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Ethics Today Online Published
by the Ethics Resource Center =======================================================
** A Word from
the President: Is Mere Legal Compliance Dangerous? ** A Word from the President: Is Mere Legal Compliance Dangerous? It seems like ethics should be easy, but creating an effective ethics program actually takes a lot of hard work. Unfortunately, in today's strident ethical environment, where CEOs and whole companies seem to disappear in the quicksand of integrity issues, many organizations that feel pressed to "do something" about ethics don't take the time to understand what makes a program effective. The temptation is great to create paper programs that fulfill the letter of the law instead of developing programs that actually work. Ethics programs are complicated. They not only require codes of conduct, policies, commitment, and comportment with the law, they also require effective implementation through structures, programs, resources, communication strategies, program evaluation and training. Throughout my career, I have seen many organizations commit "ethics suicide." By this, I mean that the organizations made themselves more vulnerable because they created ethics programs that fulfilled only minimal legal standards. Little or no thought went into effective implementation. For example:
In a recent article in Business Lawyer, William Widen argues that part of the problem is reliance, especially in the legal community, on positive law which is ill suited to guide ethical conduct. He concludes: "In crafting rules governing conduct and mandating disclosure, the better course is to employ general principles rather than to draft rules of a technical and complex nature. Compliance with technical rules has an insidious tendency to replace more general notions of right and wrong. In contract, general rules and principles constantly challenge those seeking to comply to look to themselves for guidance when making difficult decisions rather than finding refuge in a technical safe harbor. " I believe Widen has it right when it comes to codes and disclosure. Along with this must come serious attention to the effective implementation of ethics programs. Organizations that are truly interested in getting good results must provide employees with a safe environment that encourages them to ask ethics questions and helps them to get the right answers. Stuart C. Gilman, President ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Compliance and Crisis Management: Why It Pays to be Prepared How a company performed during the East Coast blackout in August 2003 often depended on how well prepared it was in advance of the emergency, writes Andrea Bonime-Blanc, Senior Vice President and Chief Ethics & Compliance Officer, Bertelsmann, Inc. In addition to the most important reason for caring about emergency planning -- the health and safety of employees and others on or around your premises -- there are several other compelling rationales. "While avoiding potential liability from a corporate standpoint might come quickly to mind for some, there is another key reason to care, " she writes. "Employees who are taken care of - given training, instructions, kits, information -- will feel good about their company and their senior management at times of crisis while those who don't get such attention may be disgruntled, angry or worse. In today's world of greater uncertainty and vulnerability, there are no excuses for not caring about this stuff." In this original article, Ms. Bonime-Blanc discusses a number of reasons that someone in the compliance function might get involved in emergency planning. She also includes a list of action items to keep in mind for a possible future crisis. Concern about the financial bottom line is not the only reason to care about crisis management from a compliance and legal standpoint, she concludes, writing that "Crisis management should be proactively practiced because it makes good human sense, preserves lives and livelihoods and provides employees with practical tools and a sense of well being." Read this article
at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Why Small Organizations Need Our Help Today, there is a significant gap between large and small organizations in the existence of formal ethics programs. This gap might be a result of the higher level of public and media attention received by large organizations, the less formal culture of small organizations, a lack of resources in smaller organizations or some combination of the above. While it may not be as feasible for smaller organizations to have the same level of formal infrastructures as large ones, it is possible for them to customize a formal structure that fits their culture. A small company can still have formal written standards for employees to follow. It can still have a means for employees to make an anonymous report of misconduct. It can designate an individual or committee to respond to these reports in a confidential manner. It will just take more time and energy for this group to discover what will work. The 2003 National Business Ethics Survey (NBES) focused on four of the seven elements of effective ethics programs that are required by the Federal Sentencing Guidelines: written standards of ethical conduct, training on standards of conduct, an ethics office or ethics hotline and a means to anonymously report misconduct. The results of the survey demonstrate the need for more attention to be shifted onto smaller organizations, especially in the for-profit sector. In the remainder of this article, ERC Research Analyst Leslie Altizer focuses on these four elements and the differences that the NBES found between large and small organizations. Read this article
