Doing the right thing isn’t always easy, particularly when distinguishing between right and wrong isn’t clear-cut. But ethics in the workplace remains a noble goal for individuals and for businesses of all types and sizes.
Behaving in an ethical manner — and building a sustainable ethical culture within an organization — also can be a competitive advantage. Katie Lawler, senior vice president, global chief ethics officer at U.S. Bank, explains how small businesses can get there.
Lawler: The gold standard is having a strong values-based culture in which employees and leaders understand the company’s values and how important it is to live by those values. In my opinion, what it doesn’t mean is being perfect. I don’t think being perfect is achievable.
You will always have employees who will make mistakes regarding ethics in business, either innocently or willfully, and to me, the gold standard is how companies respond to and handle these issues. In a nutshell, it’s about striving for perfection and making it right when you miss.
Lawler: The value of an ethical culture is the same for a business of any size, because in today’s marketplace, you have instantaneous customer feedback — social media can take things and get them out to a broad audience almost instantly. Having an ethical culture where people strive to do the right thing, and building trust with customers, employees and communities, is a competitive advantage.
Small businesses starting up are relationship-oriented, and that relationship requires a level of trust. Your reputation is your calling card: It takes a long time for it to be built and can be lost almost instantaneously. I strongly believe having a strong ethical culture is no less important if you are a small or large business.
Lawler: With one exception, I don’t think small businesses should feel an obligation to invest in technologies to foster their culture. Small businesses, however, should have some way for employees to confidentially raise concerns, such as having a voicemail box that doesn’t have caller ID or having a third party manage your hotline.
But in many cases, especially at a smaller company, it can be as simple as how you talk to your employees through written communications, such as an all-employee newsletter with thought-provoking questions or a memo from the CEO talking about organizational justice. Storytelling is powerful, and you don’t need a lot of technology to do that. In essence, it’s how you communicate what your values are and really set those social norms to help people know how to behave.
Lawler: We measure our reputation with all of our stakeholders and employee sentiments. We looked at a series of measurements, which culminated in the World’s Most Ethical Company® recognition [from Ethisphere]. Do we have a culture where our employees know what to do? How to do it? And live by our values? That’s ultimately what we are pushing for with success.
Lawler: Going back to storytelling, we try to have regular communication points with our employees. We try to make our training programs scenario-based, where we cover topics relevant to employees. For example, every month we put out a Q&A for employees to read and then think about, as to how an ethical dilemma would affect them at work. Topics include gifts and entertainment policies, the dress code, behavior in the workplace and sensitive subjects such as elections. We tell real stories that have happened and focus on where someone spoke up in a constructive way.
Keeping employees engaged is really about cadence and not only talking about Ethics Week once a year but making it a yearlong conversation.
Lawler: This is something we are working on right now as we move from a country-specific to a global approach. You have to be culturally relevant. In Europe, for example, you have a great deal of distrust in certain countries related to ethics hotlines because of events that occurred in their history. So you have to make sure that activities are culturally relevant, understand what the norms are, and create initiatives that align and can drive better employee understanding. You have to help your employees understand that they are part of a global organization, but your messaging should be country- and culture-specific.
Small businesses should use risk assessments to help tailor their activities to their areas of highest risk. Thinking through the nature of their operation and their business-specific risks, businesses can ask several questions to identify their largest risk areas: What does my business do, where I do it, who are my suppliers and who are my customers?
A retailer might be focused primarily on the risk of employee theft, while a manufacturer might be more concerned about integrity in its supply chain. A company that only does business in the U.S. faces different risks than companies that do business in certain parts of the world. And companies that do business with the government have additional risks to address.
Lawler: The bank had the foresight to establish a dedicated ethics office. This is 100 percent our job, to think about how we should continuously champion ethics — how we conduct our business and how we engage our employees to live out our core values. One way we have engaged our employees to provide us with feedback is through our annual engagement survey, where we get feedback on elements of our culture and reputation. [We’ve had] 88 percent of our employees respond to this survey, which is an unheard-of number in some industries. The fact that our employees are so committed to providing their feedback speaks a lot about our program. And part of that is because we have done a good job sharing the feedback with them and taking action based on the survey responses.
U.S. Bank was recognized as a World’s Most Ethical Company® by the Ethisphere Institute for the third consecutive year in 2017.