Are Ethical Managers Mythical Creatures? 11:53, March 23, 2017

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Are Ethical Managers Mythical Creatures?

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There is no limit to the number of articles out there espousing what makes a good manager. Popular online business publications like Inc., Forbes, Business Insider, and Entrepreneur all provide a litany of qualities that define great managers. Yet, there is little talk about ethical managers. A deeper dig into these popular articles shows how ethical managers are important for effective ethics and compliance programs. 

Ethics

Ethics means a lot of things. Merriam-Webster clarifies: “While ethics can refer broadly to moral principles, one often sees it applied to questions of correct behavior within a relatively narrow area of activity.” Namely, correct managerial behavior defined by an organization’s values.

Values are important to an effective ethics and compliance program. Forbes mentions that qualities like accountability, honesty, transparency, and being culture-oriented make the best managers. Academic research corroborates. “[I]n a specific type of culture, characterized by specific values such as openness, trust and honesty, employees are more likely to engage in compliance behaviours which collectively will contribute to organizational compliance,” says Lisa Interligi in the Journal of Management & Organization. Leaders’ deeds speak much louder than words and have a significant effect on promoting a culture of honesty and integrity by leading through example. This makes an ethical manager.

Unfortunately, three out of the four articles did not mention ethics, notwithstanding academic research, clinical studies, laws and policy, and compliance experts urging organizations to have ethical cultures. Considering that the Forbes article is by far the most recent, it perhaps may reflect the growing business reality that ethics is not only good, but good for business. Ethical managers drive this concept for companies. 

Accountability

Accountability is “an obligation or willingness to accept responsibility or to account for one’s actions,” and is most commonly mentioned trait between the articles. When a manager commits to something, they do it. If they don’t, they take responsibility for it. This can happen in a variety of management situations, such as meeting departmental goals or building a well-functioning team that feels supported. It also happens in compliance.

Accountability contributes to an effective ethics and compliance program. Managers, and truly all employees, should be held accountable to company values, often found in a company’s code of conduct. Misconduct should be addressed promptly. It may sound draconian, but it’s important to a good culture when everyone shares the same values.

EverFi colleague and attorney Karen Peterson recommends conducting “culture surveys” to reveal “how employees perceive their workplace environment and if they believe individuals at all levels of the organization are held accountable for misconduct.” For example, Google rolled out “Project Oxygen” to research effective management behaviors within its organization, which included an employee survey. It worked. Harvard Business Review reported that “employees had widely adopted the program—and the company had shown statistically significant improvements in multiple areas of managerial effectiveness and performance.” Accountable managers are ethical managers.

Opinions vs. Evidence

To opine is human, to back up statements or actions with objective evidence and criteria is divine. While professional experience is important and useful in the workplace, managers should not let it overshadow objectivity, data, and deliberation.

The US Department of Justice released its “Evaluation of Corporate Compliance Programs” (ECCP), a list of “important topics and sample questions” to help companies measure the effectiveness of their compliance programs. Management is squarely addressed. Broad categories that management should follow include:

    (*)    Conduct at the top (i.e., “Have senior leaders, through their words and actions, encouraged or discouraged . . . misconduct?”),

    (*)    Shared commitment (i.e., “How is information shared among different components of the company?”), and

    (*)    Oversight (Has “compliance expertise been available on the board of directors?”)

Data has everything to do with this, as Peterson explains. Data is the “hidden gem” that “provides a factual basis for measuring and assessing the effectiveness of ethics and compliance programs.” Ethical managers would use these objective guidelines as ways to confirm that they are implementing their company’s ethics and compliance program in place of more subjective criteria that is prone to bias and irrational behavior.

A lot of people have opinions on what makes a great manager (sometimes, unsubstantiated opinions). But digging deeper through the noise shows a good manager should always be ethical.

LawRoom (powered by EverFi) delivers online training to help your business meet compliance requirements both dynamically and scalably. In addition to our award-winning online courses, LawRoom delivers a robust, cloud-based learning management system to help you easily deploy and track our growing library of ethics, anti-harassment, data security and employee conduct courses.

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Douglas Kelly
Douglas Kelly is EverFi's lead legal editor. He writes on corporate compliance and culture, analyzing new case law, legislation and regulations affecting US companies. Before joining EverFi, he litigated federal and state employment cases and wrote about legal trends. He earned his JD from Berkeley Law and BBA from Emory University.

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