at: Learn more about
or order the 2003 NBES at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Eye on Ethics: Reprinted with Permission from Training Magazine The examples of Enron and WorldCom have become synonymous with ethical failure. But the issue of ethics is wider than preventing and censuring illegal behavior while encouraging proper behavior. Training and other professionals have to keep an eye on the accidental and unintentional as well as the underhanded. When done well, ethics training can contribute to your organization's health and stability. This article, reprinted with permission from the November 2003 issue of Training magazine, offers some tips from the experts, including ERC Principal Consultant Frank Navran and former ERC Senior Researcher Joshua Joseph. Read this article
at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** What to Do After Your Code of Conduct is Written The recently revised ERC publication "Creating a Workable Company Code of Conduct" was designed to help an organization develop and implement a code of ethical business conduct or revise existing standards and policies. A code cannot stand alone, however, and the book's penultimate chapter focuses on what an organization should do after the code is written to start meeting the requirements for the effective communication of organizational ethics standards. Read this excerpt
from Creating a Workable Code at: Read more about
and order "Creating a Workable Company Code of Conduct"
at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Selected Resources from the ERC's Website: Implementing Ethics Programs -- In "Managing
Ethics Upwards", the ERC Fellows look at the role of the ethics
officer, the leadership styles of executives, and their relationship
with each other in the realization of an ethical workplace. They
consider the shifting job responsibilities of the ethics office
and questions such as: where should the ethics officer be placed
in the organizational chart, what type of relationship should the
ethics officer have with senior leadership, and what strategies
can the ethics officer use to best shape the ethical climate of
the organization? -- "Integrating
Ethics and Compliance Programs: Next Steps for Successful Implementation
and Change", by former Senior Researcher Joshua Joseph, focuses
on how to develop more effective business conduct programs. Based
on in-depth interviews with more than twenty-five ethics officers
at leading organizations, the report identifies common challenges
in implementing ethics and compliance programs and suggests ways
for organizations to address them. In particular, it focuses on
how to better integrate ethics codes, training, help lines and other
program elements into everyday business activities. -- "Ensuring
Ethical Effectiveness", in the February 2003 issue of the Journal
of Accountancy, considers the role of CPAs in creating, reviewing
and enforcing codes of ethics under the Sarbanes-Oxley Act and other
legislation. According to author Randy Myers, since most public
companies already have ethics codes, CPAs may want to help their
employers or clients review them in order to make sure they comply
with new regulations, and even external auditors might have a role
in assessing compliance with codes of ethics. ERC President Stuart
Gilman advised taking it further than simply evaluating or testing
results, encouraging external auditors to sign a statement noting
that they understand and accept the client's code of ethics. The
article also offers practical advice in sections on "Doing
it Right", "Putting Together a Code" and "Finding
Help." -- The ERC/SHRM
2003 ethics survey updates the findings from a similar 1997 study
and provides ethics trend data and benchmarks for HR professionals
in a number of important areas. New questions on emerging topics
of interest were added to the survey to better ensure that it keeps
pace with developments in business ethics and the human resources
field. The questions in this survey, many of which were drawn from
the ERC's national ethics surveys, are focused on six key themes:
organizational ethics standards and practices, roles of HR professionals
in organizational ethics, pressure and observed misconduct on the
job, reporting of ethical misconduct, ethics of others with whom
human resource professionals interact, and influences on the ethics
perceptions of human resource professionals. The report concludes
with suggestions for addressing some of the more critical issues
raised by the findings. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Ask the Expert: Ethics, Communications and Cultural Differences This month's question concerns the ethical issues involved in business communications and the impact of cultural differences on those communications. Business communications can either be between organizations, between people within an organization or between an organization and the public, say ERC Programs Manager Jerry Brown and Principal Consultant Frank Navran. Communications within and between organizations and individuals within organizations are reflective of the personal ethics of the author or speaker and should also reflect the ethics of the organization. The same basic rules of ethical communication apply to all three: (1) Be honest; (2) Be respectful; (3) Show sensitivity to cultural differences. Read the rest
