Tone at the middle

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How to Defuse an Ethical Time-Bomb in Your Company

“Maybe you think that problems can’t infect your company because you’ve got clearly stated rules against them. Boy, are you in for a surprise.

Nothing keeps a business owner up at night like the nagging feeling that ethical time bombs are ticking somewhere in his or her company. Human nature being what it is, no company is immune from problems–from the deliberate frauds and rogue actions of traders gone wild to the gradual erosion of values and ethical standards because “everyone does it.” … If there is a time bomb in your company, people know about it. You just need to get them to tell you. …

An ounce of prevention…

Traditional ethical strategies focus on compliance programs, ethics training, and traditional operational risk assessment. But you should focus instead on:

  • Emphasizing not only “tone at the top” but “tone at the middle.”
  • Creating a culture where people can discuss risk and dubious behavior
  • Popularizing the use of ethical “tests”: for example, “How would we look if this business practice became public?”
  • Encouraging story telling about respected company leaders who overcame moral dilemmas in the past.
  • Ensuring that reward systems don’t create conflicts between business objectives and integrity norms.”

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