sometimes privately in my office. They don’t reveal the names of their employers, and I don’t ask. But it doesn’t matter because I have heard similar stories many times before.

One common scenario involves the closing days of an audit, when (at least in the eyes of these junior employees) corners are cut. Procedures are not completed or documentation is not provided. And yet the statements are signed off. One student told me, “I am getting out of audit. I have lost faith that it means anything.” Similarly, others report that tax returns go out the door without proper sign-off by the client, or without any research on a filing position.

The problem may in fact be shoddy auditing or tax preparation. But just as likely, alternative procedures or methods of documentation were undertaken, but in the rush, no one explained this to the employees. What employees saw was that firm policy was not followed. And they drew conclusions that would horrify their employers.

Other issues students raise concern people. They observe bullying, and yet see that the bullies are highly rated, fast-track employees. They see a senior manager involved in a sexual relationship with a junior on his or her own team, without anyone appearing to care. One student reported that when he raised the matter he was advised to “keep out of office politics.”

Again, my student may not know the whole story. The bully may be known to human resources and may be getting coaching and a last chance to make changes. The relationship may be new and steps may be in place to deal with it. But the employees don’t see any of this.

The result can be a disaster. At best, an employee will simply leave the firm and find another job. Or a good future audit partner will find another way to make a living. And in these days of social media, the employer may find its reputation called into question before a wide group of Facebook friends. At worst, the employee may conclude that “this is how business works” and model his or her own behaviour on what he or she sees.

The remedy is not difficult. Employees in general, and millennials in particular, need to understand what is going on when firm policies appear to be breached. The excuse is often that they cannot be briefed due to sensitive client matters or privacy rules. Or there just isn’t time or people forget. But the post-closing or post-tax return season discussion is vital. If procedures didn’t happen, was there a work-around? Or was there in fact a corner cut that, even if minor, should be talked about so it doesn’t happen again? Employees who are most concerned about ethical issues are the employees firms should most want to keep. And they are the ones who will leave quickly if their concerns are not addressed.

My suggestion is that we all ask ourselves (and them) what the people who work for us think of our ethics. Are we demonstrating that we live up to our values?