of this response, which considers each rule in more detail, at:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Practicing What We Preach The ERC prides itself on establishing programs within organizations that promote the inclusion of core values. Recognizing the importance of this within our own organization, the ERC's Ethics Committee has started a new initiative to encourage employees to "live-out" our values. We have been discussing each of our four core values (Respect, Honesty, Trust and Excellence) in weekly staff meetings. Our initial plan is to reintroduce our values into the daily operations of the ERC. The committee is currently working on a long-term approach to making our values an integral and vital part of our operations. We want our values to dictate how we interact with each other, with external individuals, and with every facet of our daily work lives. Read the ERC's
values statement at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** The ERC's Student Ethics Office™ Model The ERC has played an important role in the character education field for many years, focusing particularly on school-to-work ethics and values at the high school level. Through this work, the organization discovered that most character education programs employ a top-down approach, giving frustrated faculty "one more thing to do" and overlooking the students themselves. Knowing that student-centered instruction has emerged as a best practice in pedagogy, the ERC developed a novel solution to secondary character education programs. The Student Ethics Office™ (SEO™) model utilizes students as a resource, meeting their needs while maximizing results by tapping into students' insights and enthusiasm. The SEO™ approach is truly character education for students, by students. Read more about
the ERC's unique character education concept and learn how to get
involved at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ **Advertising Campaign Supports Character Education in Schools In November 2003, the ERC launched a print advertising campaign that highlights the need for increased support for character development in schools. "With schools struggling with issues of violence, disrespect and cheating, we hope these ads will move parents, teachers and students to enter into a dialogue about the importance of ethics," said ERC President Stuart Gilman. "The ERC was one of the first ethics organizations to introduce character and ethics programs into the educational system. For decades the ERC has created and piloted progressive character development programs such as MAXIMize the Moment®-an online education resource being implemented in schools nationally and internationally." The print ads are posted on interior bus cards and dioramas in metro stations in the Washington, DC area. The Washington Metropolitan Area Transit Authority (WMATA) provided the space as a public service. The ERC has received generous funding from the John Templeton Foundation to support the MAXIMize the Moment® program. Read the rest
of this press release at: View the four
ads at: Editor's Note: Interested in getting copies of these ads for your office or school? We will be making copies available for purchase in January 2004 for a nominal fee that covers our production cost plus shipping; purchasers are also encouraged to make a small tax deductible donation to the ERC. Please check the ERC website for more information after the first of the year or email ethicstodayonline@ethics.org and include "Character Education posters" in your subject line if you would like us to contact you when the cost of the posters has been determined. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** ERC's President Highlights Importance of Inter-Sector Collaboration in Fighting Corruption in Turkey At the third Ethics Summit held in Istanbul, ERC President, Stuart Gilman called on Turkey's public, private and NGO sectors to work together in combating corruption. Organized by the Turkish Ethical Values Center (Türkiye Etik Degerler Merkezi /TEDMER), ARI Movement - a Turkish independent community movement - and the DC-based National Democratic Institute for International Affairs (NDI), in association with the ERC and the World Bank, the summit brought together local and international experts to discuss approaches to increasing standards of ethical behavior in both government and business. Read the rest
of this press release at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** United Nations Convention Against Corruption Signed by Almost 100 Countries At the close of the three-day High-level Political Conference for the Purpose of Signing the United Nations Convention against Corruption, almost 100 countries had signed a new United Nations treaty to combat corruption worldwide, pledging to return assets obtained through bribery and embezzlement to the country of origin, according to UN and other press releases. Ratifying countries agree to criminalize corrupt practices, develop institutions to prevent corrupt practices, and prosecute offenders. It will enter into force when a minimum of 30 countries complete the process of ratification, which depends on countries developing legislative and administrative measures in accord with the provisions of the Convention, and giving final political approval. Of particular note is Article 12, which applies the convention to corruption in the private sector. That section states: "Each State Party shall take measures, in accordance with the fundamental principles of its domestic law, to prevent corruption involving the private sector, enhance accounting and auditing standards in the private sector and, where appropriate, provide effective, proportionate and dissuasive civil, administrative or criminal penalties for failure to comply with such measures." It continues by listing measures that may be used to achieve these ends, including: (a) Promoting
