Business Ethics from the Top Down

Since Enron, WorldCom, Tyco and other scandals, we scrutinize our top executives for business ethics and value and it has made many top executives exhibit ethical behaviors in all they do.

However, what happens to those ethics and values as we move down the corporate ladder to middle managers and to lower level employees?

The high standard of ethics practiced by top management may not change the behavior of middle managers and lower level employees.  Middle managers and low-level employees may frustrate the ethical business culture by lack of attention and no commitment. To create and sustain an ethical business culture, employees must believe that the organization wants them to act ethically in all they do.

If the middle managers are not committed to the values and ethics it will be apparent to the lower level employees and they will not be committed either.  An organization’s ethics and values are only as strong as the weakest link as it trickles down through the ranks.

However, how do the ethics and values of the top executives translate into ethics and values that can reach the rest of the organization?

Every CEO should influence and develop the ethical behaviors and values of middle managers just as they have done so with top executives in the recent years to ensure the trickle down of the corporate ethics to every employee.   Every top executive should realize that their behavior influences middle managers and lower level employees more strongly than any words or directives.

How do you motivate middle managers?  Middle managers have financial, operations, sales, and cost control goals to achieve. They may perceive that they must focus on these quantifiable business goals.  They may think that they cannot meet the performance goals without sometimes bending the ethical standards.  Worse, they may perceive that the ethical messages and external behaviors of top executives are for the benefit of the public and stakeholders and do not translate into anything real.

The CEO and top executives can specify the ethical behaviors and values that the middle managers should demonstrate to the lower level employees.  This sends a message that the organization is serious about ethics.  If the CEO and top executives are not serious about ethics, none of their employees will be either.  The ethical behavior of middle management will create a strong ethical culture.

The following are just some of the things the CEO and top executives can do to influence, encourage and reinforce middle managers’ ethical conduct and behavior:

  1. Always act ethically, talk frequently about the ethical values and the ethical commitment of the organization, make ethical decisions and support adherence to the values.
  2. Talk about how the ethical values and commitments apply to the work performed by the middle manager and the lower level employee and particularly to specific decisions they make.
  3. Ask the middle manager what dilemmas typically arise in implementing the ethical commitments in their work and the work of the lower level employees and give guidance about how to apply ethics to those dilemmas.  Follow up to ensure that the dilemmas are resolved ethically.
  4. Recognize ethical issues when they do arise and coach the middle manager to resolve the issues.
  5. Let the middle manager know that their ethical performance is being watched as closely as their other performance goals and incorporate it into the performance evaluation.
  6. Ask questions when the ethical action is unclear and encourage questions from middle managers prior to taking any action in which it is not clearly ethical
  7. Allow middle managers to work together to resolve more difficult ethical issues.
  8. Implement a system that encourages reports about unethical actions to top managers

JK Consultants’ always includes ethical considerations in their screening process for their candidates.  This ensures that JK Consultants’ candidates will positively contribute to the ethical culture of a client corporation. Call JK Consultants to learn more.

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The JK Consultants Team

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