Yes Men/Women Play Role in Scandals
By George Anderson
Pretty much everyone knows the story about the emperor who walked around naked because his court and subjects were too afraid to tell him his new clothes were no clothes at all.
According to Doug Lennick, coauthor of Moral Intelligence with Fred Kiel (Wharton, 2005), many of the ethical lapses that have taken place in the corporate world in recent years have a similar story line — executives enabled by underlings who do not tell them when they’ve gone too far.
“It’s not so much a matter of one being intoxicated by the power. It’s [a matter of] one being sheltered from the feedback,” he told The Christian Science Monitor.
Sydney Finkelstein, professor of leadership and strategy at Dartmouth’s Tuck School of Business, said many are trapped by their ego and maintaining what they perceive to be their public image. “Acknowledging to the world that you’re not quite as successful as you thought, and as everyone else thought, is unacceptable,” said Prof. Finkelstein.
To avoid ethical lapses, experts such as Dallas Willard, a Christian philosopher at the University of Southern California and author of books such as The Divine Conspiracy: Rediscovering Our Hidden Life in God and contributor to the new Renovare Spiritual Formation Bible, suggest business leaders have at least one person in close contact to help keep them on the moral high ground.
He also suggests leaders answer two questions as part of a daily journal: “When have I served the good of my function [as a family member or professional, for instance]? And when have I served myself?”
Moderator’s Comment: What can those in business leadership positions do to prevent ethical lapses on their part or on the part of others in their organizations?
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George Anderson – Moderator
I also believe ethical lapses take place because executives are rewarded for performance at any cost, and they are well-compensated for doing so.
Lots of companies have something called a “360” where managers are regularly evaluated by their direct reports. Ideally, this is done anonymously so that people feel safe in sharing their views, and these reports are also seen by the manager’s manager. But the kind of management that allows this sort of thing generally has a culture that is more open and upright in the first place. The bosses who are out of control would never allow a 360. And reminding them of a possible ethical lapse is likely to get you fired. Hopefully, top management can set 360s or similar programs in place, and weed out the stinkers. As always, ethics and leadership have to start at the top. When I have smelled trouble at the top, and I have twice in my career, I have just resigned and gone elsewhere. The company with the leadership problem generally gets into trouble later anyway, and you feel fabulous no longer being aboard!!
Schadenfreude is “pleasure derived from the misfortunes of others.” Hard-charging executives on the way up often enjoy seeing their bosses fall on their faces, creating more space on the next rung of the ladder. Thus, they withhold critical information or warnings. Executives at all levels would be wise not to ignore this dynamic.
Some 14 or 15 years ago, a college friend and I asked ourselves when and where we were when ethics and morality withdrew from business. Both of us were (and are) successful but in sticking to our guns and refusing to engage in questionable practices, we have had to make sacrifices. At the end of it all, it gets down to MORAL LEADERSHIP in business. If the leader does not set the standard and create an environment where people dare to speak out, there is no point blaming the rank and file. The big guy (or gal) gets the big bucks for saying ‘the buck stops here’, not for saying ‘gee, I didn’t know.’ This applies even in instances where the CEO IS ethical but has a direct report who is not. A co-worker or subordinate of that unethical person must be made to feel very comfortable by the overall organization to speak out against his or her supervisor. Let’s get back to personal responsibility, shall we?
What a cop-out, as we used to say in the 60s. So the clever guys get to the top by showing how smart they are and trouncing all over their subordinates but then get away with murder because those same subordinates haven’t got the nerve to tell them they’ve gone too far? These are leaders and top execs???!!! Passing the blame for unethical behaviour back down the line is perhaps the ultimate in unethical behaviour. If the Supreme Court thinks it’s a good idea to let a journalist be thrown in jail for refusing to succumb to unethical behaviour (unlike the source she is protecting), then these execs deserve to be locked up and have the key thrown away sharpish. There is an awful lot wrong with such a system and such a society that cannot be solved by ignoring the old adage about where the buck really does stop.
This reminds me of the story when Henry Ford approved the routine replacement of a train locomotive at one of his plants, despite the fact that the plant was scheduled to shut down. Seems Henry forgot, but no one underneath him dared to correct him.
I think it is the employee’s responsibility to remind their bosses when they are going too far. But naturally many don’t. Sometimes I did, and sometimes I didn’t. It depended on if I liked that person. If I didn’t like them and I saw they were headed for trouble, I remained quiet so they would learn their lesson properly.
Looking back, I think it’s best to be the bigger man and just tell the king he has no clothes. If they want to continue to look foolish, then your hands are clean.
The first blush answer looks to creating an environment that supports trust and encourages honesty. But…
…thinking about the realities of business Darwinism — only the fittest survive. Therefore “trust” and “honesty” more often than not are filtered by the score card by which the business is being measured and what is rewarded. So, it’s not simple.
The thing that I did not like in this article was captured in this quote: “It’s not so much a matter of one being intoxicated by the power. It’s [a matter of] one being sheltered from the feedback.” Is this the chicken or the egg?
To create an organization that operates totally above board, its leadership requires a strong stomach — encouraging the communication of bad news as well as good. The leadership would be well served to encourage rewards risk-taking, i.e. encouraging personnel to think outside the box, speaking up when they interpret actions or ideas to be wrong or counter-productive. He or she has to walk the walk by serving as a role model by seeking input from all levels of the organization, doing the right thing, acknowledging dissenting opinion and taking responsibility for decisions made.
I think the primary driver for ethical lapses is that it is in everyone’s best interest, from Wall Street to main street, to look the other way. Thousands at Andersen would still be employed if the SEC had not “interfered” with the goings-on at Enron. Untold millions of dollars in capital gains would still be intact. That’s just one minor example.
The day of reckoning for ethical breaches is so severe that its like we’re better off just keeping the music going…
Ethical breaches need to be either “nipped in the bud” or allowed to go on indefinitely. Letting it get out of hand and THEN having consequences is part of the problem – it creates an incentive to just keep the charade going at all costs.
Let’s get realistic, guys and gals. Who would dare tell his/her boss that he/she has “gone too far”? I guess, someone who is preparing to retire in a week and knows his/her pension is secure.
You can have sub-ordinates and peers tell you have “gone too far.” The leader needs to create the environment to allow that to happen – open and honest communication, trust and respect, and enthusiasm and passion. The leader needs some very specific attributes and motivations to make this happen – an ego that does not hamper her/his behavior, inclusiveness from her/his team and organization in operating the business, good listening skills, values that form the common ground for behavior standards, thankfulness to those who care enough about you, etc.
I have successfully in four different situations (employments) been able to create such an environment and have others tell me when I have “gone too far.” It can hurt, but the second time is easier than the first, etc. And every time the person(s) who spoke up were dead on correct!