This informative article on building an ethical culture comes from the Society for Human Resource Management.
CHICAGO—Chuck Gallagher was living the good life. He had a nice house, a nice car and a nice job as a certified public accountant.
But he threw it all away when financial pressures led him to “borrow” money from his clients’ accounts. He was convicted of embezzlement and tax evasion in 1995 and spent 18 months in federal prison.
Wearing an orange prison jumpsuit for dramatic effect, Gallagher described his personal odyssey for a group of HR professionals at a concurrent session at the SHRM 2018 Annual Conference & Exposition on Monday.
He wanted to demonstrate that simply providing an ethics policy for employees to sign won’t keep them on the straight and narrow.
“That’s just checking the box,” he said. “It’s not about the rules. It’s about what motivates a human being to want to follow the rules. That’s what’s important.”
Gallagher said he has learned from his mistakes. As president of Ethics Resource Group, he now provides ethics training for corporate clients. He also is the author of Second Chances: Transforming Adversity into Opportunity (Lifepaths Publishing, 2011).
[SHRM members-only toolkit: Developing Organizational Leaders]
Most people think they would never voluntarily commit an unethical or illegal act. But when Gallagher asked how many people in the audience had ever received a speeding ticket, numerous hands were raised. Similarly, employees rationalize their misuse of company supplies all the time, such as shopping online on their company-issued computer during work hours.
“It’s easy to make unethical choices when they are socially acceptable,” he said.
But those seemingly small choices can start people down a slippery slope.
No one plans to destroy their career by breaking the law or violating their company’s ethics policy. There are usually personal stressors that push them over the edge, triggering a “fight or flight” response. At that point, they’re not thinking rationally, Gallagher said.
Financial problems, relationship problems or health issues are the most common emotional stressors, he said.
“If you’re going to be an ethical leader, are you paying attention to your employees’ emotional triggers?”
For an ethical lapse to occur, he said, three things must happen:
“If you understand how it happens, you can do things to prevent it from happening,” he said. “The problem is that 95 percent of the time, we are talking about what the rules are—not ‘how does need take place?’ ”
To create an ethical culture, ethics must be discussed openly and often within an organization, Gallagher said. If you talk about ethical issues that occur every day in the workplace, people will recognize such situations and stop before they step over the line. They’ll be more aware of how “socially acceptable” ethical violations can lead to more serious violations.
“Just addressing the HR compliance checklist doesn’t get you to the emotional issues that cause people to make the choices that they make,” he said.
And, an ethical culture must start at the top. If an organization’s leader is setting a bad example, the employees will follow suit.
“Most of us don’t want to be the subject of breaking news or … face a judge,” he said. “The truth will always come out.”
Because HR professionals understand the people in their organizations, they are in a unique position to elevate the ethical leadership by starting discussions on ethics and raising an awareness among employees and executive teams.
“Not only will what you do have an impact on people’s lives, but the words that you say will impact people’s lives as well,” Gallagher said.
After the session, one HR professional in the audience said she would like to include an ethics discussion in her company’s manager training, which takes place three times a year.
While managers have a lot of support from the executive team, this would be “a great opportunity for us for training, just to keep that conversation going and just to keep us mindful that every day we have choices and you can’t escape the consequences of your choices,” said Brenda Sutherland, SHRM-CP, senior HR director at The Buckle, a national retail chain based in Kearny, Neb.
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