Ethix Forum – Issue 28

Is it possible for unethical companies–and individuals–to change and become ethical? How?

If “unethical companies and individuals” refers to those who have made some mistakes, then the outlook for change is somewhat positive. Unethical behavior occurs for a variety of reasons, including ignorance, ambiguity, and a reward system that encourages it. Decreasing these types of behaviors is not an easy task, but can be done through awareness raising, moral imagination, and changes to the incentive system. If, however, “unethical companies and individuals” refers to those who are corrupt in the very core of their character, change will be hard to come by. Only through a significant crisis and on-going intervention can improvement take place.

Kenman Wong
Professor of Business Ethics
Seattle Pacific University

Of course, anything’s possible in this life. How else could people like George Bush or Bill Clinton get to be president? The imagination reels.

More seriously: there are two reasons people and organizations make dramatic changes. The first one is fear. If an individual or company sees that their unethical practices are probably going to get them sued, fined, jailed, fired, disbarred, beat up by thugs, etc., they will probably shape up. The second reason is love. If an individual or company is gripped by affection, desire, and longing for someone or something that can only be acquired through honesty, fairness, diligence, integrity, etc., they will probably shape up.

All of us have seen (and experienced?) what both fear and love can do–to individuals and to organizations. So one answer could be to ratchet up the fear side with horror stories, threats and warnings. There is a place for this, in my opinion, but it falls short of the ideal by making avoidance of evil a bigger daily focus than achievement of good. The achievement and performance side is best leveraged by helping individuals and organizations “fall in love” and stay in love with the right kind of goals. Pick those purposes carefully and sell your people on their beauty and desirability. Show and explain to them what kind of character and behavior is required to score that goal. Of course this is too simple. It can’t be the whole answer. But it is the motivational foundation of ethical reform.

Frank Herman
Retired entrepreneur
Berkeley CA

How can an organization, especially one facing ethical concerns, change its culture to one that promotes and rewards ethical behavior? Here are seven steps to organizational change:

  1. State your position, philosophy or belief
  2. Create formal organizational systems
  3. Communicate expectations through informal (leadership) systems
  4. Reinforce the policy through measurements and rewards
  5. Implement communications and education strategies
  6. Use response to critical events to underscore commitment
  7. Avoid the perception of hidden agendas

Frank Navran
Principal Consultant
Ethics Resource Center