From Villains to Heroes

Transcription

1 DISCLAIMER: This presentation was prepared by Patricia Colombo in her personal capacity. The views and opinions expressed in this presentation are those of the speaker and do not necessarily reflect the official position of FUJIFILM group. Patrícia Colombo 1

2 Villains or Heroes? Volkswagen - Case Partial film Observed Unethical Behavior in the Workplace Using office equipment for personal use Doing personal business on work time Calling in as sick to take the day off Falsifying time reports Conflict of Interests Harassment Fraud Engaging in illegal activities / business Bribery Insider Trading Customer Privacy Breach Patrícia Colombo 2

3 Variation on Employee THE GOOD 10% Follow their own values and beliefs which are the same or even superior from those of the company. Natural heroes. THE MISGUIDED 80% Go along with the group. THE BAD 10% Take advantage of situations if the penalty is less than the benefit and the risk of being caught is low. Natural villain. What it takes to be come a business villain: Debts Lifestyle needs It s in the best interest of the Company I don t get paid what I am worth! Illicit activites: vices, gamblig, Everyone else is doing it drugs Behavior is not really illegal Unreal Targets Pressure to perform RATIONALIZATION UNETHICAL BEHAVIOR MOTIVATION (INTERNAL AND EXTERNAL PRESSURE) OPPORTUNITY Internal Controls: None in place Un-enforced Un-monitored Ineffective Culture is the key! Design or Default!!!! Patrícia Colombo 3

4 Culture is the key! One bad apple can spoil a barrel. One good egg does not make a dozen. When people face the decision to cheat, they often look to others to gain information about appropriate behavior. Lab experiments have shown that when people see others like them (e.g., peers) behaving unethically, they are more likely to cheat themselves. As long as it is legal, it s ethical Compliance Culture I m worried that our company motto makes us look shifty As long as it is not illegal, it s okay here is the motto proposal for our company: we never did anything illegal" Ethics vs. Compliance Our rules alone won t be enough. Our rules never have been enough, are not enough today, and never will be enough. What is really needed is a change of mindset one that fosters not only a culture of compliance but also a company-wide environment that fosters ethical behavior and decision-making William Donaldson - Former chair, SEC Patrícia Colombo 4

5 What is Ethical Culture? It s a company wide commitment to do the right thing this time, and every time. William Donaldson, Former Chair SEC Partial film Zappos Company Culture Tony Hsieh, CEO of Zappos, largest online shoe store stated that: At Zappos, our number one priority is our company culture. Our belief is that if we get the culture right, most of the other stuff, like delivery, great customer service and building a long-term enduring brand, will happen naturally, on its own. I don t think the Zappos culture can be or should be cloned, but I do think the idea of being transparent and running a business based on core values and a meaningful vision that s not just about money and profits can work for any organization. It doesn t really matter what the core values are, as long as the entire organization commits to those core values. Source: Making News in the Digital Era, by David Henderson. Patrícia Colombo 5

6 Why Ethical Corporate Culture is Important? Lower exposure to scandals/reputational safety; Investors interest increases; Employee engagement: he/she does not do the right thing because Codes said so, but because of culture organization; Facilitates the generation of commitment to something larger than self-interest (customers, patients, society); Employee Misconduct decreases. EMPLOYEE ENGAMENT CULTURE ENGAGEMENT NBES Research: Ethics and Employee Engagement According to National Business Ethics Survey (NBES), it was proved that: - Positive perceptions of an organization s ethical culture are associated with higher levels of engagement; - Employees who ovserved misconduct were less engaged than those who did not; - Engaged employees are more likely to report misconduct when they witness it. Source : Patrícia Colombo 6

7 EMPLOYEE ENGAMENT This is not something you do to people. Instead, engagement stems from unlocking people s natural desire to do a good job bringing the HERO to the surface!!! Ethical Engagement is when people feel so involved with company and its values they are willing take responsibility for seeing its values are maintained and speaking up if they are not. Who is responsible for sustaining employee ethical engagement? According to NBES Research: Management s commitment to ethics is particularly importante for employee engagement. Source: CULTURE ENGAGEMENT How Managers inadvertently encourage misbehavior? 1. - Not being a role model Setting managerial values that undermine integrity; 2.a. - Bottom-line mentality 2.b. - Exploitative mentality 2.c. - Madison Avenue Mentality Patrícia Colombo 7

8 How Managers inadvertently encourage misbehavior? 1. - Not being a role model. Does not act morally nor in compliance with company's values; Does not communicate importance of ethics to his/her team; Does not bring an ethical perspective to decision-making. Says Compliance Trainings are a waste of time; Do not attend nor allow its subordinates to attend compliance trainings; Does not act with integrity in personal life. How Managers inadvertently encourage misbehavior? 2. - Setting managerial values that undermine integrity; 2.a. - Bottom-line mentality Financial success as the only value to be considered; Rules of morality are merely obstacles along the way to bottom-line financial success; Employeesthatachievesnarrowgoalsshouldberewardno matter how they achieve it; Ends justify the means. How Managers inadvertently encourage misbehavior? 2. - Setting managerial values that undermine integrity; 2.a. - Bottom-line mentality Case: General Eletric: the company removed a manager who refused to discusspriceswithcompetitorandofferhissuccessortheposition with the understanding that management believed he would behave as expected and engage in price-fixing activities (Source: Geis,1977,p.124). Patrícia Colombo 8