cooperation between law enforcement agencies and private entities; The document also requires that parties take measures to prohibit certain acts related to irregular or illegal bookkeeping, accounting, and financial disclosure and reporting. Read a PDF copy
of the full treaty at: Find background,
highlights and fact sheets on the UN's website at: View webcasts
and press conferences and read press releases at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Ethics Resource Center Appoints New Vice President ERC President Stuart Gilman announces the appointment of Dr. Patricia Harned to the position of Vice President of the ERC. Dr. Harned, who assumed her new position on December 12, will oversee program development and staff as they work with organizations across educational, business, and international sectors. "Given her wealth of experience within the organization, Pat will make a valuable contribution to the ERC," said Dr. Gilman. "In her new position as Vice President she will be assisting in the ongoing modernization of the ERC's organizational structure." Read the rest
of this press release at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Publications and Media Coverage "Getting
it Right: How to Deal with Ethical Dilemmas", October 2003,
Career World Ms. Sutliff and Brad Kaufmann, vice president of marketing at Junior Achievement, are quoted extensively in this article which deals with questions such as "What is ethics?" and "Why should we care about making the right ethical decisions?" "Knowing how to act with integrity, how to be responsible, and how to treat others with respect helps in getting along with friends, teachers, and parents," Ms. Sutliff says, and also plays "a vital role in future success at work." The article also includes four brief "case files" which describe ethical dilemmas that might be faced in the workplace, some things to investigate if faced with similar situations, and appropriate solutions. Ms. Sutliff also provides some tips about finding an ethical employer, including asking if they have a written code of ethics or mission statement communicating "core company values" and finding out from current or past employees how people treat one another. An organization committed to ethics "will nurture the development of your character," Sutliff says. "That will help and encourage you to do the right thing." The article concludes with discussion questions and exercises that are intended to help students work through the ethical decision-making process. Read the full article at: http://www.findarticles.com/cf_dls/m0HUV/2_32/108790336/p1/article.jhtml Career World is a Weekly Reader publication designed for middle and high schools. Each issue provides practical advice and information on career awareness, college planning and vocational/technical opportunities. For more information on Career World visit http://www.weeklyreader.com/store/wrcw.asp
"It's almost naïve for companies to believe that they're not responsible for their subcontractors and the people they bring on board to represent them," says ERC President Stuart Gilman. "There is an affirmative obligation by any corporation to ensure that the subcontractors they're working with have the greatest amount of honesty and integrity." In addition to the financial bottom line, says Dr. Gilman, firms also need to assess the bottom-line impact on the environment, as well as the bottom line in integrity. "Having a triple bottom line is critical for a corporation in this day and age," he said. "Otherwise, they undermine their own survival. They undermine their own brand name and the quality of that name. And they do the wrong thing." Every organization must uphold its responsibility to shareholders and to the general public, concludes the article, by ensuring that their business partners adhere to rigorous professional and ethical standards. Read the rest of this article at: http://www.guardsmark.com/library/current_report.asp?nav=4&subnav=1
Reprints -- "Emphasizing
Ethics", a November 4 Pioneer Press article about colleges
and universities that are beginning to address ethics issues was
reprinted in the Grand Forks Herald and the Rochester, MN, Post-Bulletin.
In that article, ERC President Stuart Gilman commented on the state
of business ethics education. -- An August
27 article in the Wall Street Journal's CareerJournal.com saying
it is easier now to get caught doing something unethical as a result
of new corporate governance requirements was reprinted in the Kinnelon
(NJ) Suburban Trends. In " Office and Ethics Collide More Often
Than Ever", ERC President Stuart Gilman advises workers to
inquire about a company's ethics programs before they are hired.
