Leadership And Those Beautifully Written Codes Of Ethics – And Cheating

They’re not a panacea…

I’m truly sorry to have to break the news to you, but those beautifully written Codes Of Ethics aren’t a panacea. No, sadly, they don’t cure all of our ethical ills. No, sadly, this isn’t even close…

To add insult to this injury I’ve just inflicted on you (for which I apologise), you should also know this about EVERY major corporate financial scandal in recent memory—

EACH had occurred UNDER THE UMBRELLA of a major corporation that had in place a QUITE BEAUTIFULLY CRAFTED CODE OF ETHICS…

So, what does this say about beautifully crafted Codes of Ethics? Not much…

What about the leaders?

Thanks to those major corporate financial scandals, we also know that the leaders of those corporations failed miserably. They clearly didn’t do justice to the beautiful Codes they had created.

The conclusion was unassailable:

Without leaders with moral authority, Codes of Ethics have little or no practical effect—no matter how beautifully written…

Incidentally, we do know what “moral authority” means: It means that a leader must lead by example. He or she must do more than just talk-the-talk and act as a cheerleader. No, he or she must also walk-the-walk.

Sadly, in every corporate scandal, we couldn’t find a leader with even a trace of moral authority…

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The attached podcast…

In January 2015, I interviewed Steve Burrows CBE on the subject of Codes of Ethics and the role of leadership plays in creating ethical cultures.

The interview began with me noting how it has become painfully clear to us all that beautifully crafted Codes of Ethics are not a panacea. I then ask Steve to share with us how his company addresses the issue of ethics. As has been noted, Steve is Executive Vice President of an engineering firm that employs over 32,000 employees around the world.

In an interesting twist to this podcast, I invited Diane Swanson PhD to listen to it and then join us on the following week’s show to offer us her comments. I’ll post that interview soon…

Some painful facts worth noting…

In listening to this podcast, here are some facts worth noting—

  • In EVERY single major financial scandal, corporate leaders had acted IN CLEAR VIOLATION of their company’s beautifully written Code of Ethics.
  • When faced with a choice between integrity and furthering their own personal financial interests, these leaders all chose their personal financial interests, rather than integrity.
  • In almost every case, these corporate leaders knew about breaches in their beautifully written Codes of Ethics. Despite this, they either ignored the breaches or, in some cases, actively encouraged the breaches or participated in them.
  • What all of  these leaders had in common was that each was educated in our finest business, law or accounting schools.
  • Each of these schools thereby had the unusual opportunity to inculcate in these leaders a sense of ethics and integrity. Sadly, these schools didn’t do very well…
  • In particular, the business schools fared the worst—by far. These schools were given the responsibility of training our future business leaders. The hope was that, by offering our finest brightest young minds some ethics training, this would protect us from them acting unethically and thereby protecting us from the fallout.  Why was their failure so disappointing? Consider this—

Studies have now revealed that there is more cheating in business schools than in ANY OTHER SCHOOL. These studies also showed that the deans and faculties of these schools all knew about this cheating epidemic, yet were doing little or nothing about it.

A thought occurred to me:

Could it be that, like the disgraced corporate leaders, the schools were putting their financial interests in not alienating donors ahead of integrity? Was this the irony to end all ironies?

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Our gift…

In bringing life to our ideas, we need to focus more on personal integrity than on beautifully crafted Codes of Ethics…

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Our question…

What are you doing to create ethical cultures within your organizations? Does your corporate culture reward personal integrity?

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