9 How Managers inadvertently encourage misbehavior? 2. - Setting managerial values that undermine integrity; 2.b. - Exploitative mentality Lack of empathy and compassion; Highly selfish perspective: one that sacrifices others in favor of one s benefit. Cases: o Ford - Pinto o Johnson -Tylenol How Managers inadvertently encourage misbehavior? 2. - Setting managerial values that undermine integrity; 2.c. - Madison Avenue Mentality. As long as it looks like ethical, it is ok. It s about covering unethical behavior with rationalizations like: it s not really illegal; It s in the best interest of the company; Nooneelsewilleverfindout; Everybody does it. How Managers inadvertently encourage misbehavior? 2. - Setting managerial values that undermine integrity; 2.c. - Madison Avenue Mentality. As long as it looks like ethical, it is ok. It s about covering unethical behavior with rationalizations like: it s not really illegal; It s in the best interest of the company; Nooneelsewilleverfindout; Everybody does it. Patrícia Colombo 9

10 GENUINE TONE AT THE TOP AND THE MIDDLE: Walk the Talk Leaders are watched! Subordinates look up for their boss, not only for instructions but for inspiration. Employees often view unethical behaviors from leaders as an implicit endorsement that these behaviors are acceptable Leaders must demonstrate the highest moral standards and ethical conduct in theireverydaytalkandwalk,sootherwill follow suit. If leaders behave as if the only thing that matters is profit, employees are likely to act in a like manner. CODE OF CONDUCT: Adopt a meaningful set of values with which employees can identify make sure these readily translate into daily forms of behaviour. And where possible, involve employees in both identifying and naming the core values, rather than issuing them from high. They will feel like doing part of something meaningful. BE A BUSINESS PARTNER It s not just about teorical guidances. Neither do s and dont s. Sit with the business and discuss real problems as they appear. CREATE A DECISION FRAMEWORK Thisishowdecisionsaretakenhere!Most ethical dilemmas are not clear-cut situations. Employees must understand the differences between outcomes (short-term) and consequences (long-term). REALISTIC TARGETS: There is a LOT of pressure in the workplace. Repeat the mantra it s not just about getting there, but how we get there. Stick to it! When your pay check depends on the choices you make, it can be really hard even for good people always to make the right decisions Patrícia Colombo 10

11 REALISTIC ASSIGN STAKEHOLDERS TARGETS: There is Managers, a LOT of pressure Compliance in thechampions, workplace. Repeat Corporate the mantra Communication it s not just andabout HR are getting great there, and but how necessary we get there. stakeholders Stick to it! to help involving employees and keeping the ethical culture alive. According to the conclusions of NBES research, when HR is effective in its efforts to promote employee engagement, it s simultaneously reducing the company s ethics risk. Source: COMMUNICATE ETHICS Clearly and frequently communicate the desired behaviors and why they are important to the company (example: patient care). Put ethics on team agendas regularly, with senior people willing to speak about ethics and their importance to the company. Use every channel you can: internal newsletter, webpage, staff meetings, share cases of ethical dilemmas and how they were resolved. Provide office material (pens, post-its, agenda etc.) with your company logo and compliance/ethical messages. DO EXCITING AND INVOLVING TRAININGS not merely check the box games, food, small gifts have their worth. Bring real problems to be discussed. MAKE IT REAL: share monitoring results: show the gaps and suggest how to fix them; PERFORMANCE MEASURE : Ethical behavior must be part of annual employee evaluation and bonus; Patrícia Colombo 11

12 HIRE AND PROMOTE THE GOOD APPLES: Hire and promote those who share the same values of the company and look for long-term interested employee. Make Integrity Tests part of your standard hiring process. You handled the audit so well, we re promoting you from Accounts Receivable to Accounts Deceivable U.S. Attorney Preet Bharara on Leading Ethical Organizations Partial film BE RESPONSIVE: Prefer taking rewarding ethical approach instead relying only in punishment approach (but do it consistently) if ethical behavior is rewarded it s unlikely to have people wanting to be unethical. Anyway, clearly define the repercussions for wrongdoing and apply discipline consistently. Patrícia Colombo 12

13 HOTLINE: For advice on ethical situations and report mecanism (anonimaty should be allowed, but not encouraged). Display hotline number/ in every possible way (posters, website, office suppliers etc). Whenever possible, publishes internal suitably anonymous examples of where a whistle blower system report led to an investigation and appropriate disciplinary action against those found to have violated the companies' policies. This helps to build the necessary trust among employees. NON-RETALIATION POLICY: Provide encouragement and protection to any employee who reports in good faith; 21% of employees that reported misconduct suffered retaliation and 34% of those who despite witnessing stayed quite said it was for fear of retaliation. Source: CONCLUSION The key to enabling people to be as moral as possible is designing an ETHICAL CULTURE that makes such behavior easy, automatic, and habitual. When employees perceive that their organization truly puts virtues into actions, they are more likely to invest time, energy and involvement in their work, leading to beneficial outcomes for the individual employee, whole organization and society, becoming why not to say a business HERO! Patrícia Colombo 13

14 From Villains to Heroes: Fostering Ethical Behavior in Organizations 15th Annual Compliance and Ethics Institute Chicago Patricia Colombo, CCEP, CHC General Manager, Legal, Compliance and Regulatory Affairs FUJIFILM Brazil From Villains to Heroes: Fostering Ethical Behavior in Organizations 15th Annual Compliance and Ethics Institute Chicago Patrícia Colombo 14