The article
also appeared in the Wall Street Journal's Classroom edition under
the title "'A Ticking Bomb': Don't Let Workplace Wrongdoing
Destroy Your Career" ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** News from the ERC -- On November 14, ERC Principal Consultant Frank J. Navran conducted an ethics training session for a group of federal workers from the Federal Aviation Administration (FAA) and the Department of Transportation (DOT). His interactive presentation invited the audience to consider hypothetical dilemmas and to problem-solve in groups. Mr. Navran focused on the distinction between compliance and ethics and emphasized that both are necessary to effectively promote a culture of integrity in the workplace. He discussed the components necessary to make ethics training more effective, including strategies for ethical decision-making, the role of leadership and how to create an ethical culture. -- ERC Fellows Chairman Stephen Potts and Senior Consultant Anita Baker helped deliver ethics training programs in Russia from October 29 to November 5. The municipal and provincial governments of Vladivostok and Irkutsk requested assistance from USAID in combating corruption. Management Systems International (MSI), the USAID contractor that delivered the program, invited Mr. Potts and Dr. Baker to participate on their five-person team and asked them to focus on a preventive approach to corruption. Dr. Baker spoke about corporations and non-profits while Mr. Potts discussed the public sector. The group spent the first four days in Vladivostok, delivering workshops and plenary sessions to government officials, law enforcement, the business community and academics, then moved on to Irkutsk. Approximately 70 people attended the training sessions in each city. -- Current ERC Fellow and 2002 ERC Fellows Program Pace Award recipient Ira A. Lipman was part of a delegation from the Simon Wiesenthal Center that presented Pope John Paul II with the organization's highest honor, the Simon Wiesenthal Center Humanitarian Award, in recognition of lifelong friendship to the Jewish people. Rabbi Marvin Hier, the Center' dean and founder also called on the Pope to lead the worldwide campaign making suicide bombings crimes against humanity and urged him to address the resurgence of anti-Semitism in Europe. Read the press release at: http://www.wiesenthal.com/social/press/pr_item.cfm?ItemID=8592 -- On December 4, Merck & Co., Inc., which provides significant funding for the ERC's international centers, received top honors for its corporate stewardship from U.S. Commerce Secretary Donald L. Evans and the U.S. Chamber of Commerce Center for Corporate Citizenship, which awarded the newly established Corporate Stewardship Award to the company. The award in the "Large Company" category was presented to Merck Chairman, President and Chief Executive Officer Raymond V. Gilmartin, who is also the former Chairman of the ERC's Board of Directors. ERC Senior Consultant Jeff Salters represented the ERC at the ceremony in Washington, D.C., which was attended by Congressional leaders and senior U.S. government officials, foreign diplomats and corporate and non-profit leaders. Read the press release at: http://www.merck.com/newsroom/press_releases/corporate/2003_1205.html ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Offering Our Thanks As a non-profit organization, the Ethics Resource Center depends on contributions from many generous donors. Without their dedication and trust, many of the programs and projects highlighted in this newsletter would not be possible. The ERC thanks the following for their contributions of general support:
FEDERAL EMPLOYEES: Federal employees participating in the 2003 Combined Federal Campaign (CFC) workplace fund-raising drive may contribute to the ERC by marking number 2456. CFC contributions help students by providing schools with relevant, timely educational resources that encourage good character by modeling positive decision-making and creating healthy dialogue. The ERC also
participates in the Fall 2003 Hewlett-Packard/Compaq employee fund
drive worldwide, the Chevron/Texaco employee campaign worldwide,
and the Gannett Corporation fund drive, as well as the Washington
Post, Lockheed-Martin, and other corporate accounts that disaffiliated
from United Way in Washington DC last year. We invite you
to join our loyal contributors in lending your support. To find
out how to contribute or to donate online, go to: The Ethics Resource Center (ERC) is a non-profit, non-partisan educational organization exempt from taxation under the Section 501(c)(3) of the Internal Revenue Code. All gifts are tax-deductible to the fullest extent of the law. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ PLEASE NOTE: Ethics Today will be published 11 times this year, with the July and August issues combined into one. An index will be published at the end of August. ======================================================= Copyright (c)
2003 Ethics Resource Center. All rights reserved. Please contact ethics@ethics.org for information about reproducing any of the information contained within this newsletter or on our web site. Back issues of Ethics Today are available online at: /today/et_archives.html For questions about your subscription, please email ethicstodayonline@ethics.org The Ethics Resource
Center, 1747 Pennsylvania Ave., NW, Suite 400 =======================================================
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